Are You Out of Date?

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THERE IS NO doubt that the COVID-19 pandemic forced the convenience store industry to change its way of doing business and greatly accelerated the adoption of new innovations.

Today, the most successful convenience store operators in the United States have evolved into multichannel companies that give their guests multiple ways to transact with the brand, including but not limited to a proprietary mobile app tied to a robust loyalty program, fuel pumps that offer in-store ordering, drive-thru service and home delivery options.

Industry-leading retailers are also building new, bigger stores that make fresh food the first thing customers see when they walk through the door, and they’re investing significant time, money and resources in enabling customers to order the way they want and obtain their purchases the way they want. In some cases, this means fully contactless experiences.

As the c-store business gets more complex and competitive, the industry’s single-store and small chain operators are at a crossroads, as this issue’s cover heralds. While single stores still account for more than 60 percent of the industry, many of these operators are falling behind.

According to the fourth-annual Convenience Store News State of the Small Operator Study (see page 24), fewer respondents this year reported an increase in total dollar sales vs. the year prior. About six in 10 small operators said their overall sales per store increased in 2022, compared to nearly eight in 10 in 2021. Year over year, a higher percentage reported a decrease in sales: 19.7 percent in this year’s study vs. just 7.4 percent in last year’s study.

Taking motor fuels out of the mix and looking only at in-store merchandise sales, six in 10 small operators said their in-store sales rose last year, down from 76.9 percent who said the same the year before. The average net increase in in-store revenue was 5.5 percent, which underperformed compared to the industry average. In-store sales at all U.S. convenience stores in 2022 hit a new high, reaching $275.3 billion, which equated to a 6.6 percent increase year over year.

The ongoing advancement of the c-store business is putting the industry’s small operators in a precarious position. The time has come for them to conduct a comprehensive review of their business, look at the competition in their market (other c-stores and restaurants), and ask: Am I out of date? If the answer is yes, then the only option really is to modernize.

I think industry consultant John Matthews, president and CEO of Gray Cat Enterprises Inc., summed it up best when he was asked about his 10-year outlook for the c-store industry’s small operators and he responded: “Adapt, invest, improve or become obsolete.”

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

EDITORIAL EXCELLENCE AWARDS (2016-2023)

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

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

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

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

Editorial Advisory Board

Laura Aufleger OnCue Express

Chad Beck Core-Mark

Edward Davidson

Ed Davidson & Associates (7-Eleven Inc., retired)

Robert Falciani ExtraMile Convenience Stores

Jim Hachtel Eby-Brown Co.

Chris Hartman Rutter’s

Ray Johnson Speedee Mart

Ruth Ann Lilly GPM Investments LLC

Vito Maurici McLane Co. Inc.

Jonathan Polonsky Plaid Pantries Inc.

Greg Scriver Kwik Trip Inc.

Roy Strasburger StrasGlobal

Best CFX Ever Retailers are the reason the Convenience Foodservice Exchange shines every year

IN MAY, I had the honor of emceeing the 2023 Convenience Foodservice Exchange (CFX) for the fifth time. From Casey’s Chief Marketing Officer Tom Brennan’s opening address on how a giant chain turned foodservice into a focal point of its operations to BandyWorks CEO Tom Bandy’s closing presentation aimed at helping small to medium-sized retailers excel at foodservice, this year’s event in Nashville, Tenn., was the best yet. It was great to see so many familiar and new faces of convenience store industry leaders.

CFX features such variety — keynote presentations, panel discussions, a fireside chat, one-on-one networking, a visit to a new c-store prototype, a local food trends tour and the Convenience Store News Foodservice Innovators Awards reception. It’s so much more than a typical business conference.

Casey’s General Stores Inc. was the 2022 winner of the Foodservice Innovator of the Year award. Brennan’s keynote explained the step-by-step approach Casey’s takes to innovation, especially in making foodservice its centerpiece.

Another speaker was Kevin Smartt, CEO of Texas Born (TXB). He rebranded the 52-store chain a few years ago from its former name, Kwik Chek Food Stores. The rebrand emphasizes the Texan roots and values the brand was built upon: authenticity, hospitality and integrity. These are all represented in the food it sells. TXB was the 2022 winner in the prepared foods category of the Foodservice Innovators Awards program.

My favorite sessions every year are our retailer panels. We had a lineup of some of the most visionary convenience foodservice retailers on hand. Billy Colemire of Stinker Stores, Jac Moskalik of Kum & Go (the 2023 Foodservice Innovator of the Year) and Greg Ekman of BP/Thorntons told the audience about how they make their foodservice offerings stand out from the competition.

I moderated our annual New American Convenience Retailer panel featuring three retailers that are redefining the c-store shopping experience. The panel featured Tony Sparks of 2023 Foodservice Innovator to Watch winner, Curby’s Express Market; Mike Fogarty of 2019 Foodservice Innovator to Watch, Choice Market; and Ben Lucky of 2023 Prepared Foods Innovator of the Year, Dash In. This panel always showcases some of the most innovative ideas in the industry.

If you find yourself near Baltimore or Washington, D.C., I highly recommend you visit Dash In’s new foodservice-forward store in Chantilly, Va. I was so impressed when Ben showed me around last month and I got to try his trademarked Stackadilla quesadilla menu item.

My fireside chat with Kwik Trip Inc. (KT) Retail Foodservice Director Paul Servais was most interesting. Paul talked about how KT built a strong foodservice culture throughout its chain of more than 800 stores. Among the many key points he made was the critical role of KT’s foodservice district leaders, who were instrumental in the chain reaching $1.2 billion in food sales last year. It’s such an important position that only store leaders who have opened new stores and trained other store leaders can become foodservice district leaders, and only foodservice district leaders can become district leaders. What a great nugget of information.

Retailers like Paul, Tom, Ben, Kevin and so many of the other speakers and attendees are the reason why CFX continues to be the best foodservice event for convenience store retailers.

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

COVER

The

STORE

INSIDE

Industry Roundup

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Online Exclusive

Four Finalists Named for 2023 Top Women in Convenience Corporate Empowerment Award

As part of the 10th annual Top Women in Convenience program, these retailers were selected for their commitment to gender equality and the promotion of female leadership and advancement: Alimentation Couche-Tard Inc., BP, OnCue and Yesway.

Circle K Launches Free Membership Program

The Inner Circle program allows customers to save on fuel and merchandise, and offers them the opportunity to join as a premium member after they spend $500 at participating locations. The new rewards program will be available at more than 400 select stores in Florida.

BP Makes Leadership Moves Following TravelCenters of America Deal

Following its acquisition of TravelCenters of America Inc. (TA), Houston-based BP named Debi Boffa as CEO-designate of TA and Babu Rajalingam as chief financial officer-designate.

Casey’s President & CEO Appointed Board Chair

Darren Rebelez was unanimously elected and appointed to the role effective June 2. The board also unanimously elected Judy A. Schmeling, a director since 2018, to the role of lead independent director.

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RaceTrac Welcomes Customers at First Drive-Thru Travel Center in Kentucky

TXB Tackles the Phygital Space

Texas Born (TXB) works to live up to its motto of “Leave ‘Em Better,” which means engaging its customers both in-store and digitally — a.k.a. the “phygital” space.

“At TXB, it is very important that our digital app experience is an extension of the in-store experience. Social media, app, delivery, loyalty and in-store must have a consistent strategy and tactics on how each platform will be used to engage and enhance the customer experience,” explained Benjamin Hoffmeyer, vice president of marketing and merchandising. This means that although each platform has different use occasions, they all need to fit into a well-defined customer relationship management and journey strategy.