DVD Vending machine

karlos11

Hello, just want to get peoples feedback / opinions on the concept of a DVD vending machine. The concept is to have a vending machine you can rent DVDs from in a Spar, for instance. No membership fee and you pay by laser or credit card and charge €3 for new releases.

Do you think this is a viable business considering there is online renting available from Screenclick and now Lidl?

Thanks.

ronaneire

My opinion would be no. I have seen several types come and go.
You would be competing against Xtra Vision and Chartbusters.

super_furry

Aren't Chartbusters gone? Or is that just my local one?

Renting from a vending machine sounds tricky though. How will you handle returns? How will you ensure people return the DVDs on time? What will you do if they don't? How will you cope with having such a limited stock selection? A machine will probably only hold 20-30 DVDs. Where will you source the machines?

karlos11

I'm more worried about the online competition and with Movie downloads. Is this how people are renting now?
The vending machine is alot cheaper to rent from then Xtra-vision. And Chartbusters, i think, is pretty much dead in the water, so i wouldn't really be concerned about them.

ronaneire

super_furry wrote: »

Aren't Chartbusters gone? Or is that just my local one?

http://www.chartbusters.ie/ not from the their website

karlos11

super_furry wrote: »

Aren't Chartbusters gone? Or is that just my local one?

Renting from a vending machine sounds tricky though. How will you handle returns? How will you ensure people return the DVDs on time? What will you do if they don't? How will you cope with having such a limited stock selection? A machine will probably only hold 20-30 DVDs. Where will you source the machines?

All those questions are easily answered - i've sourced the machine. It holds up to 250 DVDs and there are digital tags on the actual DVDs so if a DVD box is returned with a damaged tag or no dvd in the box the machine will not accept the Box. The LASER transaction is left 'open' until the DVD is returned - so you can charge a late fee.

ronaneire

karlos11 wrote: »

I'm more worried about the online competition and with Movie downloads. Is this how people are renting now?
The vending machine is alot cheaper to rent from then Xtra-vision. And Chartbusters, i think, is pretty much dead in the water, so i wouldn't really be concerned about them.

Might be a lot better to rent from but I'd imagine stock level would be a problem from a vending machine? New releases and the likes.
As I said in a previous post I have seen them come and go, one was a unit with a self service dispensing machine and the other a free standing.

Axwell

I remember someone posting about this type of service a good while ago on this forum. If you do a search you should come across and get some more feedback from that thread. Its going back a good bit though, possibly a year or more ago.

Also what if its returned with a damaged DVD thats been scratched etc but still has the tag in place?

karlos11

Axwell wrote: »

I remember someone posting about this type of service a good while ago on this forum. If you do a search you should come across and get some more feedback from that thread. Its going back a good bit though, possibly a year or more ago.

Also what if its returned with a damaged DVD thats been scratched etc but still has the tag in place?

On that point, i guess you just have to replace it!

The real question is the emergence of Online Rentals - is this how people are renting now or are they still going out and renting in shops? Do you or your mates / family rent and if they do, how?

Will have a look for that thread, thanks!

bigneacy

scratched DVD's are a problem with any DVD rental business I'd Imagine?

Awful lot of work invloved in keeping the machine right... probably 2 or 3 site visits a day?

bigneacy

I used to rent from net. Don't bother with that anymore...

Usually buy DVD's, but if there was one in my local shop I might be inclined to get one every so often.

Axwell

Scratched DVDs would be a problem in any store but the person would bring it back up to the counter and say it was scratched, a staff member would check it and give them another copy.

You cant do that with your setup, the person would have to get in contact with your buisness and look for a refund or wait a day or two at least before you could come out and replace the copy of the DVD in the machine. So realistically it would take ages to get anything done that they probably would just stick the DVD back in and never use the service again. Along comes the next person wanting that DVD and the same happens again.

I think with the internet and current broadband speeds etc DVD rentals are on the way out to be honest. You can get movies on itunes now along with legitimate streaming sites and not have to bother going to the hassle of going to the store to get a DVD or to return it.

super_furry

Axwell wrote: »

I think with the internet and current broadband speeds etc DVD rentals are on the way out to be honest. You can get movies on itunes now along with legitimate streaming sites and not have to bother going to the hassle of going to the store to get a DVD or to return it.

I think this is a major factor. I've started 'renting' films in HD over my Xbox 360. Takes about 30 minutes to download and is convient, great quality and always in stock.

Herbalist

These are quite popular in the states. I used one in Florida recently and found it very easy to use. The machine was located just outside a 24 hour supermarket which was a good location as we spotted it on the way out.

I guess the question is OP will it take off over here. My own questions would be can you compete with the likes of the stores when it comes to having the latest dvds in stock? Can you compete with the prices they offer for example at the moment xtra vision offer a lot of combo deals.

