CStore Decisions December 2019

CStoreDecisions Solutions for Convenience Retailers

40

40

under

CStore Decisions presents the 2019 40 Under 40 class of next-generation convenience store leaders.

INSIDE CSD Congratulates New Product Contest Winners 12 Retailers Convene in Minneapolis for 2019 NAG Conference 20 Wading through OTP Uncertainty 50 December 2019

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CStoreDecisions.com

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The future of our industry is about innovation, products with the potential to reduce harm and adult consumer choice. Through our companies and strategic partners, we’ve invested in the most compelling portfolio of non-combustible products. We strive to give adult consumers the choices they want today — and invest and develop products for tomorrow.

Servicing:Servicing: Philip Morris Philip USA Morris USA U.S. Smokeless U.S. Smokeless Tobacco Company Tobacco Company John Middleton John Middleton Nu Mark Nu Mark Nat Sherman Nat Sherman

©2019 Altria Group Distribution Company | For Trade Purposes Only

Get control of your CASH MANAGEMENT COSTS Key benefits of the SMARTtill™ Intelligent Cash Drawer: Reconciles cash to sales made

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With APG’s SMARTtill™ Technology, all cash handling activities are recorded with a date and time stamp as well as information on the cashier responsible, providing full accountability for every transaction. The APG SMARTtill™ Solution alerts store managers of any discrepancy immediately after the incident has occurred allowing the error to be resolved on the spot.

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CONTENTS december 2019

•

Number 12

•

CStoreDecisions

Volume 30

CStoreDecisions

Solutions for Convenience Retailers

28

®

EDITOR’S MEMO

8 The Future for Young Leaders Is Now FRONT END

10 Quick Bites 12 CSD Congratulates New Product Contest Winners 20 Retailers Convene in Minneapolis for 2019 NAG Conference CATEGORY MANAGEMENT

50 Wading Through OTP Uncertainty

50

COVER STORY 28 40 Under 40

CStore Decisions presents the 2019 40 Under 40 class of next-generation convenience store leaders.

BACK END 55 Product Showcase 61 Ad Index 62 What’s Ahead for the 2020 Tobacco Landscape?

4

CSTORE DECISIONS •

December 2019

cstoredecisions.com

®

the CSD Group www.cstoredecisions.com

CStoreDecisions .com CStoreDecisions CStoreDecisions

Convenience Store Decisions

®

®

Convenience Store Decisions • EDITORIAL

ADVERTISING

VICE PRESIDENT, EDITOR-IN-CHIEF John Lofstock jlofstock@wtwhmedia.com

VICE PRESIDENT/GROUP PUBLISHER Tom McIntyre tmcintyre@wtwhmedia.com

EXECUTIVE EDITOR Erin Del Conte edelconte@wtwhmedia.com SENIOR EDITOR Thomas Mulloy tmulloy@wtwhmedia.com ASSOCIATE EDITOR Isabelle Gustafson igustafson@wtwhmedia.com ASSOCIATE EDITOR Howard Riell ASSOCIATE EDITOR Marilyn Odesser-Torpey CONTRIBUTING EDITORS Anne Baye Ericksen COLUMNISTS Steve Sandman

CREATIVE SERVICES VICE PRESIDENT, CREATIVE SERVICES Mark Rook mrook@wtwhmedia.com

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CUSTOMER SERVICE REPRESENTATIVE Barbra Martin bmartin@csdecisions.com

DIRECTOR, AUDIENCE DEVELOPMENT Bruce Sprague bsprague@wtwhmedia.com

EVENTS

VIDEO SERVICES VIDEOGRAPHER Bradley Voyten bvoyten@wtwhmedia.com

DIGITAL MEDIA/ WEB DEVELOPMENT

SR. DIGITAL MEDIA MANAGER Pat Curran pcurran@wtwhmedia.com

EVENT EXHIBITOR & SPEAKER MANAGER Michelle Flando mflando@wtwhmedia.com

CStore Decisions is a three-time winner of the Neal Award, the American Business Press’s highest recognition of editorial excellence.

EDITORIAL ADVISORY BOARD Robert Buhler, President and CEO Open Pantry Food Marts • Pleasant Prairie, Wis.

DIGITAL PRODUCTION MANAGER Reggie Hall rhall@wtwhmedia.com DIGITAL PRODUCTION SPECIALIST Nicole Lender nlender@wtwhmedia.com DIGITAL PRODUCTION/ MARKETING DESIGNER Samantha King sking@wtwhmedia.com

Jim Callahan, Director of Marketing (Retired) Geo. H. Green Oil Inc. • Fairburn, Ga. Bill Kent, President and CEO The Kent Cos. Inc. • Midland, Texas Greg Lorance, Dispensed Category Manager Cumberland Farms • Framingham, Mass.

Billy Milam, President RaceTrac Petroleum Inc. • Atlanta

SR. DIGITAL MARKETING STRATEGIST Michael Ulanski mulanski@wtwhmedia.com SOFTWARE ENGINEER DJ Bozentka dbozentka@wtwhmedia.com WEBINAR COORDINATOR Halle Kirsh hkirsh@wtwhmedia.com

Patrick J. Lewis, Managing Partner Oasis Stop ‘N Go • Twin Falls, Idaho Scott Zaremba, President and CEO Zarco USA • Lawrence, Kansas

NATIONAL ADVISORY GROUP (NAG) BOARD Doug Galli, Board Chairman Reid Stores Inc./Crosby’s • Brockport, N.Y. Mary Banmiller, Director of Retail Operations Warrenton Oil Inc. • Truesdale, Mo.

WEBINAR COORDINATOR Kim Dorsey kdorsey@wtwhmedia.com

FINANCE

EVENTS MANAGER Jen Osborne josborne@wtwhmedia.com

Leading Through Innovation

CONTROLLER Brian Korsberg bkorsberg@wtwhmedia.com ACCOUNTS RECEIVABLE SPECIALIST Jamila Milton jmilton@wtwhmedia.com

Greg Ehrlich, Chief Operating Officer Beck Suppliers Inc. • Fremont, Ohio Derek Gaskins, Senior VP, Merchandising/Procurement Yesway • Des Moines, Iowa Joe Hamza, Chief Operating Officer Nouria Energy Corp • Worcester, Mass.

Brent Mouton, President and CEO Hit-N-Run Food Stores • Lafayette, La. Peter Tamburro, General Manager Clifford Fuel Co. • Utica, N.Y.

VIDEOGRAPHER Derek Little dlittle@wtwhmedia.com

Vernon Young, President and CEO Young Oil Co. • Piedmont, Ala.

VIDEOGRAPHER Graham Smith gsmith@wtwhmedia.com

YOUNG EXECUTIVES ORGANIZATION (YEO) BOARD Jeremie Myhren, Board Chairman Road Ranger • Rockford, Ill. Garet Bishop, Chief Financial Officer BFS Cos. • Morgantown, W.Va. Caroline Filchak, Director, Wholesale Ops Clipper Petroleum • Flowery Branch, Ga.

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SUBSCRIPTION INQUIRIES To enter, change or cancel a subscription, please e-mail requests to: bmartin@csdecisions.com or Mail: CStore Decisions, 1111 Superior Ave., 26th Floor, Cleveland, OH 44114 Copyright 2019, WTWH Media, LLC

CStore Decisions (ISSN 1054-7797) is published monthly by WTWH Media, LLC., 1111 Superior Ave., Suite 2600, Cleveland, OH 44114, for petroleum company and convenience store operators, owners, managers. Qualified U.S. subscribers receive CStore Decisions at no charge. For others, the cost is $80 a year in the U.S. and Possessions, $95 in Canada, and $150 in all other countries. Single copies are available at $9 each in the U.S. and Possessions, $10 each in Canada and $13 in all other countries. Periodicals postage paid at Cleveland, OH, and additional mailing offices. POSTMASTER: Send address changes to CStore Decisions, 1111 Superior Avenue, 26th Floor, Cleveland, OH 44114. GST #R126431964, Canadian Publication Sales Agreement No: #40026880.

Kalen Frese, Food Service Director Warrenton Oil Inc. • Warrenton, Mo. Alex Garoutte, Director of Marketing The Kent Cos. Inc. • Midland, Texas Sharif Jamal, Corporate Training Manager Chestnut Petroleum Inc. • New Paltz, N.Y. Lindsay Lyden, Vice President, Development True North Energy • Brecksville, Ohio Stacey Davis, Manager of Marketing Clifford Fuel Co. Inc. • Marcy, N.Y.

CSTORE DECISIONS does not endorse any products, programs or services of advertisers or editorial contributors. Copyright© 2019 by WTWH Media, LLC. No part of this publication may be reproduced in any form or by any means, electronic or mechanical, or by recording, or by any information storage or retrieval system, without written permission from the publisher. Circulation audited by Business Publications Audit of Circulation, Inc.

6

CSTORE DECISIONS •

December 2019

cstoredecisions.com

Editor’s Memo

For any questions about this issue or suggestions for future issues, please contact me at jlofstock@wtwhmedia.com.

The Future for Young Leaders is Now “Those who look only to the past or present are certain to miss the future.”

This is an especially poignant quote when you consider the plight of young leaders in the ever-changing convenience store industry.

New technology, an increased demand for foodservice, staffing issues and growing competition from nontraditional retailers are just a handful of the issues facing convenience store chains.

As if this wasn’t difficult enough, an additional challenge facing young executives is developing their skills as leaders and managers. The Young Executives Organization (YEO) understands these challenges and is focused solely on helping c-store chains develop the leaders of tomorrow.

