| KN29043 |
| KEY NOTE AUTOMATIC VENDING : JANUARY 2003 |
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This report covers: automatic vending, automatic retailing, e-purse, coinless machines,refreshment machines, beverages, confectionery vending, tobacco sales, cigarette machines, other products, in-cup beverage vending machines, snack machines,
Companies covered include: Autobaar Group, Bunzl Vending Services, Compass Group, Crane Merchandising Systems, N & W Global Vending Systems, Sinclair Collis, Westomatic Vending Services, Automatic Products, Darenth MJS, Deutsche Wurlitzer, FAS UK International, The Vending Corporation, Westomatic Vending Services,
| Executive Summary 1 |
| 1. Market Definition 8 |
| REPORT COVERAGE 8 |
| MARKET SECTORS 8 |
| Refreshment Machines 9 |
| Cigarette and Tobacco Machines 9 |
| Other Machines 9 |
| MARKET TRENDS 10 |
| 24/7 10 |
| Vending as a Replacement for Staffed Outlets 10 |
| Hygiene 10 |
| Snacking 10 |
| Machine Flexibility 11 |
| Technological Developments 11 |
| More Branded Options 11 |
| MARKET POSITION 11 |
| The UK 11 |
| Table 1: Sales of Vended Products, Household Final Consumption Expenditure and Catering Sales at Current Prices (£bn at rsp and percent), 1998-2002 12 |
| Table 2: Sales of Vended Products and Total Retail Sales at Current Prices (£bn at rsp and percent), 1998-2002 13 |
| Overseas 13 |
| 2. Market Size 14 |
| INTRODUCTION 14 |
| the total market 14 |
| Table 3: The UK Automatic Vending Machine Market by Value at Current Prices (£bn at rsp and percent), 1998-2002 14 |
| by MARKET sector 15 |
| Refreshment Machines 15 |
| Table 4: The UK Automatic Vending Machine Market by Sales of Refreshment Products by Value at Current Prices (£m at rsp and percent), 1998-2002 15 |
| Cigarette and Tobacco Machines 16 |
| Table 5: The UK Automatic Vending Machine Market by Sales of Cigarette and Tobacco Products by Value at Current Prices (£m at rsp and percent), 1998-2002 16 |
| Other Machines 17 |
| Table 6: The UK Automatic Vending Machine Market by Sales of Other Products by Value at Current Prices (£m at rsp and percent), 1998-2002 17 |
| NUMBER OF MACHINES IN USE 17 |
| Table 7: Estimated Number of Automatic Vending Machines in Use, 1998-2002 18 |
| Refreshment Machines 19 |
| Table 8: Number of Refreshment Machines in Use by Type of Machine (000), 1998-2002 19 |
| Water Coolers 20 |
| Table 9: Number of Water Coolers in Use (000), Years Ending December 1997-2001 20 |
| overseas TRADE 20 |
| Table 10: UK Overseas Trade in Automatic Vending Machines, (£000, number and £), 2001 21 |
| Table 11: Imports and Exports of Automatic Vending Machines by Type of Machine (£000 and percent), 2001 22 |
| Table 12: Imports of Automatic Vending Machines by Major Countries by Value (£000), 2001 23 |
| Table 13: Exports and Imports of Automatic Vending Machine Parts and Components by Value and by Volume (£000 and number), 2001 24 |
| 3. Industry Background 25 |
| Recent History 25 |
| Number of Companies 25 |
| Table 14: Automatic Vending Association Member Companies by Area of Activity (number of companies), 2001 and 2002 26 |
| REGIONAL VARIATIONS IN THE MARKETplace 26 |
| HOW ROBUST IS THE MARKET? 27 |
| LEGISLATION 27 |
| key TRADE ASSOCIATIONS 27 |
| The Automatic Vending Association 27 |
| National Association of Cigarette Machine Operators 28 |
| European Vending Association 28 |
| Bottled Water Cooler Association 28 |
| 4. Competitor Analysis 29 |
| THE MARKETPLACE 29 |
| leading MACHINE MANUFACTURERS 30 |
| Automatic Products (UK) Ltd 30 |
| Company Structure 30 |
| Current and Future Developments 31 |
| Financial Results 31 |
| Crane Merchandising Systems Ltd 31 |
| Company Structure 31 |
| Current and Future Developments 32 |
| Financial Results 32 |
| Darenth MJS Ltd 32 |
| Company Structure 32 |
| Current and Future Developments 32 |
| Financial Results 32 |
| Deutsche Wurlitzer UK 33 |
| Company Structure 33 |
| Current and Future Developments 33 |
