Coinstar
Encyclopedia
Coinstar, Inc. is an American
company.
The firm's original focus was the conversion of loose change
into paper currency, donation
s or gift card
s via coin counter kiosks. Coinstar deducts a fee
for conversion of coins to banknotes and charitable donations, but not for gift cards.
The company has more than 60,000 locations including a variety of services in the US, UK
, Ireland
, Canada
, Puerto Rico
and Mexico
.
Coinstar currently aims to create a presence in the front end of stores
(between the cash register
s and the exit/entrance). The foremost example is their ownership of the Redbox
DVD
rental service. The company also produces machines that provide prepaid credit cards and cellular phone cards as well as e-payment kiosks.
, is located at grocery store
s, drug stores, larger merchants, banks or other retail locations. The coin counting service is available in the US, Puerto Rico, Canada, Ireland and the UK.
To process coins, one simply pours unsorted loose change into the machine. In the United States, the machine accepts all denominations of coins from one-cent coins to one-dollar coins, its only restriction being 1943 steel cent
s and Eisenhower Dollar
s. When the machine finishes counting coins it issues a scrip
, called a voucher
, which the user can redeem at the place of business providing the coin counting service at face value for currency. The same mode of operation and redemption is provided on those Coinstar machines situated in Great Britain, Ireland, Canada, and Puerto Rico
.
The coin counting processing fee, deducted from the total once coins have been counted, is 9.8% (USD) in the USA, 11.9% in Canada, 9.9% in Ireland and 8.9% in the UK. Some machines may offer a lower rate; in this case the store hosting the machine has subsidised the rate. A newer service enables users to use their coins to buy a gift card
from merchants without the usual fee ("no fee") — including such retailers as Starbucks
, Amazon.com
, Borders
, Banana Republic, Gap
, Regal Entertainment Group
, Old Navy
, iTunes
, J.C. Penney
, CVS Pharmacy and Overstock.com. Select grocery retailers, including SuperValu
and Stop & Shop
are also participating in the "no fee" offers. If the user chooses the fee-free option the machine issues a plastic gift card or, in the case of online merchants like Amazon.com
, a voucher with a redemption code.
US and UK users also have the option of donating their change to a selected charity. By 2006, Coinstar has raised more than $20 million for charities including the American Red Cross Disaster Relief fund, Leukemia and Lymphoma Society and Unicef's Trick or Treat program.
Coinstar has processed more than 350 billion coins in its nearly two decades of operation, with an average transaction amount of about $38. The largest single transaction was $13,000 in pennies from a man in Alabama
.
Coinstar has become a multi-national provider of services for the front end of retail stores. Services provided include coin counting, bulk vending
, prepaid products (gift cards), money transfer
and automated DVD
rentals (via Redbox
). In September 2009, Coinstar sold its entertainment business, which included skill cranes and bulk vending, to National Entertainment Network.
Coinstar will also be coming out with additional services, including the ability to deposit coins directly into a personal bank account. A specific time frame for availability of this service has not been announced.
.
In February 2009, Coinstar purchased all remaining shares of DVD rental kiosk company Redbox
for $175 million from McDonald's Corporation, making Coinstar the sole owner. Prior to this, Coinstar and McDonald's each owned 47% of Redbox shares with various other parties owning the remaining 6%.
In some sections of the U.S., regional banks have begun offering free coin-counting services in the amount of a gift card. Refunds are often given in cash rather than in the form of a gift card. In some cases it is not even necessary for the customer to have an account at the bank; the free service is offered as a way to attract new business from individuals who are not current account holders. TD Bank's "Penny Arcade" coin counters were free and available to both customers and non-customers in many branches, but as of November 2010, the bank charges a 6% fee for non-customers to use the machine. Netflix and Blockbuster are also considered competitors with Coinstar's Redbox
movie service.
resident Edmond Knowles after Knowles's bank refused to cash them in. The armored truck
sent by Coinstar to Knowles's home sank into the mud in his yard after being loaded with the 4.5-ton collection, and needed to be rescued by a tow truck
.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
company.
