Automatic Age

Issue: 1929 July

th e a u t o m a t ic a g e
Vol. 5
0
CHICAGO, JU L Y , 1929
No. 12
U N IT E D STA T E S F O R E IG N T R A D E IN
C O IN -O P E R A T E D M A C H IN E S
By E. A. K IE F E R , Specialties Division, Department of Commerce
The first vending machines were
introduced into the United States in
1888, from England, to be used by
an American gum manufacturer in
distribution of his products.
Domestic manufacturers of these ma­
chines began shortly afterwards but
*t has been only in comparatively re­
cent years that the industry has pro­
gressed from small machines vending
gum and chocolate to automatic
merchandising machines selling all
types of commodities and services.
Automatic retailing is becoming more
Profitable and popular as a result of
recent mechanical improvements and
new labor-saving features, and now
automatic stores are being installed
and proving successful in the larger
cities and expansion into the field of
grocery retailing is contemplated. As
a distributive instrument, the coin­
operated machine has arrived, and
bids fair to become of still greater
importance in catering to the every­
day needs of the people.
There has been manifested in re­
cent years a growing interest on the
part of the buying public of the
world in mechanical salesmen of
goods, ^services, and entertainment,
and, in turn, American automatic
machine manufacturers are devoting
more of their attention to export
markets and are finding here and
there profitable outlet overseas for
their products.
The introduction of automatic
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coin-operated machines in foreign
countries, outside of Europe, where
they are familiar objects, is some­
what of an adventure. Markets ap­
parently barren of prospects have ab­
sorbed a considerable number of ma­
chines, as in the case of Siam and
Venezuela.
Other markets, where
conditions appeared more favorable,
have proved less responsive to initial
efforts.
Saleability of vending machines de­
pends largely on their utility, novelty
or adaptability. Utility is of prime
importance in the sale of coin-oper­
ated machines in the home market,
where saving of time and wages is
a governing factor. Novelty would
be the predominating factor in the
Far East and in sections of Latin
America, where cheap labor abounc’ s.
Adaptability
is
essential
in
all
foreign markets, since coin-operated
machines sold abroad must be design­
ed to operate with foreign coins and
to
withstand
climatic
conditions
which rust or clog the machinery and
spoil the merchandise. Unusual dif­
ficulty is presented in such countries
in China, where coins in a great vari­
ety of sizes are in circulation. The
machines -must offer a commodity or
service for which there is a demand.
It should be remembered that in
many sections, there is little interest
or demand for foreign confectionery.
Machines having a luck or chance
feature are prohibited in many coun-
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12
T
he
A
u t o m a t ic
tries.
Importation or operation of
spring scales is prohibited in some
countries.
Domestic Production
The coin-operated machine indus­
try in the United States has grown
remarkably since 1919, when the
first census of the industry was
taken, showing an increase in the
value of production of 328 per cent
in the eight years from 1919 to 1927.
According to the Bureau of Census,
in 1927, the value of production of
coin-operated machines based on the
f. o . b. prices of machines manufac­
tured amounted to $7,058,921 as com­
pared with $4,202,106 in 1925. A l­
most 10 per cent of the domestic
production of coin-operated machines
has been exported during the part
two years.
Exports— World Distribution
In the first quarter of 1929, 3,529
coin-operated machines valued at
$177,822 were exported from the
United States1 to foreign countries.
A s exports of coin-operated machines
have been classified only since the
first of January, 1929, an accurate
comparison with previous periods
cannot be made.
However, an in­
formal questionnaire submitted to
the trade in September, 1928, indi­
cated that the value of exports of
all types of machines in 1928 amount­
ed to between $650,000 and $800,000,
as compared with an estimatr- for
1927 of about $600,000.
Shipments of commodity vending
machines in 1929 have had a wider
distx*ibution
in overseas
markets
than other types of coin-operated
machines, going to 27 foreign coun­
tries, including 11 in Europe and 8 in
Latin America. Other coin-operated
machines were distributed to 21
foreign
countries,
although
the
United Kingdom took over 60 per
cent of the shipments, while scales
wei*e exported to only 16 countries,
© International Arcade Museum
A
ge
half o f which were in Latin America.
Europe was the largest regional mar­
ket, with Canada second, and Latin
America third.
Largest European Market for
Machines
Total exports to Europe in 1929
were valued at $114,207, the United
Kingdom, which is the principal mar­
ket, taking $96,194 worth, or 84 per
cent.
Coin-operated service and
amusement machines have been the
most popular in the British market,
669 machines having been shipped to
that country in the first quarter of
1919. Until recently the automatic
vending machine trade was confined
to slot machines selling confection­
ery, matches, and gum, to weighing
machines in the subway and railway
stations, and to penny arcade equip­
ment operated in amusement parks
and on seaside piers. Now, there is
an increasing demand for other types,
including machines for vending cig­
arettes and stamps. The American
product entering the British market
must compete with machine of local
manufacturers.
There are about a
dozen large British manufacturers
and a number of medium and small­
sized concerns, but they seem unable
to supply the full requirements of
the market and American machines
are competitive both in quality and
price. The outstanding handicap in
the Bx*itish market is the nondecimal
coinage system in use and the large
number of bent coins in circulation.
France and Germany
Shipments to France during the
first quarter of 1929 consisted large­
ly of service and amusement ma­
chines.
Slot machines are used in
that country mainly in bars, cafes,
motion-picture
theaters,
tobacco
shops, and railway stations.
A l­
though French concessions control
the installation of machines on
streets and in railway stations,
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