DyDo, Asahi Soft Drinks form alliance to become front runner in vending machine market

The Yomiuri Shimbun
A DyDo Drinco Inc. vending machine is seen in Tokyo on Thursday.

Beverage giants DyDo Drinco Inc. and Asahi Soft Drinks Co. have formed a comprehensive business alliance regarding the firms’ vending machines, as they hope to stay afloat in the market.

The two firms said Thursday they will jointly establish a new company in January to integrate their vending machine operations. The companies plan to strengthen their alliance by having Asahi manufacture some of DyDo’s products to try and come out on top in the shrinking market.

DyDo will invest 66.6% and Asahi will invest 33.4% to establish Dynamic Vending Network, and the new company’s president will be from DyDo.

DyDo has about 270,000 vending machines nationwide and Asahi about 260,000. The new company will centrally manage approximately 200,000 vending machines directly operated by both firms. Dynamic Vending Network will use DyDo’s management system to remotely monitor the number of products in their vending machines, as well as their sales, to streamline the restocking process for Asahi’s machines.

The firms will also expand mutual sales of their major brands, including Asahi’s Wilkinson carbonated water and DyDo’s canned coffee.

Their decision to form the alliance comes as the result of the sluggish vending machine market.

With more people working from home amid the pandemic, vending machine sales have dropped. Overall industry sales in 2021 fell about 15% compared to 2019. In addition, as fuel and transportation costs have gone up in recent months, companies have been forced to quickly find ways to cut costs.

However, unlike other companies, DyDo employs a unique business model in which 80% of its sales come from vending machines. DyDo’s canned coffees featuring illustrations from the popular manga and anime series “Demon Slayer: Kimetsu no Yaiba” also created quite a stir.

Asahi takes advantage of its high profit margins in the beverage industry.

“Only companies that can withstand IT investment in vending machines will survive in the future,” said DyDo President Takanori Nakashima at an online press conference. “Through the alliance, we aim to become a front runner in the vending machine market.”