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EDITOR’S NOTE

Exceed Your Employees’ Expectations With labor pains persisting, retention is more important than ever • “With 100% turnover, we can’t train fast enough.”

CONVENIENCE STORE operators find themselves in a precarious position right now.

They are bracing for lower foot traffic this year as their customer base continues to have less discretionary income to spend. Less foot traffic translates into an even greater need to keep the customers they have by providing exceptional service. At the same time, however, they remain plagued by labor issues, preventing them from delivering that level of service.

Convenience Store News recently fielded its 2024 Forecast Study and as we do every year, we asked c-store operators to identify the factors that will have the biggest impact on their sales and profitability in the year ahead.

For the third consecutive year, labor came out on top, ahead of increasing operational costs at No. 2 and inflation and economic issues at No 3.

Verbatim comments from respondents this year included: • “Slim pickings in the hiring pool.”

• “We are seeing a sharp decline in the number of applicants for all levels of jobs and the ones who are applying are asking for significantly higher pay and benefits.”

• “Labor costs per hour increase, but the amount of work you get out of an employee is decreasing. You invest in training only for them to move on to the next job that pays a little more or has less responsibility.”

Unfortunately, it’s unlikely that the situation will improve soon. Workforce management company Legion Technologies Inc. recently polled more than 1,500 hourly employees and 628 managers in North America and found that 62% of hourly workers plan to leave their jobs in the next 12 months, up from 42% a year ago; 64% of those who intend to resign plan to leave the industry in which they work; and 67% intend to leave the retail industry altogether.

The top three catalysts cited were not enough benefits, undesirable working conditions and insufficient schedule flexibility. The good news is that all three of these are things c-store operators can control and improve upon, leading to better employee retention.

For this issue, we’ve put together a special feature on “Enhancing the Employee Experience” (page 45). The article discusses how companies are making it a priority to keep team members satisfied — from a hiring process that is positive and frictionless, to career advancement opportunities, to finding ways to make workers feel valued and respected every day.

I hope you come away with lots of ideas to meet, or better yet, exceed your employees’ expectations.

For comments, please contact Linda Lisanti, Editor-in-Chief, at llisanti@ensembleiq.com.

EDITORIAL EXCELLENCE AWARDS (2016-2024)

EDITORIAL ADVISORY BOARD Laura Aufleger OnCue Express

2021 Jesse H. Neal National Business Journalism Award Finalist, Best Infographics, June 2021

2018 Jesse H. Neal National Business Journalism Award Finalist, Best Editorial Use of Data, June 2017

2023 American Society of Business Press Editors, National Azbee Awards Silver, Data Journalism, January/April/June 2022

2023 American Society of Business Press Editors, Upper Midwest Regional Azbee Awards Gold, Data Journalism, January/April/June 2022 Bronze, Diversity, Equity and Inclusion, March 2022

2016 American Society of Business Press Editors, National Azbee Awards Gold, Best How-To Article, March 2015 Bronze, Best Original Research, June 2015

2016 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best How-To Article, March 2015 Silver, Best Original Research, June 2015

2020 Trade Association Business Publications Intl. Tabbie Awards Honorable Mention, Best Single Issue, September 2019

2016 Trade Association Business Publications Intl. Tabbie Awards

2023 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, September 2022 Business to Business, Retail, Single Article, March 2023

2022 Eddie Award, Folio: magazine Winner, Business to Business, Retail, Single Article, March 2022 Winner, Business to Business, Food & Beverage, Series of Articles, October 2021 Honorable Mention, Business to Business, Retail, Single Article, September 2021

2020 Eddie Award, Folio: magazine Business to Business, Retail, Series of Articles, September 2019

Billy Colemire Stinker Stores Robert Falciani ExtraMile Convenience Stores Jim Hachtel Core-Mark Chris Hartman Rutter’s

Ruth Ann Lilly GPM Investments LLC Vito Maurici McLane Co. Inc. Jonathan Polonsky Plaid Pantries Inc. Greg Scriver Kwik Trip Inc. Tony Sparks Curby’s Express Market

2018 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Website Business to Business, Retail, Full Issue, October 2017 Business to Business, Editorial Use of Data, June 2017

Faheem Jamal CPD Energy Corp./ Chestnut Markets

Roy Strasburger StrasGlobal

2017 Eddie Award, Folio: magazine Winner, Business to Business, Retail, Single/Series of Articles, May 2017 Honorable Mention, Business to Business, Retail, Single/Series of Articles, June 2016

2016 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2015 Business to Business, Retail, Single/Series of Articles, August 2015

Silver, Front Cover Illustration, June 2015

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VIEWPOINT

Finding Your Secret Sauce Harness innovation and future-forward strategies to create a competitive advantage BRAND LOYALTY IS ACCOMPLISHED in a number of different ways, but the most compelling

way to create loyal customers — indeed, brand ambassadors and rabid fans of your brand — is to differentiate yourself from the competition. While price points will always be important, retailers who differentiate themselves know that consumers will often pay a higher price for that special sauce.

Outside of our industry, Elon Musk is able to differentiate Tesla from other auto brands because the cars are innovative, upscale and battery-powered. Apple, despite charging higher prices than its competitors, is able to convince customers that its products are better quality, more stylish and more innovative.

While price points will always be important, retailers who differentiate themselves know that consumers will often pay a higher price for that special sauce.

In the foodservice business, KFC was the dominant chicken chain, but are its customers as devoted to its “Finger Lickin’ Good” products as the hordes of people who wait on long, double-wide, drive-thru lines at Chick-fil-A? I remember seeing lines out into the street when Chick-fil-A opened its first locations in Manhattan.

Let’s look at how the major fast-food burger chains differentiate. McDonald’s has the Big Mac, Burger King the Whopper, but why do so many people say In-N-Out Burger is a must stop on any trip to the West Coast? For me, I can’t pass up a Shake Shack whether I’m at Citi Field in Queens, N.Y., or Terminal 4 at JFK International Airport.

Starbucks’ differentiation has involved getting customers to spend an outlandish amount of money on a cup of coffee by positioning itself as its customers’ third place — with home and office being the other two places. It worked.

From beverage strategies to cutting-edge technology to proprietary food offerings and creating an exceptional service culture, the best convenience stores are also differentiating themselves to win market share today and into the future.

What’s your secret sauce? Foodservice leaders in the convenience store industry will gather in Tampa, Fla., May 2-3 at Convenience Store News’ 2024 Convenience Foodservice Exchange (CFX) for two days of education, collaboration, networking and problem-solving. We’ll explore the ways retailers are harnessing innovation and future-forward strategies to create a competitive advantage.

Among the already-confirmed speakers are: • Shawn Barnes, director of foodservice at Murphy USA Inc./QuickChek Corp.; • Jim Bressi, vice president of foodservice at The Spinx Co. • Ben Lucky, vice president of foodservice at Cal’s Convenience;

REGISTER NOW FOR CFX 2024:

• Mendy Meriweather, director of fresh foods and beverages at Wawa Inc.; • Liza Salaria, senior principal consultant at Impact 21; • Tony Sparks, head of Customer Wow! at Curby’s Express Market; and • Jasmyn Turner, director of dispensed beverages, North America at Circle K. You can get a head start on your competition by attending CFX 2024. If you are a convenience store retailer, email me for an invitation to this exclusive event.

For comments, please contact Don Longo, Editorial Director Emeritus, at dlongo@ensembleiq.com.

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CONTENTS FEB 24

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COV ER STORY PAGE 30

74 FEATURES

DEPARTMENTS

COVER STORY

EDITOR’S NOTE

SMALL OPERATOR

30 A Smokefree Future?

As suppliers embrace tobacco harm reduction and expand their noncombustible portfolios, a world without cigarettes is up for debate.

4 Exceed Your Employees’ Expectations With labor pains persisting, retention is more important than ever.

26 Can C-stores Deliver the Goods?

Home delivery can still be a competitive edge for a small operator, but only if the program is tightly focused.

FEATURE

VIEWPOINT

45 Enhancing the Employee Experience Top c-store chains focus on identifying what potential employees desire and then providing that.

6 Finding Your Secret Sauce Harness innovation and future-forward strategies to create a competitive advantage.

AN EYE ON D&I

12 CSNews Online 24 New Products

53 Helping Black Talent Thrive Circle K and CALIBR partner on a development program for Black mid-level leaders.

STORE SPOTLIGHT

55 A Brighter Future SunStop gives three of its locations a high-end remodel, with a new emphasis on foodservice.

INSIDE THE CONSUMER MIND

74 Snack, Meal or Both?

The once-clear line between snack time and mealtime will blur in 2024.

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© 2024 BlueTriton Brands, Inc.

A S I P O F T H E good life Contact your BlueTriton account representative for more information or contact us directly.

BTBSaratogasales@bluetriton.com

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8550 W. Bryn Mawr Ave., Ste. 225, Chicago, IL 60631 (773) 992-4450 Fax (773) 992-4455 WWW.CSNEWS.COM BRAND MANAGEMENT SENIOR VICE PRESIDENT-GROUP PUBLISHERUS GROCERY & CONVENIENCE GROUP Paula Lashinsky (917) 446-4117 - plashinsky@ensembleiq.com

EDITORIAL EDITOR-IN-CHIEF Linda Lisanti llisanti@ensembleiq.com EXECUTIVE EDITOR Melissa Kress mkress@ensembleiq.com SENIOR EDITOR Angela Hanson ahanson@ensembleiq.com MANAGING EDITOR Danielle Romano dromano@ensembleiq.com

ASSOCIATE EDITOR Amanda Koprowski akoprowski@ensembleiq.com

INDUSTRY ROUNDUP

CATEGORY MANAGEMENT

14 7-Eleven Adds 204 C-stores in Nearly $1B Deal

FOODSERVICE

16 Third-Generation Leader Assumes CEO Role at RaceTrac

38 Building a Better Beverage Offer Curby’s Express Market makes the case for going full speed ahead on signature beverages.

PACKAGED BEVERAGES

18 Eye on Growth 18 Fast Facts

42 Tapping Into What’s Trending In the packaged beverages category, zero-sugar options and packaging innovation are on point.

19 Retailer Tidbits TECHNOLOGY 20 Supplier Tidbits 22 Federal Reserve Extends Comment Period for Debit Card Swipe Fee Changes

50 In Pursuit of Operational Excellence Convenience store retailers seek solutions that will provide a seamless experience behind the scenes.