YEO will continue its push forward in May with the seventh annual YEO Conference in Nashville. YEO is committed to providing outstanding educational sessions, real-world insights and an opportunity to network with other leading convenience store operators and suppliers — and we have a lot of fun doing it.

I am proud to announce the 2020 YEO Conference Steering Committee, which will oversee content, planning and faculty selection of the program. These industry experts will select topics and speakers that will most benefit the current needs of the c-store community, keeping in mind the specific needs of each segment of the business, such as foodservice, marketing and technology, category management, human resources, executive management and more. Led by Stacey Davis, the marketing manager for Clifford Fuel Co. Inc., the Conference Steering Committee includes: • Jeremie Myhren, YEO Board Chairman, Chief Information Officer, Road Ranger • Jessica Barnhill, Director of Transportation, The Kent Cos. • Fouad El-Nemr, Executive Vice President, Nouria Energy • Kalen Frese, Director of Food Service, Warrenton Oil • Sharif Jamal, Corporate Training Manager, Chestnut Petroleum • Dana Renfro, Category Manager, Packaged Beverages, Wine & Liquor, Yesway • Dyson Williams, Director of Merchandising, Dandy Mini Marts 8

CSTORE DECISIONS •

December 2019

Planning sessions that address today’s most pressing issues and selecting experienced and relevant speakers are two important parts of making YEO great. We have brought together a committee of experts who will draw from their professional experience to help choose faculty and select the topics that will be covered.

PREPARING LEADERS FOR TOMORROW

The c-store industry’s young executives face unique challenges as they grow their businesses in the competitive c-store market. YEO was formed specifically to address these challenges and help the industry’s next-generation leaders identify solutions with others in their age group.

“This committee of industry experts is going to help make the 2020 YEO Conference the premier event for young executives in the convenience store and petroleum industry,” Davis said. “We are working on an agenda that will help the leaders of tomorrow shape their businesses and their careers.”

The National Advisory Group (NAG) relaunched YEO in 2012 to help young executives have a group that is solely focused on exchanging personal experiences with peers of similar ages.

YEO’s mission is to cultivate young talent in the convenience store and petroleum industry through education and networking. The YEO conference in May will continue this mission.

“All members of the committee are immersed in the c-store business, and they will help ensure that the conference covers the pressing issues retailers are facing today and can expect to face in the future,” Myhren said. “It is the premier industry conference for young leaders.”

Final details of the 2020 YEO Conference will be released in the coming months.

k c o t s f o L n h o J cstoredecisions.com

For trade purposes only. ©2019 Swedish Match North America LLC

CONTACT YOUR SWEDISH MATCH REPRESENTATIVE OR CALL 800-367-3677 FOR ADDITIONAL DETAILS

quickBites WHAT TO EXPECT IN THE NEW YEAR & BEYOND

LESS THAN HALF: By 2020, less than half (49.8%) of the U.S. population under age 18 are projected to be non-Hispanic white, compared with threefourths (76%) of those age 65 and older.

11%: The amount of chil-

dren who are “two or more races” is projected to more than double in coming decades, from 5.3% today to 11.3% in 2060.

OLDER THAN 65: By 2030, all baby boomers will be older than age 65. This will expand the size of the older population so that one in every five residents will be of retirement age.

The aging of baby boomers means that older people are projected to outnumber children for the first time in U.S. history.

179 MILLION: The non-

Hispanic white population is projected to continue shrinking over the coming decades, from 199 million in 2020 to 179 million in 2060.

Source: U.S. Census Bureau, National Population Projections

“

By 2024, there will be a nearly 6% increase of non-breakfast foods eaten in the morning and a 5% increase of warm breakfast foods eaten for dinner.

Source: The NDP Group, “Breakfast in Bed – At Night?”

CSTORE DECISIONS •

Retailers are increasingly using customercentric data to deliver hyper-personalization.

Retailers can get a very in-depth understanding of their consumers’ behavioral habits.

Consumers expect the price to reflect their values, convenience and experience.

TECHNOLOGY

Humans are becoming more comfortable with AI (artificial intelligence), and the technology is becoming more sophisticated.

EXPERIENTIAL RETAIL

Retailers are actively experimenting with experience as their most powerful tool to win and retain customers.

ENVIRONMENTALLY FRIENDLY

The planet-friendly movement has momentum.

Consumers are shopping with emotion and values as much as their wallets.

Source: KPMG Retail Trends 2019

FOOD AND BEVERAGE TRENDS CStore Decisions is tracking the following trends: 1. Redefinition of the dayparts 2. CBD- and cannabis-infused 3. “Free from” labeling, increased transparency 4. Sustainability, increased environmental concern 5. International food 6. Fresh and local 7. Snacks as meals 8. Increased automation and customization 9. Plant-based and lab-grown meat

10. Non-alcoholic alternatives

10

HYPER-PERSONALIZATION

PRICE SAVVY

“

THE CONSUMER OF TOMORROW

RETAIL TRENDS TO WATCH IN 2020

December 2019

THE STORE OF THE FUTURE The store of the future is expected to:

• Have staff that’s supported by AI, robotics and actionable shopper information • Be a branded offer that attracts, engages and rewards loyal shoppers • Be flexible to shopper preferences and respond to a broader set of needs • Provide a physical, tactile and emotional experience • Gather and aggregate knowledge of shopper behaviors, product movement and the entire store Source: Coca-Cola Retailing Research Council

cstoredecisions.com

©2019 FIJI Water Company LLC. All Rights Reserved. FIJI, EARTH’S FINEST WATER, the Trade Dress and accompanying logos are trademarks of FIJI Water Company LLC or its affiliates. FW190911-03

EARTH’S FINEST WATER. NOW AVAILABLE FOR DIRECT ORDER. We’ve reimagined our delivery service to make stocking FIJI Water easier than ever. To schedule your delivery or find your local distributor, visit business.fijiwater.com or contact our customer care team: Phone: 888-426-4602 | Email: delivery@fijiwater.com FIJI Water is also available at Sam’s Club, Costco, and BJ’s or wholesalers of choice including McLane, Core-Mark, Eby-Brown, and The HT Hackney Co.

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CStoreDecisions Congratulates

2019 New Product

Contest Winners Video contest reveals top product launches at c-stores in 2019 in a range of categories.

Isabelle Gustafson • Associate Editor

Every year, thousands of new products are launched in the convenience retail segment, each hoping to be the new favorite of the retailers who put them on their shelves.

Earlier this year, CStore Decisions introduced a video contest to determine which new product launches in 2019 retailers expected to resonate with their customers the most.

Winners were selected based on which items were expected to be most successful at c-stores. The winners were announced at the National Association of Convenience Stores (NACS) Show in October, with products featured on a monitor in the CStore Decisions booth.

And the

Winners are:

12

CSTORE DECISIONS •

December 2019

Snacks: Salty

J&J Snack Foods, Pretzel Fillers, Individually Wrapped Cheddar Cheese

cstoredecisions.com

FIFTH THIRD CORPORATE BANK CONSUMER & RETAIL

WHERE EXPERIENCE AND INNOVATION INTERSECT. Craig Wolf SVP, Corporate Banking Group Head Consumer & Retail

Craig and the Consumer and Retail experts at Fifth Third Corporate Bank do more than offer competitive capital solutions. They build personal relationships with clients and provide meaningful guidance through all economic cycles—resulting in a partnership that’s truly strategic, flexible and efficient.

Fifth Third Means Business 53.com/CorporateBank

Fifth Third Bank, National Association. Member FDIC.

Snacks: Meat

Jack Link’s, Zero Sugar Original Beef Jerky

Snacks: Sweet

Smucker’s, Jif Power Ups Stacked Bars, Epic Chocolate

Candy: Chocolate

Hershey, KIT KAT Duos Mint + Dark Chocolate

Foodservice: Breakfast

Tyson Foodservice, Jimmy Dean Pancakes & Sausage Bites

Foodservice: Ethnic

Ruiz Foods, Not Your Nonna’s Pepperoni Stuffed Pizza Wedges

14

CSTORE DECISIONS •

December 2019

Foodservice: Deli

SK Food Group, Stovers Kitchen Old Forest Board

cstoredecisions.com

WARNING: This product contains nicotine.

Nicotine is an addictive chemical.

UNDERAGE SALE PROHIBITED

NICOTINE POUCHES

THE MODERN TAKE ON NICOTINE HAS ARRIVED Please contact your RAITMS representative today or go to engagetradepartners.com to find out more. ©2019 RJRVC

NO LIMITS

General Merchandise

Procter & Gamble, Febreze Platinum Ice CAR Vent Clip

Beverage: Adult

Beverage: Cold Vault

Coca-Cola, smartwater alkaline 9+pH

BeatBox Beverages, Tropical Punch

16

CSTORE DECISIONS •

12-17_NewProductContest.indd 16

December 2019

cstoredecisions.com

11/21/19 9:51 AM

Introducing

Beverage: Coffee

STōK, Protein Mocha Cold-Brew Coffee

The Ultimate Indulgent Dessert

Tobacco: Cigarettes

Premier Manufacturing, Manitou

Tobacco: Accessories

• • • • •

Three Mouth-Watering Flavors Convenient Thaw & Sell Format Packed in 10-Count Inners 30 Day Shelf Life Attractive Upscale Packaging

Calico Brands, Scripto Torch Flame Wind Resistant Pocket Lighter

www.pcbakery.com cstoredecisions.com

©2019 Prairie City Bakery, Inc.

