• Gambling and Change Machines


• Products and Services Sold

Definition: Mechanical devices that dispense commodities (often food, beverages, or cigarettes) in return for money
Significance: The popularization of vending machines as a means of selling a variety of products revolutionized American marketing in the twentieth century. As vending machines, and the security surrounding them, evolved, the variety of products distributed increased manifold.
The first vending machine in recorded history was invented in 215 b.c.e. by the ancient Greek mathematician Hero. That first machine was a coinactivated device that dispensed sacrificial water in an Egyptian temple. It was eighteen hundred years later that the next recorded vending machines were made. In 1615, snuff and tobacco vending boxes appeared in English taverns. These tobacco machines were less sophisticated than was Hero’s, since they left much to the honesty of the customer. All an inserted coin did was open the box. Once the box was open, customers could take out as much tobacco as they wanted. One of the first U.S. patents on a vending machine, used to sell postcards, was issued in 1886 to Frederick C. Lynde.
If any one person can be considered the father of vending machines in the United States, it would be Thomas Adams, the founder of the Adams Gum Company. Adams began the first successful vending operation in America in 1888, when he placed gum machines on the elevated railroad platforms in New York City. Other early vending machines included scales (which vended a service), strength testers, and hot water vendors (which served people who had no other source of hot water). These were followed around 1900 by cigar vending machines in Chicago and an automatic divorce machine in Utah.
Gumball vending machines were introduced in 1907, at the same time that the round gumball was invented. Vending machines soon offered everything: In Philadelphia, a completely coin-operated restaurant called Horn & Hardart Automat was opened in 1902 and stayed open until 1962. In 1926, the American inventor William Rowe invented the cigarette vending machine. Cigarette vending machines remained popular until the 1980’s, when state laws began restricting the sales of cigarettes to minors. The machines fell out of use, because there was no way to keep children frompurchasing cigarettes from them. One of the major early manufacturers of vending machines was the Vendorlator Manufacturing Company of Fresno, California. The company’s machines of the 1940’s and 1950’s primarily sold bottled soft drinks, and they later came to be considered classics.

Gambling and Change Machines

During the late nineteenth century, coin-operated gambling machines (slot machines) became popular. The vending machine industry does not consider gambling machines to be a part of the vending industry, because they do not vend merchandise. They are also much more heavily regulated than are vending machines, so the logistics of placing them are considerably different. The machines nevertheless affected the industry, inducing it to research the dangers of fraud. During the early twentieth century, a nickel with a string tied to it or a lead slug could be used fraudulently to trigger a slot machine or a vending machine. It was not until the 1930’s that the slug rejector was perfected.
The invention of the slug rejection device led to growth in the vending machine industry during the 1930’s and 1940’s. In addition to boosting the slot machine industry, slug rejectors prevented children from stealing gum or candy from machines. As a result, gum and candy vending machines became commonplace. By the 1960’s, soft drink and coffee machines were equally ubiquitous, as were newspaper machines and even stamp machines at post offices. Occasionally, fishing enthusiasts could find vending machines next to their favorite fishing holes that dispensed cans of wormson the deposit of a coin.
The main advantage offered by vending machines is their convenience. Machines are not restricted to an eight-hour workday; they can provide goods and services around the clock. Moreover, they are much cheaper than paid labor. Machine owners must still pay employees to restock and maintain machines (or do it themselves), but they do not need to pay an hourly wage to a salesperson.
Change machines are also not considered a part of the vending machine industry, although they are often found next to machines that take only coins. Change machines thus contribute to vending machine sales, but like gambling machines, they forma separate if related category.

