A new day dawns for fresh food vending

It was only a matter of time before self-service technology changed the fresh food vending business — for the better. And that time has arrived. Witness the recent expansion of fast casual restaurant chains into vending as a way to strengthen their brands and reach more customers.

It didn't happen overnight, but it wasn't hard to predict this day would arrive.

More than a decade ago, remote machine monitoring technology made it possible to check machine inventory in real time. Vending operators were able to service machines on an as-needed basis instead of regular intervals. This was especially important for products such as freshly prepared food with limited shelf life.

Vending management software also evolved to support dynamic routing, whereby orders can be prepared and scheduled for delivery in response to individual location needs — within hours.

Technology evolves

Improved software boosted the efficiency for every type of machine (ambient, refrigerated and frozen), but again, the stakes were higher for the more temperature sensitive products like freshly prepared food.

Meanwhile, advances in food logistics made the nation's fresh food supply chain more readily available, bringing a greater variety of foods to retail food and foodservice, including convenience services operators.

Pioneers lead the way

In 2013, Luke Saunders introduced Farmer's Fridge, delivering freshly prepared food to vending machines in a timely fashion, based on the machine's sales.

Saunders' menu offered items such as smoked cheddar Cobb salad, sprouted grain tortillas, pesto pasta bowl, pineapple coconut chia pudding, tarragon chicken salad wrap and organic Bolivian royal quinoa. Prices ranged from $4 to $12.

Saunders saw what technology made possible and he used it to tackle the need for freshly prepared meals for people on the run, starting with airports.

He developed a vending machine that allows the customer to shop its inventory quickly using a touchscreen, and a management platform that enables the company to replenish the machine based on individual location needs.

He tapped the newly energized food supply chain to deliver food to the customer location within hours, supported by a centrally located kitchen where meals are prepared hours before delivery. His short timeline from production to delivery cut the traditional food waste from as high as 40% to low single digits.

Other entrepreneurs took note of Saunders' innovation and developed similar concepts such as Fresh.Bowl in New York City, Fresh 'n Lean in Southern California, Alpaca Market in Austin and Choice Markets in Denver.

These concepts not only changed the image of fresh food vending. They have sent the traditional fresh food vending business model into the trash heap of history where it belongs.

A 'necessary evil' no more

Fresh food has always been the vending operator's point of competitive distinction. Where any operator could offer shelf stable candy, soda and snacks, the fresh food is what separated the leader from the pack. The great irony being that it also became the Achilles' heel since customer price resistance made it impossible to charge what it took to cover the cost of preparing and servicing perishable food.

The price ceiling limited what vending operators were willing to invest in their perishable food offerings, which in turn limited their quality and reinforced the consumer's negative perception of vending machine food.

Hence, while the sandwiches and entrees won the account, fresh food has been the loss leader.

Veteran operators would never have dreamed of offering a standalone dedicated fresh food vending machine except for the rare instances where the location was willing to fully subsidize it.

Few quality conscious fresh food brands were willing to be associated with vending.

A new day has arrived

Now it's 2020, and the game has changed. The restaurant industry has taken note of Farmer's Fridge, Fresh.Bowl, Fresh 'n Lean, Alpaca Market and Choice Markets, and it's bidding for its share of the convenience dining pie.

Back in December, Coolgreens, an Oklahoma City based fast casual chain, announced plans to install its "Coolgreens Market" smart fridges in its Dallas market for the sale of salads, wraps and snacks.

The COVID-19 lockdown didn't stand in Coolgreens' way. On the contrary, the company found that its smart fridges allowed it to continue serving its branded meals while its dining rooms were closed.

Recently, this site reported that a venture capital group has invested in Coolgreens' vending initiative, jumpstarting its rollout in the Dallas/Fort Worth market.

Not to be outdone, Newk's Eatery, a Jackson, Mississippi based fast casual chain, recently announced that it is in the early stages of testing a similar concept for its brand of freshly made "grab and go" menu items. Adam Karveller, vice president of information technology, said he sees a place for these vending coolers in high traffic locations such as airports.

Karveller thinks order habits will change long-term as a result of COVID-19. He sees curbside pickup, delivery, online ordering and even vending will play a bigger role long-term.

A new day has dawned for convenience services, thanks to technology and innovative entrepreneurs.