50

EDITORIAL DIRECTOR EMERITUS Don Longo dlongo@ensembleiq.com CONTRIBUTING EDITORS Renée M. Covino, Tammy Mastroberte

ADVERTISING SALES & BUSINESS ASSOCIATE BRAND DIRECTOR & NORTHEAST SALES MANAGER Rachel McGaffigan - (774) 212-6455 rmcgaffigan@ensembleiq.com ASSOCIATE BRAND DIRECTOR & WESTERN SALES MANAGER Ron Lowy - (330) 840-9557 - rlowy@ensembleiq.com ACCOUNT EXECUTIVE & CLASSIFIED ADVERTISING Terry Kanganis - (201) 855-7615 - tkanganis@ensembleiq.com

DESIGN/PRODUCTION/MARKETING ART DIRECTOR Lauren DiMeo ldimeo@ensembleiq.com PRODUCTION DIRECTOR Pat Wisser pwisser@ensembleiq.com SENIOR MARKETING MANAGER Krista-Alana Travis ktravis@ensembleiq.com

SUBSCRIPTION SERVICES LIST RENTAL mbriganti@anteriad.com SUBSCRIPTION QUESTIONS contact@csnews.com

CORPORATE OFFICERS CHIEF EXECUTIVE OFFICER

Jennifer Litterick

CHIEF FINANCIAL OFFICER

Jane Volland

CHIEF PEOPLE OFFICER

Ann Jadown

CHIEF STRATEGY OFFICER

Joe Territo

CHIEF OPERATING OFFICER

Derek Estey

CONVENIENCE STORE NEWS AFFILIATIONS Premier Trade Press Exhibitor

The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by EnsembleIQ, 8550 W. Bryn Mawr Ave., Ste. 225, Chicago, IL 60631. Subscription rates: Subscription rate in the United States: $150 one year; $276 two year; $14 single issue copy; Canada and Mexico: $204 one year; $390 two year; $17 single issue copy; Foreign: $204 one year; $390 two year; $20.40 single issue copy; Digital One year, digital $87; two year, $161. Periodical postage paid at Chicago, IL 60631, and additional mailing addresses. Copyright 2024

by EnsembleIQ. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or information storage and retrieval system, without permission in writing from the publisher. POSTMASTER: send address changes to Convenience Store News, 8550 W. Bryn Mawr Ave. Ste. 225, Chicago, IL 60631.

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CSNEWS ONLINE

TOP VIEWED STORIES

1

ONLINE EXCLUSIVE

Casey’s Creates New Foodservice Position

The retailer is building upon its trademark as The Official Pizza and Beer Headquarters by launching a search for its first-ever Chief Pizza & Beer Officer. Casey’s partnered with former NFL player and content creator Anthony “Spice” Adams as its search consultant.

New Distributing Sells Eight Convenience

in Southeast Texas 2 Stores The company will retain fuel supply for the locations, which operate under the Fastop and Cimarron store brands, for up to 15 years. New owner Saad Ali of Houston and his operating partners are committed to further investment in the sites.

Minimum Wage Hikes Hit 22 States

the states that raised their minimum wages, seven — 3 Of California, Connecticut, Maryland, Massachusetts, New Jersey, New York and Washington — plus Washington, D.C., now guarantee baseline pay of $15 or more an hour.

Circle K Teams Up With Candy Brand

Bring Sweet Treats to Consumers 4 to In early January, the chain debuted the Butterfinger Brownie, Butterfinger Cookie and Butterfinger Hot Chocolate, available for a limited time at Circle K stores across the United States. The offerings can be purchased through March 5.

Juul Labs Seeks FDA Approval

Age-Verified Menthol Vapor Product 5 for The company submitted a premarket tobacco product application for a next-generation platform device and mentholflavored pods that require user age verification. This is among the first fully age-gated electronic nicotine delivery system products to be submitted for review.

The Merging of Emerging Trends There is no denying that change is coming to the convenience store industry. Some changes are already underway while others are further down the pike, but there is no question that c-store retailers need to decide now how they are going to handle these changes, so they don’t get left behind.

What lies ahead includes a changing forecourt, a changing foodservice offering and a changing merchandise mix. Focusing on where the emerging trends driving these changes intersect can hold the key to thriving for years to come.

For more exclusive stories, visit the Special Features section of csnews.com.

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EXPERT VIEWPOINT

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GK Engage is a modern, comprehensive, AI-powered loyalty program for every omnichannel retail touchpoint. The program enables retailers to create highly contextualized and personalized outreach — including messaging, discounts and rewards — to improve customer lifetime value. The solution also provides retailers with real-time, AI-driven, personalized loyalty offers, as well as loyalty tiers that automatically track all customer interactions and generate relevant campaigns.

GK Engage can be integrated with a retailer’s merchandise master data and customer data, and comes fully integrated into GK’s OmniPOS solution.

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INDUSTRY ROUNDUP

7-Eleven Adds 204 C-stores in Nearly $1B Deal The transaction with Sunoco LP comprises Stripes and Laredo Taco Co. locations 7-ELEVEN INC. struck a $950 million deal with Sunoco LP to become the sole owner and operator of Stripes convenience stores and Laredo Taco Co. restaurants in the United States.

2018. Under the terms of that deal, Sunoco entered into a 15-year take-or-pay fuel supply agreement with a 7-Eleven subsidiary, under which Sunoco agreed to supply approximately 2.2 billion gallons of fuel annually.

The 204 stores are located across west Texas, New Mexico and Oklahoma, and will join the more than 13,000 7-Eleven, Speedway and Stripes locations that 7-Eleven operates, franchises and/or licenses throughout the United States and Canada.

At the time, DePinto said the acquisition supported the company’s growth strategy in key geographic areas and that the retailer could learn a great deal about how to cater to the Mexican-American customer base in south Texas.

“Stripes and Laredo Taco Co. have been a great addition to our family of brands since they initially joined us back in 2018,” said 7-Eleven CEO Joe DePinto. “We’re excited to welcome the remaining Stripes stores and Laredo Taco Co. restaurants to the family, and we look forward to serving even more customers across west Texas, New Mexico and Oklahoma.”

7-Eleven’s parent company Seven & i Holdings Co. Ltd. noted that this new Sunoco deal is part of a broad strategic focus that centers on foodservice. Additionally, this acquisition will connect the 7-Eleven and Speedway network alongside the interstate highway, contribute to increasing regional market share and accelerate growth in the North America market.

7-Eleven grew its U.S. footprint by 12% when it acquired approximately 1,030 Sunoco convenience stores for more than $3 billion in early

Irving, Texas-based 7-Eleven Inc. currently operates, franchises and/or licenses more than 15,000 stores in the United States, Canada and Mexico.

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INDUSTRY ROUNDUP

Third-Generation Leader Assumes CEO Role at RaceTrac Natalie Morhous succeeds Max McBrayer in heading the convenience store chain THE RACETRAC board of directors promoted

Natalie Morhous to CEO of RaceTrac Inc., effective Jan. 2. Morhous previously served as president while Max McBrayer served as CEO. Since 2019, McBrayer and Morhous have partnered on RaceTrac’s business decisions and strategy development. Together, they led the company through a global pandemic, shifted RaceTrac’s growth strategy to expand to new markets and new prototypes, and finalized RaceTrac’s acquisition of Gulf Oil, according to the company.

“The board is thrilled to share the news that Natalie Morhous will be assuming the role of [CEO]. Having observed Natalie’s leadership as RaceTrac’s president, we are confident in her ability to continue to lead our organization to even greater heights as CEO,” said Max Lenker, a board director at RaceTrac.

“A culture champion, Natalie lives and breathes the RaceTrac Way — RaceTrac’s internal set of principles that includes Putting People First, a Culture of Strong Performance, a Warrior’s Passion, a Humble Attitude and Living for Fun Every Day. We have no doubt that her vision for RaceTrac’s future will propel our organization beyond the company we know today,” he added.

Lenker also recognized McBrayer’s 32-plus years at the convenience retail company. “Max has made significant contributions to RaceTrac’s success during his time and his leadership has positioned RaceTrac well as we move forward to the future,” he said.

A third-generation leader in the family-owned business, Morhous has served in a variety of roles during her 11 years with RaceTrac, including director of strategy and development, executive director of strategy and solutions, executive director of Energy Dispatch, vice president of Energy Dispatch and most recently, president.

“It is an honor to step into the role of CEO for the company my grandfather began nearly 90 years ago,” said Morhous, a 2020 Woman of the Year in Convenience Store News’ Top Women in Convenience awards program. “It is with great anticipation that I take on the challenge of serving our nearly 10,500 team members and the 9 million guests that visit our stores each week. I am grateful for Max’s mentorship and step into this role confident in the strategy we have developed and the team we have in place.”

Headquartered in Atlanta, RaceTrac is the 22nd largest privately held company in the United States and has nearly 800 retail locations representing the RaceTrac and RaceWay brands in 13 states.

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INDUSTRY ROUNDUP

Eye on Growth

Alimentation Couche-Tard Inc. closed its deal for certain European retail assets from TotalEnergies SE. The acquisition includes 100% of TotalEnergies’ retail assets in Germany and the Netherlands, plus a 60% controlling interest in the company’s entities in Belgium and Luxembourg.

owned subsidiary, American Natural Retail PA LLC. The acquisition includes 11 company-operated convenience stores, with an additional two company-operated retail locations scheduled to close in 2024.

With this deal, the parent company of Kent Kwik stores enters its eighth state.

The Kent Cos. acquired Birmingham, Ala.-based DC Oil Co. The transaction comprised 13 Chevron Texaco-branded stores, a fuel transportation fleet and a portfolio of dealer accounts.

Consumers Cooperative Oil Co. acquired Charlie’s Lakeside Country Store, marking the 20th convenience store in Wisconsin under the cooperative’s umbrella. Charlie’s Lakeside will retain its name, look, services and hours, providing continuity for existing patrons.

Giant Oil Inc. struck a deal with Cleopatra Resources LLC to purchase its wholly

Buc-ee’s received approval to build its first location in North Carolina, a 75,000-squarefoot facility in Mebane. The Texas-based retailer also submitted plans to open an inaugural location in Arizona.

Love’s Travel Stops opened four new locations to close out 2023, adding a combined 377 truck parking spaces to its network. The new travel stops opened in Michigan City, Ind.; Nicholson, Miss.; Watertown, N.Y.; and Salinas, Calif.

Stewart’s Shops opened three more locations in New York State at the end of 2023.

The new c-stores are in Oneonta, Lake Placid and Frankfort.

FAST FACTS

2/3

Nearly two-thirds of American consumers purchase chocolate as a treat vs. one-third who purchase chocolate for an energy boost.

95%

E15 fuel is approved by automakers for use in approximately 95% of model year 2024 cars and light trucks.

3.7% Core retail sales — excluding automobile dealers, gas stations and restaurants — were up 3.7% year over year for the first 11 months of 2023.

— Renewable Fuels Association — Mintel

— National Retail Federation

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INDUSTRY ROUNDUP

Retailer Tidbits

Maverik — Adventure’s First Stop unveiled the first Kum & Go convenience store, located in Draper, Utah, to be converted to the Maverik banner. About one-third of all Kum & Go stores will be converted to the Maverik brand over the course of 2024.

