3D-Printing: A Nuclear weapon for startups willing to disrupt the vending machine business.
3D-Printing represents a great opportunity for vending machine startups to innovate through an easier iteration process, enabling the whole industry to reinvent the customer experience.
While automated stores remain a wild dream for most retailers, it has been a reality for more milleniums for the vending machine industry [1]. However, even if the vending business is at a crossroad in developed countries [2] reinventing itself through integrating consumers’ aspirations for healthier food and digital machines, the innovation has been mostly lead by well-established big companies, leaving a very tiny space for startups to grow. Launching new features and machines takes indeed a particularly long time in this industry since it requires a long technical development and testing mainly because the iteration cycle in the industry is very costly, so that the incentive to stick with old proven distribution technology is very strong [3]. Nevertheless, 3D-Printing is completely reshuffling the cards, enabling the emergence of new entrepreneurial actors.
Centimeo is a young French vending machine companies created in 2011 [4], based on a simple concept: people in Western Europe are not using their low-denomination coins, which are costly to manufacture for European States [5]. The company started to sell chewing gum per unit for 5 Cents in vending machines in order to collect those coins. Once collected, it recycles the coins in the economy via providing change to storekeepers. While starting its business, Centimeo faced a significant issue: there were no existing system enabling the distribution of tiny products such as chewing gums sticks, so that the company relied on an underused technology in the vending machine industry: 3D-Printing. As the CTO of the company said, “3D-Printing was the only way for the company to prototype multiple distribution mechanism within the same week. It allowed us to intensively iterate, and this would not have been possible if we would worked with traditional vending machine manufacturers. Those rely indeed heavily on sheet metal manufacturing and plastic molding. Prototyping with these technologies can take up to several weeks, whereas for us, it took a couple of days, if not even hours sometimes!” [6].
What is fascinating is that Centimeo relied here on 3D-Printing to develop from scratch new distribution systems, having therefore the ability to test new products within a week, and constantly improve its distribution mechanisms without incurring high manufacturing costs. It confers to the company a very significant flexibility, that can be used to quickly match any development needs. A good example is the partnership between Centimeo and Nailmatic [7], a nail polish vending machine concept. While not familiar with the cosmetic business, Centimeo was able to develop a completely customized system applied to nail polish in two months relying on 3D-Printing technology, a performance that could not have been realized through traditional manufacturing.
I believe that the company will apply this usage of 3D-Printing to a wide variety of products, adding therefore a strong flexibility to its product line. The technology is likely to help the company to even regularly change the products formats sold in a machine, something that will help the industry to match ever better with evolving consumer needs, and pull the vending machine towards being a more dynamic retail store. We can indeed imagine seasonal products, especially during Christmas or Easter. In the longer-run, the impact of the usage of 3D-Printing in the vending industry might be to move away from standardization and to increase the number of different machines operated by the main actors of the industry. We can indeed easily think about modular vending machine that can be fully adapted to their environment, so that a vending machine in a library for instance would be perfectly customize to retail pens, ear plugs and other relevant products.
In this perspective, I think that it would be relevant to push this idea towards customizing also the shape of the machines. The vending machine is more and more problematic from an esthetic point of view, and there are many attempts to fit them better, especially in crowded places such as train stations or hospitals. I believe that 3D-Printing can here play a big role in giving adequate shapes to the machines, so that they move away from being standardized parallelograms. It represents for startups like Centimeo a huge innovation opportunity to play leading role in this industry, and engage the customer in a new shopping experience. With the combination of 3D-Printing and digital vending machines, one can indeed think about empowering the customer and asking his/her opinion towards the products that can be sold in the machine, as well as transforming the vending machine consumption into an interactive and fun experience.
(749 Words)
[1] HIGUCHI, Yoshihiro, History of the Development of Beverage Vending Machine Technology in Japan, Center of the History of Japanese Industrial Technology.
[2] LEE, Bruce, Current and Future Trends in Vending Machines, Forbes, 4/22/2016.
[3] MOREL, Agnès, La réinvention de la Distribution Automatique, Le Nouvel Economiste, 3/18/2018.
[4] Forbes 30 under 30 Website, Forbes.com.
[5] Official Website of French Senate, consulted the 11/13/2018.
[6] ANBAZHAGAN, Ramesh, Phone interview, 11/12/2018.
[7] GAZEAU, Antoine, Nailmatic se fait un nom en cassant les codes de la cosmétique, Brief Mag, 2018.
This is a very interesting and well-written essay. I completely agree that 3-d printing provides an important avenue to allow companies to iterate quickly on manufacturing concepts. This flexibility allows them to both test things that wouldn’t otherwise be possible, and test them much more quickly than they could if they were relying on other forms of fabrication.