December 2019 • CSTORE DECISIONS

17

Your competitors are selling 100+ units of 5-hour ENERGY shots per week. ®

How do they do it?

We’ll be happy to help you increase profits by increasing sales of 5-hour ENERGY ® shots.

Here’s how...

These are the best practices of the most successful 5-hour ENERGY shot retailers: ®

Top 5-hour ENERGY shot retailers sell an average of 127 units per week. That’s around $11,000 per year in gross profit just from 5-hour ENERGY shot sales. ®

®

1. Multiple locations in-store. One 15-box rack at each register plus at least one secondary location such as an endcap, a floor display, or next to the coffee station.

These retailers have learned that if the consumer sees 5-hour ENERGY they buy it. It is one product which sells well from all four locations in your store. ®

2. Keep displays full and clean looking. Out of stocks on any flavor have a huge negative impact on sales.

The 15-box rack It’s the classic retail success – lots of profit in a small space.

You get 180 bottles of 5-hour ENERGY shots packed neatly into a footprint that’s 18.5 x 12 inches. That works out to a gross profit of $1.31 per square inch some of the most profitable inches in your store. ®

3. Clearly advertised pricing and multi-unit discounts.

More 5-hour ENERGY = More money ®

5-hour ENERGY shots should be the focus of your front-end space. Why? It’s one of the highest performing impulse products with a whopping 50% gross profit, generating $1.58 to $1.64 per bottle. That’s the kind of gross profit you need more of. ®

Full Display

Multi-Unit Discounts

At Each Cash Register

Call 866-960-1700

Then press 5 for sales, then 1 for domestic sales

www.5hourenergy.com/trade

Next to the Coffee Station

In Aisle

Individual results may vary. See www.5hourenergy.com for more details. Regular Strength 5-hour ENERGY® shots contain caffeine comparable to a cup of the leading premium coffee.

Extra Strength 5-hour ENERGY® shots contain caffeine comparable to 12 ounces of the leading premium coffee. Limit caffeine products to avoid nervousness, sleeplessness, and occasional rapid heartbeat. ©2019 Living Essentials Marketing, LLC. All rights reserved.

2019

Retailers Convene in Minneapolis for the 2019 NAG Conference

Experts from around the c-store industry shared insights on burning issues from artificial intelligence and frictionless checkout to foodservice and local lobbying.

Erin Del Conte • Executive Editor

The 2019 National Advisory Group (NAG) Conference welcomed retailers from nearly 75 c-store chains to Minneapolis in September to examine timely retail issues, explore local cstores and take part in peer-to-peer networking.

“This year’s conference features speakers from 23 leading c-store industry chains, the most we’ve had to date at the NAG Conference,” said John Lofstock, executive director of NAG. Lofstock introduced incoming NAG Board Chairman Doug Galli, vice president and general manager of Reid Stores Inc./Crosby’s.

“Welcome to the 40th NAG Conference … and what I can tell you is the most awaited 20

CSTORE DECISIONS •

December 2019

convenience store event of the year,” Galli said.

Galli thanked outgoing NAG Chairman Bob O’Connor, former president and CEO of JETZ convenience stores.

On the opening night of the conference, keynote speaker Frank Siller, chairman and CEO of Tunnels to Towers Foundation, shared his story and the work he does through the foundation for wounded veterans and 9/11 survivors in memory of his brother Stephen Siller. To date, the foundation has spent over $125 million for U.S. veterans and first responders. Among its programs, over $30 million has been allocated to the construction of smart homes for injured service members.

cstoredecisions.com

When you’re

PLANTBASED

not just any creamer will do.

America’s #1 creamer is ready to offer the industry’s 1st plant-based ambient creamer in a pump bottle — Coffee mate® Vanilla-flavored Almond Milk Liquid Creamer Concentrate. Each bottle makes up to 300 servings and delivers the great taste your coffee consumers are looking for. All you have to do is make sure they get it from you.

To get your free sample,* go to CMFeeltheLove.com.

All trademarks are owned by Société des Produits Nestlé S.A., Vevey, Switzerland. *Open to US & DC foodservice operators, 18+ (19+ AL/NE).

While supplies last or 01/31/20. Subject to terms: www.CMFeelTheLove.com. 2019 Nestlé.

2019

From left, Tom Briant, president of the National Association of Tobacco Outlets (NATO), moderated the Local Lobbying session with panelists Jim Calvin, of NYACS; Clay Lambert, of Metro Petro Gas; and Jerry Smith, of Tobacco Central/Low Bob’s Discount Tobacco.

Panelists of the Developing Your Digital Strategy session: From left, moderator Bob O’Connor, formerly of JETZ; Doug Haugh, of Parkland Fuel; Marketing Artificial Intelligence Institute Founder & CEO Paul Roetzer; and Pat Lewis of Oasis Stop ‘N Go.

BURNING ISSUE SESSIONS The next three days featured an array of education sessions on burning issue topics, including: • The Importance of Family Values in the Convenience Store Industry • Local Lobbying: Why Your Voice Matters More Than Ever • Merchandising and Marketing for your Brand’s Success • Developing Your Digital Strategy: How Artificial Intelligence is Impacting Retail • Equipped for Foodservice Success • Keynote Presentation by Richard Crone, of Crone Consulting: Check-In is the New Checkout • How Cashier-less Sites Will Impact the Convenience Store Industry • YEO Breakout Session: How Millennial Insights Can Connect Your Brand with Customers • NAG Ideas Bootcamp

From left, CStore Decisions Executive Editor Erin Del Conte moderated the How Cashier-less Sites Will Impact the Convenience Store Industry panel with Richard Crone, of Crone Consulting; Gus Olympidis, of Family Express; and Raymond Huff, of HJB Convenience.

Tunnel to Towers Foundation Founder & CEO Frank Siller enthralled the opening dinner audience with the heroic story of his New York City firefighter brother Stephen’s selfless sacrifice during the 9/11 attacks and the families the foundation helps in his honor.

22

CSTORE DECISIONS •

December 2019

cstoredecisions.com

®

®

INTRODUCING SNICKERS FLAVOR COFFEE MATE

The creamer brand your guests want— now in one of the most popular snacking flavors on the planet.

Everybody knows snacking is a hot trend — and 74% of consumers say coffee creamed with COFFEE MATE is a good snack.1 Introducing COFFEE MATE Snickers® flavor liquid creamer singles. Whether for here or on the go, hot or iced, when America’s favorite creamer 2 meets America’s favorite candy bar,3 you’ve got an irresistible new way to help guests turn your coffee into an anytime snack occasion. It’s the perfect tasty treat!

1. Datassential 2018

2. Nielsen data 52 weeks ending 1-26-19

3. TrendingTopMost.com

1 (800) 288–8682

CMFeelTheLove.com

We have a range of solutions that will delight all your customers

specialty coffee

brewed coffee

creamers

juices

iced tea

Unless otherwise noted, all trademarks are owned by Société Des Produits Nestlé S.A., Vevey Switzerland. Snickers and the Snickers logo are trademarks of Mars or affiliates used under license.

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10/14/19 9:42 AM

2019

INFORMATION EXCHANGES During the conference, retailers took part in Information Exchanges, known as the ‘heart and soul’ of NAG, where they discussed key issues and topics with noncompeting peers.

Attendees had the option of attending a Top Golf outing or a tour of local convenience stores, including Kwik Trip, Bobby & Steve’s Auto World, Holiday Stationstores and Metro Petro Gas. LIFETIME AWARD At the Dinner & Awards Ceremony at the Nicollet Island Pavilion, NAG honored Gus Olympidis, president of Family Express in Valparaiso, Ind., as the 2019 recipient of the NAG Lifetime Award for Convenience Retailing.

“We will always be grateful for his belief in NAG and YEO, his leadership and, most importantly, his friendship,” said Lofstock. “That’s why we are so honored to recognize Gus this evening with this prestigious NAG Award.”

The 2020 NAG Conference will be held in Charlotte, N.C., Sept. 13-16.

Family Express President Gus Olympidis, left, alongside his wife, Beth, accepted the NAG Lifetime Award for Convenience Retailing at the NAG Conference Dinner and Awards Ceremony at Nicollet Island Pavilion. NAG Executive Director John Lofstock, right, presented the award.

From left, Sean Luce, of McLane; Casey Kanclerz and Ryan Faville, of Stewart’s Shops; Pat Madden, of McLane; David Caruso, of Stewart’s Shops.

Bill Weigel and Doug Yawberry, of Weigel’s enjoy the grounds of Nicollet Island Pavilion.

From left, seated: Mary Banmiller, of Warrenton Oil; Tim Campbell, of Quantum Services; and Peter Tamburro, of Clifford Fuels. Standing: Stacey Davis, of Clifford Fuels; Olivia Beck, of FriendShip Food Stores; and New York Association of Convenience Stores (NYACS) President Jim Calvin.

24

CSTORE DECISIONS •

December 2019

cstoredecisions.com

McLANE GREEN ADVANTAGE: IT’S MORE THAN AN IDEA, IT’S OUR FUTURE. McLane is committed to making continual improvements to minimize our environmental impact.

That’s why we’ve invested more than $230 million in energy efficient automation and equipment.

We also replaced 100% of our tractor fleet in the past five years to improve emissions performance, reduce the amount of fuel burned and lower NOx. And that’s just the beginning, because advantages like these benefit us all.

To find out more about our green initiatives, visit mclaneco.com/green

© 2019 McLane Company, Inc. All rights reserved.

2019

Hanging in the hospitality suite, from left: Joe Varao; David Caruso, of Stewart’s Shops; and Joy Almekies, of Global Partners/Alltown Convenience Stores.