Casey’s General Stores Inc. is using a $5 million grant from the U.S. Department of Agriculture to install 456 E15 dispensers at 111 fueling stations. The new dispensers, located in five states, will increase the amount of ethanol the retailer sells by more than 49 million gallons per year.

The first Choice Mini-Mart store model opened on the University of Colorado Anschutz Medical Campus in October 2022.

Choice Market entered into an exclusive pact with Adroit Worldwide Media to be its provider of frictionless technology

solutions for the future of shopping. The partnership will allow the retailer to rapidly scale its automated Mini-Mart format.

Love’s Travel Stops completed the rollout of a new truck maintenance service, Freightliner ExpressPoint, to more than 400 Love’s Truck Care and Speedco locations. Additional site openings are planned for the future.

Exxon went live with a new Car IQ Pay network at Exxon and Mobil stations. Fleet customers can now connect their vehicle directly to the pump without the requirement for a credit card, PIN number or vehicle odometer reading.

Onvo, a regional travel center and convenience store retailer that operates 39 locations in Pennsylvania and New York, selected the Precision Fuel System Diagnostics platform from Warren Rogers Associates as its provider of fuel system compliance, wet-stock management and forecourt diagnostics.

F E BRUARY

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INDUSTRY ROUNDUP

Supplier Tidbits

Ferrara Candy Co. is halting production of two iconic chewing gum brands as it evaluates consumers’ changing preferences.

The candy maker quietly discontinued its Fruit Stripe and Super Bubble products.

Premier Manufacturing Inc., the consumer products division of US Tobacco Cooperative Inc., acquired VP Distributors LLC. The transaction will broaden its parent company’s distribution network.

Ruiz Food Products Inc. opened two onsite health centers for insured team members and their covered family members: one in Florence, S.C., and the other in Denison, Texas. Both health centers have extended hours two days a week to accommodate team members working second and third shifts.

This is the sixth consecutive year that the organization received a score of 100, the highest score an inclusive company can receive.

Altria Group Inc. was recognized with the 2023-2024 Equality 100 Award from the Human Rights Campaign Foundation.

The recognition designates the manufacturer as a leader in LGBTQ+ workplace inclusion.

Alto-Shaam began construction on an innovation center at its global headquarters and manufacturing facility in Menomonee Falls, Wis. The 100,000-square-foot innovation center will include a research and development lab.

Hunt Brothers Pizza entered into a multiyear partnership with Team Penske. Under the terms of the pact, the company’s colors and branding will appear on the No. 22 Team Penske Ford Mustang for select races beginning in 2024.

Kingswood Capital Management and First Bev made an eight-figure cash investment in energy drink company G Fuel. Terms of the deal were not immediately released, but the funds will provide significant growth equity for G Fuel.

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INDUSTRY ROUNDUP

Federal Reserve Extends Comment Period for Debit Card Swipe Fee Changes The public now has until May 12 to weigh in on the board’s proposal THE FEDERAL RESERVE BOARD announced on

Jan. 22 that it will extend the public comment period for its interchange fee proposal to May 12. Comments were originally due by Feb. 12.

The extension will allow the public more time to analyze the proposal and prepare their comments, according to the board, which also published additional data related to the interchange fee cap in order to provide the public with more information as they consider the proposal. The data is available on the Federal Reserve website.

The Federal Reserve Board of Governors voted in October 2023 to open up the proposed revisions to Regulation II’s Interchange Fee Cap to a 90-day public comment period upon the proposal’s publication in the Federal Register.

If adopted, the base component cap would

decrease to 14.4 cents, the ad valorem component would decrease to 4 basis points, and the fraud-prevention adjustment would increase to 1.3 cents per transaction. With these three components taken into account, the maximum interchange fee for a $50 debit card transaction would be 17.70 cents, down from the current value of 24.50 cents for the same transaction.

Numerous retail groups, including the National Retail Federation (NRF), the Retail Industry Leaders Association and the Merchants Payments Coalition, have applauded the proposal but raised concerns that the revisions do not go far enough.

“This is a significant reduction that will save money for retailers and their customers, and we welcome the progress that has been made,” said NRF Chief Administrative Officer and General Counsel Stephanie Martz. “Nonetheless, it still doesn’t get to the ‘reasonable’ level Congress sought and it isn’t proportional to banks’ falling costs.”

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NEW PRODUCTS

Reese’s Caramel Big Cup The Hershey Co. presents the latest offering from its Reese’s brand, the Reese’s Caramel Big Cup. Known for its iconic combination of chocolate and peanut butter, Reese’s adds a layer of gooey caramel to the classic peanut butter cup for the first time with its new Caramel Big Cup. Next to peanut butter, caramel is the most requested combination with chocolate, according to the company. The product is available in standard and king-size packages.

THE HERSHEY CO. • HERSHEY, PA. • THEHERSHEYCOMPANY.COM

LEVO Energy + Focus An alternative to the traditional energy shot, LEVO Energy + Focus combines 75 milligrams of naturally derived caffeine from tea with 75 milligrams of L-theanine, an amino acid that stimulates alpha brain waves associated with increased mental clarity. Containing only natural ingredients and flavors, LEVO comes in a 2-ounce shot, with a choice of either grape or berry flavor. The formulation is intended to provide a steady stream of energy without jitters or a crash while providing the mental clarity needed to elevate focus and execution.

CLEAR CUT BRANDS • LOUISVILLE, KY. • DRINKLEVO.COM

BIC Special Edition Skulls Lighters BIC Lighters debuts a brand-new special edition series, Skulls. According to the company, skulls can be found in an array of pop culture genres and can be used to represent everything from bravery to life itself. The new series features a variety of designs, from skulls adorned with red roses to a Jolly Roger updated for the digital age. The lighters come with a suggested retail price of $2.39 per unit. As with all BIC Maxi Lighters, the items in this series are long-lasting, reliable and 100% quality inspected.

BIC USA INC. • SHELTON, CONN. • US.BIC.COM

Fresh Blends Blender Plus Self-serve beverage platform Fresh Blends launches the Fresh Blender Plus, which includes a built-in self-cleaning system. The Advanced Sanitation system handles both daily and periodic cleaning tasks without human intervention for up to six months, potentially boosting savings for retailers by eliminating extra labor for staff. The company plans to introduce a kit to retrofit the cleaning program into existing Fresh Blenders. Additionally, Fresh Blends is unveiling an enhanced version of its Fresh Cloud, an IoT platform that can provide stakeholders insight into the operations, sales and machine status of their beverage program.

FRESH BLENDS • DELRAY BEACH, FLA. • FRESHBLENDS.COM

Instore.ai Cashier Engagement Solution Technology company InStore.ai unveils its Cashier Engagement solution, a cashier scorecard and gamification application designed to incentivize, measure and reward cashiers for outstanding effort, and discover best practices that can be used to train and uplift other cashiers. The system utilizes InStore.ai’s suite of voice analytics services and applies them to interactions between cashiers and customers, along with a new feature that employs generative AI to compare one store’s performance against another based on what’s been spoken at the point-of-sale.

INSTORE.AI • SAN FRANCISCO • INSTORE.AI

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Seagram’s Escapes Refreshers New for 2024, The Seagram Beverage Co. introduces Seagram’s Escapes Refreshers, a flavored malt beverage option sweetened with cane sugar and real fruit juice, and featuring a 5% ABV. Available in Strawberry Acai, Pineapple Cherry, Mango Orange and Kiwi Lime flavors, Refreshers will be sold in a 12-pack slim 12-ounce can variety pack and a 24-pack club variety. Additionally, Strawberry Acai will be offered in a 7.5-ounce can as a trial offering, while a 23.5-ounce can will be available year-round for the convenience channel.

Select varieties will also be offered in six-pack 11.2-ounce bottles. The line will launch in 15 markets.

THE SEAGRAM BEVERAGE CO. • ROCHESTER, N.Y. • SEAGRAMSESCAPES.COM

Trolli Sour Electric Crawlers Ferrara Candy Co. presents Trolli Sour Electric Crawlers, dual-colored crawlers with two mouth-puckering flavors zapped together in a soft and chewy candy. The new multiflavored gummies feature never-before-seen flavors and a unique swirling pattern. The flavor combinations are Strawberry Watermelon, Blueberry Lemonade and Dragon Fruit Mango. Trolli Sour Electric Crawlers are available in 4.25-ounce and 6.3-ounce packages for a suggested retail price between $1.99 and $2.79. Price and pack size availability may vary.

FERRARA CANDY CO. • CHICAGO • TROLLI.COM

Flexeserve Zone Xtra Flexeserve debuts two new offerings: the Flexeserve Zone Xtra hot food display and cloud service program Connect. Backed by hot air recirculation technology, the Xtra features two multitemp zones, capable of hot-holding products with different temperature requirements in the same unit. According to the company, operators can display up to 60% more hot food than competitors, along with utilizing a range of accessories, all within the same footprint and power supply as Flexeserve’s two-tier countertop models. Connect enables retailers to control and automate units remotely, allowing for greater flexibility in food offerings.

FLEXESERVE • SOUTHLAKE, TEXAS • FLEXESERVE.COM

formi Universal Instant Savings Digital Platform Loyalty program provider Patron Points launches formi, a universal instant savings digital platform for convenience stores, manufacturers and consumers. The program connects independent convenience stores and consumer packaged goods manufacturers through a digital solution that offers immediate savings to consumers on purchased products at their local c-store. According to the company, formi provides independent convenience stores with a tool that can drive store traffic, sales and profit while giving manufacturers access to shoppers at c-stores throughout the United States.

PATRON POINTS • WOODBURY, MINN. • PATRONPOINTS.COM/FORMI

OPW SmartStart Pro Payment Terminal OPW Vehicle Wash Solutions’ Innovative Control Systems (ICS) brand unveils the SmartStart Pro Payment Terminal. Billed as an affordable payment terminal for the convenience store and in-bay automatic vehicle wash markets, the SmartStart Pro is powered by the proprietary ICS WashConnect wash-management software and features a 10.4-inch touchscreen, along with multiple cashless payment options. The terminal is compatible with most contactless payment platforms while allowing the wash operator to access real-time financial data from a PC, tablet or smartphone.

INNOVATIVE CONTROL SYSTEMS INC. • BETHLEHEM, PA. • ICSCARWASHSYSTEMS.COM

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C-

S

TO

Can C-stores Deliver the Goods?

UE

SMALL OPERATOR

RE RES

C

Home delivery can still be a competitive edge for a small operator, but only if the program is tightly focused

By Roy Strasburger, CEO, StrasGlobal

DING-DONG.

It was almost Pavlovian. Starting about mid-2020 and going through the end of 2021 — the depths of the pandemic — every time the doorbell rang, I got excited.

Whenever I opened the door, new treats, supplies, surprises and necessities were on the doorstep. The world was coming to my home!

It was a time during the pandemic when companies were reinventing themselves to stay in business. Bars and restaurants started delivering cocktails to homes. Ice cream stores and cookie kitchens would deliver their sweet treats to your front door. Drugstores sent us prescriptions and COVID tests. And the driver from Amazon became our best friend.

