The vending industry between regulation and economic trends since 1993
The vending industry is currently facing a variety of challenges. Rising operating costs, the decline in floor space in the hospitality industry, the COVID-19 pandemic, and increasing digital competition are putting providers of slot machines under increasing pressure. At the same time, there is only limited legal room for manoeuvre for the vending machine industry to counteract the changed economic conditions by adjusting prices, the quantity offered and via changes to product characteristics.
On behalf of the Verband der Deutschen Automatenindustrie e.V. (Association of the German Amusement Machine Industry), DIW Econ examines the key economic figures of the amusement machine industry against the background of the applicable regulations and the development of economic trends over the past 30 years.
The analysis shows a close correlation between the applicable legal framework and the key figures in the gaming industry. The vending industry is thus becoming a pawn in the game of legal regulations.
At the same time, long-term economic trends, such as rising operating costs and the death of pubs, as well as current developments, such as the expansion of digital offerings and the COVID-19 pandemic, are putting the industry under increasing pressure. Given the regulatory environment, vending machine operators cannot adjust prices, volume offered, and product features to adequately address these challenges. Gaming attractiveness at slot machines may also be reduced as a result.
If the reduced attractiveness of gaming leads to an exodus of consumers, it must be expected that at least some players will replace gaming machines with alternative offers, for example, illegal offers. However, regular evaluation of regulation, considering changing economic conditions, could counteract this.PDF Download of this publication