Friday, June 12, 2009

Vending machine economics

Wherein perhaps if the prices were higher I would stay away more and this issue would not have occurred to me

I'm curious about the science, if any, behind vending maching pricing and stacking. Consider two vending machines next to each other -- one for beverages, the other for snacks. What is the most optimal pricing for both to generate maximum profit? My thinking is that always being able to split a dollar between the two machines would work best.

Example from breakroom nearest me. Cokes/sodas/carbonated beverages are .50 cents. Snack prices range from .45 through .60 cents broken down as:
  • .45 cents: 17
  • .50 cents: 4
  • .55 cents: 7
  • .60 cents: 17

Buying the most expensive snack and a drink means having a dollar and change; or break two dollars and getback a pocket full of change. Kind of pricey and whipping out the second dollar reminds how much is being spent on junk.

Until about a year and a half ago, drinks were .35 cents. A bargain price and if you used a dollar then you could use the change to buy anything from the snack machine. I wonder where the markups are highest? Does a .35 cent coke lose money even if sales of .60 cent Ho Hos goes up?

How about selling everything at .50 cents? Seventeen items get raised a nickel, seven items get dropped a nickel, and seventeen items get dropped a dime. Sold evenly, that's a drop of $1.20 in gross sales. Maybe it is worth selling fewer M&Ms at .60 cents sans drinks.

found -- Discussing pricing of the New York Times vending machines: debit cards lead to higher prices? Doesn't really answer my question, but does suggest that prices in my office building might be on the low side.


Blogger blake said...

65 cents for 12 oz, 1.25 for 20 oz.

75-85 cents for snacks, I think.

This is WeHo.

In our building, what I don't get is that the guy's circuit is once a month. By the time he comes by, the machine is almost empty, except for full rows of crap no one wants.

I don't get it.

5/09/2012 10:20:00 PM  
Blogger blake said...

Hate the CAPCHA.

5/09/2012 10:20:00 PM  
Anonymous Anonymous said...

bill -- had no idea there was capcha. Don't know when blogspot added that.

5/10/2012 05:17:00 PM  
Blogger blake said...

Couple months ago.

I suck at these.

5/10/2012 05:52:00 PM  

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