Beverage boost for Vending Technologies

Under the agreement Rio Beverages has purchased signage rights on up to 4,000 of VTL's beverage machines in New Zealand with each machine featuring brands from Rio's drink range.

Rio will pay VTL $8 million over four years and will receive vending channel-specific sales analysis.

The deal is the second under the vending company's new partnership programme aimed at the FMCG (Fast Moving Consumer Goods) industry. In February it struck a deal with Cadbury Confectionery.

The programme is designed to provide a cost-effective way for FMCG brands to beef up their vending presence.

Rio Beverages, which is half-owned by Cerebos Greggs, owns a number of leading beverage brands including e2, Keri, Kiwi Blue and Thextons. VTL general manager, Rob Seymour, says deal with Rio will strengthen his company's product offer.

"e2 is the fastest growing beverage in the market and the second largest drink brand behind Coca Cola in New Zealand in convenience store sales.

"Distinctive e2 signage will be placed on new vending machines as they are rolled out around New Zealand. Each machine will feature leading brands from Rio's range of beverages."

Rio GM, Nigel Woodd, says the deal gives Rio a premium entry position into the local vending channel.

"We believe Vending Technologies' expertise and smart management will deliver us a long-term position in the rapidly growing category of vended beverages. We'll also receive week by week and site by site data and sales analysis on our products."

Vending Technologies claims vending is one of the few growth markets available to FMCG companies but says traditional vending growth is constrained by a lack of profitability because of high capital costs and inefficient vending management systems.

""What VTL aims to do is to deliver real consumer choice within the vending channel in a way that is cost effective and sustainable," says Mr. Seymour.

"With our FMCG partnership programme, FMCG brand owners receive access to a new fast growing channel with minimal overhead costs. For us, it means quality long-term sustainable income. It delivers choice and convenience to consumers."

For the half-year ended September 1999 VTL posted a profit of $1.25 million with sales revenue of $8.8 million.

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