Dr. K's Tech Times

Dispelling Technology Myths

There are many myths that linger relative to the effective procurement, contracting, and implementation of vending and micro-market technology. Some are legacy beliefs that evolved out of early, ill-conceived applications; others were perpetuated by under-qualified suppliers claiming to offer a comprehensive solution. Many myths, unfortunately, appear to be the result of reluctance by operators to explore and engage in the technology selection process. Unfortunately, operators may have been content to delegate automation decisions to a route manager, warehouse staffer, accountant, or customer services manager. This article presents a set of common technology myths and truths. Each is presented with rationale, best practice insight, and a long-standing technology adage.

Product Recognition Software

For many years operators have struggled to find a more exacting method to coordinate products sold through a vending machine with sales and nutrition data. Now, as mandatory calorie disclosure requirements become reality, the ability to identify a specific product and link it to its price and caloric data take on a more prominent role in consumer-facing. Since item placement in a vendor tends to be based on a pre-determined plan-o-gram (POG) or product map, both of which rely on products being properly placed in the machine in adherence to the scheme, product recognition is assumed, not assured.

16 Acronyms for 2016

Across the vending, refreshment services, and micro-market landscape there are many techno-terms and related jargon used to describe processes and patterns of data movement and integration. Sixteen acronyms to know for 2016, in alphabetical order, are:

Mini-Max Inventory Operations

Inventory cost control in the refreshment services industry has always been a focal point, but recently it has taken on an even more prominent role as escalating energy costs, fleet transport, product costs, and delivery congestion have begun impacting operations. What is the best way to ensure an optimal mix of products in the warehouse without over-committing capital to stagnant assets? Well, often it is moving from a par stock based inventory control system to a minimum-maximum algorithm accomplished through back office software. Effective inventory control procedures can lower the cost of goods sold (COGS) while also enhancing efficiencies in product receiving, monitoring, replenishment, and auditing functions. Sound inventory policies can help identify shrinkage, automate purchasing, retain historical data, and present automatic reordering of depleted products. Maintaining stable inventory prices assists management with determining feasible selling prices while generating effective item contribution margins. In addition, inventory reports can be customized to address many important operational concerns, including the optimization of stock on-hand inventory based on supplier lead and lag times.

Developing a Loyalty Program

Despite the fact Americans hold more than three billion loyalty program memberships, it is estimated that a significant majority do not actively participate in programs for which they hold membership. Often called mining for gold in a mountain of data, loyalty programs are about to become mainstream in the vending, refreshment services, and micro-market channels. A loyalty program is typically defined as a rewards program offered by a company to customers who frequently make purchases. A loyalty program may provide its members with advanced access to new products, special sales coupons, or reward merchandise. Understanding the mechanics, dimension, and parameters of loyalty programs is important to the development of an effective platform.

About Dr. K

Mike KasavanaMichael L. Kasavana is the emeritus NAMA Endowed Professor in the School of Hospitality Business at Michigan State University. He retired from MSU after having served as a professor for nearly four decades.  His expertise and research have centered on information technology, electronic commerce and cashless transactions in the hospitality industry. Kasavana has authored and contributed to several books, written for a variety of industry journals and trade magazines, and created industry software products.

Dr. Kasavana was selected as the 2011 Industry Person of the Year by the National Automatic Merchandising Association, is an inductee of the HFTP International Technology Hall of Fame, and is a recipient of the prestigious FS/TEC’s Distinguished Achievements in Food Service Technology Award. Other accolades include the MSU Distinguished Faculty Award, MSU Broad College of Business Withrow Teacher-Scholar Award, MSU Academic Spartan of the Year Award, and the MSU Teacher-Scholar Award.  Kasavana was also part of the inaugural class of NAMA Certified NCE5 executives.

Dr. Kasavana received his B.S. in Hotel, Restaurant and Travel Administration, his MBA in Finance, and his Ph.D. in Management Information Systems from the University of Massachusetts-Amherst.

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