Finding Profitable Vending Locations An interview with Larry Towner of Service Group International
Finding Profitable Vending Locations? How do I get more vending accounts?
Finding Profitable Vending Locations is based on a number of things. Are your current accounts close together or spread out? Think about geography. What’s in the neighborhood? Look for at least 20 people in a location, for example look at the number of cars in the parking lot.
How do you get to the decision maker at that location?
Rather than talk to the secretary, go around to the back or to someone who works there to learn about the status of their vending and how happy they are with it.
Tip: Make a sales call a day.to finding profitable vending locations
When you talk to an employee at a potential location, this is market research.
A: Do you have vending?
B: Are you happy with it?
These two questions will tell you everything you need to know when prospecting.
EPISODE TRANSCRIPT:
Tom: I’m Tom with the Vending Business Show and here again with Larry Towner who is a vending business consultant and has been in the vending business for a number of years and sold the share of his company in 2012. So glad to have you here Larry. Today, we’re talking about finding profitable vending locations. Why don’t we do a little role play, say I’m new to the vending business and I’ve got one vending account and I want more, how do I get more of vending accounts?
Larry Towner: Well, that’s a great question. This is a question I get asked an awful lot is how do I get more vending accounts. So I’m going to ask you a couple of questions. First, your account, is it close to where you drive all the time? Is that something, when you go there, how many times you go there a week? Tell me that first.
Tom: Well, I go there probably four times a week and it’s full of people during the evening hours, mainly.
Larry Towner: Mostly during the evening hours. Okay, great. So you’re there, usually you service it during the day because you don’t want to be there when people are there, I’m assuming that’s correct. Is that correct?
Tom: That’s right.
Larry Towner: Okay. All right. So you’re looking for something during the day. You’ve got a rough idea of how many people are there and I don’t need specifics, but you’ve got this idea and you think in your head and you know this account because you’ve probably had it for some period of time. So the big question is, is do you want another account like that or do you want something that’s close by? These are the questions you need to ask yourself and a lot of it just depends on do you want to spend your time closer? Do you want to drive distance to get say bigger accounts? Just for example, let’s go over it. Let’s just go over the scenario that you want to stay close.
Larry Towner: The first thing that I always did is first off, let’s understand that this is called selling, right? Now, nobody likes to sell, but everybody needs to know how to sell. Selling in the vending industry is not as difficult as people want to think. Selling in the vending industry is actually pretty easy, particularly if you have just one satisfied customer, which obviously if you have the one account, you’re maintaining it, you’ve got a satisfied customer. So it kind goes this way. The first thing that I always do, this would be very, very basic prospecting. I get into the vehicle or I walk, it doesn’t really matter, but I drive around and see what’s around the neighborhood, what’s within a mile, right?
Larry Towner: If you go in a circle around the place and if you’re in any kind of an urban area, which perhaps you’re not, you might have to expand your search out a little bit. But I drive around and I look for potential candidates. For me, if I’m looking for a vending account, I want 20 employees in there all the time, or at least 20 people there during an eight hour work shift, for my personal model that worked for us for years, that’s a very big base minimum number. How do you determine if there’s 20? Well, you can tell an awful lot by the size of the building, the size of the parking lot, number of cars in the parking lot is actually a really good way to kind of figure out how many people are actually in that facility.
Larry Towner: So you go and you find there’s a place that’s got 50 cars in the parking lot. All right, that’s somebody that I think I’m going to go in and talk to. Now what do you have to do? Well, what do you think you have to do, Tom?
Tom: You got to get to the decision maker somehow and convince them that you’ve got a very good thing for his business.
Larry Towner: That’s exactly what you have to do. How do you go about doing that? How would you go about doing it?
Tom: Well, I would want to show, I mean, I’d want to not go in there with any assumptions except that I can contact, talk to the person who’s at the top if possible, the manager of the location.
Larry Towner: Well, that’s correct and that’s what we all would want to do. The tendency, at least in my sales experience in all the years I’ve been selling, is you tend to go in the front door and talk to the secretary. What’s the secretary’s job?