Ben Duff and Phil Harper manned the Pinnacle Corp. booth during the opening night reception.

Eric White, of Thompson Haskel & Associates; and Gate Petroleum’s Cole Fountain.

Anna Masur and Jeff Seccombe with their oh-so-sweet treats on display at the Prairie City Bakery booth.

Lots of laughs in the hospitality suite courtesy of Mark McCarty, of Clark’s Pump-NShop; Vern Young, of Young Oil Co.; Brian Unrue, of Clark’s Pump-N-Shop; and Mark Lopofsky, of Republic Tobacco.

26

CSTORE DECISIONS •

December 2019

NAG Board Chairman Doug Galli, of Reid Stores/Crosby’s; with John Petersen, of CStore Decisions.

cstoredecisions.com

R E N W O POINNOV TI

THE

OF

1894

2019

Join the conversation:

@HersheyCompany The-Hershey-Company

h the lts wit u s e r Drive ATIVE

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LAURA GRIFFITH AUFLEGER, 34 President Company: OnCue Headquarters: Stillwater, Okla.

Number of Stores: 75 Years with the Company: 13

Laura Griffith Aufleger grew up in the family c-store business and began working at the stores at age 15. After college, she expanded her knowledge CStore Decisions presents the 2019 40 Under 40 by tackling positions in other industries before officially beginning her career class of next-generation convenience store leaders. at OnCue. Aufleger worked her way A CStore Decisions Staff Report up to her current position as president, where she is involved in all areas of the company from advertising to site selecToday’s retail environment is changing faster than ever before as tion and operations. She is especially technological disruption pushes c-stores to adapt for the future while passionate about continued innovation, simultaneously championing the values and traditions that have supemployee engagement, marketing and ported their success throughout their companies’ histories. expanding OnCue’s charitable efforts Next-generation leaders are playing a key role in bridging this path into and community involvement. tomorrow’s competitive landscape by combining new communication styles, What project/innovation are you digital dexterity, know-how and innovative ideas with open-mindedness, most looking forward to in 2020? flexibility and a passion for convenience retailing.

“New store development and conOn the pages that follow, CStore Decisions presents the 2019 class of tinued expansion of our concept, 40 Under 40 C-Store Leaders to Watch in 2020. These next-generation leaders including new coffee bar, The represent some of the best and brightest young executives in the c-store industry Grill fresh food offer and today, selected from chains of all sizes across the convenience store industry. drive-through.”

Among them, these retailers hold a myriad of different positions, including president, IT director, category manager, chief strategy officer and chief financial officer, to name a few.

Several are members of the National Advisory Group’s (NAG) Young Executives Organization (YEO), a growing group of emerging industry frontrunners focused on education and networking with other under-40 executives in the competitive c-store channel.

Those interested in nominating future leaders for the class of 2020 or joining YEO, contact CStore Decisions Editor-in-Chief and NAG Executive Director John Lofstock at jlofstock@wtwhmedia.com.

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KELLY BANNON, 25 Category Manager Company: QuickChek Corp.

Headquarters: Whitehouse Station, N.J. Number of Stores: 158 Years with the Company: 3

Kelly Bannon is category manager for candy, nutritional bars, dairy, milk and HBC. Bannon also helps manage QuickChek’s relationship with its primary wholesaler, McLane.

What’s the most challenging issue facing young executives today? “I think the biggest issues that I have encountered are keeping up with the ever-changing industry trends as well as the everyday detail. Trying to keep up with the new, emerging trends as well as the specific details in order to successfully roll out products and programs can be challenging at times. Once you are able to stay on top of these aspects of the business and roll out a successful item or program in stores, it is the most rewarding feeling.”

OLIVIA BECK, 30 Business Development

JOSEPH BICKHAM, 31

Company: Beck Suppliers Inc. (FriendShip Kitchen) Headquarters: Fremont, Ohio Number of Stores: 27 Years with the Company: 3.5

Company: Fuel City Headquarters: Dallas, Texas Number of Stores: 7 Years with the Company: 7

Representing the fourth generation of the Beck family, Olivia Beck is involved with business development for FriendShip Kitchen, which involves special projects including but not limited to dealer business unit, dispatch, marketing and human resources. Her job is to complete a corporate rotation in the next several years to learn each business unit in order to become the best owner and operator possible.

What’s the most challenging issue facing young executives today? “Planning for the future is a challenging issue. The environment in which we compete is constantly changing. The goal is to stay relevant, to be proactive versus reactive. Everything from technology to EV (electric vehicles). We don’t know what the future is going to bring exactly, but I do know that we need to keep updating our business model in order to innovate or else we won’t have a business!” cstoredecisions.com

President

As the president of Fuel City, Joseph Bickham handles day-to-day operations, corporate and real estate development.

What do you think today’s young executives bring to the table? “We are bold, creative and not afraid to make mistakes. We see opportunities and forge successes through trial and error in landscapes that are constantly shifting from new ideas and changing technologies. A great strength of today’s young executive is the ability to separate useful tools from essential pillars. Having spent most of our professional careers in an era of advanced technology, we understand the value and utility of technology as a means to increase efficiency and profits. But the next generation of leaders also values people, and we understand that despite the benefits technology offers as an accelerator of momentum, people are always the creators of it.”

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40 under 40

KENNETH COSGROVE, 39 Vice President Company: Piedmont Petroleum Corp. (Citgo Corner Mart) Headquarters: Greenville, S.C. Number of Stores: 32 Years with the Company: 16

COURTNEY BUCKLEY, 34 Manager of Training, Development and Fun Company: Verc Enterprises Headquarters: Duxbury, Mass.

Number of Stores: 31 Years with the Company: 8

In her role as manager of training, development and fun, Courtney Buckley creates training manuals and written procedures for associates, shift leaders and team leaders. She hosts training classes and educational sessions throughout the year. Buckley also creates fun at stores, including costume and store decorating contests and sports guessing games. She also plans company outings with team leaders, shift leaders and associates.

What is your favorite thing about your job/role? “My favorite thing about my job is being able to connect with everyone in the company (from the support center, team leaders and shift leaders to associates). … On top of that, I plan all the fun events like bowling, Go Karts, beach outings, dress-up contests, store-decorating contests and free giveaways!”

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In his role as vice president for Piedmont Petroleum Corp., Kenneth Cosgrove is the buyer for all retail categories, as well as head of the real estate division, internal auditing, environmental compliance and tech support.

What’s the biggest issue facing c-stores in your region? “Labor!

South Carolina is right around a zero real unemployment rate, and finding new team members is our biggest challenge.”

MARK DANIELS, 35 Managing Director & Chief Strategy Officer Company: Yesway Headquarters: Des Moines, Iowa Number of Stores: 414 Years with the Company: 9

Mark Daniels was hired by Brookwood Financial Partners, Yesway’s parent company, to research and propose a new type of corporate fund. He settled on a c-store roll-up, leading the team that created Yesway and driving the company’s strategy. Daniels is a member of Yesway’s Executive Committee, evaluating the feasibility, risks and expected return of all major initiatives. He oversaw Yesway’s recent acquisition of 300-store Allsup’s in Texas and New Mexico, leading the underwriting process and the negotiation of the debt facility.

Daniels serves as an integration management officer for the acquisition, responsible for merging the two corporate infrastructures.

What project/innovation are you most looking forward to in 2020? “I’m definitely looking forward to the post-merger integration process between Yesway and Allsup’s. We unlock a ton of opportunity by bringing Yesway’s loyalty, fleet and technological platforms to Allsup’s, and rolling out the Allsup’s brand and famous burrito to Yesway’s stores.”

cstoredecisions.com

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40 under 40

STACEY DAVIS, 26 Marketing Manager Company: Clifford Fuel Co. Inc. (Cliff’s Local Market) Headquarters: Marcy, N.Y. Number of Stores: 20 Years with the Company: 3

Stacey Davis oversees all branding, marketing, community involvement and corporate sponsorship in her role as marketing manager for Cliff’s Local Market.

What do you think today’s young executives bring to the table? “Today’s young executives in the c-store industry are adapting ideas and molding the way we shop.

Our lives are artificially assisted, and today’s young executives are finding new ways to harvest that data and create a quicker and smoother in-store experience.”

TAMARA DICKERSON, 29

NATHANIEL DODDRIDGE, 37

Loyalty Manager

Director, Fuel

Company: EG America Headquarters: Cincinnati, Ohio Number of Stores: 1,680 Years with the Company: 3.5

Company: Casey’s General Stores Headquarters: Ankeny, Iowa Number of Stores: 2,185 Years with the Company: 2

Tamara Dickerson drives EG America’s centralized U.S. Loyalty team, supporting loyalty and marketing strategies for eight divisions including over 1,000 stores with a U.S. market focus, while keeping aligned to allinclusive EG Group Global goals.

She leads customer rewards program strategy during Global planning sessions and develops future strategies to keep the company current with retail innovations. Dickerson was a key player in the Kroger Co. transition, following that acquisition in 2018.

What is your favorite thing about your current job/role? “The people. When faced with multitasking and everyday challenges, it is great to be working beside equally passionate individuals. We really have created a work family here at EG.”

Nathaniel Doddridge oversees the procurement, delivery and sales of fuel across the 16 states Casey’s General Stores serves. He develops and executes near-term and long-term strategy for all facets of fuel in order to bolster financial performance.

