Original story on Vending Times.
ST. LOUIS, MO -- BFC Enterprises started in 1947, operating jukeboxes in diners. Today, third-generation operator Todd Farber is keenly aware of his company's history and familiar with tales of his grandfather counting out the day's receipts on the kitchen table.
"I've heard the war stories from the time," Farber said. "My grandfather was a one-horse guy, collecting the route by himself. He'd spend half the day collecting $40. But he built it from there. When my dad [Norm Farber] took it over in the early 1980s, he took the business to another level."
During the post-World War II boom years, the company expanded its services, offering pinball machines and pool tables in addition to jukeboxes, primarily to taverns. An expansion into cigarette vending during the 1960s garnered additional locations in which BFC could expand its equipment offerings. However, another initiative, a move into snack and soda vending in the late 1990s, turned out to be a poor match for the company.
"We thought the answer was in the snack and soda vending route my dad bought," Farber said. "We held that for 10 years, but it wasn't for us."
The less-than-successful foray into vending did not deter the company's innovative spirit, nor its search for new equipment and location opportunities. In the 1980s, the Golden Age of Video games picked up speed and the company's growth took off. BFC expanded into convenience stores and other retail locations in the St. Louis area. "There was a local theater chain that decided to do a game room, and we tagged along with them as they got bigger," Farber said. "That gave us more scale."
Another opportunity arrived in 2001, when an ATM operator began eying one of BFC's tavern locations. ATMs only had become legal for independent operators in 1996, and therefore were a relatively new equipment asset. However, the competition was enough to spur BFC to explore and then expand into the ATM segment, making the operation one of the first coin-op amusement operators to add cash machines.
"With our ATM business, we were able to go coast to coast," Farber said. "We had a convenience store chain and other locations, but then we got a lot bigger in 2009 when we made an acquisition that allowed us to grow even more."
Coast To Coast Reach
Today, BFC Enterprises remains a major player in coin-operated amusements in the St. Louis region, but its coast-to-coast ATM scope is fueling the company's growth. Both divisions are run out of the same 10,000-sq.ft. facility in a St. Louis suburb, though the two equipment service businesses are managed separately.
By the time of the major acquisition, the company had already built up a solid infrastructure and had gained an understanding of the ATM industry that allowed it to use economies of scale to advantage. A knowledgeable employee, already in place, came with the acquired company. "We were really able to expand on that," Farber said. "We were able to do things in nontraditional locations, beyond taverns."
A major selling point in which Farber takes particular pride is BFC's ability to accommodate location requests when placing an ATM. "A hotel might like a wood cabinet, so we invest in enhancements that add value for the customer," he said. "That's a free service. We look at our accounts as a long-term investment."
Another point of pride is the quality of the company's ATMs on location, some of which are "bank branded," a strategy that Farber has adopted for growth. He told VT that the company continually upgrades its equipment, as it has been doing for a long time. This is particularly evident on the ATM side now, as BFC does the necessary conversion to accommodate the new EMV chip cards.
"We spent a lot of money on upgrading ATMs this year, and we junked a lot of them," Farber said. "Service calls are death by a thousand cuts. And, for those of us in the amusement business, we're used to buying all the time."
The success of the company's ATM division, which primarily uses Hyosung equipment, has not diminished its commitment to coin-op amusements. Although coin-op is primarily limited to the area in and around St. Louis, the company has continued to expand its equipment offerings, which now includes not only jukeboxes and pool tables but darts, photo booths and skill cranes -- and even bulk vending equipment.
Everything You Want
"The fact is we can offer the entire package, and not everyone can do that," Farber said. "We have systems and controls in place that allow us to grow. Just last year, we bought new ATM software to help us forecast and track cash. And we've got a talented team of employees; many have been here a long time."
Although the company's ATM and amusement businesses are run separately, Farber sees synergy, so the same management philosophy is applied to both divisions. For instance, Farber prefers LED-lit equipment because it's less prone to failure and requires fewer service calls. "Now you have the LED cranes, like Smart's Prize Time Deluxe or S&B Candy and Toy Co.'s crane line," Farber said. "But back a few years, some of those cranes did not come with LEDs, so we had to upgrade them in-house."
Another innovation upon which BFC relies is the widespread use of the "play-until-you-win" strategy, which the company favors for its claw equipment, particularly in locations catering to younger children. "Many of our cranes are set on play-till-you-win mode," Farber reported. "When we find a product that makes sense, we put a 'Play Until You Win' or 'Winner Every Time' sign on the crane," he said. "That keeps them coming back. We might charge them a dollar per play, but if they know they're going to win, they'll play."
Given BFC's long track record, it's no surprise that Farber sees innovation and expansion in the company's future. Not surprisingly, he is steadfastly hopeful about that future.
"I'm optimistic," the operator said. "If you work hard, always look for new things and use technology to your advantage, you can make a good go of it," he said. "But if you take your eye off the ball and think you have it made, that's when problems happen. I look into the future, and try to see the next opportunity."