The firm's original focus was the conversion of loose change
Coin
A coin is a piece of hard material that is standardized in weight, is produced in large quantities in order to facilitate trade, and primarily can be used as a legal tender token for commerce in the designated country, region, or territory....
into paper currency, donation
Donation
A donation is a gift given by physical or legal persons, typically for charitable purposes and/or to benefit a cause. A donation may take various forms, including cash, services, new or used goods including clothing, toys, food, and vehicles...
s or gift card
Gift card
A gift card is a restricted monetary equivalent or scrip that is issued byretailers or banks to be used as an alternative to a non-monetary gift....
s via coin counter kiosks. Coinstar deducts a fee
Fee
A fee is the price one pays as remuneration for services. Fees usually allow for overhead, wages, costs, and markup.Traditionally, professionals in Great Britain received a fee in contradistinction to a payment, salary, or wage, and would often use guineas rather than pounds as units of account...
for conversion of coins to banknotes and charitable donations, but not for gift cards.
The company has more than 60,000 locations including a variety of services in the US, UK
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
, Ireland
Ireland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
, Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
, Puerto Rico
Puerto Rico
Puerto Rico , officially the Commonwealth of Puerto Rico , is an unincorporated territory of the United States, located in the northeastern Caribbean, east of the Dominican Republic and west of both the United States Virgin Islands and the British Virgin Islands.Puerto Rico comprises an...
and Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
.
Coinstar currently aims to create a presence in the front end of stores
Retailing
Retail consists of the sale of physical goods or merchandise from a fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. Purchasers may be...
(between the cash register
Cash register
A cash register or till is a mechanical or electronic device for calculating and recording sales transactions, and an attached cash drawer for storing cash...
s and the exit/entrance). The foremost example is their ownership of the Redbox
Redbox
Redbox is an American company that specializes in the rental of DVDs, Blu-ray Discs, and video games via automated retail kiosks. As of the end of June 2011, Redbox had over 33,000 kiosks in over 27,800 locations....
DVD
DVD
A DVD is an optical disc storage media format, invented and developed by Philips, Sony, Toshiba, and Panasonic in 1995. DVDs offer higher storage capacity than Compact Discs while having the same dimensions....
rental service. The company also produces machines that provide prepaid credit cards and cellular phone cards as well as e-payment kiosks.
Kiosk design and operation
The typical kiosk, painted green and the size of a large vending machineVending machine
A vending machine is a machine which dispenses items such as snacks, beverages, alcohol, cigarettes, lottery tickets, consumer products and even gold and gems to customers automatically, after the customer inserts currency or credit into the machine....
, is located at grocery store
Grocery store
A grocery store is a store that retails food. A grocer, the owner of a grocery store, stocks different kinds of foods from assorted places and cultures, and sells these "groceries" to customers. Large grocery stores that stock products other than food, such as clothing or household items, are...
s, drug stores, larger merchants, banks or other retail locations. The coin counting service is available in the US, Puerto Rico, Canada, Ireland and the UK.
To process coins, one simply pours unsorted loose change into the machine. In the United States, the machine accepts all denominations of coins from one-cent coins to one-dollar coins, its only restriction being 1943 steel cent
1943 steel cent
The 1943 steel cent, also known as a steelie, was a variety of the U.S. one-cent coin which was struck in steel due to wartime shortages of copper. It was designed by Victor D...
s and Eisenhower Dollar
Eisenhower Dollar
The Eisenhower dollar is a $1 coin issued by the United States government from 1971–1978...
s. When the machine finishes counting coins it issues a scrip
Scrip
Scrip is an American term for any substitute for currency which is not legal tender and is often a form of credit. Scrips were created as company payment of employees and also as a means of payment in times where regular money is unavailable, such as remote coal towns, military bases, ships on long...
, called a voucher
Voucher
A voucher is a bond which is worth a certain monetary value and which may be spent only for specific reasons or on specific goods. Examples include housing, travel, and food vouchers...
, which the user can redeem at the place of business providing the coin counting service at face value for currency. The same mode of operation and redemption is provided on those Coinstar machines situated in Great Britain, Ireland, Canada, and Puerto Rico
Puerto Rico
Puerto Rico , officially the Commonwealth of Puerto Rico , is an unincorporated territory of the United States, located in the northeastern Caribbean, east of the Dominican Republic and west of both the United States Virgin Islands and the British Virgin Islands.Puerto Rico comprises an...
.
The coin counting processing fee, deducted from the total once coins have been counted, is 9.8% (USD) in the USA, 11.9% in Canada, 9.9% in Ireland and 8.9% in the UK. Some machines may offer a lower rate; in this case the store hosting the machine has subsidised the rate. A newer service enables users to use their coins to buy a gift card
Gift card
A gift card is a restricted monetary equivalent or scrip that is issued byretailers or banks to be used as an alternative to a non-monetary gift....
from merchants without the usual fee ("no fee") — including such retailers as Starbucks
Starbucks
Starbucks Corporation is an international coffee and coffeehouse chain based in Seattle, Washington. Starbucks is the largest coffeehouse company in the world, with 17,009 stores in 55 countries, including over 11,000 in the United States, over 1,000 in Canada, over 700 in the United Kingdom, and...
