You’ve probably heard a grandparent or even a parent talk about how the costs of goods have risen substantially over the years. Today, there’s no such thing as penny candy, cola costs more than a nickel and you’re not going to get very far with only 50 cents to your name. And while we’ve come to accept that the price of snacks has risen from decades passed, what’s unbeknownst to many people is the fact that prices for snacks in vending machines in Tucson are still rising.
You may still be able to grab a Hersey’s candy bar for $1.25 from your local vending machine, but that doesn’t mean the cost of stocking that candy bar has remain anywhere close to what it was only a year or two ago. The sad truth is that candy and snack companies constantly raise their prices, each year and even sometimes twice per year. But, when the cost to stock an item rises and the cost it’s being sold for stays the say, vending companies absorb the loss in the end.
Why take the hit?
When providers like PepsiCo, Frito-Lay, Coca-Cola, Mars-Hershey and Nestle decide to change their prices on stocked vending items, it presents vending companies with a dilemma. Does the vending company raise their prices as well, maintaining the same margins as they always have? Or, do they forgo the price increase and absorb the cost internally? Many vending companies choose the latter. Why? Because it’s better for business, even though it’s the lesser of two evils.
Let’s explain. Let’s say that you buy a bottle of Coca-Cola from an office vending machine each day on your way to lunch. The cost of that bottle for you, the consumer, is $1.50 and each day, you swing by the machine with six quarters in hand. But, one day, when you’re buying your daily drink, you notice that the price has been raised by 10 cents and you don’t have enough change on hand to buy it. What do you do? Too often, in many cases, this causes too great of an inconvenience for people, causing them to abandon vending machines in Tucson when it comes to buying their snacks and instead, seek purchases from a corner store or other outlet.
Rather than lose the business altogether, vending companies often take a minor margin cut in order to retain their frequent customers.
The breaking point
With costs being risen by the likes of PepsiCo, Frito-Lay, Coca-Cola, Mars-Hershey and Nestle each year or even more frequently, what happens when the margin shrinks to almost nothing? Sadly, there’s a breaking point for every vending company and eventually, they’re forced to raise their prices. The inevitable happens and many times, the vending company will not only settle for lower margins, in an attempt to keep costs to consumers as low as possible, they’ll also lose the business that they feared losing in the first place.
It’s a vicious cycle that can’t always be controlled, however it’s one that can be twisted by consumers. If you notice that the prices in your local vending machine have gone up, call the brands, not the vending company! The vending company is as much a victim as the end consumer, but far too often, the companies receive the blowback of customer anger. Bypass the middle man and go straight for change at the source: call PepsiCo, Frito-Lay, Coca-Cola, Mars-Hershey or Nestle!
Categorised in: Vending Services