What do you think today’s young executives bring to the table? “There are a lot of very knowledgeable industry vets across the c-store space, but our industry is changing faster than ever, which forces us to continue to look for new ways to add value. Young executives are growing up in the new digital workplace, and it is becoming the norm, so their ability to adapt will provide an edge that will benefit them in the long run.”

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40 under 40

TOM DRANSFIELD, 38 Director of Information Technology (IT) Company: The Kent Cos. (Kent Kwik) Headquarters: Midland, Texas Number of Stores: 47 Years with the Company: 8

DAN DUNSTAN, 38 Vice President of Retail Company: Parkland USA (Superpumper, Harts, KB Express stores) Headquarters: Calgary, Alberta, Canada Number of Stores: 50 retail sites and 240 dealer-operated sites Years with the Company: 19

In his current role as director of IT, Tom Dransfield identifies the ways technology can support Kent Kwik, including platform integration and process automation, ensuring the security of company data and managing the IT support department.

What’s the most challenging issue facing young executives today? “Keeping up with and adapting to changes in technology while maximizing returns from that expense is extremely important to our company and all companies across the c-store industry. Technology will evolve faster and faster.

Choosing solutions that will remain relevant to the business is essential. This includes point-of-sale, loyalty and back-office systems.”

FOUAD EL-NEMR, 28 Executive Vice President Company: Nouria Energy Headquarters: Worcester, Mass.

Number of Stores: 140 Years with the Company: 4

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Dan Dunstan oversees Parkland’s U.S. retail business, which has grown as Parkland USA acquired five companies in the past year, many with retail stores. Dunstan is also the general manager of the Northern Tier ROC (regional operating center) in North Dakota.

What project/innovation are you most looking forward to in 2020? “In 2020, we will launch our national c-store brand, working with great c-store partners. I am excited to see the new store designed, branding become reality and the response from our customers walking into our stores.”

In his role as executive vice president at family-owned Nouria Energy, Fouad El-Nemr is responsible for risk analysis, cash management, budgeting and fuel pricing, plus assisting in a major rebranding effort to roll out the Nouria c-store brand.

What’s the most challenging issue facing young executives today? “I believe the most challenging issue in the c-store business today is the pressure to adapt quickly and retain industry knowledge in order to perform at a high level. Staying abreast of the latest technologies and trends to be considered a member of the competitive market is, in and of itself, a large part of being the best in the industry.”

December 2019

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40 under 40

JOSH EMMICK, 35

Executive Vice President

Company: Valor Oil (Hop Shops) Headquarters: Owensboro, Ky. Number of Stores: 11 Years with the Company: 17

As the executive vice president of Valor Oil and Hop Shops convenience stores, Josh Emmick manages the executive team for the Wholesale, Retail, Racing, and Commercial and Industrial divisions.

What project/innovation are you most looking forward to in 2020? “After a 13-year break from operating c-stores, we re-entered the arena in 2018 through an acquisition. We are excited to continue our growth in this division.”

RYAN FASEL, 39

RYAN FAVILLE, 33

Director of Marketing

Director of Sales

Company: Family Express Headquarters: Valparaiso, Ind. Number of Stores: 74 Years with the Company: 11

Company: Stewart’s Shops Headquarters: Ballston Spa, N.Y. Number of Stores: 335 Years with the Company: 11

In his current role, Ryan Fasel works to ensure Family Express’s success with customers by managing the activities of the marketing department, including category management, merchandising, loyalty initiatives, mobile app, website, digital marketing and advertising What’s the biggest issue facing c-stores in your region?

“Adapting to give customers a personalized experience. Not only offer them what they want, but the way they want it. With options like delivery, mobile payment, cashier-less checkout and offers targeted to specific purchasing habits, the entire customer experience in all channels is becoming more personalized. We know our customers on a personal level, but now we have an opportunity to be on the forefront of personalizing the entire experience, starting before they ever walk into our stores.”

As director of sales, Ryan Faville oversees a team of category managers and buyers responsible for optimizing the selection of items at Stewart’s Shops.

What is your favorite thing about your job/role? “My favorite parts about my role are being able to identify new and trending items and make them available to our customers. It’s amazing to see how products perform, whether they are a flash in the pan or here to stay. With 335 shops operating in all different types of communities throughout New York and Vermont, we have the opportunity to see how different items perform in different settings, but also how some items are popular throughout our entire geographic footprint.”

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40 under 40

RYAN FUELLING, 35 President and Chief Financial Officer

DANIELA FIELD, 29 Category Manager, Wine and Spirits Company: 7-Eleven Headquarters: Irving, Texas Number of Stores: 70k+ Globally; 11k+ Domestic Years with the Company: 7.5

As the national category manager for wine and spirits at 7-Eleven, Daniela Field’s responsibilities entail managing a $180 million business. She owns the strategies, sales plans, pricing, marketing elements and merchandising guidelines that roll into 7-Eleven leadership’s corporate strategy. She strives to be customer obsessed and drive franchise gross profits for the organization.

What do you think today’s young executives bring to the table?

“I believe we challenge the speed at which we move to make change in the industry. We continuously tap into less conventional ideas, disrupt the marketplace and, most importantly, we are OK with breaking through the bureaucracy that comes with our business.”

Company: Parent Petroleum Inc. (The PRIDE Stores) Headquarters: Saint Charles, Ill. Number of Stores: 16 Years with the Company: 2.5

Ryan Fuelling leads the operational and strategic direction of the company’s distribution business, with financial responsibility and oversight across the broader enterprise that is Parent Petroleum Inc. What is your favorite thing about your job/role?

“In my role, I’m often pulled in a number of different directions — no two days look alike.

With the continued growth of the business and dynamic nature of our industry, each day is assured to present its own set of challenges, yet they are always rewarding. The most rewarding aspect of my role, bar none, is the people. It’s a tremendous privilege to lead such a talented and genuine team.”

BRANDON GORMLEY, 32 Manager of Retail Petroleum Pricing Company: Cumberland Farms (recently acquired by EG America) Headquarters: Westborough, Mass.

Number of Stores: 567 Years with the Company: 6

Brandon Gormley started at Cumberland Farms in 2013. In 2016, he joined the retail petroleum team, was selected to manage the pricing team and became manager of retail petroleum pricing, responsible for the gasoline retail pricing of 500+ locations.

What his co-workers are saying: “Brandon is a talented and gifted young professional who has the motivation, passion and desire to succeed in this industry and is viewed as a future leader in the Cumberland Farms organization,” said Ronald Saumur, vice president of petroleum operations for Cumberland Farms. “He has done a tremendous job while in his current position and has developed a very strong team, while establishing himself as a solid leader. Brandon exemplifies the qualities that we would expect from our future leaders in order to maintain the success and prosperity of our company and our industry.”

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LISA HAM, 31 Senior Category Manager, Center Store & Beer Company: Yesway Headquarters: West Des Moines, Iowa Number of Stores: 414 Years with the Company: 2.5

ANTHONY GROSS, 29 Category Manager Company: Casey’s General Stores Headquarters: Ankeny, Iowa Number of Stores: 2,185 Years with the Company: 9

As the category manager for cigarettes and tobacco at Casey’s General Stores, Anthony Gross manages the merchandising, pricing and promotional strategy, and maintains the vendor partnerships for these categories.

What project/innovation are you most looking forward to in 2020? “I am most excited for our organization’s continued digital transformation, which will allow us to have more engagement and tailored communication with our guests.”

As the senior category manager for Yesway, Lisa Ham oversees everything in relation to the beer and center store (candy, snacks, HBA, etc.) categories, including pricing, promotions, assortment, planograms and private brand final selections. She is also responsible for training new category managers for Yesway and serves as mentor and adviser to all the category team members. Ham acts as the team liaison between other departments, including construction and operations.

What’s the most challenging issue facing young executives today? “Adapting to the different communication styles of other generations. … Most millennials I know feel most comfortable with email or text communication; however, the generations before us tend to value face-to-face and phone conversations. … With the new generations coming behind us, we will have to continue to adapt and expand our communication repertoire to include emojis, Snapchat and now TikTok.”

JORDAN HARRELL, 24 Director of Transportation, Manager of Foodservice Technology Company: Jernigan Oil Co. Inc. (Duck Thru Food Stores) Headquarters: Ahoskie, N.C. Number of Stores: 53 Years with the Company: 3

Jordan Harrell oversees the operations of Jernigan Oil’s transportation department. He works with branded and unbranded suppliers to negotiate contracts and allocations to meet the changing demand of Jernigan Oil’s stores and customers. He also works with software companies to develop made-to-order foodservice kiosk software and has implemented a made-to-order solution at Duck Thru Food Stores.

What makes this industry special? “The thing that makes this industry special to me is that I am part of a family business that is still wholly owned and operated by the family that started the business. My brother, sister and I make the fifth generation to join the family business. This is really special to me because I get to work with my family every day, facing new challenges daily! … I (also) get to work closely with other family businesses, such as vendors and other neighboring oil companies.” cstoredecisions.com

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40 under 40

MILES HARRELL, 27 Vice President of Operations Company: Jernigan Oil Co. Inc. (Duck Thru Food Stores) Headquarters: Ahoskie, N.C. Number of Stores: 53 Years with the Company: 6

As part of a small, family business, Miles Harrell wears many hats. His responsibilities include environmental compliance, logistics coordination for petroleum bobtails, recruiting, point-of-sale maintenance, district manager supervision, vendor communication, new store builds, loyalty execution, branding execution and more.

