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The Change Shortage is Making Change.

July 21, 2020
Tokens and Coins

The lack of coins in the market place is causing coin-op companies to change their business models.  

COVID-19 has upended many aspects of our daily lives. One unanticipated consequence is a shortage in US coins.  Due in part to lowered production levels by the U.S. Mint and the reduced currency circulation caused by the national stay-at-home orders, our country is in the midst of a coin shortage.  Businesses that require coins for their livelihood are reconsidering their dependency.  Such things as parking meters, bar-arcades, family entertainment centers, laundromats, vending businesses and car washes are considering a switch to a token-operated system.  

Currently large grocery chains are requesting patrons use contactless payment, while smaller shops are requesting exact change for purchases.  Banks are being forced to ration their coin allotment and some banks are actually calling customers requesting they bring their coins in for deposit.  During the lockdown, many businesses and banks that offered coin sorting kiosks, like Coinstar, were closed.  As a result, loose change has stayed piled up on the dresser or collected in the change jar.  

“What’s happened is that with the partial closure of the economy, the flow of coins through the economy, it has gotten all – it’s kind of stopped,” stated Jerome H. Powell, Chairman of the Federal Reserve while testifying in front of lawmakers on Capital Hill.  The Federal Reserve has initiated strategic allocations of coin inventories and is working with the US Mint to increase production levels.  

TokensDirect has been monitoring the current coin shortage in the United States as a result of the COVID-19 pandemic.  Requests for information about changing the vending model from coins to tokens has increased immensely.  Companies like car washes and laundromats are leading the charge.  According to Ted Schuh, national sales manager for TokensDirect and Van Brook of Lexington, “Companies that were considering a move to a token-based model are activating their plans and businesses, that are for the first time being hurt with the shortage of coins, are expressing interest now too.”  

TokensDirect and Van Brook are both divisions of Osborne Coinage Company and combined they are  the nation’s largest suppliers of tokens.  Every token they craft is proudly made in America.  

There are numerous benefits to using tokens instead of actual coins for your coin-op business and the newest benefit is insulating your company from the lack of US currency as a result of COVID-19 pandemic.  In the event that another coin shortage occurs down the road, moving to a token based model will eliminate the chance of a repeat dilemma. 

Benefits of Using Tokens:

•    Decreased theft and vandalism 

Theft can occur at multiple points during the vending cycle.  It could be as simple as an employee skimming quarters from the till.  Tokens provide more cash control with less supervision. 

Theft can also have a more substantial financial impact to the bottom line if the coin boxes themselves are damaged in the act.  Thieves have to pry open the coin holders, often damaging the faceplate and the cash box, causing exceptionally more financial damage to the machinery than the actual take from the coins.  For the owner of a coin-op car wash or laundromat, the costs of a theft are doubled or tripled by repairs.  As one laundromat owner expressed “…the loss is then compounded by the time the system is down, coin operated equipment only makes money when it is working.”  Tokens are not usable as legal tender so the spoils of the theft are diminished, if not eliminated, by switching to a token-based system.  

Even with the sophistication of today’s coin vending machines, they are still susceptible to counterfeit or slug usage.  Many types of tokens can include characteristics that eliminate the opportunity to counterfeit.  

•    Reusable

Simply stated you can purchase your tokens once and use them for years.  The cyclical cycle that tokens deliver allows you to reuse your tokens over and over.  Because tokens are made from metal, they seldom wear out and even dirty, they maintain their metallurgical properties.

•    “Walkaways”

If the token system is set up where a patron receives five one-dollar value tokens for their five dollar bill and only uses four tokens, they take the extra token home.  Those walkaways are pure profit.  On average a token may cost 30 cents for you to purchase.  If it is sold at one dollar, the walkaway token netted you 70 cents of pure profit, as you have not used any of your machine costs, electricity or water.  Mark Jolin, owner of Big Bunny’s Dunk ‘N Foam Car Wash in Southbridge, Massachusetts, says, “I annually purchased 5,000 tokens and by year’s end the number of tokens remaining in the poke is around 3,500.  That means that 1,500 of those tokens have walked away.  Consider that each token is a profit of 70 cents then in one year that’s $1,050 profit.”  