Products and Services Sold

Soft drink machines were introduced just before the turn of the twentieth century. By 1906, the improved models would dispense up to ten different flavors of soda. The drinks were dispensed into a drinking glass or tin cup that was placed near the machine (there was usually only one glass or cup to a machine because paper cups had not yet been invented). Health officials were concerned that everyone using the machine drank from the same cup. Then, vendors began setting buckets of water next to the machines, so each customer could rinse the cup before drinking from it.
The year 1909 witnessed the invention of the pay toilet. Although pay toilets remain popular in other countries, they have largely disappeared from the United States because of arguments that they discriminate against women.
The 1930’s witnessed improved machines. In addition to slug rejectors, change machines were perfected during the decade. These improvements led marketers to experiment with vending machines. Coin-operated washing machines were introduced during the 1930’s: During the Great Depression, some appliance dealers attached coin-metering devices to washing machines that they sold. People who bought the machines on credit were thus able to accumulate money to make their monthly payments by using their appliances. Soon, enterprising appliance dealers placed such coin-operated washing machines in apartment-house basements. Eventually, dedicated coin-operated laundries appeared.
Following World War II, there was a surge of innovation in the vending machine industry. Much of that surge was due to the discovery of vending machines by industrial management. Before the war, the management of most factories had been merely tolerant of vending machines, but they soon discovered that the machines could be a low-cost means of keeping workers happy. They kept workers on the premises during breaks, and the easy availability of candy bars and soft drinks increased productivity. As a result, the demand for vending machines exceeded the supply during the late 1940’s.
Despite advances made by the vending machine industry during the 1950’s, one major limitation to the industry’s growth remained until the early 1960’s: Vending machines could sell only low-priced items, because machines could accept only coins. The early 1960’s witnessed the invention of vending machines that would accept and make change for paper currency, paving the way for the industry’s expansion into more expensive grocery items, as well as various kinds of tickets.
The first use of vending machines to issue tickets was at an Illinois racetrack, where pari-mutuel tickets were dispensed on deposit of $2. Penn Central Railroad became one of the first transportation companies to sell tickets by means of vending machines. These machines, used in high-traffic areas, permitted passengers to buy train tickets without the need to interact with a person. They accepted one-dollar bills and five-dollar bills as well as coins.
There are problems involved with the use of vending machines. Primary among these are mechanical failure and vandalism of the machines. Moreover, not every product can be successfully sold by machine. Several requirements make some goods more suitable to machine vending than others. First, the most successful products will generally be those that consumers are predisposed to purchase, such as those already supported by national advertising campaigns. Second, products must enjoy a high turnover to justify the costs of purchasing, deploying, and servicing machines. A third factor is the relationship between the location of machines and the location at which products will be consumed or used. Usually, products must be usable within a short distance of the machine; otherwise, consumers might prefer buying them at dedicated stores.
Although tangible merchandise is the most commonly sold category of vending machine commodity, services are also offered. Coin-operated laundries are among most common service vendors. Other machines that sell services include scales, parcel lockers, and pay toilets. Some motel beds include a coin-operated massage feature, and coin-operated telescopes and binoculars are located in national parks, on the roofs of major skyscrapers, and at other tourist locations. Coin- and card-operated copying machines have experienced a large boom, particularly in libraries and at twenty-four-hour copy stores. Perhaps the most ubiquitous single servicevending device, however, is the parking meter.
Advances in telecommunications have made possible the use of credit cards to operate vending machines. Such devices are most common in locations that also have human cashiers with credit card machines. Thus, one can use a credit card at a machine to purchase transportation tickets, motion-picture tickets, or copies at a copy center. Even soft drink machines may occasionally accept credit cards, however. The technology behind these machines is related to that behind automatic teller machines (ATMs). The latter devices are not considered to be part of the vending machine industry proper, but swift, secure verification of financial information is necessary for both devices to operate. Similarly, while not technically vending machines, creditcard- operated gasoline pumps have increased the number of twenty-four-hour service stations and changed the way people buy gas. The influence of credit cards on the vending machine industry will most likely grow in the future.
The United States is not alone in the development of vending machines. In fact, the United States is not as advanced as some other nations of the world. For example, in Japan, credit-cardoperated machines have been used widely since the 1960’s. The future will see a broadening of product lines offered in vending machines, as marketers recognize the opportunities that exist in automatic retailing.

Further Reading
Amann, Fred. “Automated Cashless Services: A Trilogy.” Vend, March 15, 1970, 19-20. This article from the leading journal for vending machine operators discusses the role of vending machines that accepted credit cards in 1967.
“From Peanuts to Panties.” Sales Management, June 3, 1960, 38-42 and 116-118. Provides highlights from the history of vending machines and includes an extensive discussion of the variety of products being sold via vending machines during the late 1950’s.
Hanna, Charles. The Vending Industry: History, Trends, Secrets, Opportunities, Scams. Kearney, Nebr.: Morris, 2001. The sections on history and scams are particularly useful.
Manning, W. J., Jr. “Automatic Selling: A Business in Billions.” The Management Review, October, 1960, 15-21. A history of the vending machine industry that emphasizes technological breakthroughs.
Schreiber, G. R. A Concise History of Vending in the U.S.A. Chicago: Vend, 1961. Short history of vending machines published by the leading journal in the industry.
Segrave, Kerry. Vending Machines: An American Social History. Jefferson, N.C.: McFarland, 2002. Traces the influence of the vending machine in American culture from its beginnings through the end of the twentieth century; includes an extensive bibliography and index.
See also: Cola industry; Credit card buying; Currency; Drive-through businesses; fast-food restaurants; Motion-picture industry; Retail trade industry.