The one question I would raise, however is whether 3-D printing is viable at scale. In your essay, you imply that Centimo could use 3-D printing to fabricate all of its products and product lines. I would be very curious to better understand the unit economics of manufacturing in this way. I would guess (though I don’t know) that 3-d printing does not generate the same economies of scale as traditional production mechanisms. If this is true, 3-D printing would primarily remain a tool for internal iteration on a concept, rather than a technique for mass-production.
Thanks for the really interesting insights. I can definitely understand for the start-up why it was so important to iterate quickly and I think it was a great idea to utilize 3D-printing. What I found particularly insightful was the synergies mentioned between different products. Although I understand how 3D-printing could improve development speed for separate products individually, I was unaware how one product’s development (chewing gum) could aid the speed at which an entirely separate product could be developed (nail polish).
Although the development is fascinating, I am curious about how much scale is possible. The speed of prototyping does make sense, but once I product is complete and tested, does 3D-printing work as well on a large scale as typical manufacturing?
It is really impressive how this start-up was able to impact the whole French economy by leveraging on the 3-D Printing technology.
However, I am a little bit skeptical with the replication of this business, which would allow to achieve economies of scale in this production. Based on the strong growth of technological companies such as Amazon, Google, Uber, among others, I believe that the digital economy will end up removing most of the vending machines in the world. Although they can be used to sell specific products in certain occasions, the convenience of ordering products online will cap the vending machines growth before 3-D printing becomes a useful technology.
This is a very in-depth experience of how 3D-printing can facilitate rapid prototyping. Thanks for the unique insights! I am curious what the next step is after Centimeo has a prototype prepared. When it moves forward to scale-up, how might the company leverage 3D-printing? Would it be possible?
Thank you for providing insight on the use of additive manufacturing (AM) in a quite distinctive industry and segment. It sounds as though this startup recognized the value of 3D printing during the iterative phase of product development before going to market. It makes sense why AM is the optimal tool for prototyping in the earlier stages of ideation; however, it’s hard for me to believe that the use of 3D printing is scalable in this industry. Once Centimeo develops the proper prototypes (e.g., vending machine shape, product packaging, etc…), why would AM be the most cost-effective way in commercializing the idea? Intuitively, I would presume that more traditional means of vending machine manufacturing would be more efficient than relying on 3D printing technology, which seems to be currently uneconomical for mass-production.
This was a well-written essay. A main underlying premise of the piece is that rapid prototyping is inherently a good thing. One question I had was whether there was some incremental gain from having friction costs associated with prototyping? Does the incremental gains from speedy prototyping outweigh the likely incremental waste created from poorly thought-out prototypes being created? I imagine that it might, but I imagine that some of these materials may not be able to easily recycled.
This is an exciting opportunity for additive manufacturing as vending machines provide the double benefit of reducing labor costs as well as being produced at potentially a small enough scale to be readily viable for 3D printing. With printing available in a multitude of materials, companies like this may be able to forego sheet metal entirely with plastics or metals that are secure enough to handle the stress of being in a public area as well! Another bonus of using additive manufacturing to produce customized vending machines is the ability to integrate non-proprietary payment and data collection systems (like Square etc) to save on development costs for small companies!
Very interesting article about the use of 3D printing for vending machines. Additive manufacturing is an interesting field and has potential to change the dynamics of this industry.
The author goes into detailed discussion about how 3D printing is useful for developing new distribution systems. The author does provide a great example about nail polish. A couple more examples could have further strengthened the argument. There is also a nice discussion on customization and the benefit offered by 3D printing in that regard.
From a constructive standpoint, I would have liked to see more details relating the exact economics of this vs traditional manufacturing and how this might affect the potential going forward in future. This would have made clear whether 3D printing has a potential or not, and if it does, what economics are required for that to be.
But overall, enjoyable reading, opened my eyes to the potential of 3D printing/other forms of manufacturing in the vending machine industry.
I love the product side of this and see a ton of opportunity in what they’re doing. My concern is related to maintenance and upkeep costs, given part of what’s attractive about the vending machine model is that once distributed, they only really require replenishment and the occasional technical maintenance issue. In contrast, these machines would require materials replenishment in the same manner but it seems like any technical breakdowns would need a much more skilled type of mechanic to fix them. This is a scalability and cost concern for me, since I’m guessing the number and geographical distribution of 3d-printer engineers is sparser than traditional vending machine repairmen.
Interesting insight here, especially on the future of the industry – you really demonstrated an incredible expertise on the industry and a nuanced understanding of the company!
