Vending Machines Are The Latest Threat To US Retailers

Tyler Durden's picture

US retailers just can’t catch a break.

In a bid to undercut US-based brands, “fast fashion” purveyor Uniqlo announced this week that it will begin selling its clothes in vending machines, a common practice in Japan, where Uniqlo’s owner, Fast Retailing Co., is based. All told, the company plans to open 10 machines in and around New York City, Oakland and Houston, according to MarketWatch’s Ali Malito, who reported that brands are increasingly selling consumer goods like clothing out of vending machines as part of a “growing trend” as they “look for new ways to sell their goods" amid a flood of brick-and-mortar bankruptcies.

“There’s no hassle,” consumer shopping expert Andrea Woroch told Malito. “You get what you want.”

However, this latest wave of innovation in the retail space threatens to leave US firms flat-footed if the fail to quickly adapt, just like many now-dead companies who failed to anticipate the rise of Amazon.com and e-commerce more broadly.

In the US, vending machines are a $7 billion-a-year business, although sales have been flat in recent years, according to industry-research group IBISWorld, as consumers increasingly prefer healthier snacks and beverages than the potato chips and soda that consumers typically associate with vending-machine sales. According to Euromonitor data cited by MarketWatch, the US vending-machine market is closer to $5 billion a year in sales, the third-largest behind No. 2 Spain ($8 billion) and No. 1 Japan ($26 billion).

In recent years, vending machines have been popping up in the US that sell a range of nontraditional items, including guitar accessories, bike parts, Lego toys, caviar, pet food, umbrellas, socks, shoes, envelopes, cosmetics, gold and even – in the states where it has been legalized – marijuana, according to MarketWatch.

“Food and beverages still make up most vending machine sales — each accounting for roughly one-third of sales — while movies and games made up 29% of the industry, followed by 6% for other products including electronics, magazines, toys, condoms, first-aid products and cosmetics, IBISWorld found. Still, food vending machines no longer just offer Pringles and pretzels. Sprinkles, a bakery in New York, has a “Cupcake ATM” for passersby in the mood for a treat, and another bakery, in Cedar Creek, Texas, has a vending machine for its full-sized pecan pies.”

A “vending machine” for luxury cars opened earlier this year in Singapore. The “machine” is a revamped office building that allows wealthy collectors to pay in cash and drive off in their new car with minimal hassle. Luxury goods brands appear to be seizing on the vending-machine model more quickly than their downmarket peers, as MarketWatch explains…

“Champagne company Moët and Chandon also has vending machines, which hold 320 mini-bottles of its champagne. The first such machine launched in London last year and they are now available in Las Vegas and New Orleans. Companies even sell cars through vending machines - there’s already one in Singapore automotive division of Alibaba Group-owned shopping site Tmall hopes to bring one to China — not to be confused with vending machines in cars, which Uber has introduced in partnership with tech startup Cargo.”

As a gathering wave of brick-and-mortar closures and bankruptcies force brands to innovate, low-cost vending machines are looking increasingly attractive. However, Uniqlo must still find a way to surmount customer-service obstacles like allowing customers to try on clothes before buying, and enabling them to easily return their purchases.

“Because it’s cheaper for companies to sell from a machine instead of paying for rent and employees, Woroch said the variety of machines will keep growing. But they aren’t always the best option for shopping. Using them takes away most of the customer service element, since there’s no one to ask for help in sizing and product information, and no easy way to try or return the item back to the vending machine, Woroch said. And even with online shopping becoming more of a go-to option for consumers, shoppers still want that extra help, which is why so many more companies have chat boxes, she added.”

As we recently reported, retail bankruptcies surged 110% during the first half of 2017, accounting for some $6 billion in debt, even as the overall high-yield default rate tumbled to 1.9% in the same period from 2.2% at the end of June as $4.7 billion of defaulted debt, mostly in the energy sector, rolled out of the default universe. Overall high-yield default rate tumbled to 1.9% in the same period from 2.2% at the end of June as $4.7 billion of defaulted debt - mostly in the energy sector - rolled out of the default universe.

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CRM114's picture

Vending machines are dead. The fact is they are a nightmare if for any reason they don't deliver the goods. "I'm sorry, we can't do refunds. You'll have to write to the address on the machine, in triplicate, in dragon's blood. They'll usually get back to you within a decade, denying everything and blaming you for tilting the machine."

