4
platform (e.g. advertisements, announcements, and promotions) or serve as part of the
surveillance/security network.
Micro Market software also provides market operators with the option of
implementing a variety of consumer promotional opportunities, including price
incentives/discounting, product bundling, and preferred shopper rewards. Operators can
adjust promotional programs by location with changes implemented at a predetermined
date and time. Often a MM database contains transactional information capable of
identifying the consumer and linking purchase habits by time of day and demographic to
the purchaser.
Pricing and merchandizing in a market setting involves extensive flexibility as
decisions can be based on contribution margin, competition comparison, taxability
status, promotional reward, rebate program, or comprehensive transactional analytics.
The technology involved in a Micro Market involves advanced business modeling that
more closely resembles commercial retailing than vending operations. In summary,
Micro Market characteristics include:
•
Controlled environment in a secure, limited public access location
•
Retail store-like on-shelf and in-cooler/freezer merchandising
•
Broad product offerings (may include several hundred items)
•
Consumer self-shopping with pre-purchase product access
•
Self-checkout primarily utilizing multiple cashless payment options
•
Complete operator remote pricing and product promotion flexibility
•
Transaction sequencing involves the three
S
s:
S
elect
,
S
can
,
S
ettle
While there are some managerial similarities, Micro Markets and vending operations
can be segmented into different forms of retail; each an identifiable business channel. It
is important to note that many product suppliers and manufacturers have recently
developed dedicated websites and staff specialists targeting the Micro Market channel.
MM Location Factors
The current perspective relating to Micro Market locations is that an acceptable
location would generate a minimum of $30,000 per year in revenues with the average
Micro Market delivering more than $40,000 annually. It is important to note that in 2012
locations generated an average of $48,000. Historically, to deliver a level of financial
viability, an acceptable at-work location was expected to service a population of at least
150 consumers. This threshold level of shoppers is being reduced as different levels of
Micro Market configurations, involving lower investment costs, become available. In
addition, with the potential for enhanced operational efficiencies and an expectation for
operators to adjust product and equipment offerings to better meet consumer demand,
Micro Markets are being scaled back as marketplaces are refined and updated.
Micro Market ‘
best
’ locations have generally been identified as white collar
locations and call centers, although alternate locations may produce successful sales
levels based on local competition, consumer access, work shift duration, break/meal
period, and other factors. Importantly, research indicates that self-serve retail outlets
perform equally well regardless of whether classified as white or blue collar clientele,
once the product mix is tailored to the location demographics (from at-work sites and
break rooms to hotel lobby pantries). Some operators have indicated that up to 40% of
vending locations may ultimately be replaced by a Micro Market.
