Automatic Merchandiser - 31

pourover brewer in my vehicle as I
went on cold calls because when I
sold an account, I was able to unplug
the competitor's pourover and install
mine. It was that simple. Then came
the automatics, or machines capable
of connecting to the water source so
the customer would no longer need
to pour the water into the reservoir
to make a pot of coffee. Automatics
generally had two to four burners, or
hot plates, to keep the coffee hot. I will
never forget the smell of coffee that has
been sitting on the burner for hours,
only to eventually burn up and ruin the
glass pot. This issue was resolved with
the release of smart coffee machines
that would automatically turn off the
burner after a set amount of time.
Next came air pots, which most
of the independent operators hated
because they kept coffee fresh for
hours. You have to remember, we were
in the business of selling coffee, not
preserving coffee and lowering sales.
Since the nationwide OCS companies
started providing air pots to customers,
the independents had to as well. Similar thermos machines came later, and
brewing coffee into a thermos of some
sort became the trend in the latter '90s.
SINGLE-CUP WAS BORN

As coffee equipment trends changed,
innovations started to happen. People
started to ask, "Why should we make a
whole pot of coffee when we only need
one cup?" The idea of single-cup was
born in the late '90s with the introduction of a plastic pod (with a filter inside
and a sealed lid) known as the K-Cup®.
The Keurig® machine started to gain
traction even though operators were
told they had to sign a contract to buy
Keurig machines and use the licensed
K-Cups to brew in the proprietary
equipment. Naturally, most operators
resisted signing these contracts.
But once the national operators
started closing deals and taking away
accounts, operators had a change of

heart. In order to stay competitive,
they also signed contracts to get the
machines, even though other forms
of single-cup existed. One competitor was Flavia® and the other was the
original pod. The pod was - and still
is - a round filter pack of coffee built
to brew one cup at a time. The problem
with pods at the time was that there
were no good machines to brew them
in. Today, however, there are several
manufacturers that build reliable pod
brewing machines.
The consumer variety is what
built the K-Cup business because the
customers didn't have to have a "one
size fits all" in coffee. Consumers could
have as many different varieties as the
client would allow, making everyone
happy. The K-Cup cost more than the
traditional coffee pot coffee per cup,
but the end consumers didn't care.
Nobody had to "make" coffee anymore.
As the K-Cup became very popular,
the margins came down for OCS
operators due to market saturation.
While operators couldn't buy from a
different provider because of contracts
and the patented K-Cup, OCS customers could buy K-Cups from other
retail outlets while using the machines
operators provided. This resulted in
lower revenues for operators. They
were ready for a new product.
FROM SINGLE-CUP

1980s

1990s

2000s

TO BEAN-TO-CUP

Using operator feedback, coffee equipment manufacturers started offering
better commercial coffee machines
capable of using ground and wholebean coffees to brew one cup at a time.
Operators didn't have to sign a contract
to use these single-cup machines, and
they could increase their profit margins
to the levels they had before K-Cups
saturated the market.
Today, operators can choose from
a variety of single-cup capsule options
such as the one offered by Massimo
Zanetti Beverage Group. Massimo

October/November 2019 * VendingMarketWatch.com

31
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