It was during these halcyon days that it looked like home delivery was going to become the future of retailing and could, quite possibly, replace brick-andmortar stores.

Coming out of the pandemic, a lot of people (including me) were talking about the importance of having home delivery services for convenience stores. The rapid adoption of the technology surrounding online ordering by consumers made it look like home delivery was going to continue as a viable consumer trend.

Ordering was convenient, and customers seemed to have the time and money to place their orders, pay the delivery fees and wait for their items to arrive.

In addition, there was a generational

change in the use of the smartphone.

Millennials and the tech-savvy iPhone generation were much more at ease ordering products without actually talking to a person. These digital natives drove the online access of everything — from shopping to outsourcing services to ride and accommodation sharing — by touching one or two buttons on their phones.

However, while I still believe home delivery can be a viable business model and an important part of a retailer’s omnichannel marketing strategy, I now know it’s not for everyone.

We experimented with home delivery programs in our stores by using various apps, and we found that the service was not economically viable for small stores.

The biggest problem is the fees that companies such as Uber Eats, Grubhub and DoorDash charge for making the deliveries. These fees can range from 15% to 30% of the transaction price of the items, plus other fixed delivery fees.

These fees can take a large bite out of the convenience retailer’s gross profit margin. Typically, c-stores only get between 25% and 35% gross profit margins on the items they sell in the store.

For a lot of convenience store operators, the store’s profitability comes from selling gasoline (which is another concern for the industry and an entirely different discussion).

This meant that every time we sold an item using these delivery services, we lost

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SMALL OPERATOR

money on the sale once our operating costs, including the labor costs of fulfilling the orders in the store, were factored in. To make matters worse, we were not gaining any other advantages from the home delivery sale. The customer experience was solely dependent upon how the third-party delivery service performed — if the delivery was late, it was because the third-party driver had other priorities; it was not something within our control.

We didn’t gain customer loyalty because, first of all, the transaction was completely digital and impersonal, so we never had the chance to establish a personal relationship with the customer and, second, there were so many digital apps that it was very easy for us to get lost in the crowd and for the customer to choose somebody else.

It also made competitive pricing a real issue as prices were very transparent and a customer’s buying decision was swayed by an item being a few cents cheaper, or the fact that a company was subsidizing the delivery fee.

Some decisions were based upon the expected delivery time which, again, was out of our control because it was being handled by a third-party operator.

The Right Conditions for Home Delivery I do think home delivery can still be a competitive edge for a small operator, but the program must be very tightly focused. The conditions where a small operator can compete, and possibly thrive, by offering home delivery are as follows.

First, you need to focus on what is being delivered.

Low-margin items in the store will never be profitable once you add the cost of providing home delivery with either a third-party delivery fee or your labor picking the order and having someone within your store deliver it. Therefore, foodservice is really the only c-store category that can provide the margins necessary to sustain a home delivery program.

If you are offering a food program that is compelling, home delivery is a viable option. Of course, delivering foodservice has its own challenges — food safety, packaging, maintaining temperature, etc. — but these issues can be overcome. There may also be a few items in the store that you can combine with your foodservice program to increase your gross profit dollars, such as bundling the food offer with chips or drinks, which will increase the total purchase price.

Most importantly, your food must be so good that your customers will think of you when they are hungry.

The food has to be restaurant quality with top-shelf ingredients because your competition is restaurants, including fast-food restaurants.

The second thing you need to consider is your method of delivery. There are a couple of ways you can approach this. The easiest, and most expensive, is using a third-party

operator such as Uber Eats and DoorDash.

These are recognized names and they provide a professional service, but they are costly and you don’t have access to the customer information.

The upside is they may introduce your store to a new customer base.

An alternative is to do the delivery yourself with someone on your staff delivering the food. The foodservice challenges I mentioned earlier still apply, but you will have much more control over the delivery cost and customer satisfaction than when using a third-party delivery program, and you will be able to harvest the customer information for future marketing opportunities. There are apps that provide online ordering, such as Square, Olo and Toast. All you have to do is provide the food and the transportation.

If you’re planning to go down the self-delivery route, be sure to calculate the cost of having labor available to make a delivery, determine how the transportation will be provided (a company vehicle or the employee’s vehicle), and consider the general liability insurance ramifications of having one of your employees driving and delivering food.

The third thing you must consider is your delivery area.

Make sure it is a viable delivery area. Ideally, you need to be in a densely populated area so that the delivery times are short, and you have many customers available in a small area.

Last, but not least, you must have a good local marketing plan to get the word out that you have a home delivery program and offer promotions specific to home delivery — something that will take more time and money for you to put into place.

Your customers have to know about you and the service you are offering. They need to know how to find you and how to order from you because when they go on their phone, they will have multiple delivery services available to them and many of your competitors to choose from. If you have a loyalty program in place, getting the word out will be much easier.

Advertise in-store about what you’re doing and come up with inexpensive ways of informing your customers that you have the service available. Use local mailers, put up leaflets and promote your service in the community newspaper to get the word out.

Home delivery can be a viable option, but it’s not for everybody. For it to be successful and profitable, small operators must be laser-focused on providing the best product and service.

When the doorbell rings, will your store be able to deliver? CSN

Roy Strasburger is CEO of StrasGlobal, a privately held retail consulting, operations and management provider serving the small-format retail industry nationwide. StrasGlobal operates retail locations for companies that don’t have the desire, expertise or infrastructure to operate them.

Learn more at strasglobal.com. Strasburger is also cofounder of Vision Group Network, whose members discuss future trends, challenges and opportunities, and then share with all retailers and suppliers, regardless of the size of their business.

Editor’s note: The opinions expressed in this article are the author’s and do not necessarily reflect the views of Convenience Store News.

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COVER STORY

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A SMOKEFREE

FUTURE?

AS SUPPLIERS EMBRACE TOBACCO HARM REDUCTION AND EXPAND THEIR NONCOMBUSTIBLE PORTFOLIOS, A WORLD WITHOUT CIGARETTES IS UP FOR DEBATE

BY RENÉE M. COVINO

TO GIVE SHAPE AND STRUCTURE to its smokefree vision, Richmond, Va.-based Altria Group Inc. recently introduced its 2028 enterprise goals, which include growing its U.S. smokefree volumes by at least 35% from its 2022 base of 800 million units and doubling its smokefree revenue to $5 billion, $2 billion of which will be from innovative smokefree products.

British American Tobacco (BAT), parent company of Winston-Salem, N.C.-based Reynolds American Inc., currently has 24 million adult consumers of its “new-category products,” which include heated cigarettes and oral nicotine products. It aims to have 50 million by 2030. The company also wants 50% of its revenue to come from noncombustible products by 2035.

Amidst these objectives, BAT announced in early December that it would take a hit of around $31.5 billion as it wrote down the value of some U.S. cigarette brands, acknowledging that its traditional cigarette market had no long-term future.

Philip Morris International Inc., headquartered in Stamford, Conn., expects that with its rapid smokefree transition, more than two-thirds of its

net revenue will come from smokefree products by 2030, driven by volume and positive price/mix, with strong operating income growth and cost efficiencies driving margin expansion and strong bottom-line performance.

No doubt about it, Big Tobacco is in the midst of a big transformation.

Gaining Momentum As compelling smokefree strategies abound, the near-future needle moves closer to alternative products and farther away from combustibles.

“For decades, we have been committed to offering adult smokers better alternatives and ensuring a regulatory framework to determine if those products offer lower risk and how to appropriately communicate about them,” said Altria Group CEO Billy Gifford. “We are proud of the groundwork we’re laying in using science to develop a smokefree product pipeline that we believe can successfully transition adult smokers and achieve [U.S. Food and Drug Administration (FDA)] authorization.”

Bonnie Herzog, managing director and senior consumer analyst at Goldman Sachs, is optimistic

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about Altria’s “ability to pivot its portfolio to a smokefree business.” She said she’s encouraged

by Altria’s recent transparency and visibility on its transformation plan, calling its smokefree efforts “clearly the next important phase of growth as it accelerates plans to move beyond smoking and eventually beyond nicotine.”

At Reynolds American, the company views tobacco harm reduction as not only core to its strategy, but also an important initiative to create better public health outcomes for Americans, a company spokesperson told Convenience Store News. “We know that sustained and lasting changes to adult consumer smoking behavior offer the greatest hope for making cigarettes obsolete, and we believe that providing viable nicotine alternatives to smoking is in the public interest,” the spokesperson said.

Like Altria, Reynolds stresses that the science behind this movement is paramount. “Nicotine alternatives to cigarettes, and the policies that enable adult consumers to access them, must be rooted in objective science, not politics,” the spokesperson stated.

Philip Morris International also recently highlighted its smokefree transformation story to investors. The company sees an opportunity for smokefree revenue to be two to three times higher than cigarettes and gross profit dollars to be two to 2.5 times higher.

Herzog called it “a compelling strategy to lead Philip Morris through its next phase of growth, with an unmatched range of high-margin smokefree products to meet the adult smoker at every stage and price point of their conversion journey.”

The way some see it, the COVID-19 pandemic accelerated the switch from combustible cigarettes, both from an economic perspective and a situational perspective.

“Inflation, generally speaking, was going to happen given the Fed’s ballooned balance sheet but that, combined with consistently increased pricing on combustibles and moist smokeless, has driven consumers to seek alternatives,” reasoned Matthew Hanson, chief financial officer/chief growth officer at

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“Smoking will continue to exist in some form or fashion — it’s been used in North America for almost 7,500 years! The likely outcome will be a continued annual decline in adult consumption, driven by risk reduction efforts, education, consumer preferences, flavor bans, excise taxes and manufacturer price increases.”

— Matthew Hanson, Black Buffalo

Chicago-based Black Buffalo, a modern oral nicotine product that mimics moist smokeless tobacco, but without the tobacco leaf.

“Situationally, adult consumers found themselves unable or unwilling to use traditional tobacco products and conversely, [sought] novel nicotine products due to work-from-home, social pressures and a more general awareness of health and risk reduction alternatives,” he added.

But is a world without cigarettes really on the horizon?

Reynolds believes a smokefree future is “possible” and makes note that tobacco harm reduction is gaining momentum worldwide, with some countries such as Sweden and Japan already ahead of the curve. The company explained that its intent is to encourage adult smokers who would otherwise continue to smoke to transition completely away from cigarettes to smokeless alternatives.

Hanson, however, has a slightly different take.

“Smoking will continue to exist in some form or fashion — it’s been used in North America for

almost 7,500 years!” he said. “The likely outcome will be a continued annual decline in adult consumption, driven by risk reduction efforts, education, consumer preferences, flavor bans, excise taxes and manufacturer price increases.”

The Education Piece Educating smokers on why they should transition from cigarettes to smokeless alternatives is an important piece of the smokefree puzzle, but ahead of that must come policy, according to Reynolds.

