Automatic Merchandiser - 22

"For the employee, instead of just
picking up a handful of these things
and heading back to their desk or
out the door, the items are under
a controlled environment where
they're actually checking those items
out," he explained. "They may still
be free to them, but they're checking them out at a kiosk and it allows
us to have better control over the
products and know they're not going
out by the handfuls, and that they're
really being provided for employees'
use at work."
MICRO MARKETS MOVE OUT
OF THE BREAK ROOM

Some industry insiders believe that
the greatest potential for micro markets doesn't lie within the workplace,
but outside of it. In order to capitalize on that, operators need to adjust
their thinking.
"I've been in this industry 25 years
and I've seen the consolidation and the
lack of readiness for a succession plan
with businesses," Rosenberg said. "I've
also seen what an economic downturn
can do to an industry. We're going to
need to diversify. With Amazon Prime
and Starbucks Delivery and everything
else invading our space, we've got to
diversify and plan in order to minimize short term risk associated with a
change in the market."
Patrick McMullan, co-founder
and president of Three Square Market,
has been expanding his company's
unattended retail stores into public
areas such as shopping malls, hospitals,
military bases and airports.
"Without question, in our world,
we are looking to break down
the break room wall," McMullan
explained. "We're not just depending on employers to do business. This
year, we'll be north of 40 stores that are
complete self-pay, self-service retail
stores. You walk in and it's like a mini
Amazon Go. Anybody can walk into it;
it's open to the public."

22

McMullan said he saw an opportunity to compete with convenience
stores that are improving not only the
range of products offered to consumers, but also the overall shopping
experience.
"You can go anywhere in the
country, and you'll see locations that are
improving what they offer consumers,"
he explained. "You can make a customized sandwich, you can get ice cream,
you can do so many different things
than what your traditional convenience
store used to do. So, we said, 'Why are
we lending ourselves to a single-serve
experience?' We've expanded, and our
retail stores are true retail stores. People
are buying products that they're taking
home with them."
According to McMullan, competing in the public-facing, convenience
retail space is a natural next step for
this industry.
"The location needs to become a
destination," added McMullan. "Let's
face it, the business has evolved. It
went from vending to markets, and
if we're going to continue to protect
what we have as an industry, then we're
going to need to evolve to keep up.
If all you're going to do is sell sugars
and salts and maybe a fresh sandwich
or salad, you're missing the boat. You

"

We're not just depending
on employers to do
business. This year, we'll be
north of 40 stores that are
complete self-pay, selfservice retail stores. You
walk in and it's like a mini
Amazon Go."
Patrick McMullan, co-founder and
president of Three Square Market

Automatic Merchandiser * October/November 2019

need to get in the game of becoming a
destination literally for anything that
somebody may need at any time."
Brinton agreed that expanding into
public markets is a great opportunity
for operators who are willing to get
outside of their known territory.
"Operators' traditional micro markets have been in closed environments
from the very beginning, serving a
known set of people," he said. "Operators have to start looking outside of
our comfort zone - now we're having
to look at street locations. As we see
convenience stores and others start to
look more at our space, we're beginning to look more at their space."
Kasavana said that non-traditional
products - and even services - will
likely become more prevalent in markets as operators look for additional
ways to increase revenue.
"For example, 'As Seen on TV'
products, personal hygiene, over-thecounter pharmaceuticals, flowers and
plants, and drop-off/pick-up dry cleaning as well as Amazon Prime package
locker service are among the products
and services operators are considering," he said.
LOOKING FORWARD

While nobody can predict the future,
operators can prepare for what's ahead
by staying on top of these micro
market trends. Micro markets will
continue to evolve - just as they have
since their inception - and successful
operators need to be open to change.
"My recommendation for operators is, always be curious," Steiner said.
"If you are open to new ideas, listen
and learn from those ideas. Whether
you decide to implement them or
not is up to you, but being open and
curious will only allow you to continue
to look at the business in ways you
didn't before. This is how you can be
proactive, because then you start to
make informed decisions on what you
should do next." ■
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