Starbucks Corp.’s partnership with Green Mountain Coffee Roasters in the single-service coffee pod market created $5 billion in shareholder value for the two companies when it was announced last week. Unfortunately, that amount was split evenly between the two companies, and Starbucks shares soon gave up most of the bump from the news.

The market’s reaction suggests that Starbucks could have created more long-term shareholder value by acquiring Green Mountain and introducing its Keurig brewing technology internationally. That potentially could have made Starbucks a major player in the global single-serve coffee market.

The Green Mountain deal follows Starbucks’ cancellation of a distribution agreement with Kraft Foods Inc., (Kenco Singles and Tassimo) which among other things had given Kraft the right to sell Starbucks coffee for pod brewing machines. But cutting ties to Kraft, Starbucks has hoped to regain control over key areas of potential growth in both the grocery aisle and single-serve. Kraft lost against the split but is still pursuing damages.

It can be argued that the new Green Mountain alliance will only pay dividends in the long term so it should not have a dramatic impact on Starbucks’ stock. But the fact that Green Mountain’s stock ran up 40% on the news versus 10% for Starbucks shares and Starbucks has retained only a third of those gains while Green Mountain has held onto 85% suggests that Starbucks management left value on the table.

Starbucks is playing the role of kingmaker for Green Mountain’s Keurig brewing system. Keurig has an installed base growing 5 million units per year and accounted for five of the top 10 models representing 50% of holiday sales dollar volumes in the U.S. But there is a long way to run, as single-serve machines have penetrated only about 6% of U.S. households, and 80% of Starbucks customers don’t own one. Of those that do, 25% indicated in a recent Morgan Stanley survey that Starbucks would be their primary single-serve brand.

Under the agreement, Green Mountain brewing machines will be distributed via Starbucks’ 11,000 domestic retail outlets, nearly a 50% increase over Green Mountain’s 23,000 current locations.

Gaining access to the Starbucks brand is a coup for Green Mountain, which now has licenses for four of the top five coffee brands in the U.S. — Folger’s, Starbucks, Dunkin Donuts and Green Mountain. In addition, it bought itself protection from Starbucks, which might have developed its own machines or partnered with one of Green Mountain’s pod rivals.

Given the value contributed by Starbucks, it’s hard to see why Starbucks’ management didn’t make a bid for Green Mountain and the Keurig technology. Green Mountain had hit a high of $47.81 on February 14 on media reports of partnership talks with Starbucks before falling to $40.16 when Starbucks suggested it was considering a range of single-serve alternatives.

Green Mountain’s founder still serves as chairman and he and his children control 18% of the company, so Starbucks could conceivably have offered a modest premium to the recent highs. Starbucks could have offset dilution by raising leverage for a cash-and-stock bid.

Green Mountain’s stock price now appears to factor in the possibility of expanding the partnership internationally, where Starbucks has nearly 6,000 additional outlets. The international singer-serve market is seven times as large as the U.S.

However, the Starbucks deal covers only the U.S. Starbucks appears to be taking a hardware-neutral strategy, and it is free to partner in other countries with regional market leaders. Any value currently ascribed to Green Mountain on account of the international potential could easily be transferred to a prospective partner in Europe such as Sara Lee Corp., which uses machines from NACCO Industries Inc.’s Hamilton Beach Brands.

Having risked a damages award to end the relationship with Kraft — damages some analysts estimate could run as high as $1 billion — Starbucks shareholders may fairly ask why management didn’t capture more of the $2 billion created for Green Mountain shareholders by the new partnership.

The small segment of the high-end coffee market has been getting a lot of attention lately, due in part to the pending dissolution of a deal between Kraft and Starbucks Corp whereby Starbucks provides coffee for Kraft’s Tassimo one-cup brewer.

Kraft and Starbucks are disputing the terms of ending their partnership, by which Kraft also distributes bags of Starbucks coffee at supermarkets.

Despite the dent in sales the loss of Starbucks would cause, Kraft Chief Executive Irene Rosenfeld said she was committed to that business.

“Single serve has been an important part of our portfolio. It’s growing quite nicely around the world and we expect that that will continue to be a key part of our coffee portfolio,” Rosenfeld told Reuters at a conference in Boca Raton, Florida.