“Effective tobacco harm reduction policies have the possibility to make strides in public health and reduce the burden of combustible tobacco use. These science-based policies are urgently needed to best serve public health,” the company spokesperson relayed. “Without tobacco harm reduction policies that educate adult smokers and provide access to alternative, noncombustible products, smoking rates will likely remain higher than they could be.”

Education is needed around the health misperceptions of nicotine; informing adult consumers of their options when it comes to alternative, noncombustible tobacco products; and the risk continuum associated with each product.

Reynolds believes appropriately regulated, adultoriented flavored vaping products (including menthol) are critical to supporting adult smokers as they migrate from combustible cigarettes. The company is working to disseminate information about tobacco harm reduction through “easily digestible” whitepapers, blog posts, videos and more on its ReynoldsHarmReduction.com website.

In tandem with education, Hanson believes a more flexible merchandising mindset is necessary for a smokefree future. “It is even more important that category managers allow space for the next brands to flourish,” he said.

“These novel products typically provide enhanced margins, accretive penny profits and differentiation from competitors,” Hanson noted. “Adult consumers will vote with their retail visits and hence their dollars, and the most successful retailers [will] stay ahead of the curve by constantly monitoring adult consumer demand.”

Course Correction Needed There are, of course, challenges impeding the current and future states of a smokefree world.

Looking specifically at the e-vapor category, some say the current state of the market is intolerable for both legitimate manufacturers and consumers.

“The regulated market is being overrun by illegal flavored disposable e-vapor products made and distributed by companies violating virtually every rule and guidance the FDA has issued since 2016,” said Altria’s Gifford. “Regulation not enforced is indistinguishable from no regulation at all.

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“A strong course correction is needed to protect the tobacco harm reduction opportunity for the 30 million adult smokers in the U.S.” — Billy Gifford, Altria Group Inc.

Illegal e-vapor products circumvent the actions of regulators, responsible manufacturers and retailers by evading scientific review, quality and manufacturing controls, marketing oversight and legal age of purchase restrictions.”

Despite recent actions by the FDA, enforcement has been inadequate and ineffective, according to Gifford, who added that Altria is actively engaged with regulators, state and federal lawmakers, and its trade partners and other stakeholders to build awareness and drive marketplace enforcement. The tobacco giant even initiated litigation in the U.S. District Court in California against 34 organizations, including manufacturers,

distributors and online retailers, related to the sale of unlawful products.

“A strong course correction is needed to protect the tobacco harm reduction opportunity for the 30 million adult smokers in the U.S.,” Gifford concluded.

Reynolds agrees that to push tobacco harm reduction forward, “it is vital that we have a coherent, science-based regulatory framework that is properly enforced by the authorities.”

This past fall, in an effort to increase evidencebased transparent dialogue, the company released interim data from a 24-month longitudinal tobacco use and transitions survey it initiated — part of an ongoing evaluation of its products and the role they can play in tobacco harm reduction.

Reynolds presented a summary of the results at a tobacco and nicotine regulatory product science symposium to an audience that included senior officials from the FDA’s Center for Tobacco Products, as well as several prominent public health researchers.

Hanson echoes the call for the FDA to be a stronger partner in this movement. “Using a science-based approach, the FDA needs to clearly and unambiguously articulate the benefits of risk reduction via switching or using products with lower potential risk, recognizing that adult consumers are clearly moving toward harm reduction on the risk continuum,” he said. CSN

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FOODSERVICE

Building a Better Beverage Offer Curby's Express Market makes the case for going full speed ahead on signature beverages

By Angela Hanson AS THE CONVENIENCE channel's collective foodservice offering has grown more complex and enticing, the industry has both taken ideas from and become competitive with the quick-service restaurant (QSR) market. However, if you ask Tony Sparks of Curby's Express Market, QSR beverages are what should really inspire c-store retailers.

"If you're talking about the frequency of visit relative to food QSR, they're not even in the same universe," said Sparks, head of Customer Wow! at Curby’s Express Market, a chain of three convenience stores in Lubbock, Texas.

Sparks, who urged attendees of the 2023 NACS Show to consider the velocity of beverage retail, pointed out that while consumers will rarely visit even a popular QSR brand like Chipotle more than once a week, they have no qualms about stopping at Starbucks for a beverage multiple times a week.

Recognizing and capitalizing on the opportunity found in beverages has been core to Curby's strategy since its first location opened in February 2022 — and that focus is paying off.

The First Steps to Success Two years after opening its doors, Curby's now features a wide range of made-to-order and self-serve beverages, including a tea bar with roughly 40 different varieties, handmade Zoomies and Red Bull Refreshers energy drinks, and Twisters craft soda concoctions. That’s in addition to c-store staples such as milkshakes and hot and iced coffee drinks.

Curby's initial beverage menu wasn't small, but the company decided to invest in expansion after observing the segment's effect on sales.

"We added a lot," Sparks told Convenience Store News.

"We thought the food was going to be a much bigger driver than the beverage, but [with] our beverages, we're different."

Traditionally, c-stores are more associated with coffee, but Curby's looked into the future and saw a great deal

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of potential around tea. The chain’s tea bar offers a wide array of flavors such as ginger, hibiscus, blueberry pomegranate, apple pie and classic — all available in either sweetened or unsweetened versions.

"We knew tea was going to be a big deal," Sparks said. "Imagine 20 linear feet of nothing but iced tea."

This investment in tea requires an investment in labor as Curby's tea offering has its own dedicated staff and backstock.

These employees brew tea all day long to keep up with sales volume, particularly during the warmer months. The effort has paid off in sales as Curby's is now known as a tea destination.

On the coffee side, the retailer partners with La Colombe Coffee Roasters as its provider. Curby's lack of gas pumps and resemblance to a QSR outlet made it more likely that the chain's customers would connect with a more upscale brewer than if it offered Curby's branded coffee, according to Sparks.

Additionally, having a subject matter expert like La Colombe provides the company with menu development assistance, overall guidance and leadership; "all the things that come along with an expert,” he noted.

Curby's also serves up Twisters, which pair popular sodas such as Dr Pepper and Coca-Cola with Torani syrups and fruit purees for a customized, decadent experience.

The Power of Energy The most eye-catching aspect of Curby's beverage menu, though, is its line of Zoomies energy drinks, which feature layered colors and flavors like the pink and orange Sunny's Set or the tricolored Sparky.

Nonpackaged energy drinks are fairly niche in the convenience channel, but at Curby's, "it was as important as anything else that we did at the very, very, very beginning of the store in the preplanning," recalled Sparks, who came up with the idea for the line.

The stacked colors are achieved through a combination of hot and cold water plus different powders. "Almost like a science project," he said.

As a small chain, the Curby's team does its

Zoomies energy drinks are eye-catching, featuring layered colors and flavors.

"I say let the beverages drive the food, not the food drive the beverages."

— Tony Sparks, Curby’s Express Market own experimentation to come up with limited-time offers or permanent new Zoomies flavors. This involves a great deal of trial and error: Sparks estimates they go through 15 different options for every one that makes it onto the menu.

This development process and the inherent made-to-order nature of the line requires more investment than self-serve dispensed energy drinks, but the end results are worth it as Zoomies generate the most buzz for the company by far, Sparks reported.

"It's Zoomies, a hundred feet of dirt, and everything else," he said. "They're beautiful drinks. People like to hold them in their hands. [There’s] a lot you can do with them on social media."

And while Zoomies may not be the most efficient in terms of labor, having them as a signature drink distinguishes the Curby's brand from its competition.

"I think what makes the made-to-order energy drinks different than something that dispenses is the variety. I think that you get more variety in what we're doing," Sparks said.

Without being made-to-order, Zoomies' color stacking would be impossible. Made-to-order also allows more customization of the drinks' functional attributes. "If people want a little bit more energy, I can put more energy or dial it back if they want it. You can't do that on dispensed."

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Capitalizing on the opportunity in beverages has been core to Curby’s strategy since its first location opened in February 2022.

The upside of being a smaller company is that Curby's can be more agile when making menu changes or improvements to the line. "We can make changes fast and we can come up with stuff real fast, too," Sparks pointed out.

As time went by, the company found that there was plenty of room for growth and interest in made-to-order energy drinks, so it added Red Bull Refreshers, which offer the twin benefits of major brand recognition and carbonation, which is something regular consumers of packaged energy drinks often crave.

"There was a bit of a disconnect where it's like, 'Well, you're making me an energy drink and it's great and all, but I normally get something that's carbonated.' I thought we were missing a big segment," Sparks recounted.

It turned out to be a good decision as Zoomies sell more units, but Refreshers generate more dollars per ounce. "It's like a win-win," he said.

Picking Up the Pace To keep its beverage momentum going, Curby's offers regular deals such as $1 Tea Day and Half-Off on Zoomies every Wednesday. The company is in talks to launch a traditional loyalty program, but currently it has a club format through which customers can buy nine beverages and get one free.

On an average day, Curby's redeems 40 to 60 club cards.

The retailer hired a "badass" social media person to run its accounts, where it nearly

exclusively pushes special deals. The key is to offer consumers consistency. "Every month, we have some type of beverage promotion that we're doing,” Sparks said.

To succeed in beverage retail, he advocates for commitment to what's being offered. For example, tea requires more than just a couple of metal dispensers. The segment demands significant variety or else "it just looks half-baked," he cautioned.

A wide range of flavors, bubblers, and the choice between sweet and unsweetened demonstrate to customers that the offering is more than just an afterthought. "You've got to show people you're actually in the business," he said. "You can't be half-in, half-out with tea."

Made-to-order beverages should also have sufficient diversity to cater to different preferences without overextending. For Curby's Twisters, eight is the sweet spot, but it will vary by brand.

Sparks also sees a shift in coffee demand that could affect what c-store operators should view as must-haves within the segment.

"All the action is no longer in hot coffee, all the action is no longer in lattes and cappuccinos and all of that," he said. “It's all in the flavored sweet coffee-based [drinks]; whether it's a Frappuccino or an iced coffee drink, it's all on the flavored side."

Regardless of what types of beverages a retailer offers, they need to execute their program at a high level to be as successful as possible. "You have to offer and execute at that level to be taken seriously by the customer and to be a competitive alternative to the top QSRs," Sparks advised. "We also only hire people with QSR experience."

The prepared food segment of Curby's foodservice offering is not an afterthought — the chain offers a delicious range of quality traditional items and unique products and flavors. But if Sparks were in the position of putting capital investment into making his kitchen bigger or creating a made-to-order beverage line, "no question" he would choose beverages.

"I say let the beverages drive the food, not the food drive the beverages," he said. CSN

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PACKAGED BEVERAGES

Tapping Into What’s Trending In the packaged beverages category, zero-sugar options and packaging innovation are on point

By Kathleen Furore THE HORIZON appears bright for packaged beverages in the convenience channel, as the category turned in a solid performance for most of last year.