Nobody needs the hassle.

sincerely_yours's picture

The REAL threat to US retailers is the monopoly the so-called (((chosen))) have on most of the malls in the US. SIMON comes to mind.

sincerely_yours's picture

I know. Why I said "so-called".

El Oregonian's picture

It's just a matter of time that you will see vending machines for human body parts. Kinda like one stop shopping "Sidewalk Surgeries".

Mr 9x19's picture

the whole point of machinery and automatisation is :

 

human -> machine

          machine -> human for maintenance

                   maintenance machine -> human to make maintenance of maintenance

etc

 

it is a no ending,  who build robots... ? human. then ? robots making robots actually. but who made the builder..? humans...

 

you want to get full employment, start by destroy all those fucking robotic craps and let the social relationship come back

Whoa Dammit's picture

So what happens when that luxury car you just bought gets stuck in the vending machine?

Stuck on Zero's picture

I'm waiting for a vending machine from Smith&Wesson.

HardlyZero's picture

Parts crib/machine would be very good idea...like on many assembly lines for tools and items.

It could be periodically stocked but probably chained/bolted down with padlocks.

Synoia's picture

Don't be stupid. The Smith amd Wesson is already a vending machine.

It delivers the goods.

Mazzy's picture

That's a bunch of LUDITE nonsense.

It's like saying if you want a job as a letter writer or a typesetter you should destroy all personal computers.

If you want a job you need to survive, adapt, figure it the fuck out, scrimp & save, be responsible, and above all: become a QUALITY human being rather than a degenerate turd.

Bastiat's picture

Machines might have a different idea about what a "quality human being" is--then they won't hire you.  This has already started with HR application screening programs.

autofixer's picture

Yes, yes, yes, I, I, I, I, I, redrum, redrum, redrum you. 

SmokeOrMirrors's picture

With advances in 3d-printing its foreseeable that the machine will be able to manufacture a custom item on the spot while you wait.  Maybe it would even be able to scan your foot and create a shoe your exact size...  or other things... who knows ?  ( in another generation or two of course )  after all to quote one of my favorite radio hosts "  This is America,  where we get what we want,  when we want it,  and lots of it.  "

peddling-fiction's picture

Early Christians that were taught by Jesus knew that we reincarnated. That is why cross-racial marriage was not allowed before, because the spirit (soul) leaves the body upon death, and finds a new host to give life to. Thus your spirit upon death would find a suitable father and mother, typically within your own tribe, and stick around. So the original chosen ones were 144,000 spirits that have long since moved along, and are scattered all over the world. Very few chosen spirits are in (((tribe))) members anymore, and they would be despised by the Zionists.

Only good message here, is that most of (((them))) are really goyim, meaning not being a chosen one, a foreigner.

TuPhat's picture

You really are peddling-fiction.

Low-Withers's picture

Original 144000 no different than the unchoosen except in their own belief. There lies the power in your own belief.
Use that belief in good or evil endeavors.
But God's choosen story does greatly reduce the likelihood of widespread dissent for the supposed moral authority and control of the choosen.
Pretty good con/ gig if you pull it off.

peddling-fiction's picture

Don't hate the messenger. Truth has a way of being uncomfortable.

JackT's picture

Don't get me started on dragon's blood. That stuff is more expensive than HP printer ink.

CRM114's picture

Your dragon blood dealer is ripping you off. Nothing is more expensive than HP printer ink.

83_vf_1100_c's picture

HP 276dw iirc, big all in one inkjet printer. 4 pack of chinesium cartridges with the big ass size black, $12 shipped on ebay. They work great.  God knows what is in the ink but I'd guess the black is squeezings fron octopii.

bluskyes's picture

Does it have the DRM? HP put out a firmware update on our m401 and 402 laser printers that protects us from inexpensive, non hp cartridges. Any one else notice that the cost of toner is up 400% in the last decade or so?

Anon2017's picture

While HP was raising the price of its cartridges to nose bleed levels, the price of laser printers was coming down. I replaced my HP ink jet printer with a Brother laser printer in late 2010 and I'm very pleased with the results. It prints faster, costs less per page to operate and rarely malfunctions. Another American icon bites the dust. I suggest that users replace their HP ink jet printer with an inexpensive laser printer.

