Steve McBride, Strategic Procurement Manager
Vending machines traditionally offer snack foods and drinks that are high in fats, sugar and salt, and low in nutritional value. Yet Alfred Health has shown leadership and innovation in this area, proving that healthier vending machines can be both popular and profitable.
In 2011, Alfred Health implemented the Healthy choices: food and drink guidelines for Victorian public hospitals to improve the availability and promotion of food and drinks offered in each of its three sites – The Alfred, Caulfield Hospital and Sandringham Hospital.
The healthy eating guidelines were introduced in three areas at once: catering, retail food outlets and vending machines. It was important to address vending machines at the same time as the other areas, so that the retail outlets making healthy changes were not disadvantaged by what the vending machines offered.>
When the vending contract was due for renewal, a new clause on Alfred Health’s commitment to health and the Healthy Choices guidelines was included in the tender document.>
While it was important to maintain income from vending machines, Alfred Health’s core objective was to choose a supplier that could support its implementation of the Healthy Choices guidelines.
Tenderers were asked to demonstrate their experience and expertise in supporting a healthy choices framework, especially their familiarity with the ‘traffic light’ categories, and their ability to provide foods and drinks within the required proportions: >
- machines must offer 50% or more GREEN items and less than 20% RED
- only GREEN products can be advertised on the outside of the machines
- only GREEN products should feature on the most prominent shelves
Following a thorough evaluation, the new supplier was appointed for a five-year contract to supply and stock 35 vending machines at all three Alfred Health sites. Alfred Health was impressed by their commitment to sourcing, planning and providing healthier vending products, and they worked closely to select the food and drink items and review the placement of the vending machines for greater accessibility in high traffic areas.
All vending machines now meet the Healthy Choices guidelines. Sales of salty snack foods, confectionery and soft drinks have all decreased, while sales of healthier alternatives such as trail mix, oats, popcorn and water have proven successful.
Steve McBride is the Strategic Procurement Manager at Alfred Health, and manages the contracts with the vending suppliers.
How did this approach to vending differ from normal?
The key to the tender process was evaluating the suppliers on a ‘value for money’ basis and not just focussing on maximising revenue from sales.
A team of key stakeholders assessed the tenders based on competitive information, demonstrated capability to meet the required standards, and how they proposed to partner with Alfred Health on Healthy Choices.
What was it like to work with your new vending company to implement a healthier approach?
The health angle is an emerging concept for vending, so it required a lot of thought and planning. Our current contractor is a global company and naturally they’ve got their own KPIs to meet as a business. They have preferred suppliers for products and their targets.
So it needs to be a collaborative relationship where we work together to maintain ongoing compliance with the guidelines while delivering the best outcome for both parties. They have undertaken significant work to identify and propose new healthier products.
How did the new products affect revenue?
We expected that revenue may have reduced initially while people became more familiar and adapted to the new products, but this wasn’t entirely the case. Although implementing healthy options was the key focus, the preferred supplier has also improved our commission on sales which was an added benefit.
If you want maximum benefits you have to make sure your machines are also placed in the right positions. We looked at every machine within Alfred Health: their size, sales figures, and amount of traffic in the area and decided to pull some machines out and put new machines in other areas. This helps us ensure we’re always improving and optimising our vending, which ultimately benefits everyone.
How have the contents of the vending machine changed?
There are far less salty foods and confectionery, and we’ve started stocking smaller sizes of some snacks. There’s also a lot of water available instead of fizzy drinks, and surprisingly beverage sales have slightly increased as a result of our changes.
What’s the feedback been like?
I thought the reception would be a lot more negative than it has been to tell the truth. But our CEO’s commitment to the project and the way the project was communicated helped. The upfront communication about our aims and how we were implementing Healthy Choices diffused a lot of the potential complaints, because people knew it was coming, and the reasons we were doing it.
What advice would you give to other hospitals considering implementing Healthy Choices?
They’ve got to be serious about it, and be prepared to put in the effort. Most of all you’ve got to have support from the top.