Executive Summary
This business plan presents a new line of vending machines from a well-known company providing similar services throughout the UAE, Dr. Vending Company. At the moment, the company sells, operates, and maintains vending machines with coffee, snacks, cold drinks, ingredients, ladies’ naps, as well as change givers and cellphone charge stations. Vending machines are traditionally located in administrations, hospitals, healthcare centers, universities, colleges, schools, banks, malls, public and private enterprises around the UAE. The company’s website notes that vending machines with healthy food or hot drinks “motivate staff, keep clients happy and occupied while they are waiting for you to attend their needs” (“Profile of Doctor Vending,” n.d., para. 1). Besides, consumers can save time, which is also very convenient. Currently, the main competitors of Dr. Vending are Modern Vending, Snack Zone, Gulf Vending, and JORA.
Due to such convenience for customers, it is assumed that the new line of products – different types of hand sanitizers and wipes will meet great demand. The product line will include wipes, sanitizers, disposable medical masks, and costumes for paramedics – for machines located in medical facilities. Because of the COVID-19 pandemic, the demand for these products has increased dramatically. Dr. Vending plans to enter into contracts with suppliers, thus ensuring a sustainable offer. During the epidemic, the highest demand is expected in medical facilities and supermarkets, where vending machines will be located first. After the outbreak and the associated social distancing are over, the need for our products will decrease significantly. But still, it will be higher than in the period before the epidemic began. Therefore, in the future, machines will also be located in universities, colleges, schools, banks, public and private enterprises.
Due to the extremely high demand for goods and insufficient supply, market competition is low. Competitors of Dr. Vending may also come to mind to introduce a new similar product line, but so far, nothing is known about this. Thus, Dr. Vending will be able to gain a significant share of the market as it enters the market first. Dr. Vending will provide operational maintenance services of machines and will fill them with goods twice a day. It is proposed to place vending machines in hospitals, healthcare services, and the most popular grocery stores in Dubai. If the products sell well, the company will place vending machines in Abu Dhabi and other settlements of OAE.
Dr. Vending wants to show social responsibility and organize the supply and weekly maintenance of machines in the most remote regions of the country. Besides, it is planned to organize the free distribution of products to the most socially vulnerable people. Marketing strategies such as segmentation strategy and potential target market, positioning and differentiation strategy, product strategies, pricing strategy, distribution strategy, and promotion strategy will be applied to complete the business plan. Dr. Vending will finance the implementation of the business plan.
Situation Analysis
The market stability of vending machines is facilitated by many demographic, political, economic, social, and technological factors. The main supporting demographic factor is that thanks to the growth of urbanization and the disposable income of the population, the number of vending machines continues to grow around the world. As for economic factors, according to the study, by 2023, the global market for vending machines will reach $ 5.4 billion, an increase of 15.8% over the forecast period (“Global vending machine,” 2018). There is also evidence that the global industrial vending machine market will reach $ 4.6 billion by 2027, an increase of 9.6% from 2020 to 2027 (“Industrial vending machine,” 2020). Hand sanitizers, wipes, medical masks, and protective suits for health workers are part of the industrial vending machines product group. It is hoped that these products will successfully occupy their niche in the market.
Industrial vending machines are sometimes selling personal protective equipment such as gloves, goggles, and helmets. These types of vending machines are increasingly being implemented in manufacturing and oil and gas companies. Another example is maintenance, repair, and operations (MRO) stations installed at maintenance facilities in aviation industries (“Industrial vending machine,” 2020). Therefore, the proposed new product line resides on the border of traditional and industrial vending machines. The OAE society already got used to innovations in this market segment (Sengupta, 2016). Thus, non-traditional products, such as medical masks, wipes, and hand sanitizers, will not scare away potential buyers.
Furthermore, the introduction of the latest technologies will contribute to the maintenance of a new product line. Some manufacturers offer machines with an Internet connection, which allows managing data on the use of the device, as well as protect it from hacking. Moreover, such machines are connected to the cloud, which provides remote access to data, and allows making the replenishment of stocks more efficiently (“Industrial vending machine,” 2020). Other recent developments offer faces recognition technologies, checking the customer’s purchase history, and a convenient cashless payment system (“Global vending machine,” 2018). Thus, the use of technology allows mitigating the security risks associated with the business and make purchases as convenient as possible.
One of the main strengths of a new line of products is the existing customer base and data on the operation of traditional vending machines of Dr. Vending Company. Nonetheless, the weaknesses may include a seasonal decline in demand for products after the COVID-19 epidemic ends. The most favorable opportunity is a seasonal peak in demand. Besides, when seasonal demand finally drops, there is the company will establish long-term cooperation with medical institutions, following the example of other industrial vending machine suppliers. The main threat is high competition in the market sector, which can be transferred to a new line of products, and possible problems with the supply, which may necessitate a constant search for suppliers.
References
Industrial vending machine market size worth $4.6 billion by 2027. (2020). Web.
Profile of Doctor Vending LLC. (n.d.). Web.
Sengupta, A. (2016). Crazy vending machines in the UAE. Gulf News. Web.