Convenience store retailers are also cautiously optimistic about the category’s 2024 prospects. More than half of the c-store retailers surveyed for the 2024 Convenience Store News Forecast Study (52%) said they foresee their average perstore dollar sales of packaged beverages increasing in 2024, while 43% expect sales to hold steady. Just 5% expect a decrease.

In terms of unit volume, the percentage of c-store retailers that anticipate their packaged beverage volume will increase in 2024 jumped 10 points vs. last year to reach 49%, while 43% expect steady volume. Just 8% are bracing for a decrease in average per-store volume.

Innovation and limited-edition flavors are top trends for both the category and the channel — and they’re things retailers and suppliers alike are seeking as they try to attract the next generation of shoppers, specifically Generation Z consumers who over-index in the convenience retail channel, according to Carlton Austin, director of convenience retail strategy for the

North America Operating Unit of The Coca-Cola Co. Coca-Cola’s “2023 iSHOP Tracking Study” showed that consumers in the 16-to-24 age range shop 25% more in the convenience channel than the average shopper.

“And we know that younger drinkers prioritize fun and discovery,” Austin noted.

He also cited a 2022 YouGov study on packaging that revealed new and different packaging is a key purchase driver. “Snacking also is on the rise, and younger drinkers are looking for the right-size packaging for every drinking occasion,” he said. “For c-store, this could take shape in the form of offering a wider variety of packaging sizes to meet the consumption preferences of Gen Z.” Coca-Cola is tapping into that push for packaging options with 12-ounce sleek cans for products including its core Coca-Cola, Sprite and Coke Zero brands, and its new Coca-Cola Spiced that is launching in February.

This packaging is geared toward Gen Zers “who view 12-ounce as the ideal consumption size, and also offers additional space for marketing, allowing brands to capitalize on exciting graphics and offers that appeal to this audience,” Austin said.

At PepsiCo Beverages North America, the company is seeing increased interest in better-for-you, zero-sugar offerings. Chief Commercial Officer Chad Matthews pointed to this segment as a key growth area for PepsiCo brands.

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C-store retailers must ensure their selection resonates with the needs, preferences and shopping habits of their audience.

“When our flagship brand Pepsi unveiled its new logo and visual identity [last] year, the design brought in the color black, further showing the brand’s commitment to Pepsi Zero Sugar,” Matthews explained “Throughout our portfolio, we’re leaning into zero-sugar options, including recently launched Starry and Mug Zero Sugar launching in 2024.”

Matthews also identified consumer desire for all-day hydration and for products in the functional energy space as current packaged beverage trends. Electrolyteinfused Gatorade Water — PepsiCo’s first unflavored water, launching in the first quarter of 2024 — is the company’s pitch to active consumers looking for all-day hydration, while Rockstar Focus — a 12-ounce subline launching nationally in Q1 2024 — meets the demand for functional energy beverages thanks to its 200 milligrams of caffeine, zero sugar, zero calories and Lion’s Mane extract.

Tips on Inventory With so many options in the packaged beverages category, knowing the best products to carry can be challenging, especially for stores with limited shelf and cold vault space. Austin and Matthews say there are several things to keep in mind when deciding on inventory.

“First and foremost, retailers should prioritize high-velocity SKUs to ensure that they are maximizing the turnover rate of products within the confined space,” Austin said, noting however that it is equally important to not lose sight of emerging

“Striking the right balance between best-sellers and upcoming innovations can help maintain a competitive edge.”

— Carlton Austin, The Coca-Cola Co. trends and the potential for the next big thing. “Striking the right balance between best-sellers and upcoming innovations can help maintain a competitive edge.”

Keeping a keen focus on the shopper's perspective while developing the product set is crucial as well, according to Austin. By taking this step, “retailers can ensure that the selection resonates with the needs, preferences and shopping habits of their audience, thereby enhancing the chances of increased sales and customer satisfaction,” he explained.

Matthews likewise stressed the importance of employing a customer-focused approach to packaged beverage inventory, noting that “the best way to optimize growth is to leverage data to meet shoppers’ specific needs.”

“We’ve found it is important to adapt assortment based on shopper attitudes and preferences as a way to win repeat visits and increase market share, and even compete with quick-service restaurants,” he added.

Tips on Merchandising & Marketing Austin and Matthews also offered up the following suggestions for how convenience store retailers should merchandise and market packaged beverages to boost sales: • Look for innovative, trending products. This is especially key to attracting Gen Z consumers, according to Austin, who recommends considering products with unique flavors, functional benefits and sustainable packaging.

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• Refresh and diversify your range of products in-store regularly. “That can create a sense of excitement and novelty, encouraging repeat purchases and fostering brand loyalty among Gen Z consumers,” Austin pointed out.

• Consider grab-and-go options along with food and beverage and snack pairings. According to Matthews, this will attract today’s consumers who want their shopping experience, especially at convenience stores, to be tailored to meet the needs of their busy lifestyles. “We know 60% of c-store shoppers are looking for a meal, so it is important to make the meal experience even more complete and convenient by bundling prepared foods with the right snacks and beverages,” he said.

• Merchandise relevant food and beverage items at checkout for impulse purchases. This approach, Matthews said, “is among the top drivers of choice for shoppers.”

• Implement a comprehensive pumpto-purchase marketing strategy. This will allow retailers to engage customers at every stage of their shopping journey,

“We know 60% of c-store shoppers are looking for a meal, so it is important to make the meal experience even more complete and convenient by bundling prepared foods with the right snacks and beverages.”

— Chad Matthews, PepsiCo Beverages North America from the moment they approach the store to when they make a purchase and leave, Austin said. “Utilize eye-catching signage, interactive displays and appealing visual merchandising both inside and outside the store to capture their attention and guide them to the beverage section,” he suggested.

• Enhance omnichannel marketing. Increasing the touchpoints throughout the entire shopper journey, starting with digital communications and continuing the messaging from the curb to the cold vault, is one of the biggest ways retailers can communicate with customers to boost packaged beverage sales.

“Whether consumers are turning to grab-and-go options, curbside pickup or delivery, they want a curated experience,” Matthews said. CSN

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ENHANCING THE EMPLOYEE EXPERIENCE

Top c-store chains focus on identifying what potential employees desire and then providing that

By Tammy Mastroberte SAVVY CONVENIENCE store retailers know a good customer experience starts with good frontline employees. So, they make it a priority to keep team members satisfied, whether it’s through a flexible schedule, competitive pay or career advancement opportunities.

Knowing what potential employees desire and then providing that — or even exceeding expectations — not only attracts them to a company, but also keeps them there.

“We believe the best way to have happy customers is to first have happy and engaged team members,” said Jill Van Pelt, vice president of human resources at RaceTrac Inc., the Atlanta-based operator of nearly 800 c-stores. The company has found that employee satisfaction and engagement come down to a combination of competitive pay, great benefits, flexible schedules and “a fun-loving and teamoriented culture,” as well as opportunities for growth.

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RaceTrac strives for frictionless experiences from the moment a team member applies for a job.

the COVID-19 pandemic ushered in are starting to turn around. Instead of hunting for job applicants, c-store operators are able to be more selective and hire the right employees. Technology helps with this process.

“Technology helps retailers screen people to determine if they are qualified and to understand their personality and aptitude to be successful within the company,” said A.J. Richichi, CEO of Sprockets, a Charleston, S.C.based software company that helps retailers find, hire and retain quality workers. “In c-stores, we only convert about 3% of the people who apply for a job, so out of 100 people, you will hire three of them.”

This is the case at Family Express Corp., which will screen 50 applicants to hire just one, according to Alex Olympidis, president of operations for the Valparaiso, Ind.-based operator of 81 convenience stores. While the idea is to move as quickly as possible to respond to someone applying, because most people apply for jobs in mass and the competition may act faster, there must still be a screening process in place to ensure the right employee gets hired, he said.

“Our average time from application to hire is lengthy.

Our strategy is to spend as much time as it takes to make the right hire,” Olympidis explained. “Great candidates often need to give notice to their current employer, and we are willing to wait for them.”

The Hiring Process The process to apply for a position and get hired at a c-store is just as important to the potential employee as it is to the employer. Creating a positive experience will help attract quality employees and just as frictionless is emphasized in the store, it should apply to the recruitment process as well.

“Taking the time to connect with our teams and letting them know they are valued, coupled with having fun, is key to keeping our team members happy.”

— Jill Van Pelt, RaceTrac Inc.

“We strive for [our team members] to have frictionless experiences from the moment they apply to the day-to-day operations of onboarding, getting paid, working the cash register, training and servicing the pumps, among other tasks,” said Van Pelt.

RaceTrac created a well-defined framework for its hiring teams to understand the “candidate profiles” for each role in the company and what success looks like within those roles. In doing so, the hiring teams can seek out and find the right employees through “insightful interviews” and “engaging discussions with prospective talent,” she explained, noting that this approach is beneficial to both RaceTrac and the potential employees.

“Both RaceTrac and our potential team members can assess whether the job partnership aligns with their

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respective goals and aspirations,” she said. “In the end, we want our candidates saying, ‘I hope I get this job!’ and if it’s not the right fit, then we figure that out in the interview process.”

RaceTrac offers a text-to-apply feature to make it easy and user-friendly for individuals to apply online. The company also hosts in-person job fairs to connect with potential candidates, which allows for a more personal experience.

“By offering these diverse application avenues, we aim to ensure every applicant has a positive, frictionless experience, encouraging a strong first impression of RaceTrac,” Van Pelt said, pointing out that the team communicates with applicants throughout the entire process to keep them in the loop. “We’ll proactively share updates and expectations throughout the hiring process, from screening to job offers, ensuring candidates have a clear understanding of where they stand and what to expect next.”

Additionally, RaceTrac has a “Realistic Job Preview,” a program that allows applicants to fully understand what their day-to-day responsibilities as an employee would look like. It’s “a live view of what a real day would be like working at a RaceTrac store location,” Van Pelt explained.

Part of creating a good hiring experience is acting quickly when potential hires apply, as many are applying to a large number of jobs without emotional attachment to any one company, especially for entry-level positions.

Generation Z and millennial applicants are especially looking for a fast response time, according to Richichi. In the surveys Sprockets has conducted among millions of job applicants, the No. 1 thing they look for when selecting a workplace, above pay, is a fast response time.

“If they don’t hear from you quickly, they may be turned off or the competition may move faster than you,” Richichi said. “You need to identify the people who are a fit quickly, so you can get them scheduled for an interview.”

Often, identifying the right candidates for a company starts with a pre-screening process. At Family Express, Olympidis said the goal is to find “happy individuals who also share our values.” For decades, the retailer has used industrial psychology in its pre-screening test to ensure it identifies the people who are most likely to have a “sense of joy in serving others.”

It’s also important to highlight benefits, pay and other perks offered by the company during the hiring process. The two most desired benefits for hourly employees are flexibility in pay and schedule, according to the “State of the Hourly Workforce” report from Legion Technologies Inc., a workforce management company based in Palo Alto, Calif.