Tom: To keep you out.
Larry Towner: To keep you out, that’s correct. You’ve done this before. I can tell. So for me, what I do is I figure out, I usually go around to the back. I usually go to a loading dock or something like that and I try to just find somebody that works there and I don’t bother him because you don’t want to bother them. But I go in and I find somebody that works there and I asked him a couple of questions. The first question I always ask is, I don’t assume anything, the first question is do you have vending? You might laugh at that, but you’d be surprised, there are places out there that they have a big facility and don’t have vending.
Larry Towner: The next question is of course is if you do have vending, it’s like, “Hey, tell me, I run a vending business, are you guys happy with who you have?” Now that guy back there, he’s got no skin in the game. He’s going to tell you the way it is. “Ah, this or that or whatever.” He’s going to tell you everything you need to know nine out of 10 times, at least that’s been my experience. He’s going to tell you whether they’re, “Yeah, they do a really good job. It’s this XYZ Company and the guys here and the machines work.” He’s going to tell you everything you need, that you need to know about how it’s going as a general rule because people will talk about it. Particularly if he uses it a lot.
Tom: Right. So you bring up an interesting point there, Larry and that is it sounds like you’re not making phone calls to get this information.
Larry Towner: Well, you can go and make … You can do telemarketing if you want to call it that. You can make your phone calls and solicit the information. It’s just that if you’re going to go on what I call a geographic base, which means you want to be within a certain radius around your existing accounts, if you want to do it that way, you’re almost better just to do it by driving because sometimes you’re in industrial parks or sometimes … One of the things I tell everybody, this is a success tip for vending professionals, is make a sales call a day, make one sales call a day and that just means stop in somewhere on your route, stop into one of the businesses you don’t have as an account. You drive by hundreds of accounts every single day. I mean, just to and from, you drive by probably 10 accounts going to the grocery store every day. You just don’t realize they’re potential accounts, right?
Larry Towner: There are a lot of venting accounts out there. You just have to know which ones really work. So anyway, so yeah, so I mean I talk to … I do it by the old fashioned cold calling, if you want to call it that or in this case, this is kind of market research. When you get in and you talk to an employee, you’ll find out what … Are they happy? What do they like? You want to listen to what they have to say because essentially they’re the ones that pay your paychecks. Now at the same time, I’ve had guys come in, I’ve walked in and talked to an employee and the guy says, “Oh my God, I’m so glad you’re here. This guy is terrible and the foods’ old and it’s molding and and it’s this. Come on with me.” I got dragged into a president’s office one day by the dock manager and he said, “You need to talk to this guy.” Well, we closed that account that day. So this is, while it sounds cumbersome, it works. It really does work. You find an employee.
Larry Towner: You can do the same thing for prospecting. You can do it at your local church or you can do it … People you know. You ask everybody you know, “Do you have vending A? Do you have vending B? Are you happy with them?” There’s a million ways to prospect. We could do hours on this topic, hours and hours and hours. But like I say, if you’re going to do a geographic center in your planning, you want to do it around the center, then you do it that way. If you want to do the other kind where you want to do a size comparison, then you get on the internet. You get on the phone, you do your research. You say, “I want to find places with 200 employees.” The number of places with 200 employees is a much more limited thing you have. You can do the same techniques, but it’s just a little … It takes a little bit more time and you’re going to have to actually identify those prospects before you go in. Sometimes it’s easy, sometimes it’s not.
Tom: All right, well thanks Larry. Tell us about what you do.
Larry Towner: Well, we do consulting for vending industries. We do big companies, small companies. We specialize in startups. If you need help, give us a call or actually send us an email. It’s [email protected]. Again, [email protected].
Tom: Oh, you mean … Go ahead, do it again.
Larry Towner: [email protected]. That’s what I meant to say.
Tom: You’ve been watching Finding Profitable Vending Locations at the Vending Business Show, a publication of A & M Equipment Sales.
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