| Financial Results 33 |
| FAS UK International Ltd 33 |
| Company Structure 33 |
| Current and Future Developments 34 |
| Financial Results 34 |
| Mars UK Ltd 34 |
| Company Structure 34 |
| Current and Recent Developments 34 |
| Financial Results 34 |
| N&W Global Vending Systems Ltd 34 |
| Company Structure 34 |
| Current and Future Developments 35 |
| Financial Results 35 |
| The Vending Corporation Ltd 35 |
| Company Structure 35 |
| Current and Future Developments 35 |
| Financial Results 36 |
| Westomatic Vending Services Ltd 36 |
| Company Structure 36 |
| Current and Future Developments 36 |
| Financial Results 36 |
| Other Manufacturers 36 |
| Azkoyen UK Ltd 36 |
| Company Structure 36 |
| Current and Recent Developments 37 |
| Financial Results 37 |
| leading MACHINE OPERATORS AND DISTRIBUTORS 37 |
| Autobar Group Ltd 37 |
| Company Structure 37 |
| Current and Future Developments 37 |
| Financial Results 37 |
| Bunzl Vending Services Ltd 38 |
| Company Structure 38 |
| Current and Future Developments 38 |
| Financial Results 38 |
| Compass Group PLC 38 |
| Company Structure 38 |
| Current and Future Developments 38 |
| Financial Results 38 |
| Springbank Industries Ltd 39 |
| Company Structure 39 |
| Current and Future Developments 39 |
| Financial Results 39 |
| Sinclair Collis Ltd 39 |
| Company Structure 39 |
| Current and Future Developments 40 |
| Financial Results 40 |
| Other Distributors and Operators 40 |
| 24 Seven Vending Ltd 40 |
| Aramark PLC 40 |
| Associated Vending Services Ltd 40 |
| Coffee Point PLC 41 |
| Drinkmaster Holdings Ltd 41 |
| Gem Vending Ltd 41 |
| Midland Vending Services Ltd 41 |
| Nestlé Vending 41 |
| Sodexho UK Ltd 41 |
| SSL International PLC 41 |
| UK Vending Ltd 42 |
| Commodity and Merchandise Suppliers 42 |
| Eurogran International Ltd 42 |
| Nichols Foods Ltd 42 |
| Hot Beverages 42 |
| Cold Beverages 43 |
| Table 15: Selected Food and Drink Companies Active in the Automatic Vending Market by Main Activity, 2001 43 |
| Other Suppliers 44 |
| Transacsys PLC 44 |
| Vianet Ltd 44 |
| BT RedCARE 45 |
| Disposables and Components Suppliers 45 |
| Huhtamaki UK Ltd 45 |
| Nebrak 45 |
| Veriplast International 45 |
| OUTSIDE SUPPLIERS 45 |
| 5. Strengths, Weaknesses, Opportunities and Threats 46 |
| STRENGTHS 46 |
| WEAKNESSES 46 |
| OPPORTUNITIES 47 |
| THREATS 47 |
| 6. Buying Behaviour 48 |
| INTRODUCTION 48 |
| WORKPLACE AND INSTITUTIONAL USERS 48 |
| Businesses 48 |
| Table 16: Number of UK VAT-Based Businesses (000 and percent), 1998-2002 49 |
| Education 49 |
| CATERING MARKETS 50 |
| Public Houses 50 |
| Hotels 50 |
| Other Catering Sectors 50 |
| Table 17: Number of VAT-Based Catering Enterprises Engaged in Selected Sectors, 1998-2002 50 |
| 7. Current Issues 51 |
| EURO COINS AND NOTES 51 |
| NEW VENDING PRODUCTS 51 |
| Kenco 51 |
| Microwaved Popcorn 51 |
| Nichols and Kellogg's 51 |
| Pringles 51 |
| Quick Tags 51 |
| Unilever Bestfoods 52 |
| TECHNOLOGICAL DEVELOPMENTS 52 |
| Cadbury Vending 52 |
| Crane Merchandising 52 |
| UK VENDING WEBSITES 52 |
| 8. The Global Market 53 |
| Japan 53 |
| the US 53 |
| Europe 53 |
| Table 18: Number of Automatic Vending Machines and Number of Persons Per Machine by Selected European Country (number), October 2001 54 |
| 9. Forecasts 55 |
| INTRODUCTION 55 |
| FORECASTS 2003 to 2007 55 |
| Total Vending Sales 55 |
| Table 19: The Forecast UK Automatic Vending Machine Market by Value at Current Prices (£bn at rsp and percent), 2003-2007 55 |
| MARKET SEGMENTATION 56 |
| Refreshment Machines 56 |
| Table 20: The Forecast UK Automatic Vending Machine Market by Sales of Refreshment Products by Value at Current Prices (£m at rsp and percent), 2003-2007 56 |
| Cigarette and Tobacco Machines 56 |
| Table 21: The Forecast UK Automatic Vending Machine Market by Sales of Cigarette and Tobacco Products by Value at Current Prices (£m at rsp and percent), 2003-2007 57 |
| Other Machines 57 |