, Amazon.com
Amazon.com
Amazon.com, Inc. is a multinational electronic commerce company headquartered in Seattle, Washington, United States. It is the world's largest online retailer. Amazon has separate websites for the following countries: United States, Canada, United Kingdom, Germany, France, Italy, Spain, Japan, and...
, Borders
Borders Group
Borders Group, Inc. was an international book and music retailer based in Ann Arbor, Michigan. The company employed approximately 19,500 throughout the U.S., primarily in its Borders and Waldenbooks stores....
, Banana Republic, Gap
Gap (clothing retailer)
The Gap, Inc. is an American clothing and accessories retailer based in San Francisco, California, and founded in 1969 by Donald G. Fisher and Doris F. Fisher. The company has five primary brands: the namesake Gap banner, Banana Republic, Old Navy, Piperlime and Athleta. As of September 2008,...
, Regal Entertainment Group
Regal Entertainment Group
Regal Entertainment Group also known as REG is a movie theater chain headquartered in Knoxville, Tennessee. Regal operates the largest and most geographically diverse theater circuit in the United States, consisting of 6,775 screens in 548 locations in 39 states and the District of Columbia as of...
, Old Navy
Old Navy
Old Navy is an American clothing brand as well as a chain of stores owned by Gap, Inc., with corporate operations in San Francisco and San Bruno, California. It is one of the first major corporations to house headquarters in the new Mission Bay district of San Francisco.Gap, Inc. was run by...
, iTunes
ITunes Store
The iTunes Store is a software-based online digital media store operated by Apple. Opening as the iTunes Music Store on April 28, 2003, with over 200,000 items to purchase, it is, as of April 2008, the number-one music vendor in the United States...
, J.C. Penney
J.C. Penney
J. C. Penney Company, Inc. is a chain of American mid-range department stores based in Plano, Texas, a suburb north of Dallas. The company operates 1,107 department stores in all 50 U.S. states and Puerto Rico. JCPenney also operates catalog sales merchant offices nationwide in many...
, CVS Pharmacy and Overstock.com. Select grocery retailers, including SuperValu
Supervalu (United States)
SuperValu Inc. is a United States grocery retailer and distributor. The corporation, headquartered in Eden Prairie, Minnesota, has been in business for over a century. It is the third-largest food retailing company in the United States , and ranks #51 on the Fortune 100 list.On June 2, 2006,...
and Stop & Shop
Stop & Shop
The Stop & Shop Supermarket Company is a chain of supermarkets located mostly in the northeastern United States. Its main rivals are Shaw's Star Market and Hannaford in New England, while ShopRite and the A&P family of supermarkets are its main competition in New York and New Jersey.- History :Stop...
are also participating in the "no fee" offers. If the user chooses the fee-free option the machine issues a plastic gift card or, in the case of online merchants like Amazon.com
Amazon.com
Amazon.com, Inc. is a multinational electronic commerce company headquartered in Seattle, Washington, United States. It is the world's largest online retailer. Amazon has separate websites for the following countries: United States, Canada, United Kingdom, Germany, France, Italy, Spain, Japan, and...
, a voucher with a redemption code.
US and UK users also have the option of donating their change to a selected charity. By 2006, Coinstar has raised more than $20 million for charities including the American Red Cross Disaster Relief fund, Leukemia and Lymphoma Society and Unicef's Trick or Treat program.
Coinstar has processed more than 350 billion coins in its nearly two decades of operation, with an average transaction amount of about $38. The largest single transaction was $13,000 in pennies from a man in Alabama
Alabama
Alabama is a state located in the southeastern region of the United States. It is bordered by Tennessee to the north, Georgia to the east, Florida and the Gulf of Mexico to the south, and Mississippi to the west. Alabama ranks 30th in total land area and ranks second in the size of its inland...
.
Other services
Many Coinstar machines in the US also sell prepaid products such as Green-Dot preloaded MasterCard, prepaid wireless airtime from major carriers and long distance cards. In the UK gift cards are not available but phone cards are, including Virgin, Tesco Mobile, Orange, T-Mobile, Vodafone, Swiftcall and United.Coinstar has become a multi-national provider of services for the front end of retail stores. Services provided include coin counting, bulk vending
Bulk vending
Bulk vending is the sale of unsorted confections, nuts, gumballs, toys and novelties selected at random and dispensed generally through non-electrically operated vending machines. Bulk vending is a separate segment of the vending industry from full line vending — i.e., the snack and soda vending...
