Distributor of energy drinks and soda SNS plans to create its own network of vending machines for their sales

The automated trading market is attracting new major players. GC SNS, a distributor of drinks under the brands Tornado Energy and Fresh Bar, plans to create its own network of vending machines to sell this range. Market turnover in 2024 could grow to 85–88 billion rubles, but not all points can bring profit, and competition for places is high, experts say.

The distributor of SNS Group plans to launch a network of vending machines, as follows from the vacancies published by the group on the HeadHunter portal. In December 2023, a vacancy appeared there for a department manager who would oversee the placement of machines, deliveries and network development. And in January 2024, the group began searching for a vending machine assembler. SNS told Kommersant that we are talking about trading in Global Functional Drinks (GFD) drinks, which are part of the group’s portfolio, adding that they have already found a manager for the position of manager. General Director of GFD Rus Svetlana Malyuta confirmed her interest in the project.

GFD produces energy drinks Tornado Energy, E-ON, Fresh Bar carbonated drinks and Ilyinskie Lemonades. Since the start of distribution of these drinks, SNS has sold more than 1.75 billion bottles, according to the group’s website. SNS is also engaged in the distribution of ITMS products (formerly the Russian division of British American Tobacco) – Dunhill, Kent, Vogue cigarettes, glo tobacco heating systems, Vuse disposable evaporators, etc.

Operations Director of Uvenco Group of Companies (manages over 15 thousand vending machines) Sergei Kaledin notes that the turnover of the automated trading market has recovered after the recession caused by the pandemic, and there are prospects for new players. According to preliminary estimates, in 2023, sales through vending machines in Russia increased year-on-year by 15.38%, to 75 billion rubles, he points out. In 2023, Vkusville’s turnover increased by 64%, and 104 new points of this format appeared, the network reported. But, Mr. Kaledin adds, business is complicated by high competition for places and “limited assortment in vending machines.” There is also a risk of prohibiting the sale of certain products, for example, energy drinks, to persons under 18 years of age, the top manager notes.

Multon Partners (formerly Coca-Cola HBC), the manufacturer of Dobry and Rich drinks, also plans to develop its own vending machines. In September 2023, the company held an auction for the purchase of devices for 2024–2025, according to data from the Kontur portal. Procurement”. The placement results have not been published. PepsiCo (Evervess, Russian Gift) also placed vending machines with its assortment, Kommersant’s interlocutors in the market say. Multon Partners and PepsiCo declined to comment. The GC Chernogolovka (Fantola, Turbo Energy, Baikal) and MPBK Ochakovo (CoolCola, Fancy, Street) did not answer Kommersant.

According to Sergei Kaledin, own machines allow the beverage distributor to freely control the price level without depending on other assortment, choose the product range and freely place advertising. One of the founders of Famous Amazing Brands (Vanilla Flight and Anarchy), Anton Stelmakov, notes that the project may increase awareness of GFD brands, but a small number of devices may become profitable, and locations with high traffic will likely require daily deliveries. According to him, SNS can cope with the task through the van selling system – shipments from trucks plying along the routes that already cover the territory.

As NielsenIQ notes, soda variety and sales are growing, but amid variety, average sales per store for individual items are declining. According to NielsenIQ, in January-November 2023, sales of carbonated drinks grew year-on-year by 4.7% in volume, and energy drinks by 24.2%.

According to Uvenco forecasts, in 2024 the turnover of the Russian automated trading market may grow to 85–88 billion rubles. As Sergey Kaledin notes, in the Russian Federation, on average, there is one device per 775 people, and in Europe – per 175 people. But market dynamics will also depend on the purchasing power of the population, he points out.

Anatoly Kostyrev, Alina Savitskaya