“By offering these benefits, c-stores can provide their hourly employees with greater control over their work schedules and allow them to access their pay more promptly, helping differentiate from other employers and ultimately leading to higher job satisfaction and reduced turnover,” said Tiffany Chelsvia, senior vice president of people operations at Legion.

The Retention Process Of course, it’s not enough to hire the right employee. When a c-store operator finds a great fit, they want to keep that employee happy and satisfied, so they stay and grow with the company.

Pay, benefits, bonuses, career advancement and more can serve as tools to retain employees and avoid a high turnover rate, which ultimately costs a company more time and money.

Family Express uses industrial psychology in its pre-screening test to identify the right candidates.

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“Offering good pay, options to move up within the corporate ladder and even daily pay are perks to keep employees happy,” said Richichi. “Now, there are no-interest daily pay apps for employees to access their salary on the same day they work, rather than waiting two weeks. A lot of c-stores are doing that, with some even offering college credits or other perks like access to Spotify or $250 gift cards if you make it 90 days.”

More than 50% of the corporate office staff at Family Express started in a sales associate role in the chain’s stores.

into new scheduling technology and how shifts are currently scheduled “to evaluate if there are opportunities to give our team even more flexibility,” said Van Pelt.

Another important aspect for retention is the culture of a company and the way employees are treated and valued — they want to find joy in the work they do.

Creating an environment that nurtures this can keep employees satisfied and with the company longer.

“Our team members want what any other employees want — to feel valued, to feel included, to feel a sense of community and a sense of belonging,” Van Pelt explained. “They want to know that they can come to work and be themselves, have fun and be treated with respect. Taking the time to connect with our teams and letting them know they are valued, coupled with having fun, is key to keeping our team members happy.”

Career advancement is also an essential component of retention as many employees want to grow within a company and increase their salary and responsibilities. Highlighting this upfront and following up on it should be top-of-mind for c-store operators.

“Our average time from application to hire is lengthy. Our strategy is to spend as much time as it takes to make the right hire.”

— Alex Olympidis, Family Express Corp.

At the top of the list for most employees, especially hourly workers, is having a flexible schedule and options for how they receive their pay, according to Chelsvia. Offering faster access to earned wages can provide team members with more financial stability and allow them to better manage their everyday expenses, the Legion executive said.

“Employees today are increasingly looking for opportunities for recognition and career advancement within their roles,” Chelsvia said. “C-stores can meet these expectations by integrating performance data into their management systems, offering clear feedback and development opportunities. This not only helps employees improve their skills, but also fosters a sense of growth and progression within the company.”

At Family Express, more than 50% of the chain’s corporate office staff started their career at the company in a sales associate role in its stores, Olympidis shared.

“Development is both a passion and a necessity,” he said.

RaceTrac has defined training programs to not only help employees in their current roles, but also prepare them for future roles, according to Van Pelt. The content is designed to build both “confidence and competence” by reinforcing concepts through actual practice.

“This foundation helps our teams prepare for career advancement within the store, and we make it a priority to communicate that there is a clear career path into each level of management,” she said.

“Additionally, the ability to control their work schedules and the opportunity to pick up extra shifts are highly valued,” she pointed out.

More than 70% of RaceTrac’s store leaders have been promoted from in-store positions, and upwards of 95% of its regional support teams in operations and human resources began in a store role.

At RaceTrac, making scheduling easier for employees is a top priority right now, as the company is looking

“The sky is really the limit for our team members,” Van Pelt said. CSN

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TECHNOLOGY

In Pursuit of Operational Excellence Convenience store retailers seek solutions that will provide a seamless experience behind the scenes

By Melissa Kress CONVENIENCE STORE retailers faced ongoing pressures to optimize their workforce, offer advanced amenities, manage industry consolidation and navigate economic uncertainty — all adding up to challenges and opportunities in 2023. What 2024 has in store for the channel remains to be seen, but there is little doubt that technology will play a crucial role in meeting the challenges and embracing the opportunities to come.

“Top retailers, popular brands and technology innovators will distinguish themselves by prioritizing integration and collaboration,” Jeff Hassman, vice president of product strategy and partnerships at PDI Technologies, said during the company’s trend forecast in late 2023. “We all have insightful data on what’s happening in the store, at the pump or behind the scenes. By working together to connect that data, we can maximize the convenience experience for consumers, which means a big win for the industry.”

Among the trends that will most impact the global convenience industry in 2024, according to Atlanta-based PDI, is

“One of the constant struggles I think many of us deal with within IT is just the myriad of things that are coming at us as leaders, as departments, and how do we prioritize all of those needs across the business.”

— Erika Cobb, Jacksons Food Stores technology’s growing role in operational excellence.

With evolving labor challenges, forward-looking operators will invest in technologies that integrate easily with their existing systems to reduce complexity and make their processes — and their employees — smarter, faster and more efficient, the company forecasts.

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Targeting operations with the help of technology was a key focal point in a recent Conexxus webinar entitled “Think Tank v8.0 – IT Leaders’ Insights.” During the session, top c-store IT leaders discussed the transformative impact of technology on their businesses.

Step one is wading through the numerous IT requests to set priorities. At Jacksons Food Stores, creating a project management office helped the retailer tackle this, according to Erika Cobb, vice president of technology at the Meridian, Idaho-based convenience store chain.

“One of the constant struggles I think many of us deal with within IT is just the myriad of things that are coming at us as leaders, as departments, and how do we prioritize all of those needs across the business,” she said. “One of the things that has really come to life at Jacksons over the last year and a half [is] we hired a person to lead our project management and established a [project management office] along with a small number of project managers.”

The project management office director works with different departments “diligently and consistently to understand all of their needs” and prioritize those needs, Cobb noted.

Small Operator Roadmap Jacksons Food Stores has more than 300 company-operated convenience stores in Idaho, Nevada, Oregon, Washington, Arizona, California and Utah under the Jacksons Food Stores and ExtraMile

by Jacksons banners. On the other end of the spectrum is Vancouver, Wash.based The Convenience Group LLC, which operates and franchises eight neighborhood c-stores throughout Washington and Oregon.

Donnie Rhoads, director of business development for the small operator, pointed out that the chain’s smaller footprint enables The Convenience Group to keep things “tightknit,” but there are still points along its technology roadmap that keep him up at night.

Foremost is ease of integration. “For us independent operators, it’s important for us to choose the right suite of tech solutions that fit our needs,” he said.

“If we’re going to be upping our foodservice game and we want to do curbside pickup or delivery, is it going to be able to talk to our registers? That’s the kind of

“If we’re going to be choosing a suite of tech solutions, are we just purchasing or licensing the use of the tool essentially, or are we gaining a partner in the industry? That’s definitely something we’re thinking about.”

— Donnie Rhoads, The Convenience Group LLC

thing that we’re thinking about,” Rhoads explained, adding that it can be daunting when exploring the hundreds of solutions available from the tech companies. “But at the same time, I also enjoy the place where we’re playing in — that, again, we can be pretty nimble on our feet when choosing these solutions and when we’re choosing different vendors in the tech space.”

It's also vital to choose a technology vendor that will be able grow with the retailer. This is important for a company of any size, but particularly for small and midsized chains.

“I think it’s important when you can leverage supplier partnerships.

If we’re going to be choosing a suite of tech solutions, are we just purchasing or licensing the use of the tool essentially, or are we gaining a partner in the industry? That’s definitely something we’re thinking about,” Rhoads said, while also stressing the importance of communication.

You Can’t Spell Operations Without AI Artificial intelligence (AI) created a lot of buzz in 2023, so many c-store operators are wondering if this is a space they should enter — and if so, how.

Valparaiso, Ind.-based Family Express Corp. has been partnering with a loyalty company that provides AI for more than three years now, and works with additional vendors that offer AI solutions.

Clifton Dillman, chief information officer for the 80-plus-store chain, believes AI is a space all convenience store retailers should be exploring, if they’re not already.

“With the release of ChatGPT and other tools, there’s a lot of buzz around AI and what it’s going to do, and really it’s going to be transformative. It’s going to transform everyone’s business in some way, shape or form,” he said. “If you aren’t looking at how you can use it, I think you’re going to end up falling behind. But with that, we have to do it in a smart way.”

Family Express has been looking into several tools, such as a GPT trainer where the retailer can upload documents detailing standard operating procedures (SOP) and store associates can find solutions to operational problems that may pop up at 2 a.m., for example.

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question that’s ever been asked, and it shows you the response that it gave that person,” Dillman said. “There’s a lot of questions that get asked that we don’t have an SOP for, we don’t have an installation guide for.”

There’s power in being able to adapt and create to fill in where you have gaps, he noted.

“It’s not really to cut out the first-level person. We’re going to get better.

We’re growing. It’s about being able to do more with less,” Dillman said. “It’s also about getting the answer quicker.

So, even though we have a 24/7 helpdesk, a lot of times we have one person on shift in the middle of the night and if there’s multiple stores that are calling, you might end up staying on hold for an hour while someone’s working on an emergency.”

That being said, he advises all convenience retailers to implement an AI policy to safeguard confidential information.

“We need to make sure we’re using tools that are smart; tools that are secure. Everyone should be thinking

“With the release of ChatGPT and other tools, there’s a lot of buzz around AI and what it’s going to do, and really it’s going to be transformative.

It’s going to transform everyone’s business in some way, shape or form.”

— Clifton Dillman, Family Express Corp. about implementing some type of AI policy at their company,” he stressed.

“It is so easy to get into the AI environment. It’s a website, and it’s no more difficult than using Google. The difference is if you have users, maybe unbeknownst to you, putting in Excel sheets of fuel data to try to analyze the data, all of a sudden now, if that’s in ChatGPT, that’s publicly available. That’s out there,” he cautioned.

“It is going to learn from that, and it could technically be asked to divulge information.” CSN

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AN EYE ON D&I

Helping Black Talent Thrive Circle K and CALIBR partner on a development program for Black mid-level leaders

By Linda Lisanti ALIMENTATION COUCHE-TARD INC. (ACT), parent company of Circle K,

is committed to fostering a culture that enables its team members of all backgrounds to bring their authentic selves to work and grow in their careers. Realizing the need for greater representation within its leadership ranks, the convenience store retailer established a development program for Black talent.

Now entering its third year, the program is dedicated to accelerating Black managers through a collaboration with CALIBR, a strategic talent development partner devoted to giving Black midlevel executives the tools they need to take the next step in their career. The program combines guest speakers, group discussions, coaching, a team project and more.

To date, two “cohorts” have gone through the program, each comprised of 12 Circle K team members. A third cohort will begin the program this spring. ACT is also in the process of starting a similar leadership development program for its Hispanic team members in partnership with the Hispanic Association of Corporate Responsibility.

