Vended Milk Facts
PRINT THIS PAGEVended Milk Facts
Vended milk has wide appeal from schools to company cafeterias to other out-of-home occasions. These studies prove it!
Milk Vending is Gaining Momentum
Findings for the MilkPEP “Milk Vending State of the Industry” study suggest that vending operators have an escalating opportunity for success with milk vending, particularly due to the increasing consumer demand for healthier beverages and the changing landscape regarding beverages in schools.
The report, conducted by Beverage Marketing Corporation (BMC) in early 2006, consisted of interviewing more than 800 vending operators, more than 1,000 school officials, numerous processors and industry experts. BMC also examined articles and other materials on milk vending.
Key Findings
- Milk vending appears to be in a state of positive transition for operators, towards a stronger platform for growth and sustainability:
- BMC estimates that the vending opportunity for milk is an incremental increase of 900 million units annually nationwide.
- Currently almost 40% of vending operators offer milk and more are considering adding it to their mix since more and more consumers are looking for healthier alternatives.
- National operators and smaller companies are offering “better for you” products in response to government and consumer concerns about obesity and nutrition, driving changes in vending selections.
- Milk is vended more as a beverage rather than as a cold food, with an increasing share of mixed beverage machines and more dedicated milk venders.
- In 2005, there was significant expansion in the variety of milk offered, and vending operators indicated that they are looking for more variety to keep consumers interested.
Prospects and Channels for Milk Vending
Plant/factory and business/industry locations continue to comprise the bulk of the milk vending business, yet a huge opportunity for growth remains. It is estimated that a possible incremental increase of nearly 697 million units could be sold in B/I locations. Many operators recommend converting two or three slots of their existing machines to milk as an entrée into the business, as well as using dedicated milk venders and healthy beverage machines that feature milk as a means to capitalize on milk’s profit potential.
The study also indicates that secondary schools are a relatively untapped market. The BMC report estimates that only about 10% of middle, junior and high schools sell milk or milk drinks through vending and milk is available in only about 4% of beverage venders in schools. By comparison, soft drinks are available in nearly 70% of school venders. However, with the recent decision by soft drink manufacturers to remove all non-diet carbonated beverages from secondary schools, a huge gap will exist that can be filled by milk vending.
Note: there are 38 slides in the presentation, which may take a few minutes to download.
MilkPEP School Vending Test
MilkPEP's School Milk Vending Test found that the opportunity for school milk vending is estimated at 130 million 16-oz. plastic, single-serve bottles annually. The results show a strong demand and a significant business opportunity for vending operators:
- Two-thirds of schools allow students to buy food and drinks from vending machines during lunch.
- Results of a five-month milk vending study concluded that many students will choose milk over competitive beverages.
- 68% of students said they bought vended milk
- About 30% of students purchased milk at least once a week
- Average weekly sales per machine were 307 units in high schools and 213 units in middle schools
- A recent test program was initiated in 146 schools encompassing 100,000 students to enhance milk programs with high visibility displays, new packaging and adding chocolate and strawberry flavors in a variety of sizes.
- Milk sales increased 18%: 15% elementary, 22% secondary
- 14% from a la carte and vending sales
The study demonstrates that if school milk vending is widespread, it can potentially increase school milk consumption by 130.4 million pints per year nationwide. It also identifies product, placement, merchandising and service levels, and offers helpful economic models for vending operators.
Click on any link to view that section of the study. Each section of this study can be downloaded as a PowerPoint document.
The study contains 96 slides and may take a while to download.
Multi-Channel Vending Study
MilkPEP conducted tests to evaluate the opportunity for milk vending in various settings - business and industry (B&I); college and university; public venues; and schools. The tests involved 150 venders placed in four markets. Three vender types were used — Royal Live-Display, Royal Closed-Front, Dixie-Narco Glass-Front — and featured 12-oz., 14-oz., and 16-oz. plastic milk packages in a range of flavors and a mix of local processor and national brands. Some machines also included non-milk products for comparison, including juices and fruit drinks (local processor and branded), water and sports drinks.
The objective of this study was to test the premise that consumer trends, coupled with dairy innovation have created unprecedented opportunities for milk vending in alternative channels. This study will explain how milk can help grow your business.
Note: There are 61 slides in this presentation, so it may take a few minutes to download.