Kraft also sells the mid-range coffee brands Maxwell House and Yuban. It is unclear what premium brand will replace Starbucks and Kraft has declined to comment on any specifics, given the ongoing fight with Starbucks.

COFFEE GETS BUZZ

The demise of Starbucks’ partnership with Kraft has led many to wonder what the world’s biggest coffee maker will do next as it seeks growth outside its namesake cafes.

Marcel Smits, chief executive of Sara Lee, which has the Senseo brand one-cup brewer, said the flurry of headlines and focus on the single-serve market are good for the industry and prove coffee is an exciting business.

“It adds buzz to the category,” said Smits at the same industry conference.

The buzz comes as Sara Lee is planning to split into two companies — one focused on its North American meat brands such as Jimmy Dean and Hillshire Farm, and one on coffee and tea brands such as Senseo, Douwe Egberts and Pickwick.

Green Mountain also announced a deal on Tuesday with Dunkin’ Donuts to bring that company’s coffee onto its machines. Analysts said bringing in such a popular brand lessened the potential competitive threat from Starbucks.

MORE THAN JUST THE COFFEE

While companies like Sara Lee and Kraft spend a lot to market their coffee brands, their electronics partners spend a lot to market the machines, said Sara Lee Chief Financial Officer Mark Garvey. Since many purchases are driven by hardware, the coffee makers sometimes offer brands for rival machines.

For example, in Europe, Sara Lee sells L’Or espresso capsules for Nestle AG’s Nespresso machines and Kraft sells Carte Noir coffee made for Senseo machines.

When asked if Senseo would make coffee for Keurig machines, Smits said it was too early, since the brand has such a little presence in the United States, where Keurig has more than an 80 percent share of the market.

“If we would have a very big brand, I guess we’d start thinking about it putting it into Keurig machines. But we don’t have a very big brand here in the U.S.,” Smits said.

Of Senseo’s total 2010 sales of $536 million, the United States only accounted for $20 million.

Smits, who was named permanent CEO last month after serving on an interim basis since May, said Sara Lee’s beverage business will take aggressive steps to compete with Nestle, the world’s largest food company.

“In Europe, it’s obvious the Nestle people, they have an ambition. There’s other people out there who have less of an ambition,” Smits said. “We have an ambition. We want to play. We will throw everything we have at that category.”

Popularity of vending machines has increased in times. A number of factors contributing to its popularity include convenience, accessibility, time saving, and branding, eating habits while offering diverse range of quality products.

Dating back in 1880s, vending machines are rectangular-shaped box, standing up and selling certain kind of goods/services. Over the years, vending machines evolved to meet the sensitive needs of consumers, from bubble gum, coffee, sodas, chips, chocolate, fruits, vegetables, and even napkin and tampons. They are unattended in exchange of monetary payment. Recent innovations include healthy vending machines, cashless payments and LCD monitoring for nutrition facts. These fresh vending machines include fresh juices, fruit, veggies, yogurt and other healthy snacks and drinks

While the meltdown in economy temporarily moderated the growth of vending machines, it is expected to pick up by year 2015. Global Industry Analysts, Inc. (GIA), a research firm catering to major industries worldwide announced that vending machines installation will reach 35.2 million in 2015, from 32 million this year. According to GIA, growth during this period will largely increase because of changes in consumer food consumption habits leaning strongly towards 0healthy lifestyles.

GIA study shows that Japan and the US accounts for the 50% of the global installed machines and topping the list in the industry includes American Vending Machines, Inc., Azkoyen SA, Fuji Electric Retail Systems Co., Ltd., Glory Ltd., GTECH, Maas International, Tomra Systems ASA, and Westomatic Vending Services Ltd.

Technology advancements have made the vending machine industry more cutting-edge, offering benefits to modern time consumers, infusing reliability and the quality of the service and products being offered. Nowadays, due to health conscious public, more and more vending machine companies are selling fresh, organic foods, low-carb high-fiber food and fruit-based beverages.

In addition, vending machine these days offers cashless transactions via credit, debit card, and other cashless payment systems. Some have increased sophistication in equipment engineering by developing multi-functional machines capable of operating at multiple temperatures. It can well be noted that vending machine industry has weathered the recession better than other several businesses. This is because vending machines are the mirror of our fast paced society where convenience and accessibility is the public’s priority.