Another fringe benefit of walkaways is their marketing power.  Custom tokens placed in the coin tray of the car or in the bottom of a purse serve as a subtle reminder that it could be time for a car wash,  family event or date night.  Branded tokens with your company name and address point these repeat customers to the right place and encourage return visits since the token can’t be redeemed elsewhere.  Others may even find the token collectable or it may serve as a keepsake to mark a particular visit.  

•    Marketing Tool

Permanently branding tokens with your business name and address allows for a continuous product placement opportunity, basically a perpetual advertisement.  These advertisements build customer loyalty and brand recognition.

Tokens can also act as the perfect promotional item, given to a potential customer to encourage them to visit your location.  If you give a quarter to a person they can spend it anywhere, if you give a uniquely branded token to someone they have to patronize your business to redeem it.

Tokens serve as an immediate refund for the disgruntled client in lieu of handing back cash; smart proprietors often give additional tokens to add gravity to the apology.  

Since you are able to determine how many tokens are distributed in a purchase, one can gift 35 tokens for $30 and still be making money, all while giving the impression that the customer is getting more for their money.  Tokens branded with your company name and redeemable only at your establishment have just added business.  This marketing tool is a win-win for you and the customer.

The Federal Reserve stated that “the COVID-19 pandemic has significantly disrupted the supply chain and normal circulation patterns for U.S. coin.”  Despite the U.S. Mint increasing production of coinage from 1 billion per month to in excess of 1.35 billion per month, the effects of the coin shortage will continue for at least another month.  Businesses across America are finding it difficult to literally have two pennies to rub together, driving coin-operated companies to reevaluate the use of tokens.

TokensDirect and Van Brooks offer easy transition opportunities to convert current coin vending ventures over to a token based model.  Based on the type of customized token selected, change receptacles can easily be reprogrammed to accept only your tokens.  Switching to tokens can also provide cost-savings opportunities.  A change machine that holds 1,200 quarters provides $300 worth of transactions before needing a refill.  If that machine is converted to hold one-dollar tokens, it can now hold four times the monetary value and the exchange transactions for a dollar increases to 4,800.  If $5 gets a customer 6 tokens and only $5 transactions are programmed you will have 800 dealings before a refill.   This not only eliminates the dependency on quarter change, but reduces the number of times employees have to load the machine, saving on labor.

The tokens themselves can be licensed for exclusivity in a radius of 75 miles of your location with a controlled distribution program.  Not only will your tokens be unusable in any other machines for miles, but competitor’s tokens will not be useful in your devices.  The uniqueness of these tokens truly differentiates your business from your competition.  

Those coin-op companies that act now and initiate the changeover process will receive one FREE custom die set-up, a $210 savings, so that they can individualize their new tokens.  The TokensDirect design team is ready to assist.

Coin operated businesses do not want to be caught with a change shortage again, causing many to make the move to tokens.  The lack of change is bringing change with the assistance of TokensDirect and Van Brook of Lexington.  Contact them today to start “making change!”

About Osborne Coin:  / #OsborneCoin and TokensDirect/Van Brook of Lexington

Established in 1835, Osborne Coinage is America’s oldest continuously operating private mint.  The family of brands includes: Osborne Mint, TokensDirect and Van Brook of Lexington. 

TokensDirect knows the process of minting custom and stock tokens that result in crisply detailed impressions with accurate dimensions that exhibit electrical and weight consistency throughout every batch. Our tokens look great, work great, and accept time after time in all standard coin mechanisms. 

We have a talented staff of graphic designers on site that can take a rough sketch and turn it into a workable token design. Our self-contained facility encompasses all the operations necessary to mint over 600,000,000 coins and tokens a year. We’re exceptionally proud that we make all our tokens in the USA. We do not import our tokens or materials from overseas.

Van Brook has been a token innovator in the carwash, vending, parking and amusement industries since its inception in 1964. Van Brook tokens are used in over 97 countries. Home of the CT™ and CTX™ High Security Electronic Tokens. Best used for values of $1 or more, these tokens are available with an “exclusive use” license, which means a specific token will not be sold to another coin-op business withing a 75 mile radius, reducing the issue of cross-play. 


New press releases highlighting token uses are added all the time. Please continue to check back for the latest white papers. If you'd like to speak with a sales specialist, call