HardlyZero's picture

Ink is difficult to handle reloads (so I end up paying premium),  but laser toner refill is very cheap and can get 2 or 3 'run' from a new HP laser.  Then there are also the page counter chips...on the new models.  The old HP laser models w/o counter chips seem to keep working over 20 years now.  Keeping older models in rotation helps, if you can have a few options and the desk space.

yogibear's picture

Dumb boxes that thieves can steal or vandalize.

Take sludge, break the glass and take the contents.

 

Guderian's picture

The safety issues of vending machines is very real.

Picture yourself pulling a pair of $200 Air Jordans in the streets of... say Baltimore.

pliny the longer's picture

Aw come on whyd u have to ref baltimore on murder no kill day? 

 

pugilist's picture

...assuming the front window of the vending machine isn't already smashed in.

edotabin's picture

A few years back someone got pissed off at a vending machine and started shaking it violently to get their money back. The machine tipped over and pinned the guy. I think he was hurt and was going to sue etc.etc.

Arnold's picture

The Corner Quickie Mart does all of it's scratch off sales via vending machine.
Not mentioned in article.
It gets lots of traffic.

Doom Porn Star's picture

What a total load of bullshit article!

Vending machines were in vogue back in the 1950s.

They called food courts lined with vending machines 'automats'.

 

Do a web search of term: 1950's Automat food vending   ...and look at all the old black and white pics!

TheReplacement's picture

What has been will be again, what has been done will be done again; there is nothing new under the sun.

mkkby's picture

All the big stores are really just concrete vending machines.  When was the last time you saw a *helpful* employee?  They're more rare than white rhinos.  Then you self scan the product and swipe your card.

Online retail was always just a computer vending machine.

Nothing's picture

Every year, worldwide, more people are killed by vending machines falling over upon them than by shark attacks .....

Juggernaut x2's picture

I'm still waiting for those "Lightly Worn Panties" vending machines like the Japs have

Ajax-1's picture

I wonder how much I could get for my 3 year old Hanes Boxer Briefs with or without skid marks.

Never One Roach's picture

I read Hillary's Plus 6x purple pants suit will go for quite a chunk at Christies Auction House

Unfortunately, Christies rejected the wookie's Size Plus 6X panites so they'll be auctioned off on FleaBay for a few dollars + shipping.

SheHunter's picture

Ouch.  Nasty image there.  Worse thinking of her without her poly pants on...

runnymede's picture

Back in the early days of eBay -- late 1990s-- I knew a trucker who sold his used soiled underwear there. Around 25 bucks per. He guaranteed they were worn 7 straight days. Always had a buyer.

I had to re-calibrate my weird shit-o-meter though. Nothing has surprised me since.

Pernicious Gold Phallusy's picture

I MAKE $7,000 A WEEK SELLING DIRTY UNDERWEAR ON THE INTERNET! FOR DETAILS SEE HTTP:\\WWW.ASHUR.CON

Juggernaut x2's picture

Yes- it's an actual thing in Japan- look it up

Chief Wonder Bread's picture

Japan is a high-trust society. U.S. not so much.

Pernicious Gold Phallusy's picture

They still have to figure out how to let you sniff first to get the ones you really want.

NoDebt's picture

"must still find a way to surmount customer-service obstacles like allowing customers to try on clothes before buying, and enabling them to easily return their purchases."

Fuck that shit.  But a goddammed shirt, motherfuckers!  If it doesn't fit, throw it out and buy another.  They only cost like $2 each.  Why you being such a fucking tight-wad?  We need the fucking GDP!  

SPEND IT you fucking cheapskate dirt bags!

(Damn, I really should stay away from marketing.  My bedside manner leaves a lot to be desired.)

 

CRM114's picture

I dunno - a lot of rich, guilty b@stards seem to like your kind of approach - do you have a whip too? ;)

NoDebt's picture

You know those nasty egg salad sandwiches you can buy from your corner gas station?  I invented those.  My net worth is roughly $500MM dollars right now.

 

CRM114's picture

Anyone who buys an egg salad sandwich from a gas station deserves what they get.

I bet they only sell them at the gas stations with the outside washroom, that's 3/4 way round the building in some dark corner.

And then the key doesn't fit.

At which point the egg salad sandwich wins.

NoDebt's picture

Just wait till you buy a shirt from one of my gas station vending machines.  Slightly used, mild pit stains, collar too small, arms too long.  You don't know who to sue when that "egg salad sandwich" makes you violently ill, how you gonna figure out who to sue when my vending machine shirt doesn't fit you right?