I definitely agree that 3D printing allows for quicker customization of new dispensing mechanisms, which allows a start-up to develop products while limiting capital requirements. However, I question the long term disruption that 3D printing will have in this industry, as there are many other reasons why vending machines are not replaced frequently, besides the high cost to prototype. For example, just the cost of scrapping / replacing an old machine each year and installing a new one could prove prohibitive. Therefore, I wonder if when Centimeo reaches scale, they will be able to innovate as quickly, or be constrained by the finances of their business.
Very interesting article! I wonder going forward what other changes are possible in the vending industry in terms of moving more products outside of stores and putting them more directly in front of the consumer? And how can additive manufacturing help facilitate those changes? I have started to notice in train stations in the United States that CVS and other players are moving towards large vending machines that sell a collection of the highest selling SKU’s and believe that Amazon is rolling out similar concepts.
This is really cool! Reading your article, in my mind there are several ways the vending machine industry can be disrupted by 3D printing technology:
First, how could you better able integrate the speed and flexibility brought about by 3D printing with the predictive power of machine learning by gathering insights from your customers and adapt really, really quickly to changing in trends and customer behavior?
Second, I wonder how Centimeo makes money? I imagine it’s from the sales of merchandise from the vending machine? If so, I was wondering if rapidly changing product formats or even worse, product type would unavoidably increase the cost of goods sold simply because the company would not be able to leverage the economies of scale of bulk purchases? Alternatively, would Centimeo consider licensing their vending machine capabilities to companies like PepsiCo who will pay flat fee + commission based on sales?
Very interesting read. 3D printing has been a concept for a while but the application at scale is still not seen viable. From either cost or time spent perspective. Another concern is that mass product does not need personalization because personalization is expensive, and the product will not be mass anymore. What do you see this startup’s trajectory moving forward?
I enjoyed reading your thoughts on the applications of 3D printing, particularly the possibility of apply crowd sourcing techniques to creating the design of these vending machines. In an age of customization and personalization I believe your idea could be a great way to engage with the consumer. Indeed it would be a good way to market the vending machines. I see regulatory and distribution risks (are the vending machines of different shape legal? can we bring enough product to stock them without incurring on heavy costs?) that once solved will undoubtedly bring success to your plan.
Very interesting topic! I agree that vending machines are in need of a technological and aesthetic refresh, especially in urban areas where space comes at a premium. I wonder if there is opportunity for keeping one modular “shell” and just using 3D printing for the interior fixture that would be perfectly customized to the product. This would allow for frequent changes in product assortment since the fixtures could be relatively easily updated via 3D printing. This way, different companies could also rent out the machines for a limited time, only needing to supply their interior fixture and their product.
Definitely something out of the (vending machine) box! This is a very interesting take on making additive manufacturing more flexible and iterative. It also brings 3D printing to a much more consumer-friendly and scalable approach. Everything I’ve read so far is something that only large corporations that have the resources to invest in for large scale R&D, but also this could be way more accessible for SME’s and smaller D2C businesses. If you could make this so nimble and flexible to customer demand as vending machines, you could make a singlur vending machine be able to sell anything! It could so much more effectively utilize every single location!
It is interesting to see that 3D printing is helping with increasing efficiency in iterating distribution systems. Often, 3D printing is thought about in a manufacturing context. Although the application outlined in the article is manufacturing, but its end application shows the immense potential of additive manufacturing and the agility of the technology.
This was an interesting and informative read! Thank you for providing color to the vending machine industry, and sharing how new technology has the potential to impact an unchanging, and (at least by me) overlooked object. In my mind, vending machines are simply part of the backdrop of everyday life, and before this article, I had never thought of them in the context of machine learning, open innovation, or 3-d printing. But, precisely because the vending machine is so quotidien and has gone unchanged for so long, are there likely many yet-to-be-thought-of uses and applications of new technologies. The most advanced tech I’ve ever seen on vending machines is a credit-card reader. I’m curious to know more about the laws surrounding vending machines. If they are present in public spaces, does one require a permit?
Your footnotes are a delight– such varied & compelling sources.
Before this article I had never considered how 3D printing could drive innovation in the vending machine industry. As you noted in your final paragraph, there are actually so many use cases for vending machines in locations that don’t typically have them. 3-d printing as a prototype mechanism would be especially valuable here given the flexibility that would be required to know if a certain shape, size, or functionality of a machine were appropriate for a certain setting. In a broader context, it may also be useful for cities to adopt this type of technology as a way to offer free guides to the city, feminine products for the homeless, or even free water to kids when it’s hot. This is inspiring so many great ideas!