| Table 22: The Forecast UK Automatic Vending Machine Market by Sales of Other Products by Value at Current Prices (£m at rsp and percent), 2003-2007 57 |
| FUTURE TRENDS 58 |
| Demographic and Socio-Economic Trends 58 |
| New Sites 58 |
| Technological Developments 58 |
| Euro Coins and Currency 58 |
| 10. Company Profiles 59 |
| Autobar Group Ltd 60 |
| Bunzl Vending Services Ltd 62 |
| compass group PLC 64 |
| Crane Merchandising Systems Ltd 66 |
| N&W GLOBAL VENDING SYSTEMS LTd 68 |
| Sinclair Collis Ltd 70 |
| Westomatic Vending Services Ltd 72 |
| 11. Further Sources 74 |
| Associations 74 |
| Bonnier Information Sources 74 |
| Government Publications 75 |
The automatic vending market is in a period of healthy growth. Consumer demands for convenience, more vending machines at more sites, and the improved quality of vended products, have all contributed to growing sales. In 2002, sales of vended products were estimated at £3.10bn, an increase of 3.7 percent at current prices on the previous year's value. The number of vending machines in the UK continues to increase year-on-year and, by the end of 2002, there were expected to be over 1.1 million machines in operation. This would represent an increase of 3.3 percent on the previous year's total.
Refreshment machines is the largest vending products sector and includes hot and cold drinks, snacks, confectionery, sandwiches and meals. Refreshments contribute 61.4 percent of all vending revenues, with sales of £1.9bn in 2002. Snacking and grazing trends have helped sales, along with the penetration of more familiar food and drink brands into the automatic vending market. The development of microwaved vending meals, vended coffee made from ground coffee, and improved fresh food from vending machines has also had a positive impact on sales.
The second-largest market sector is cigarette and tobacco machines. However, the number of these machines is declining as smoking bans are introduced in some public places. Concerns over the availability of cigarettes to children have also reduced the options for machine sites. Yet the value of sales has been increasing slightly due to increased taxes on these products. Cigarette sales through vending machines were estimated at £1bn in 2002.
The remaining £190m of sales in the automatic vending market comes from a range of other products, such as condoms, sanitary protection and personal care products through to newspapers, videos and toys. This `other machines' sector of the market is expanding as more products become suitable for vending.
The workplace is still a core location for vending machines. Many institutions have cut back on staffed catering resources and opted for a more cost-effective vending approach, while smaller companies and departments have been able to take advantage of changes in machine design and size. Compact machines and table-top machines are increasing in popularity. Hospitals and educational establishments are other prime targets for machines, and the range of sites is increasing rapidly.
Major suppliers to the industry fall into the categories of machine manufacturers, machine operators, and suppliers of merchandise and disposables. The manufacturing sector has a few leading UK suppliers, but penetration by overseas companies has been increasing in recent years. US and Italian companies, in particular, are major suppliers. The operator sector is much more fragmented, with many local and regional companies. Pressures on margins are greatest in the operator/distributor sector, but good margins can be made in the merchandise and commodity supply sector.
Automatic vending sales will continue to grow to 2007 as more machines, and a wider choice of products, become available to consumers. Cashless payment systems and improved monitoring systems will help increase penetration.
Text © 2003 Key Note
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Last updated by Amanda Porteous July 2003