What makes this industry special? “I believe the c-store industry is special because of the way that the many different moving parts allow you to meet and develop working relationships with many extraordinary people whom you will know for many years to come. … I get an opportunity to work with my family every day and employees who have been with us for many years who feel like family. The relationships gained through this industry can be truly special.”

NICK HURD, 32

ERIC JONES, 37

Director of Operations, Facilities and Maintenance

Chief Innovation Officer

Company: EG America Headquarters: Cincinnati, Ohio Number of Stores: 1,680 Years with the Company: 6

Company: Parker’s Headquarters: Savannah, Ga. Number of Stores: 64 Years with the Company: 2

Nick Hurd oversees all expense categories for EG America, including all store support services, audits, travel, customer service, loss prevention and operational practices. He manages a facility maintenance team handling 5,000 calls monthly for all areas of the property (fuel, concrete, restaurant equipment, HVAC, refrigeration, dispensed beverages) and establishes and sets the contracts and staffing to handle the volume and acquisitions.

What’s the most challenging issue facing young executives today? “There is always an age difference, and too many people associate age with knowledge. That being said, an education and MBA does not automatically qualify a young person to rise to the top. One needs to have real-life, hands-on experience with a strong work ethic and drive. No opportunity is ever just given.”

As chief information officer, Eric Jones is responsible for the digital transformation efforts at Parker’s, including all technology, business intelligence and data science initiatives.

This includes end-to-end product and application development, machine learning and artificial intelligence initiatives, Internet of Things, robotic automation and Parker’s modern data platform.

What’s the biggest issue facing c-stores in your region?

“The biggest challenge facing our business is how fast customer expectations are increasing when it comes to convenience.

This is driven by the rapid change in technology and the expectation to deliver a remarkable and frictionless shopping experience at every physical and digital touchpoint. To exceed these expectations, our organization and offering must continuously adapt and change at an even higher rate.”

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40 under 40

TANNER KRAUSE, 32

JAMES MCELROY, 28

President

Senior Category Manager

Company: Kum & Go Headquarters: Des Moines, Iowa Number of Stores: 400 Years with the Company: 3

Company: QuickChek Corp.

Headquarters: Whitehouse Station, N.J. Number of Stores: 158 Years with the Company: 3

As a fourth-generation member of his family company, Tanner Krause began working in the stores at the age of nine. After college, he worked for Gallo Winery, before becoming a district supervisor at Kum & Go. He left to pursue his MBA but returned to Kum & Go in 2016. Today, as president of Kum & Go, he’s creating the vision for the future state of Kum & Go and leading the team to develop the strategy to make that vision a reality.

What do you think today’s young executives bring to the table? “Age might help, but it doesn’t matter how old you are. When setting a company strategy, you need to understand and relate to your associates and your customers. Growing up working in stores and traveling constantly to talk to our store associates and customers in person keeps me aware of the opportunities in our business.”

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As a senior category manager, James McElroy is responsible for the tobacco, snacks, frozen, and newspapers and magazines categories at QuickChek.

What’s the most challenging issue facing young executives today? “One of today’s most pressing challenges is adapting to the demands and needs of the younger, growing population. Individuals have become more educated and informed about the products we sell. … Increased digital communication and the current social media landscape result in an overall greater connectedness. The dynamics and ways in which we market to consumers is ever-changing, which creates obstacles. That said, these are the challenges that make the c-store industry fun.”

LACEY MEDINA, 31 Director of HR & Risk Management Company: Golden Pantry Food Stores Inc. Headquarters: Watkinsville, Ga. Number of Stores: 38 Years with the Company: 1

Lacey Medina has more than six years of experience in a human resources director role.

At Golden Pantry Food Stores, she handles workforce planning and talent acquisition, strategic planning/management, assessment and mitigation of risks, policy formulation and compliance, organizational leadership and leadership development.

What is your favorite thing about your job/role? “What drives me in my role are the people I work with on a daily basis. In the convenience industry, you get the realest version of people.

At Golden Pantry, I became a part of our employees’ stories, and I get the joy of seeing their lives unfold even beyond their time at Golden Pantry.”

cstoredecisions.com

40 under 40

LUKE MINDERLER, 33 Category Manager Company: Reid Stores Inc. (Crosby’s Stores) Headquarters: Lockport, N.Y. Number of Stores: 82 Years with the Company: 1

Luke Minderler manages a variety of categories, including alternative snacks, better for you, grocery, HBC, meat snacks, packaged sweets and more. He also manages a handful of direct-store-delivery vendors, including ice, ice cream, propane and even bait. He has recently taken on more responsibility with Scan Based Trade programs.

What project/innovation are you most looking forward to in 2020? “We are working to launch our loyalty program, My Crosby’s Rewards, in the first half of 2020. This will be a game changer for us as a company and will offer us a ton of insight into what our customers’ purchasing habits are and their overall experience at our stores. … We’ve added CBD products to around half of our stores, and I am very interested to see where that category goes in 2020.”

JEREMIE MYHREN, 38 Chief Information Officer Company: Road Ranger LLC, a division of Enex, S.A. Headquarters: Rockford, Ill. Number of Stores: 40 Years with the Company: 17

Jeremie Myhren holds strategic management responsibility for all technology-based systems, processes, platforms and related initiatives. He is responsible for ownership and mapping of the company’s data and analytics/ business intelligence functions. He also works with the marketing team on the company’s digital marketing endeavors, and is the YEO Board Chairman.

What’s the most challenging issue facing young leaders in this industry?

“The technological advancements of the past 25 years have caused rapid and seismic shifts in the way commerce is conducted at retail. … Young leadership in our industry must bridge the gap between so-called fellow digital natives and their parents and grandparents who grew up in a pre-digital world. …

Those of us that work through this challenge and embrace it will be the ones who find great success in the years ahead.”

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ALAYNA RECK-BROWN, 23 Regional Manager Company: Northdale Oil Inc. Headquarters: East Grand Forks, Minn.

Number of Stores: 13 Years with the Company: 2

In her role as regional manager, Alayna Reck-Brown is accountable for the entire c-store division, managing price book and profit margin, as well as hiring, developing and evaluating management talent.

What’s the most challenging issue facing young executives today? “The biggest challenge I have faced is the fear of not having enough time. There is so much to learn in this rapidly changing and progressing industry. … With the help of mentors, I’ve learned that things take time, and you have to dig deeper into a project before moving onto the next thing because that’s when you truly start to understand things. You will never stop learning, so it’s OK if you don’t know everything right now.”

cstoredecisions.com

JON RIER, 34 Chief Financial Officer

As the chief financial officer, Jon Rier handles all aspects of finance and accounting for Refuel, including the retail and wholesale business lines. Rier has been in the c-store industry for 13 years. Before joining Refuel, he worked for Atlanta-based RaceTrac Petroleum. He enjoys the fast-paced, dynamic and entrepreneurial nature of the industry.

What is your favorite thing about your job/role? “At Refuel, my favorite things are working alongside our bold and committed ownership/leadership group and building new insights, teams and processes to help Refuel grow rapidly and profitably. Being on the beach in Charleston isn’t half-bad either!”

Company: Refuel Markets Headquarters: Charleston, S.C. Number of Stores: 33 currently (45 by end of year) Years with the Company: 1

KRISTAL SEARLE, 35 ARIEL RUBIN, 34

Chief Financial Officer

Communications Director

Company: Stinker Stores Headquarters: Boise, Idaho Number of Stores: 110 Years with the Company: 4

Company: Kum & Go Headquarters: Des Moines, Iowa Number of Stores: 400 Years with the Company: 1

In his role as communications director, Ariel Rubin is responsible for external and internal communications at Kum & Go, including developing PR and social media campaigns to build the Kum & Go brand. He’s also the unofficial fanny pack designer and merchandise enthusiast.

What do you think makes this industry special? “The definition of what constitutes convenience is evolving every day. I think what’s really special is the chance to work for a company that encourages risk-taking and innovation in tackling industrywide disruption head on.”

cstoredecisions.com

Kristal Searle is the chief financial officer at Stinker Stores. As part of her role, she’s developed financial modeling for the company’s growth plans and beeninvolved in all phases of recent acquisitions that have expanded Stinker from 65 stores in Idaho to over 100 stores in Idaho, Colorado and Wyoming. Searle grew up in a farming community in southern Idaho where she learned the value of hard work.

How have your values impacted your outlook and career?

“Consistently seeing the pattern of ‘you reap what you sow’ (on the farm) ingrained in me that good things in life are the result of hard work. I approach each day with the attitude that I am going to work hard and be better today than I was yesterday.”

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40 under 40

MORGAN SIMONSON, 33 Executive-Level Manager Company: Simonson Station Stores Inc. Headquarters: Grand Forks, N.D. Number of Stores: 16 Years with the Company: 15

RYAN SHEETZ, 36 Associate Vice President of Brand Strategies Company: Sheetz Inc. Headquarters: Altoona, Pa. Number of Stores: 600 Years with the Company: 17

In his role as associate vice president of brand strategies, Ryan Sheetz leads brand strategies and go-to-market teams for Sheetz as the company drives customer traffic and builds brand equity.

What do you think today’s young executives bring to the table? “The young executives that I know in this business have tremendous appreciation for what prior generations have established matched with an incredible drive to advance the industry forward in lockstep with the changing needs of our customers. They are bringing high energy, big expectations and an optimistic future to a dynamic business that is central to the daily lives of millions of shoppers every single day.”

As a fourth-generation member of the family business, Morgan Simonson started helping out around Simonson Station Stores at age 10, cutting grass and picking up garbage, later moving up to part-time sales associate during summers.

