Canadian Vending

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Operators to suffer from RCM’s savings

CAMA doubts new coins will deliver intended benefits


March 25, 2010
By Administrator

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March 25, 2010, Mississauga, Ont. – The Canadian Automatic Merchandising Association (CAMA) acknowledges that the introduction of new multi-ply coins by the Royal
Canadian Mint (RCM) will save significant money for the Canadian Treasury.

March 25, 2010, Mississauga, Ont. – The Canadian Automatic Merchandising Association (CAMA) acknowledges that the introduction of new multi-ply coins by the Royal
Canadian Mint will save significant money for the Canadian Treasury. However, this change will result in equal if not greater
costs to Canadian small businesses in the automatic merchandising
industry. 

Last week, the federal government announced
it is planning to change the composition of Canadian $1 and $2 coins by
using a "less expensive patented multi-ply plated steel technology."
Under its plans outlined in Budget 2010, The Mint estimates the new
technology to make them, will cut production costs significantly,
saving up to $15 million a year. Furthermore, The Mint claims its new
coins will work in vending machines. 

CAMA believes both
claims are misleading. As importantly, the $15 million the federal
government estimates it will save is just a fraction of the extra costs
that will ultimately be borne by Canadian businesses and consumers. In
addition, local governments will be forced to bear the financial burden
related to the conversion of municipally owned and operated parking and
transit equipment. 

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"Although CAMA appreciates the Royal
Canadian Mint's cost saving efforts, we are concerned with its negative
impacts on the coin acceptance industry in Canada," said Kim Lockie,
President, Canadian Automatic Merchandising Association. "This change
delivers no financial benefits to our industry, but rather will add
significant expenses to not only our members, but to all Canadian
businesses that rely on automatic coin acceptance. Transit authorities,
parking lot operators, municipalities, amusement machine owners, retail
kiosks, carwash operators, laundry machine operators, toll authorities
and lottery associations are just some of the industries that will be
negatively affected."

Industry experts agree The Mint's
new multi-layer plating technology will cause coin acceptance issues as
a result of the not-so-subtle differences between the new steel core
coins and Canada's existing coins which have worked flawlessly in
vending machines. The result – lost revenue as well as increased
service costs for automated vending machine operators nationwide. CAMA
estimates this conversion will cost its members significant time and
financial resources in bearing the costs associated with software and
hardware upgrades.


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