I would imagine the issue of secruity may arise too - if you keep credit card or laser details in order to process late fees are these details deleted afterwards?

best of luck if you do decide to go ahead with it

RATM

OP I'd drop this idea if I were you. I remember there was one of these installed in the Super Value supermarket on Aston Quay, Dublin 2. I signed up as I thought it a great idea- you scanned your laser card and rentals were a good bit cheaper. But I never really liked it that much as the DVD I wanted was typically not in the machine. Also you don't have the touch and feel aspect of a DVD shop- at least there you can read the disc cover, find out what the movie is about etc.

But anyway one day I went into the shop to get a DVD and the machine was gone. I know the manager and asked him what happened. He said they pulled out because 'people just weren't going for it'. Now it could be the case that the rent Supervalue were charging for the 2-3sqm the machine was taking up was just too expensive for turnover. But my analysis was that if you can't make money from a DVD machine in one of the busiest shops in Dublin then you'll find it tricky to do so elsewhere.

Just my 2cents

ten10twenty

What do you do if:

someone says the dvd is scratched and it's not (prob get this in xtravision anyway)

what if dvd's get dropped off at a different location from where they were hired? could cause stock problems?

best of luck, sounds like it'd be very labour intensive tho

Saruman

I saw DVD vending machines around the country years ago but they never seemed to take off and then just disappeared.

I imagine a number of the negative reasons in the post are partly to blame. If there was money to be made, I am sure a vending machine company would already be doing it.

That said, if you check and recheck your numbers and you think you can make a go of it then do so, just don't gamble your home or anything crazy on it.

Bandara

These machines do not work in retail stores. I looked into it about 5 years ago, an Italian company was producing an excellent machine, I had it on trial for 3 months. Customers didn't want to sign up for it, they didn't like putting their credit/laser cards in it. I think I got about 20 customers in 3 months. Complete waste of space, I can make ten times that by putting a bagged sweet stand in its place.

They have been tried several times by other Spars also.

They don't come close to justifying the footprint they take up with the business they generate.

Its a hugely declining market, I personally have not rented or bought a DVD in about 7 years. I torrent everything or watch movies on the TV, my friends pretty much all do the same.

Tried and failed.

Dman001

This is a rather popular in the States alright, there is one called Redbox and it costs $1 to rent a DVD/Blu Ray. The only reason it is so popular is because it is insanely cheap.

OP have you considered online rental service like Screenclick? Personally I think there is great potential for an Online rental service in Ireland but are badly executed and advertised in this country. The start up and operating costs would be lower than the Vending Machines, and works on a national basis. Trying to set up a vending machine in each town in each county would be hassle. You also have the option to place advertisements on the website which would bring in more revenue, and you could also have the option to expand into the Online Movie Streaming market too.

Fergal C

http://www.redbox.com/ claim to have over 23,000 locations in the US, if it works there maybe a version of it can work here.

Victor

I've experience with one of these machines, Spanish made I think and it was extremely finicky. ideally your location is 24 hour and staff on-site.

bigneacy wrote: »

scratched DVD's are a problem with any DVD rental business I'd Imagine?

Just have the machine accept returns within X minutes for no charge.

ten10twenty wrote: »

what if dvd's get dropped off at a different location from where they were hired? could cause stock problems?

Machine simply refuses to accept the return.

Fries-With-That

I know someone that tried this in Nenagh Co Tipperary a few years ago. He rented his location installed his machine ( sourced from a UK company) and watched his cash roll out.

Rent was expensive.
Upkeep and service issues on the machine were a nightmare.
All servicing had to be done by UK engineers.
He off loaded the machine to a garage owner eventually on a profit share basis. No profits for either party.
He finally ended up selling his DVD stock at car boot sales.. and last time I spoke with him the machine was in mothballs in the garage stores.

If you want me to put you in touch with him I will.

I saw the machines in Florida that a previous poster is refering to, they have a very small footprint and are available outside many 24 hour premises. I think they work well over there because you have a huge tourist market using them, no sign up required and you can pay on your credit card.


Regards,

Fries.

karlos11

Hi Herbalist - yeah the transaction is closed once the DVD is returned and the details are deleted. It's set up with a renound company that the likes of Paypal use. With regard to RATMs point about being able to read the back of the box in an Xtra-vision, this machine has a touch screen, so when you select a movie you can watch a trailer or just read what it's about before renting or buying.

You can also set up Special Offers as you have a website for the machine where people can book a copy of whichever title they want - the machine will hold it for a certain amount of hours for you. You can even pay online.

The only real reason i'm holding back is the fact that Next Generation Broadband is going to be widely available very soon so downloading or streaming movies is going to be even easier and handier. But will most people do this or do they still want to head to the shop to rent a dvd and their popcorn etc.?

Answers on a postcard...!!

BTW thanks for all the feedback - it does help.

karlos11

OP have you considered online rental service like Screenclick? Personally I think there is great potential for an Online rental service in Ireland but are badly executed and advertised in this country. The start up and operating costs would be lower than the Vending Machines, and works on a national basis. Trying to set up a vending machine in each town in each county would be hassle. You also have the option to place advertisements on the website which would bring in more revenue, and you could also have the option to expand into the Online Movie Streaming market too.[/QUOTE]

Since reading this thread, i've considered online rental but to be honest, i wouldn't even know where to start! Any suggestions are very much welcome.