At 19, he co-managed his first location, and after graduating from college, he joined the company full-time. Today, he oversees the company’s 16 locations alongside his brother, Dane, and his father, Arch, working with store managers and sales associates.

He developed the company’s central price book, which he manages, and he acts as the primary contact for in-store vendors.

What’s the biggest issue facing c-stores in your region? “Constantly trying to exceed the ever-changing demands of our customers.”

ADAM STEPHENSON, 32 Vice President, Strategy and Innovation Company: Cary Oil Co. (Breeze Thru Markets) Headquarters: Cary, N.C. Number of Stores: 20 locations, plus it supplies nearly 800 independently owned and operated c-stores.

Years with the Company: 7

At Cary Oil Co., Adam Stephenson is responsible for corporate strategy, internal operations, mergers and acquisitions, and marketing and communications.

What do you think today’s young executives bring to the table? “What stands above the rest is the ability to offer creative solutions for difficult problems. Young executives in leadership roles have diverse educational and professional backgrounds to draw from and can put that experience into practice on a daily basis to make their teams, firms and the industry as a whole more successful. ... We are all made better when we can lean on best practices from the past and infuse those practices with 21st century innovation and problem-solving.”

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CSTORE DECISIONS •

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40 under 40

ALAN WEAVER, 32 Director, Merchandising Solutions Company: RaceTrac Petroleum Inc. Headquarters: Atlanta, Ga. Number of Stores: 540 Years with the Company: 8

ALEX THIE, 30 Senior Real Estate Representative Company: 7-Eleven Headquarters: Irving, Texas Number of Stores: 70k+ Globally; 11k+ Domestic Years with the Company: 3

In his role as a senior real estate representative at 7-Eleven, Alex Thie leads the charge for new store development in Colorado. He is responsible for long-term market planning, site selection, real-estate deal-making and transaction management, as well as entitlements supervision.

What do you think today’s young executives bring to the table? “I believe today’s young executives bring an earnest passion for innovation to the table. We’ve matured during a time where new ideas and processes for executing those ideas are being developed at lightning speed. This empowers our generation to not only adapt to a constantly evolving marketplace, but also take up an ‘It Can Be Done’ attitude where nothing is impossible if you are surrounded by the right team. … ”

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CSTORE DECISIONS •

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Alan Weaver’s department is comprised of four functions: space management, demand planning, merchandising, operations and retail solutions. His team ensures the right product shows up at the right store at the right price by leveraging RaceTrac’s merchandising technologies.

What project/innovation are you most looking forward to in 2020?

“We have spent the last few years putting the technology infrastructure and inventory processes in place to become more granular with our analytics. In 2020, we will continue to push the envelope with these types of analytics, including advanced forecasting, macro space, pricing exceptions, over/under stock and vendor management. These advancements will continue to become more critical as our store count continues to grow with more complexities inside the store than ever.”

DYSON WILLIAMS, 33 Director of Merchandising Company: Dandy Mini Marts Inc. Headquarters: Sayre, Pa. Number of Stores: 65 Years with the Company: 4

Dyson Williams is responsible for evaluating and placing all retail items for Dandy Mini Marts. This includes maintaining close relationships with existing vendors and seeking new vendors. Williams directs a team of three category managers who are directly responsible for the company’s specific categories. He also works with the foodservice and marketing teams to create quarterly foodservice specials.

What’s the biggest issue facing c-stores in your region? “The impact that government legislation has on our day-to-day operations. New government regulations expose our business to new challenges and consequences for our bottom line. These include increased fuel and cigarette taxes, minimumwage requirements and (legislation) adversely affecting our industry’s relationship with the new e-cigarette industry.”

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Category Management | Tobacco

Wading Through OTP Uncertainty

From vaping to smokeless tobacco, it’s been an eventful quarter for other tobacco products (OTP) as confusion around potential regulations continues. But how does it all ring up at c-stores?

Anne Baye Ericksen • Contributing Editor

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CSTORE DECISIONS •

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cstoredecisions.com

On Nov. 6, members of the Boston Convenience Store Owners Association, along with independent c-store owners throughout Massachusetts, closed shop for the day in protest of a proposed ban on menthol and mint tobacco products. Their frustration is shared by many in the industry as lawmakers across the country float various bans and new regulations on the top c-store category.

cstoredecisions.com

“

It is understandable there is confusion in the market at the moment. With mixed signals coming from FDA and the administration and a patchwork of state/local bans, some of which are being challenged and overturned, retailers are in a vortex of regulatory uncertainty. The FDA can stabilize this by releasing reasonable guidelines that do not discriminate between retail formats.

“

Cigarettes and other tobacco products (OTP) account for nearly 40% of all inside sales, according to the National Association of Convenience Stores (NACS).

But public scrutiny on underage use of e-cigarettes and vaping devices, coupled with an outbreak of vapingrelated illnesses, has rallied policymakers to target the category. In fact, several governors issued emergency temporary bans on e-cigarettes and vaping sales in reaction; however, at press time, lawsuits brought by retailers resulted in judges halting these orders in Massachusetts, Utah and New York. “(New York) Gov. Cuomo put an emergency order in place in October, which effectively banned all flavored tobacco products. This was overturned by a judge, so for the time being, flavored products are still legal. However, most expect a ban will be put in place through legislation in the near future,” said Mike Clifford, category manager for Clifford Fuel, which operates 20 Cliff’s Local Market stores in New York state.

Directives by the Food and Drug Administration (FDA) continue to be another source of frustration. Federal officials have taken an aggressive stance against access to e-cigarettes and vaping items by minors, including a proposed national ban on mint and menthol flavors, which could disproportionately affect smokeless tobacco sales.

In October, though, Bloomberg reported the Trump Administration might reconsider its approach on a mint and menthol ban. Then, last month, the president announced support for a national tobacco 21 age minimum.

— Lyle Beckwith, senior vice president, government relations for NACS

December 2019 • CSTORE DECISIONS

51

Category Management | Tobacco

Public Reaction to Vaping BRIGHT SPOTS AMID CONFUSION

According to an October USA Today/Ipsos survey, a majority of Americans believe vaping companies should list all ingredients and health risks on packaging labels. Also, more than half agree a vaping ban would increase black market activity.

“It is understandable there is confusion in the market at the moment,” OTHER FINDINGS INCLUDE: said Lyle Beckwith, NACS senior vice • 80% of people believe 21 should be minimum purchase age president, government relations. “With for vaping products mixed signals coming from FDA and the • 52% support banning flavored e-liquids administration and a patchwork of state/ • 63% of respondents age 55 or older back vaping bans comlocal bans, some of which are being chalpared with 33% of millennials lenged and overturned, retailers are in a Source: USA Today, “Americans overwhelming support regulations to make vaping safer, USA Today poll finds,” vortex of regulatory uncertainty. The FDA Oct. 2, 2019, https://www.usatoday.com/story/news/health/2019/10/02/americans-strongly-support-teenvaping-ban-poll-says/3826575002/ can stabilize this by releasing reasonable guidelines that do not discriminate between retail formats.”

Despite all that, there’s optimism OTP sales could be buoyed by the FDA’s approval of IQOS (heat-not-burn tobacco) as well as which operates more than 70 locations in central Penngranting Swedish Match the authority to market eight sylvania, West Virginia and Maryland.

General snus as modified-risk products.

That said, he’s pleased with consumers’ acceptance “We view this as very good news for the broader of new smokeless options. tobacco/nicotine industry as it demonstrates the FDA’s “Recently, the introduction of ZYN pouches and R.J. commitment to a ‘continuum of risk’ strategy and Reynolds VELO pouches has done very well,” he said. provides a viable pathway/process for manufacturers,” noted Bonnie Herzog, senior analyst for Wells Fargo AHEAD FOR 2020 Securities.

As for what’s coming in 2020, Beckwith hopes Con“I believe Swedish Match now can market the prodgress passes the electronic cigarette PACT (Prevent uct more prominently, but for retailers, sales volume All Cigarette Trafficking) Act, which has passed in the will drive the placement,” said Robert Perkins, vice U.S. House of Representatives and has bipartisan president of marketing for York, Pa.-based Rutter’s, sponsorship in the Senate. “This would require internet and remote retailers of electronic cigarettes to use a face-to-face age verification delivery service. It would also require the collection and remittance of all applicable taxes for the zip code to which the product was shipped,” he explained.

There could even be positive reception from the industry for a federal 21 age minimum.

“Multistate operators and those in states that have already raised the legal age to 21 may very well welcome a consistent age,” Beckwith said. CSD

fast facts:

• Judges halt emergency bans on e-cigarettes.

Cigarettes and other tobacco products (OTP) account for nearly 40% of all inside sales, according to NACS.

52

CSTORE DECISIONS •

December 2019

• General snus granted permission to market as modified risk. cstoredecisions.com

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PRODUCTShowcase

On-the-Go Repairs Flex Seal Mini is the easy way to coat, seal, protect and keep water out, even on the go. Perfect for a variety of uses, including roof leaks, windowsills, flashings, downspouts and more. Flex Glue can now be taken anywhere, making it a perfect option to make repairs on the go. Flex Tape Minis are lightweight, portable and easy to use, with all of the bonding strength of original Flex Tape. Perfect for home repairs, auto repairs, camping equipment and more.

Swift Response LLC

www.flexsealproducts.com

Interchangeable Lighter Inserts Zippo launched its new range of interchangeable lighter inserts including two butane torch options and a rechargeable arc. The new rechargeable arc and butane torches are compatible with existing regular-sized Zippo Windproof Lighters, allowing for an easy switch to the preferred flame source. Butane is odorless and stored in a sealed, pressurized tank inside the insert. The rechargeable arc lighter works on electrical energy that, in turn, creates two powerful electrical windproof beams for hassle-free maintenance and quick and easy ignition.

