I 've just returned from the National Bulk Vendors Association convention at the Rio Hotel in Las Vegas. The convention dates were April 4-6. Prior to joining Sugarloaf, I was never involved in bulk vending. I've attended three NBVA shows now, and each time I take away a different perspective. The show is small compared to the AMOA or ASI, (52 exhibitors and just under 800 attendees) but large considering that 90% of the exhibits are one category, bulk vending. You've never seen this much bulk equipment in one room. I find it fascinating. One thing for sure, I should have been involved in bulk vending throughout my career. For various reasons this industry is just coming into its own.
For ages, this industry was represented by the nine-head rack, 30 years old and refurbished for the seventh time, dispensing various colors of gumballs and other trinket and sticker items. Historically, the bulk industry has been largely ignored by the amusement vending industry. No more. The bulk industry is fast becoming a mainstream category in today's modern full-service operating company. The actual revenue generated by the non-metered traditional racks is open for discussion, but clearly it's a significant and profitable business. That's right, no meters. That astounded me when I got involved in this industry. I'm actually quite impressed that an industry was able to stay at this state of development for so many years. I've been actively involved in running routes since high school in 1975 and never remember a video game, kiddie ride, or crane that didn't come standard with a meter. Technology has finally caught up with this segment too. Today's state-of-the-art "racks" are all metered and accept dollar bills, as do the vast majority of all equipment offerings at the NBVA convention. The "shows" (industry talk for what happens after the machine has been activated and before the product is dispensed) that deliver the product are getting flashier every year, as well as new equipment innovation.
New bulk equipment is being introduced more aggressively than ever. It's fascinating to tour the floor and see all of the new ways to dispense trinkets, gumballs of all sizes, and stickers. The product suppliers are big into hot licensed items, and this industry is as hot as ever. I visited a new first-time booth at the show. Namco, a big video game operator and manufacturer from Japan, had a booth showing two new pieces. It was the first time they had ventured to the NBVA. They were pleased with what they saw. This says a lot about the state of the coin-operated video game business, and none of it is good. So congratulations to Namco for trying something different. Sammy, Smart and many other crane and merchandise machine makers have been NBVA regulars over the years. Trade shows aren't cheap to attend, so by their attendance you know something must be bringing them back.
Just as in other industries, no one is in business to get smaller. The traditional bulk operator is a small businessman by nature. Consider that entire machines can be purchased for less than $1,000, and you can see that there is a very low barrier to entry. Just as in the video business, many of these operators started out putting machines in a friend or relative's store or restaurant, and it just kept growing. Now they've developed routes and technical support personnel. Expanding into other categories is a natural. We call that "leveraging the infrastructure." So here we have the NBVA with one of its largest shows ever. I think many amusement industry members are looking to bulk vending as an expansion category.
I sat in on a couple of committee meetings and their NBVA board meeting, although I'm not a board member. The NBVA has racked up some impressive accomplishments over the years. Their legislative committee, forever headed up by Roger Folz of Folz Vending, has been impressively successful in eliminating sales tax on bulk machines in numerous states. This amounts to enormous savings every time it's accomplished for the bulk operator. Consider that the average sales tax amount may be between 7-8%. A company is considered healthy if they can make a profit of 7-8% in a year. Equally impressive is the "rainy day" savings fund that the association has put aside. I know from experience that this is a critical element to successful longevity for any association, and it requires discipline by the board of directors. In today's ever-changing business climate, it does "rain" - and to survive, associations need to have a little nest egg to fall back on. Operating on a limited budget as the NBVA does, these are accomplishments to be proud of. Of course, no good association board of directors would be any fun without controversy.
Although I don't fully understand the issues they're debating, they have more than their share of controversy at the NBVA. Much of it appears to center around a growing association transitioning from an association that was held pretty close to the vest for years by a few, and is now bigger and more diverse in membership. Just as with the ASI and the AMOA, two other associations I've been involved in and followed, it challenges the average outside mind to figure out what there is to argue about. When personalities get involved and people's livelihoods are affected, there's plenty to disagree on. Politics is politics at any level, and the NBVA is no exception. I heard it explained once that when it comes to associations, controversy exists in inverse proportion to the size of the organization. The NBVA has been driven by a few very dominant personalities over the years. They built a successful association, which is no small feat. With new entrants and leaders entering the industry the transition is healthy, and I believe that will lead the association to the next level.
The NBVA does not have a dedicated executive director, as most do. The administration is a function of Morrie Much, Mitchell Roth and their 75-member Chicago law firm, Much, Shelist, Freed, Denenberg, Ament & Rubenstein. Morrie Much has been involved in the association since the early days. It appears to be a labor of love. The president of the association is Neel Clark of Brand Imports. Behind every successful association there are always Neel Clarks. He's dedicated and spends numerous thankless, payless hours seeing to association needs. That's what an association president does. I was involved in the planning of a single social event at the NBVA convention. I didn't go a week in four months without hearing from Neel to offer his assistance and to make sure I was doing my job. Congratulations go out to convention chairperson Marlene Campbell as well for a great convention.
For the same reason I visit IAAPA on occasion, I highly recommend giving the National Bulk Vendors Show a look next year. Operators should always be open to new ideas. Maybe bulk vending is for you. Next year's show dates are April 10-12 at the Wyndham Palace Resort and Spa in Orlando. For exhibitor information, contact the association office at 312/621-1400.