To learn more, Convenience Store News recently caught up with Sue Vandersall, vice president of executive succession planning and global talent development for Laval, Quebec-based ACT. CSN: What was the impetus behind this program?

Vandersall: About three and a half years ago, Altria invited us to

participate with them. We decided to work together to create this program and [had] hopes that other people in the industry would join into the program, which they have. We did it because we had a lot of Black colleagues in our stores and at the next level of the organization, but we seemed to have this stopping point where our representation was just not as good. This program that CALIBR designed is to help remove that barrier for mid-level Black leaders.

CSN: How are team members selected for the program?

Vandersall: We accept nominations, so people are nominated into the

program by their leaders and generally, they are nominated based on their growth potential. But we look at a variety of different things; not just potential. We want our group to be well-rounded, so we want them to come from our operations areas, we want them to come from our functional departments, and we also look at things like could they relocate for another opportunity. We’ve been able to accept most of the people who get nominated into the program.

CSN: What does the program entail?

Vandersall: It’s a really unique program, and I wouldn’t say it’s your

standard leadership development program. It requires the participants to be fully open and willing to have tough, honest conversations.

We were just talking to somebody who participated in it, and they said they don’t always have the opportunity to talk with other Black colleagues who are like them. So, talking openly about things they could do differently, things that get in their way, is a big part of the program, as well as encouraging them to own their own development.

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AN EYE ON D&I

We know that sometimes people believe they can’t stand out in a crowd or they can’t raise their hand.

Having this experience, which puts them in positions where they have to be almost courageous, builds leaders who come out of the program a little more confident, a little more secure in talking about what they want to talk about, a little more understanding that they are strong people who have great characteristics and sometimes you have to sell yourself.

they had to go through to get to where they were and how that made them feel. And telling that story to our executive committee really helped them see things from a different perspective. And that’s just one example, but I think looking at how we do things from the lens of this group has been really interesting for the company and valuable.

It usually takes six to eight months for them to complete the program and that includes creating a project and presenting that project as a team to our executive leadership team. For the past two cohorts, the project has focused on how we can become a more inclusive organization.

Vandersall: That’s my favorite question right there. I

CSN: What do you hope the participants take away

from the experience?

Another part of this program that is really important is that we have two executive sponsors, which gives [the participants] exposure to some senior leaders in our business. And I think they feel more sponsored because these senior leaders are there advocating for them.

CSN: What are the business benefits for Circle K

from this program? What has the company achieved through it?

Vandersall: Some of the things they put into their projects, and one example is mentorship and sponsorship, has really helped the organization understand the need for that. So, our executive leadership team has agreed to be mentors for people coming out of the program. That’s great. That’s huge. That’s something that wouldn’t have happened without this group.

I think the benefits to the organization are really, if you were to simplify it, awareness and hearing some honest things from a group of people that maybe would never have come together before. It’s been just eye-opening.

We had somebody tell a story of their career and what

hope they take away from it that each person in our company brings a unique lens in helping us grow and do things differently and better. And I hope they come out more confident and really appreciate that being a great leader, it’s not about the color of your skin; it’s about the empathy you have, it’s about who you are to our organization and allowing your uniqueness and what’s brought you to this point in your career to just blossom.

Being inclusive means that we don’t want people to come out of this program and feel like they have to do things different or a certain way. All these great leaders we have in our organization, every single person brings a unique perspective and a unique point of view, and we want them to have the confidence to bring theirs the same way everybody else does.

CSN: How does this program fit into the larger

picture of what you’re trying to achieve?

Vandersall: We have a lot of things we’re trying to achieve,

and this is just one of the puzzle pieces and in order for us to be inclusive, we always have to remember that there’s lots of puzzle pieces out there. And so, we started with women’s leadership, and then we moved to CALIBR, and now Hispanic. So, I think we’re just building a more inclusive environment one small piece at a time. I think we have to always look at ourself in the mirror and say what’s next? CSN

THE 2024 CONVENIENCE STORE NEWS BUSINESS CASE FOR DIVERSITY & INCLUSION PROGRAM IS UNDERWRITTEN BY:

The Business Case for Diversity & Inclusion program is part of The Convenience Inclusion Initiative, a Convenience Store News platform that champions a modern-day convenience store industry where current and emerging leaders foster an inclusive work culture that celebrates differences, allows team members to bring their whole selves to work, and enables companies to benefit from diversity of thought and background.

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STORE SPOTLIGHT

A Brighter Future SunStop gives three of its locations a high-end remodel, with a new emphasis on foodservice

By Amanda Koprowski

At a Glance SunStop Opened: July 12, 2023 Location: 3500 N. Monroe St., Tallahassee, Fla. Size: 5,300 square feet Unique features: Showcases SunStop’s new-generation prototype design that is heavily food-focused and features in-store seating; cold and hot grab-and-go offerings displayed front and center; proprietary Eats Southern Cookin’ deli; high-end materials used throughout the store

THE TALLAHASSEE, Fla.-based Monroe Street location of SunStop, the convenience store subsidiary of Southwest Georgia Oil Co. (SWGA Oil), has gotten a facelift. However, it’s not the first time the retailer has updated its look.

extent, returned to its roots, once more offering both diesel and three grades of nonethanol gasoline, though Bench said it’s really changes in the overall convenience store industry that prompted this latest round of updates.

“[It was] originally a full-service gas station back in the 1960s. We did a raze and rebuild in 1987 to convert it to a small, center-island marketer convenience store, around 1,200 square feet,” recalled Glennie Bench, president of Bainbridge, Ga.-based SWGA Oil.

“With the trends in convenience toward prepared food and broader merchandise offerings, we decided to raze and rebuild again,” she said, noting that this latest update required the purchase of additional lots, expanding the site to about three acres.

Since its inception, SGWA Oil itself has operated at the intersection of c-store and fuel supplier. It started out purely in diesel, with its founder Jimmy Harrell using an old tanker to sell fuel to local farmers. As the company expanded, it began to set up brick-and-mortar gas pumps throughout the 1960s. By the 1970s, the company began to incorporate convenience stores into its gas stations, with a few even including a deli concept and some basic foodservice. By the early 2000s, SGWA Oil launched its current incarnation, creating the SunStop brand to unify its c-store locations.

The 5,300-square-foot store showcases SunStop’s new-generation prototype design that is heavily food-focused and features in-store seating. This is the third ground-up location to sport this design.

The Monroe Street store has, to a certain

“One of our strategic goals is to compete toe to toe with national standard bearers in our industry,” said Bench. “Our store is designed to stand up against those big national chains, but we do it with our proprietary elements — proprietary food offering and proprietary fuel offering.”

A Destination for Food As part of its all-in-one strategy — where customers can get fuel, packaged goods

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and fresh meals in one go — SunStop has worked to develop a greater focus on food.

As with chains like Pennsylvania-based Wawa Inc., which has developed a reputation for both made-to-order meals and branded ready-to-go offerings, SunStop is looking to establish its brand as a destination for food; a place customers specifically seek out for its offerings.

The Monroe Street remodel reflects this both in layout and available items.

“We placed our cold and hot graband-go front and center, adjacent to our dispensed hot and cold beverages,” Bench explained.

The store also includes the proprietary Eats Southern Cookin’ deli, which lives up to its name with a menu of fried chicken, biscuit sandwiches and traditional southern-style sides, alongside lighter fare such as three types of flatbread. For customers looking for some refreshment to go along with their meal, there are 17 coolers full of packaged beverages and a beer cave.

Additionally, SunStop is seeking to upgrade its customer experience by utilizing a range of high-end materials in its store environment. The sales area is framed by a variety of textures provided by shiplap, tile and paneled finishes, while the space is lightened by a combination of pendant and track lights. Even the bathrooms have gotten a bit of a glam makeover, refinished with tiled walls and quartz countertops.

“All the design elements are meant to convey our mission: ‘Brighten Every Moment,’” said Bench. “The store has a very high, open ceiling with a clerestory roof. The graphics are bright and sunny, connecting our customer to our name everywhere they look.”

More Remodels to Come The overall customer reaction to the remodel has been “remarkable,” making such a large undertaking worth it, according to Bench.

“With any raze and rebuild, you hope customers will come back to you when you reopen — plus new customers — and that has been true here,” she said. “We are fortunate to have [such a] response from our customers.”

SunStop’s new-generation prototype store aims to be a one-stop shop for customers to get fuel, packaged goods and a fresh meal.

With the success of the Monroe Street site joining the two previous prototype locations, one on the west side of Tallahassee and the other in Thomasville, Ga., the company plans to move forward with remodeling more existing stores and building new ones.

While not all of the rebuilt stores will include a full made-to-order deli, SunStop’s foodservice focus will still be evident. Space for a greater selection of grab-and-go meals will be included, with stores preparing some of the food onsite.

In 2024, the company will have four stores under construction, as well as three major remodel projects. It’s also focused on some smaller projects, such as finishing its fountain replacement program and completing its rollout of new gondola and checkout counter replacement.

“We are on track to open three to four new-to-market or razeand-rebuild stores per year for the next four years. We are also remodeling two to four stores a year,” Bench shared. “We have lots of opportunities within our existing footprint of Georgia, Florida and Alabama.” CSN

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INSIDE THE CONSUMER MIND

Snack, Meal or Both?

The once-clear line between snack time and mealtime will blur in 2024 According to Merriam-Webster, a meal is defined as an act or the time of eating a portion of food to satisfy appetite. A snack is defined as a light meal or food eaten between regular meals. In 2024, the once-clear line between snacks and meals will blur as Americans struggle with a lack of time to prepare, eat and enjoy meals, according to the fifth annual “U.S. Snack Index” released by PepsiCo Inc. divisions Frito-Lay North America and The Quaker Oats Co. The national survey of 2,000 U.S. adults aged 18 and older also found that:

The average American has only 52 minutes per day to prepare, eat and enjoy their meals.

One-third of consumers say they have even less time — under 30 minutes.

More Americans are integrating their favorite snack foods into meals, up 35% over previous years. Men are just as likely as women to use snacks in meals — 92% vs. 93%, respectively.

More than half of consumers report proudly using snacks as a key ingredient in no-prep dinners at least once a week, while more than a third seize this opportunity multiple times a week.

When considering snacks at the store, consumers cite protein as the most important nutritional attribute they seek (55%). This is especially true among those most time-crunched.

Energy is also a top-rated attribute as 60% of consumers look to their favorite snack products to provide energy.

Generationally, millennials (72%) are by far the group most likely to be looking for a pick-me-up, followed by Generation Z (62%).

Across all generations, nearly three-quarters of Americans (74%) refuse to sacrifice taste when selecting their snacks. Baby boomers are the most unwilling to compromise on taste (84%), followed by Generation X (75%).

2024 is expected to see the continued rise of the self-proclaimed “Snack Savant,” who embraces all things food, adventure and community. Millennials (83%) and Gen Z (82%) embrace this title most of all — and the majority of Snack Savants are city dwellers (77%).

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