On location design model of beverage vending machines: Its performance analysis by purchasing behavioral and distribution design models

Vending machine, whose share in the total sales exceeds 30% among beverage industries, is an important sales channel in Japan. However, in recent years, the sales amounts in some cases are insufficient for paying their maintenance and distribution costs, due to the decline by expanding sales of other channels, e.g. convenience stores and super markets. For this reason, effective ways to stimulate potential demand are required among the industries that manage beverage vending machines. By contrast, installation and removal costs of vending machines are greatly lower than other general retails; therefore, to improve profitability by reallocation of vending machines is relatively easy. Nevertheless, sales amounts of plural vending machines depend on others mutually. Thus, only installation of new vending machines or reallocation of worse seller to high demand area are ineffective to improve profitability. Furthermore, reallocation of vending machines occurs the change of distribution cost. For solving these problem, this paper proposed the exploration model of the optimum locations in the objective commercial area for maximizing profitability with consideration of the interaction between sales amounts of each vending machine based on Huff's purchasing behavioral and distribution design models. Moreover, its performance is analyzed by simulation experiments with assistance of genetic algorithm. From the result, total sales amount after reallocation based on the proposed model is slightly increased and the profit of the inter distribution network is improved 1.3% from the initial locations, despite the distribution cost is increased. Thus, it is demonstrated that the proposed allocation model of beverage vending machines functionates effectively.