, prepaid products (gift cards), money transfer
Money transfer
Money transfer generally refers to one of the following cashless modes of payment or payment systems:*Wire transfer, an international expedited bank-to-bank funds transfer*Electronic funds transfer, an umbrella term mostly used for bank card-based payments...
and automated DVD
DVD
A DVD is an optical disc storage media format, invented and developed by Philips, Sony, Toshiba, and Panasonic in 1995. DVDs offer higher storage capacity than Compact Discs while having the same dimensions....
rentals (via Redbox
Redbox
Redbox is an American company that specializes in the rental of DVDs, Blu-ray Discs, and video games via automated retail kiosks. As of the end of June 2011, Redbox had over 33,000 kiosks in over 27,800 locations....
). In September 2009, Coinstar sold its entertainment business, which included skill cranes and bulk vending, to National Entertainment Network.
Coinstar will also be coming out with additional services, including the ability to deposit coins directly into a personal bank account. A specific time frame for availability of this service has not been announced.
History
The company was founded in 1991 and is headquartered in Bellevue, WashingtonBellevue, Washington
Bellevue is a city in the Eastside region of King County, Washington, United States, across Lake Washington from Seattle. Long known as a suburb or satellite city of Seattle, it is now categorized as an edge city or a boomburb. The population was 122,363 at the 2010 census.Downtown Bellevue is...
.
In February 2009, Coinstar purchased all remaining shares of DVD rental kiosk company Redbox
Redbox
Redbox is an American company that specializes in the rental of DVDs, Blu-ray Discs, and video games via automated retail kiosks. As of the end of June 2011, Redbox had over 33,000 kiosks in over 27,800 locations....
for $175 million from McDonald's Corporation, making Coinstar the sole owner. Prior to this, Coinstar and McDonald's each owned 47% of Redbox shares with various other parties owning the remaining 6%.
Competition
Cummins-Allison Corporation (Mt. Prospect, IL), best known for its wide range of "backroom" currency and coin handling equipment, is also a leading supplier of self-service, coin counting kiosks. Cummins-Allison offers two different base model self-service coin counting kiosks -- The Money Machine and Jetcoin -- each with a variety of available features and options.In some sections of the U.S., regional banks have begun offering free coin-counting services in the amount of a gift card. Refunds are often given in cash rather than in the form of a gift card. In some cases it is not even necessary for the customer to have an account at the bank; the free service is offered as a way to attract new business from individuals who are not current account holders. TD Bank's "Penny Arcade" coin counters were free and available to both customers and non-customers in many branches, but as of November 2010, the bank charges a 6% fee for non-customers to use the machine. Netflix and Blockbuster are also considered competitors with Coinstar's Redbox
Redbox
Redbox is an American company that specializes in the rental of DVDs, Blu-ray Discs, and video games via automated retail kiosks. As of the end of June 2011, Redbox had over 33,000 kiosks in over 27,800 locations....
movie service.
Advertising
To generate publicity, Coinstar offered to cash in over 1.3 million pennies collected over four decades by Flomaton, AlabamaAlabama
Alabama is a state located in the southeastern region of the United States. It is bordered by Tennessee to the north, Georgia to the east, Florida and the Gulf of Mexico to the south, and Mississippi to the west. Alabama ranks 30th in total land area and ranks second in the size of its inland...
resident Edmond Knowles after Knowles's bank refused to cash them in. The armored truck
Armored car (valuables)
A common meaning of armored car is as an armored van or truck, used in transporting valuables, such as large quantities of money . The armored car is a multifunctional vehicle designed to protect and ensure the well being of the transported individuals and/or contents...
sent by Coinstar to Knowles's home sank into the mud in his yard after being loaded with the 4.5-ton collection, and needed to be rescued by a tow truck
Tow truck
A tow truck is a vehicle used to transport motor vehicles to another location , or to recover vehicles which are no longer on a drivable surface.Towing services are generally provided by an emergency road service operator...
.
External links
- Coinstar website for the United States (in green)
- Coinstar website for the United Kingdom (in blue)
- StartupStudio In depth interview with Jens Molbak covering the story of how Coinstar began, recommendations for entrepreneurs, childhood experiences that helped Jens succeed, etc. Copy of StartupStudio podcast at AllBusiness
- National Entertainment Network
- Counting Canadian Coins