Axwell

karlos11 wrote: »

The only real reason i'm holding back is the fact that Next Generation Broadband is going to be widely available very soon so downloading or streaming movies is going to be even easier and handier. But will most people do this or do they still want to head to the shop to rent a dvd and their popcorn etc.?

People dont need nextgen broadband, what they have now does the job nicely. Most people in bigger towns and cities are serviced by the likes of UPC etc, I have a 30 meg broadband connection. The majority of others have access to a dsl line and can avail of a 3 meg line at the least in most cases upwards to 24 meg.

For streaming any of those work no problem. If you think that next gen broadband is whats going to stop you then you are already behind the times and need to realise whats readily available right now is good enough for it. Even RTE at this stage has RTE player where you can watch previous tv programmes that were shown recently. There are numberous sites where you can pay for a subscription and with the likes of itunes now allowing you to watch DRM protected movies and the same with xbox live the DVD rental market is on the way out big time.

Technology has moved on, I think looking at the facts raised so far you can see people tried these already in Ireland but we are talking about 5 years ago. 5 years ago the broadband situation in Ireland was awful and people were lucky to be able to get anything near a 3meg line. Thats all moved on and has given rise to all these streaming sites and DRM downloads. At this stage you can get TV's in the states like the Sony Bravia HDTV that comes internet enabled which can be linked to Netflix in the states and allow you to stream tv and movies directly through your tv.

I would give up on this idea and take onboard that if it failed a number of years ago when broadband and streaming wasnt even a competitor to the service, its fairly safe to assume at this stage it would make the idea even more of a non runner.

karlos11

Axwell wrote: »

People dont need nextgen broadband, what they have now does the job nicely. Most people in bigger towns and cities are serviced by the likes of UPC etc, I have a 30 meg broadband connection. The majority of others have access to a dsl line and can avail of a 3 meg line at the least in most cases upwards to 24 meg.

For streaming any of those work no problem. If you think that next gen broadband is whats going to stop you then you are already behind the times and need to realise whats readily available right now is good enough for it. Even RTE at this stage has RTE player where you can watch previous tv programmes that were shown recently. There are numberous sites where you can pay for a subscription and with the likes of itunes now allowing you to watch DRM protected movies and the same with xbox live the DVD rental market is on the way out big time.

Technology has moved on, I think looking at the facts raised so far you can see people tried these already in Ireland but we are talking about 5 years ago. 5 years ago the broadband situation in Ireland was awful and people were lucky to be able to get anything near a 3meg line. Thats all moved on and has given rise to all these streaming sites and DRM downloads. At this stage you can get TV's in the states like the Sony Bravia HDTV that comes internet enabled which can be linked to Netflix in the states and allow you to stream tv and movies directly through your tv.

I would give up on this idea and take onboard that if it failed a number of years ago when broadband and streaming wasnt even a competitor to the service, its fairly safe to assume at this stage it would make the idea even more of a non runner.

Point taken!

karlos11

Okay, so the vending machine is not a great idea! Are there any Irish based websites that do Online Streaming of movies? I've looked on screenclick but they seem to just do DVD rentals via post.

Dman001

There isn't any Irish based ones, but a few UK based ones work here like Blinkbox. Xbox Live has a Movie rental service for the Xbox, and iTunes has one in Ireland too.

You have to remember that Ireland is a very small market so not many companies bother getting the rights to stream movies here

RATM

Unless you have a global marketing budget in the millions forget about online streaming. There are already a number of massive companies operating in this space, X-box for one. You'd have to pay Hollywood studios millions in agreements to lay your hands on their back catologue, and thats before anybody knows who you are.

I don't mean to sound negative but this isn't a business that can be run from your bedroom, its far bigger than that.

Internet TV and online streaming is going to be huge. But the likes of iTunes are already miles ahead. Porn companies are even further ahead- they've been streaming live sex shows for over a decade now ! Even if you could set up such a service there would be nothing to stop the likes of Sony putting a device in their Internet tv that meant only movies streamed from a pay-per-play Sony movies website could actually play on it.

karlos11

RATM wrote: »

Unless you have a global marketing budget in the millions forget about online streaming.

If you can set up an Online DVD rental business relatively cheap, i.e buy DVD's off a supplier and do it by post, why does it cost millions to get to stream the same movies you would rent out?

Budget Marketing

From looking into the industry myself a few years back, i can remember that the price of DVD stock is (or was at least) massive.

Rental DVD's and their rights are very expensive (something like €80 per copy).....so its not like you can source new releases at the same price as you would do for private viewing DVD's.

I think anyhow regardless of this the market is pretty much dying, you would have to find an excellent location and pay rent/percentage of profits for machine placement, and would need to rent alot of DVD's to cover your costs.

P.s Chartbusters is not gone, they went into recievership or admin and the company was restructured, shareholders were payed a divedend to every € owed and loss making stores were closed....at least as far as i can remember.

Rob