Eight months ago Chattanooga-based Five Star Food Service became one of the nation’s first independent vending operators to surpass the 300 micro-market threshold. Last week Five Star celebrated the opening of its 400th micro-market at a Jostens production facility in Clarksville. The Jostens installation marks the 133rd micro-market Five Star has opened this fiscal year which ends this month.
Officials said, "Five Star’s secret to success is its people. The unprecedented growth and success is due in large part to its dedicated micro-market organizational structure spanning from the corporate office to the branch level including area managers and route drivers who specialize in merchandising micro-markets."
President and CEO Alan Recher said, “In order to sustain scalability, we made the decision to invest in the infrastructure on the front-end. We recruited the best people, top to bottom, to manage micro-markets and involved all levels of management from the beginning to ensure buy-in and adoption.”.
Headed by Vice President of Micro-Markets, Mark Stephanos, Five Star has a team of 50+ employees solely dedicated to the success of its micro-market business.He said, “Five Star’s rapid growth to 400 markets in just over four years has been an exciting challenge. Our team of micro-market professionals has done an outstanding job of consistently delivering on our promise of quality service and products to our customers.” .
Growth this significant does not come without a few bumps in the road and lessons learned. Five Star quickly learned the micro-market business was very different from traditional vending and it needed to adapt. “From the onset, we knew this was a retail concept and learned over time from errors made in the planograms,” said Mr. Recher.
Along the way, Five Star has focused on continuous improvement in its processes, products, promotions, and execution. “Our unique approach to choosing the ‘right’ products and promotions for our micro-markets truly differentiates us from our competition,” said Mr. Stephanos.
As the industry grew and became more sophisticated, the available solutions for technology followed suit. It became vital for Five Star to invest in the best technology to keep up with the growth internally as well as the demands end-users were asking for. About 18 months ago, Five Star partnered with 365 Retail Markets to power their micro-market kiosks and backend reporting. “Partnering with 365 was a major switch in the kiosk technology we use. It has proved to be advantageous to our growth and negated many technical issues we encountered early on,” said Mr. Recher.
While Five Star’s core business continues to be traditional vending, senior leadership foresees a future where micro-markets comprise 50 percent or more of the total business. Mr. Recher said, “We see continued growth in the micro-market space. I believe improved technology will play a key role in the future expansion of the industry.”
Five Star Food Service specializes in full-service vending, micro-markets, coffee services, full-service dining, and catering services across Tennessee, Georgia, and Alabama. Founded in 1993, Five Star Food Service has grown to one of the largest privately held operators in the Southeast. Five Star Food Service is a franchise of Canteen Vending.