Enjoy premium drinks with the Flavia drinks system

It can be difficult to recreate the drinks you enjoy from the barista at your local coffee shop, as vending machines so often disappoint. Not so with the Flavia drinks machine, a premium quality design which uses only the finest ingredients to make beverages for all to enjoy on a morning break in the office. The daily runs to the coffee shop can be expensive but with the Flavia Creation 400 you can enjoy coffee shop quality with ease and convenience and without the coffee shop prices.

The Flavia Creation 400 was specifically designed for the office environment. It provides a wide range of beverages with minimal fuss and cleaning up. The drinks all come in individual filter packs which ensure that each drink is fresh, flavourful and give off a tempting aroma during creation.

Working on the basis that any office will have peak demand periods, the machine has been designed to ensure a quick start up and delivery time, minimising the otherwise inevitable queue for refreshments. It employs a tank system in which the water is heated to the optimal temperature for the specific drink selected.

With ever greater focus on environmental issues, the system conserves energy by boiling only the quantity of water that is necessary. The machine can also be plumbed into a water supply, removing the time and resource costs associated with re-filling.

Staff will be spoilt for choice with the range of beverages that come with the machine. More flexible than traditional coffee machines, the Flavia can offer ten different types of fresh ground coffee, giving plenty of variety for the coffee connoisseur.

These include a smooth roast, strong Arabica, a frothy cappuccino and an espresso full of body and aroma. There is also a decaffeinated coffee. Other team members may appreciate the wide range of teas including English Breakfast, Earl Grey and fruit teas, together with a wonderfully rich and decadent hot chocolate.

Please explore our website for more information as to the advantages of the Flavia Creation 400 in the workplace. The system comes with a range of accessories to fulfil a variety of customer needs, for example base cabinets and paypods for coin or token operation. To find out more, please contact our customer service team who will be happy to answer any questions.

Changing trends at work

So how did we move from being a nation of tea-drinkers, to a nation of fine coffee lovers? Most of us are now used to having refreshments on demand. And yet, the old-fashioned traditions of tea ladies, mid-morning trolley runs and staff canteens are rapidly disappearing, as office space becomes ever-more expensive and support services are outsourced. Self-service is also increasingly popular, reflecting our desire to eat when we wish (and when our working patterns allow), enjoying high quality food and drink on the run.

As a result, we have seen a significant rise in the number of vending machines and Flavia coffee making machines in the workplace, together with offerings from other brands. These have been accompanied by hot water boilers and mixed beverage units, providing other hot drinks such as tea, hot chocolate and soup. On-demand drinks are ideal for meetings, gatherings of an informal nature and simply as an opportunity to escape the desk for a few minutes and benefit from a change of scene.

Why coffee machines?

Britain is becoming increasingly sophisticated in its tastes, reflecting influences from European, Arabic and other global locations. These have brought us into contact with new flavours, foods and their associated producers. Flavia is one such brand, providing high quality coffee machines for the office environment and allowing staff to pick their favourite coffee blends and enjoy them on the go. No more queues for lukewarm coffee flavoured water at the cafeteria.

It is far more satisfying for staff to offer contractors or customers a decent cup of Flavia or other branded coffee from a high-quality espresso machine. Contrast this with the experience of stirring a mug of unrewarding instant granules. Expectations are rising and the range of products is evolving accordingly.

The trend towards high quality coffee and accompanying snacks in the office through the use of the latest generation of vending machines is equally good news for employers. Costs are minimised through a self-service, automated approach in sharp contrast with the traditional need to hire serving staff or external caterers. On-site machines also reduce working time lost through trips to the nearby coffee shop.

For further information on the latest generation of vending solutions, why not contact our friendly team today?

If you are currently thinking of ways to improve or simply maintain the level of staff morale in your company then look no further than our clever range of vending machines that we believe that they can have significant impact on a working environment, the ethos of your company and even productivity levels.

Whether you’re thinking small scale with the likes of table-top coffee machines or larger scale ‘in-cup’ technology machines with self-cleaning action, the main things to think about when picking suitable vending machines is the size (for a very small office, space is in high demand and you will be unlikely to want to compromise a lot of it) and budget (at Nexus Drink systems we pride ourselves on having a varied price range to suit every wallet).

