On any given day, in any given machine shop in America, a foreman saunters up to a machine that looks suspiciously like a candy bar vending machine, punches in his personal identification number on a keypad, and waits — not for a bag of chips or cup of coffee to pop out — but for a metalworking tool that a worker on the shop floor needs to complete a critical job.

Known as automated tool vending machines, these hulking pieces of equipment that operate much like snack vending machines are gracing more shop floors these days, thanks to the seamless inventory control, loss prevention and state-of-the-art interfaces they provide. Almost more important than the tools they house is the accurate data that these machines harbor and feed to companies, which in turn can keep inventory counts low, while ensuring fewer stock outs.

In the early 1990s, one of the vending machine concept's forerunners, Steve Pixley, president of AutoCrib, Inc., in Huntington Beach, Calif., realized that combining tools with helix-style vending machines would solve a majority of the inventory problems that manufacturers were dealing with. Accountability was one issue (Where did that tool get off to?), compounded by the need for better inventory management and loss prevention. Pixley was president of Machine Tools Supply in Costa Mesa, Calif., at the time, and based on his idea, developed a dispensing system modeled after a vending machine concept.

"As the head of a mid-sized, industrial distributorship that sold cutting tools, Steve saw that a number of large integrators were coming into the territory and placing people at the end-user sites to take over the tool cribs," says Bruce Weaver, AutoCrib's vice president of sales. "He realized, however, that outsourcing that function didn't result in any process improvements, so he came up with a way to change the process and battle the integrators at the same time."

Because machines don't need salaries, benefits or vacation days, Pixley figured that the inanimate vending machine would serve as the perfect guardian of the tool crib. The concept has come a long way since that time, and today, encompasses a wide variety of tool cribs and technology solutions that drive them.

Over the last 10 years, the tool vending machine concept has surpassed its original purpose and gone beyond simply doling out cutting tools and safety supplies, according to Kevin Harless, director of business development for San Diego-based automated information system developer Vistant Corp. Among the most popular items today are durable hand tools, pneumatic air tools, drills, grinders, cut-off saws, calibrated gauges and instruments.

Even the basic battery is popular, particularly around the holidays, quips Robert Holmes, marketing director for WinWare, Inc., in Marietta, Ga., a software firm that produces the CribMaster. WinWare manufactured its first vending machines in 1996 and currently has a co-marketing agreement with Vistant. Holmes recounts a story involving an employee in need of batteries around Christmastime. After realizing he could no longer grab a handful of them from the tool crib, he sulked off to buy his own.

That ability to control misuse and inventory levels without having to put a security guard on duty can be particularly attractive for manufacturers in today's economy, where tight budgets and cutbacks are the norm.

Holmes says that today, automated vending machines can be found at major aerospace and automotive manufacturers, machine and job shops. Most useful for manufacturers that manage high-use items, the machines have been used in the machining and metalworking industries, but are now making their way into non-traditional settings, such as the healthcare industry. While the most common items continue to be cutting tools, hard hats and gloves, products such as welding and safety consumables, gauges and even walkie-talkies are gaining in popularity.

The machines start at $10,000, with the typical vending machine costing $25,000 to $30,000. The distributor has traditionally footed the bill for the machines, in exchange for the steady business from the customer who uses them. In the last few years, however, an increasing number of customers have purchased their own vending machines.

Well positioned to tap the value of the automated vending machine, says Holmes, are the individual distributors who provide the machines to customers at no upfront capital costs, then gain ultimate control not only of the contents, but also of the machines' technological interface. WinWare's CribMaster, for example, can produce more than 170 different reports, which means distributors can tap that data and share it with their customers.

The distributor who alerts company management to the fact that one of the two machines on the shop floor is being used twice as much on a particular shift, for example, can end up looking pretty golden.

"Because the machines can easily identify such problems for the end user," says Holmes, "the distributor is able to add value to the operation with little extra effort."

The George Whalley Co. in Cleveland first offered tool cribs to its customers in late-1999. A distributor that specializes in cutting tools, abrasive and precision tools, the company originally attempted to develop its own system. As it happens, the company it was selling through was Machine Tool Supply, which was headed up by Pixley.

"We decided to use his system instead," says Jim Elliott, controller.

For the last four years, The George Whalley Co. has been placing the machines in job shops, tool and die makers, screw machine, and milling shops throughout Northern Ohio. The machines' biggest selling points, according to Elliott, are ease of use and the ability to track tool use to individual job orders. He says customers typically rent the machines from the distributor via a formal contract, and the distributor handles the maintenance, software updates and restocking. Elliott says the machines provide clear benefits for his company, including the fact that it no longer has to guess at customer inventory levels and needs.

"Customers only buy what they need," says Elliott. "It gives us a much tighter relationship with them because we're within a day or so of their production schedule, so we know what they need and when they need it."

At Cutting Tools Inc., in Louisville, Ky., Curtis Coombs, business development manager, says his firm knocked around the idea of using automated tool cribs back in 1997, and sold its first system in 2001. He says the distributorship began its lengthy research process on the machines after customers began asking for them.

"We're an engineering company, and customers didn't want us wasting our time with administrative issues like material procurement, inserts, drills and whatever, that could be put in the machines," says Coombs. "It was at their request that we began using them."

Coombs says the primary benefit has come in the shape of 24/7 tool and product availability, right at the customer's site. The machines also eliminate the hassle of stock outs, he says, and help both the distributor and customer lower their costs.

"Customers also can get a better handle on point-of-use cost," says Coombs, "which in turn helps determine the true cost of tooling as a percentage of goods sold, and the cost of goods sold."

As customer needs, technology and the industrial landscape continue to evolve, so too will the vending machine concept. Holmes says the machine industry itself is "far from being mature," and adds that demand for the products is increasing right along with the level of competition between the companies that make the machines.

"Some of the players coming into the marketplace will be here long-term and some others won't, but the overall market and the technology are both performing nicely," says Holmes.

"We go into shops every day and are amazed at these facilities and how they are managing their inventory," he says. "While vending machines are not the total answer, they're definitely a big improvement from what we see out there."

Weaver says the vending machine concept is nearing the end of the "early adopter phase," which means the low-hanging fruit has been picked and companies and distributors need to aim for deeper penetration into those job shops and manufacturing firms that still use expensive, ineffective inventory management and control systems. Looking ahead, Weaver sees the movement toward an Internet-based or ASP (application service provider)-based machine, and says that in the next five years the actual inventory management will integrate more RFID (radio frequency identification) and microscale capabilities into the machines.

Overall, Weaver says that both awareness of and demand for the vending machines has grown significantly over the last five years, and he expects more of the same for the next five years.

"At trade shows, I used to get a fair amount of people coming through saying, 'I never have seen that before — that's really cool,'" says Weaver. "We don't get that too much of that any more."