Sales Per Vending Machine Accelerates in Japan. Coke Dominates

From Beverage Digest 8/27/99

Sales Per Vending Machine Accelerates in Japan. Coke Dominates.

Japanese soft drink vending machines ring up $17.95 bil in sales from 2.3 mil machines during 1998; "soft drink" category in Japan includes CSD, teas, coffees, other non-alcoholic beverages. Vending channel moves about 40% of Japanese soft drink volume (BD 1/28/99) vs 11.9% in US. Coke holds top share (table); adds 18,000 machines in 1998, according to independent data. Since 1993, overall sales growth in vending channel far outpaces growth in number of machines. Vendor sales increase +22.7%, while vendor census is up +8.7% according to industry analyst Hisashi Nakai. Nakai says average sales per machine "have been steadily growing ... mainly thanks to the increasing number of larger and sophisticated (new) machines." In visit to Japan early this year, BD notes 350-ml cans of brand-name soft drinks generally sell for $1.05 in vendors. Also, Matsushita and Sanyo now offer machines vending 500-ml PET.

Japan Non-Alcoholic Drinks Vendor Census

	1998	1998	Machines
Company	Vendors	Share	+/- vs. 1997
Coca-Cola	870,000	38.1	+18,000
Suntory/Pepsi	310,000	13.6	+5,000
Dydo Drinco	212,000	9.3	flat
Kirin	152,000	6.7	+17,000
Asahi	146,000	6.4	+16,000
Unimat	105,000	4.6	+5,100
Pokka	99,000	4.3	-1,000
Ohtsuka Pharm.	90,000	3.9	flat
UCC Deshima Coffee	80,000	3.5	flat
Ito-en	51,000	2.2	+6,000
Others	166,000	7.3	-40,600
	2,281,000		+25,500

Trends. In 1998, Coke system adds most vendors; Pepsi/Suntory also up (table). Nakai: "Coke, Suntory, Kirin, Asahi and Ito-en have been actively increasing the number of vendors. Other players mostly replace the old machines (with) new, larger machines." Adds: "The available locations for installation (of new outdoor machines) have been getting scarce." Coke system executive previously tells BD potentially 1 mil new locations exist, but "mostly indoors."

Data. Census per company in table based on industry sources. Overall total from Nakai.

Value. Nakai says total soft drink vendor sales increased +3% to ¥2.348 trillion in 1998 vs ¥2.280 trillion in 1997. Manufacturers. Nakai says Fuji Denki Reiki is top seller of vending machines, with 70,000 sold in 1998. Other big players include Sanden, Sanyo, Toshiba, Kubota and Matsushita. Perspective. Japanese soft drink executives previously tell BD that vending channel's share may wane as C-stores and supermarkets grow. Soft drink vendors far outnumber other vendors. Nakai says 173,400 machines sell "milk/dairy drinks" in 1998, with census up +0.9%; 187,200 vendors sell hot coffee/cocoa, down -2.5%; and 153,100 machines sell beer/liquor, down -9.9%.

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