We stock a massive range of vending machines but a few examples that we feel are appropriate to the work place stretching from small table top coffee makers provide luxury coffees such as lattes and cappuccinos, are perfect for a show room or boardroom or a very small scale office. Our Larger Coffee machines work well for larger office spaces yes, but also warehouse spaces and open plan areas and then of course we have the in-cup technology which guarantee delicious, freshly-made drinks (not just coffee!) that include many well-known brands including Nescafe Gold Blend, Kenco, Maxwell House and many more with the added bonus feature of a self-cleaning function which will minimise its operating time drastically.

So whatever the size of your business is you are looking to give your employees a boost in morale, team spirit and of course a little caffeine, why not take a look at our collection of appropriate vending machines online we are sure that you will find a model to match your needs and your you budget, all of our drinks dispenses are well priced and on top of that good value for money due to their durability. Should you need a little extra help differentiating between models and makes do feel free to contact us with any queries or for further information.

Here at Nexus Drinks, we sell top quality vending machines suitable for the workplace, reception area, restaurants, pubs and more. Our blog has been following stories and news releases for a long time now but still we still find some of the items on offer in countries, such as Japan, truly astonishing. Years ago, you were more than likely to use a vending machine for a quick snack or beverage but these days it can be quite surprising to see the sorts of items that can now be purchased here.

Japan takes top place for the variety and quantity of strange items available. Bottled sweat, single cigarettes, groceries, video cameras, bananas, eggs, Ikea spare parts, a smart car and, quite conveniently, flowers for when you have forgotten a special day or birthday – all can be obtained from stand-alone vending machines.

Equipment selling strange items is not only popular in Japan but North America is also embracing the world of eccentric vending items. One of the more convenient are the fishing bait vending machines – fishermen do tend to go out to catch their fish at strange hours of the night and at this point bait shops are generally closed so, in a way, it makes sense; what’s more, they can provide both live and frozen bait (in Nanging, China where live hairy crabs are a delicacy, you can even purchase the crabs live from a vending machine).

Some are quite controversial and have caused a stir amongst the public. For example in Philadelphia a vending machine selling the morning after pill at the university campus in Pennsylvania prompted much debate and even an investigation.

The Hudsen Hotel in New York stock convenient luxuries for guests in their vending equipment including designer jewellery and clothing, 24 carat gold handcuffs, an $8000 photo shoot with a celebrity photographer and a $10,000 Ferrari rental!

As further evidence of their capacity for luxury, in LA the first ever caviar vending machine was recently launched for the wealthy business man on the run. It stocks caviar from all over the world and also offer other gourmet items such as truffles, escargot, Bottarga blinis, gourmet salts and caviar accessories. Amazingly, these aren’t even new – apparently they appeared in Moscow over 2 years ago!

Whilst they may be less wacky, Nexus vending machines are still ideal for the workplace, meeting room and reception area and will provide your staff, colleagues and visitors with a range of hot delicious beverages. For more information, visit the website today.

Coffee or Tea? With vending machines, you don’t have to choose

Employers looking to provide hot drinks for employees while optimizing employee satisfaction, look no further. With so many different drink options, it can be difficult to know what employees in an office setting prefer to drink during the workday, so why not offer a variety? Modern day vending machines offer hot drinks such as coffees, teas and other specialty drinks sure to please any palate. For a great variety that is great for the workplace and energy efficient, the Flavia Creation 400 really has it all.

For coffee drinkers, the Creation 400 really covers all of its bases. The system utilises the Alterra Coffee Roasters brand, whose packets contain both the coffee and the filters needed for brewing. There are more than ten coffees to choose from, ranging from light and smooth, medium and balanced, medium and bright, dark and intense, and flavoured and decaffeinated. This office drinks dispenser will be sure to keep everyone awake and on task and satisfy any coffee lover’s tastes.

Tea drinkers will not be disappointed with this vending machine’s tea varieties. With four kinds of black tea, including decaf, three herbal infusion teas, and two green teas to choose from, no one will be left wanting. The Flavia Creation 400 system employs The Bright Tea Co. for all of their teas, a new brand launched by Mars Drinks in 2010.

