(We originally posted this in 2020. You can read more of our original ideas in our archive.)
Problem: Vending machines haven't been significantly improved since their invention in the 1800s. Given the cloud, a huge opportunity area is enabling vending machines to be more data-driven and data-dynamic.
Solution: During a podcast interview I had with Dawn Dickson of PopCom, she gave me a run down of the difficulties and opportunities of building a business in the hardware space. You can give it a listen here. Her business, "builds software to revolutionize automated retail. Engage with customers, understand sales metrics, and sell more products with our digital pop-up shop technology." In short, their goal is to bring vending machines into the 21st century. Most recently, Dawn was awarded a design patent for her vending Kiosk.
This business would begin as a vending machine acquisition company then would work to digitize and modernize vending machines: including aspects like facial recognition, no-touch purchases, dynamic on-site food creation, and more. Broadly, vending machines actually are quite a profitable business. As described in this medium post,
It is estimated that roughly ⅓ of the world’s ~15m vending machines are located in the US.
Of these 5m US-based vending machines, ~2m are currently in operation, collectively bringing in $7.4B in annual revenue for those who own them. This means that the average American adult spends ~$35 per year on vending machine items.
What makes the vending industry truly unique is its stratification: The landscape is composed of thousands of small-time independent operators — and no single entity owns >5% of the market.
Other sources like First Quarter Finance and VendSoft also describe the profitability of vending machines as a medium. Globally, the Intelligent Vending Machines Market is expected to Reach US$17.1 Billion by the Year 2027. Amid the COVID-19 crisis, the global market for Intelligent Vending Machines estimated at US$6. 5 Billion in the year 2020, is projected to reach a revised size of US$17. The major competitors identified in this market include, among others,
Azkoyen Group
Cantaloupe Systems Inc.
Crane Co.,
FAS International SpA
Fuji Electric Co., Ltd.
Intel Corporation
N&W Global Vending SPA
SandenVendo America, Inc.
Seaga Manufacturing, Inc.
USA Technologies Inc.
VE Global Vending, Inc
Westomatic Vending Services Ltd.
It's a large, overlooked, market that could potentially provide large and reliable returns.
Monetization: The money generated from vending machines along with data sold about their insights.
Contributed by: Michael Bervell (Billion Dollar Startup Ideas)