Create new revenue streams with connected devices and IoT
Cellular IoT connections, which reached 1.7 billion in 2020, are expected to reach 5.9 billion in 2026. This amazing growth is due to various means of wirelessly connecting devices to collect valuable data. Massive IoT technologies are developing rapidly and are expected to account for 46% of all cellular IoT connections by 2026. They are primarily used to connect low-cost, low-cost devices that consume little power and return small amounts of data, like connected distributors. machines and apparatus.
With this in mind, Ericsson worked with WMF Group, a leading manufacturer of commercial coffee machines, and Swisscom, a leading communications services provider, to create a business case for connected coffee makers. This article will discuss how cellular connectivity enables companies like WMF Group to create digital sales solutions that reduce downtime, monitor their own conditions, such as supply levels and maintenance needs, and ultimately generate new sources of income, as indicated in our report “[insert finalized report name]. “
Something is brewing
WMF Group produces commercial coffee machines that are used daily by several hundred million people. The company is at the forefront of the development, manufacture and distribution of connected coffee machines of all types, such as those found in restaurants, hotels and high-end vending machines. Connected devices and services allow vendors like WMF to monitor the health status and supply levels of their machines, remotely control them, and receive customized analytical reports for customers. All of this is made possible by transferring data to and from machines over a 5G cellular network, enabling three main categories of use cases.
- Digital Solutions: The manufacturer provides an easy-to-access portal where an operator can monitor sales figures, supply levels, and machine health. It enables revenue management, consumption analysis, reduction of supply shortages, and advanced screen usage for multimedia packages such as advertisements.
- Health Monitoring and Predictive Maintenance: This use case uses cellular connectivity to send machine health updates and maintenance alerts. The goal is to reduce costs by minimizing downtime through proactive just-in-time maintenance and to reduce over-maintenance.
- Remote self-service and digital payment: Cellular connectivity not only enables contactless ordering through web applications, but also a variety of remote and digital payment options to streamline processes.
There are opportunities in the IoT, mainly because the insight provided by the data helps vendors improve customer satisfaction through personalization, ensure supply levels, and reduce downtime, resulting in downtime. increased income.
Add smart data photo
Knowing how to access, interpret and act on smart data can unlock huge potential for coffee machine owners to generate their income in a wide variety of businesses. Connected machines can unlock data, turn it into powerful information, and correct faults automatically, enabling owners to improve efficiency and drive operations forward.
For example, nearly one in five cafe owners have never increased their prices, indicating that they do not know the optimal price that they can charge to increase their profits. Maybe if they increased their prices, the demand would stay the same. On the other hand, by charging a lower price, the volume could increase. Because their prices remain static, they have no way of knowing. Accessing clear and tangible data via connected machines would allow them to price their coffee accurately and maximize their profit.
Another problem is the shortage of supplies and inadequate maintenance, resulting in downtime and lost sales. On average, coffee machines are not operational about 2% of the time, which might sound like a small number, but can add to the difference between profit and loss. At gas stations, for example, 20% of all lost coffee sales are due to machines out of service. Worse, supply shortages explain 39% downtime. Connected machines can help drive operations forward by using intelligent data to correct faults before they even occur, dramatically reducing downtime.
A final challenge is to figure out which beans and which recipes will appeal to you the most. According to Arthur D. Little, about 8% of the US market is created from specialty coffees that sell for higher prices. But knowing which varieties to buy can be difficult, unless you have access to the direct consumer information that the IoT can provide.
What are the advantages ?
In the hotel industry (restaurants and hotels), coffee is sold to customers or as part of a hospitality package. With a baseline of € 300,000 in annual coffee sales, a gas station operator can leverage connected coffee machines to increase revenue by 3.4% for an additional € 10,200 per year. This comes from better revenue management, reduced supply shortages, and advanced screens that allow gas stations to sell other products.
In the workplace, machines are sold to companies that offer free coffee as a benefit to employees. While revenue generation is not a goal, smart coffee makers offer significant benefits through advanced use of the display that allows businesses to communicate without further signage. Advertising can be sold to neighboring businesses to recover costs. This could create an annual net worth of $ 2,900 for an office with 200 employees.
In facility management, coffee machines and other services are often part of a bundled package for corporate clients. The annual net worth is around 300,000 EUR for a company with a turnover of 3.5 million EUR from the rental of coffee machines. Advanced use of the screen includes the ability to display content or advertisements. And, if the facility provides replenishment services, they will benefit from less downtime and increased consumption.
For resellers, coffee machines are sold through sales channels to customer businesses such as gas stations and convenience stores. This can present new business models. For example, dealers may offer machines along with additional services such as the provision of grain. This is analogous to smartphone models, where devices are sold at a subsidized price in exchange for a long-term contract. Another possibility is revenue sharing, where the reseller and the customer share the product, verified through the data of the connected coffee maker.
Take a cup and open
“[insert report name]”Illustrates the additional gains WMF achieves through its technological approach, including greater competitive advantage. It also discusses the perspectives of original equipment manufacturers and cloud solution providers. It even looks at connected coffee vending machines. However, their learnings are applicable to the entire industry, to any organization that wants to pull data from their machines that they can turn into a greater opportunity.
So grab a cup and open up to connected devices and IoT. Download the report now and find out why coffee makers, like so many other device makers, can see their cups overflowing with connected devices and IoTs, powered by 5G cellular connectivity.
Click here and download your free copy of [insert final report name and hyperlink]