FEATURE
EXPANSION FEVER Convenience retailers are growing their footprints at a rapid pace By Tammy Mastroberte
marketplace, chains are expanding their footprints at a rapid pace, and many are entering into brand-new markets to extend their reach.
IN TODAY’S CONVENIENCE STORE
In the past six months alone, Sheetz Inc. opened its first store in Columbus, Ohio; Kwik Trip Inc. announced plans to move into both North Dakota and South Dakota with new construction; Kum & Go LC announced plans to open stores in Utah and Michigan for the first time; and both QuikTrip Corp. and Buc-ee’s reported moves into Tennessee, along with Buc-ee’s first store in Mississippi to be completed in the next two years. “There are not a lot of big acquisitions left because so many of them happened in the last couple of years, and the companies left standing are not going anywhere soon. We are not seeing big deals on the horizon, so companies are buying smaller chains or growing organically through new construction now,” said Dennis Ruben, executive managing director of NRC Realty & Capital Advisors LLC, based in Chicago.
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The larger chains with bigger bank accounts are less restricted in terms of where they expand, especially those run by private equity. Many are in a push to expand their total number of units across the country, according to Chris Kehl, vice president of SRS Real Estate Partners, based in Dallas. “This is why we saw 7-Eleven’s acquisition of Speedway. The fastest way these major operators are going to become leaders in total unit counts is through acquisition,” Kehl explained. However, in today’s market, there are more buyers than there are sellers, so acquiring stores is much more competitive. Instead, many chains are choosing to build stores from the ground up in new markets to increase their total number of units. “There are two groups of c-store operators — the builders like Kwik Trip, Kum & Go, RaceTrac, Buc-ee’s and Casey’s. They are all building new big-box stores,” noted Terry Monroe, president of American Business Brokers, based in Fort Myers Beach, Fla. “Then, you have those like EG Group, GPM, 7-Eleven and Circle K, who build a