Lastly, these hot drink machines also offer specialty drinks. These can be a nice pick-me-up and break from the ordinary in the workplace when an employee has had a particularly long day. The options are a cappuccino/latte swirl, Mars Swirl, and Galaxy hot chocolate. The hot chocolate would be especially enjoyable on a cold winter’s day.

The government has been asked to make an exception for cranberry juice in its assessment of these school vending machines. It has been pointed out that cranberries also have a role to play in combating urinary-tract issues and may also have the potential to fight cancer.

Interested in having one of these machines in your office? The machine has settings to be free of charge for users, or require compensation to help buy back some of the cost. There is also a water pump system option so that users do not have to manually pour their water into the machine. Visit Nexus Drink Systems Limited’s website to enquire and get a quote for your office.

Tweet to Use New Vending Machines

A South African company has come up with an unusual way of ordering beverages – you can choose and demand a cup of iced tea by tweeting the instructions to the vending machine.

The company responsible for this new idea is called BOS and the novelty of the technology has meant that it has featured widely in the industry press. These innovative vending machines are called ‘BEV’ and they are operated by the hashtag on the tweets they are sent. The customer does need to be standing in front of the drinks machines when tweeting, however.

There are few of these vending machines around as yet. They are by no means as mainstream as, for instance, the more traditional machines in the Flavia range. At present, you would need to travel to locations such as Wembley Square in Cape Town in South Africa in order to find one.

In addition to being tweet-operated, these new vending machines boast a number of other features to impress customers. The technical facilities include speakers, a camera and microphone and coloured LED lights which shine when a beverage is dispensed. In addition, the customer can view a little video screen which shows a video feed from a camera connected to the ‘arm’ that picks up the drink.

The machine talks too! A robot-like voice tells the customer to enjoy the drink once it has been dispensed. A series of programmed messages are designed to engage customers when they are waiting for the drink and these messages are repeated on a red LED display, which incidentally also adds some tension to the experience by giving the customer a countdown to the delivery of their order. The entertaining messages include, “You look thirsty, human. Let me help you”.

And what is it that this all-singing, all-dancing machine dispenses? It’s a tea that is said to be based on organic teas from a local plant called Rooibos. This is a typical South African beverage that can be drunk with milk, sugar, slices of lemon or some honey for added sweetness.

However, if you are looking for a rather more conventional vending machine, there are plenty which produce excellent blends of coffee and other reassuringly mainstream drinks. Please browse our selection to find something which suits you, human!

Cranberry Juice for School Vending Machines?

According to several recent news stories, it appears that the US government is considering how to monitor what goes into school vending machines and eateries. The First Lady, Michelle Obama, has created a ‘Let’s Move’ initiative to counter obesity. One of the many issues that the administration plans to examine is whether or not beverages which have been sweetened, such as cranberry juice, are appropriate for children.

It has long been understood that there is significant nutritional value to cranberries – they have high antioxidant properties, in addition to other positive characteristics. However, those in the cranberry industry argue that they are too ‘mouth-puckeringly tart’ for consumption unless they are sweetened.

So if companies that can provide an office drinks dispenser to businesses, such as Flavia, want to branch out into the education sector, they may want to consider this new-found interest in the nutritional value and sugar content of drinks provided to children.

There have been some objections to the targeting of cranberry juice. In one notable example, the spokesman for the Wisconsin State Cranberry Growers Association has been quoted as objecting to the classification of this drink as unhealthy. This, he argued, ignores the other healthy properties of the drink.

The government has been asked to make an exception for cranberry juice in its assessment of these school vending machines. It has been pointed out that cranberries also have a role to play in combating urinary-tract issues and may also have the potential to fight cancer.

However, the general initiative is widely held to be a good thing in principle. With obesity reaching almost epidemic proportions in many Western economies, there is clearly a need for action. What our children consume while at school will undoubtedly have a long term effect on their health. Thus any effective programme must address the nutritional habits formed in the early years.

You may or may not want to become involved in the debate about the nutritional value of products made available to school children. But if you are considering reviewing vending machines and drinks dispensers, it is worth taking the time to browse the relevant pages of this site. Alternatively, you can always contact our team to ask questions or to obtain further information about the products available.