It is powered by lithium technology within the insert, which can be recharged through a USB port.

Zippo

www.zippo.com

High-Quality CBD ZuRI, A CBD Supply Co., is committed to offering its customers the highest quality, hemp-derived CBD products available in the marketplace. ZuRI CBD is made with premium, U.S.-grown hemp and a best-in-class manufacturing process ensuring consistent purity and potency, batch after batch. ZuRI will assist in merchandising solutions to maximize sales and shelf presence for both inline and promotional product placement, including counter displays, promotional displays, shelf talkers, window signage, literature displays and more. ZuRI’s Boost CBD Energy Shots have a suggested retail price (SRP) of $4.99, and the Gummies Convenience Pack has an SRP of $5.99 per five-pack.

Cream-Coated Marshmallow Treat Kellogg’s Rice Krispies Treats Dunk’d are big, rich, indulgent bars that deliver the delicious marshmallow-y crunch today’s consumers love, dunked in silky smooth coating. Kellogg’s Rice Krispies Treats Dunk’d are available exclusively in convenience stores. Kellogg’s latest convenience products will be added to their existing, diverse portfolio in late 2019.

Kellogg Co.

www.kelloggcompany.com

ZuRI, A CBD Supply Co. www.zuricbd.com

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December 2019 • CSTORE DECISIONS

55

PRODUCTShowcase

Peanut-First Granola Bars Jif Power Ups, available in two varieties, are high-quality snacks with peanuts as the first ingredient. Chewy Granola Bars offer Creamy Peanut Butter and Chocolate varieties, while the Stacked Granola Bars are available in Super S’Mores and Epic Chocolate. These 1.3-ounce individual packages are a great portable, on-the-go snack. Sold in 15-count boxes, Jif Power Ups are perfect to merchandise for individual sale. Jif Power Ups Stacked Granola Bars – Epic Chocolate was recently recognized as a winning product for CStore Decisions’ New Product Contest in the “Snacks – Sweet” category.

The J.M. Smucker Co.

www.smuckerawayfromhome.com

Pocket Lighter Line Calico Brands Inc. introduces two new series to its Scripto UItima Designer pocket lighter line: Runway and Geometric 2. The Ultima Designer Runway and Geometric 2 wraps appeal to multiple demographics and feature five colorful and stylish designs for each series. The Scripto Ultima Designer pocket lighters are available in a 50-count displaya-tray and two-pack open stock.

The lighters have a suggested retail price (SRP) of $1.69 per lighter in a display-a-tray and $3.49 per two-pack. The Scripto Ultima has up to 3,000 lights on full-size lighters, greater fuel capacity, sparkwheel design for comfortable ignition, visible fuel supply, adjustable flame and is made with polycarbonate material.

Calico Brands Inc.

(800) 544-4837 • marketing@calicobrands.com

www.calicobrands.com

Candy Cane Peppermint Gum Another year, another exciting holiday season with Mars Wrigley’s delicious products.

Each piece of Eclipse Candy Cane Peppermint Gum has a limited-edition candy cane design, keeping customers looking and feeling fresh all season long. The suggested retail price (SRP) is $2.99.

Unbleached Cone Packs Pre-rolled and equipped with a tip to offer an easier way to pack, fill and enjoy, JOB Virgin Cones are made of unbleached, chlorine- and dye-free fibers that are responsibly harvested. Vegan and GMO-free, JOB Virgin Cones are ultrathin and lightly porous for a slow burn and truer taste with minimal ash. With their natural brown hue, natural acacia gum adhesive and distinctive JOB watermark, the cones are part of the recently introduced JOB Virgin product line intended for the discerning and eco-conscious consumer who prioritizes quality, flavor and sustainability. JOB Virgin Cone Packs are available in two retail sizes — 1-1/4 Size with six cones per pack and King Size with three cones per pack — packed 32 packs per display and 24 displays per case.

The Republic Group

(800) 288-8888 • info@rpbtob.com

www.therepublicgroup.net

Mars Inc.

www.mars.com

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CSTORE DECISIONS •

December 2019

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PRODUCTShowcase

Ready-to-Stretch Pizza Dough Rich’s new Ready-To-Stretch Pizza Dough makes it easier for c-store operators to create delicious, artisan-style pizza with high-quality, flavorful dough. With ReadyTo-Stretch, Rich’s has done the proofing for you. Take your dough out of the cooler, stretch it to your signature shape, and stick it right into the oven. It’s the perfect palette for made-to-order customization — from pizzas to calzones, stromboli and breadsticks. Every rustic pie shows consumers you’ve made this authentic fresh baked pizza just for them. With a 120-day frozen shelf life, the six-inch dough comes 80 per case, and the 12inch dough comes 20 per case.

Rich Products Co.

www.richsconvenience.com

Wafer Bars Nature Valley Crispy Creamy Wafer Bars feature a unique dual texture, combining layers of crispy wafers with creamy peanut butter. Available in Peanut Butter and Peanut Butter Chocolate varieties, with no artificial colors, flavors or sweeteners, the new bars appeal to consumers looking for an indulgent snack they can feel good about eating. The bars come in a 1.3-ounce size with a suggested retail price (SRP) of $1.49.

General Mills Convenience & Foodservice

www.generalmillscf.com

Nitro Draft Latte Califia Farms announced their latest plant-based innovation: new shelf-stable Nitro Draft Lattes with Oatmilk in a can. The new self-stable Nitro Draft Lattes are available in four flavors: Black & White, XX Espresso, Salted Caramel and Mocha. The product is made with gluten-free oat milk and is non-GMO, kosher, vegan and free of nuts, allergens, soy, gluten, carrageenan, BPA, dairy and preservatives.

While best served cold, it does not need to be refrigerated until opened — just crack open, sip and enjoy.

Global-Inspired Meat and Cheese Snacks

Califia Farms

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The newest varieties of Hormel Natural Choice deli meats — Mediterranean style chicken paired with bruschetta jack cheese alongside garlic and herb pita chips; and chipotle chicken paired with queso quesadilla cheese and flaxseed corn chips — expands the Hormel Natural Choice branded product portfolio. The convenient, portion-controlled Hormel Natural Choice snacks are available in two-ounce packs with a suggested retail price (SRP) of $1.50 to $2.

Hormel Foods

www.hormelfoods.com 58

CSTORE DECISIONS •

December 2019

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Classifieds/Ad Index Calico Brands

16

800.544.4837 / www.calicobrands.com

Cardtronics

833.200.5250 / www.cardtronics.com/CSDecisions

CB Distributors

60 5, 7

888.824.3256 / www.cbprices.com

Core-Mark

31

E-Alternative Solutions

Nestle Professional

21,23

800.288.8682 / www.CMFeelTheLove.com

North American Bancard

59

866.481.4604 / www.nynab.com

Philip Morris USA

2

Pinnacle

37

27

Prairie City Bakery

17

Fifth Third Bank

13

Professional Supply

41

FIJI Water

11

R.J. Reynolds

15

www.core-mark.com 877.373.0069 / www.EAlternativesolutions.com www.53.com/CorporateBank 888.426.3454 / www.figiwater.com

5-Hour Energy

866.960.1700 / www.5hourenergy.com/trade

Gulfcoast

3

727.449.2296 / www.gulfcoast.com

Home Market Foods

800.367.8325 / www.HomeMarketFoods.com

JUUL

www.racscompliance.org/getcertified/

MasonWays

800.837.2881 / www.masonways.com

McLane Company

www.mclaneco.com/green

18-19

63 35 61 25

817.795.5555 / www.pinncorp.com/solutions/affiniti-cloud-pos www.pcbakery.com

800.236.8675 / www.cleaningstuff.com www.engagetradepartners.com

Swedish Match

800.367.3677 www.zyn.com www.gamecigars.com www.whiteowlcigar.com

Swisher

9 33 53 64

TPE20 International

43

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December 2019 • CSTORE DECISIONS

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IndustryPerspective

What’s Ahead for the 2020 Tobacco Landscape?

After a rocky 2019, c-store retailers turn their attention to tobacco plans for 2020.

Steve Sandman • Contributing Editor

The tobacco industry may have had the most tumultuous year any of us can remember in 2019. The industry saw nearly double-digit declines in cigarette volume that was truly a bell ringer for everyone, including the manufacturers. For the first time ever, as far as I can tell, Big Tobacco raised prices three times in a year that amounted to over $2 a carton wholesale, and with reductions on buy downs, nearly $3 at retail.

Multiple states banned flavored vape products as a mysterious lung disorder claimed lives around the country, only to have many of them reversed or temporarily put on hold in court after retailers scrambled to pull them off their shelves before the products became illegal.

The success of ZYN, a “clean nicotine” product, spurred the launch of new products in this new category from cigarette and cigar companies alike.

Fourth-tier cigarettes made further inroads and made many parts of retail look the Wild West again for smokes.

It can’t get any crazier in the tobacco world than it did in 2019. Or can it?

LOOKING FORWARD

The uncertainty swirling around the industry at the moment is all about vaping. Everyone is asking whether the Food and Drug Administration (FDA) will ban flavors and when that will occur, but it’s not that simple. The PMTA (premarket tobacco product application) process is getting close to the May 2020 filing date. Some products have already declared they are coming off the market, and there will be more to come. Will there be a grace period for products the FDA might remove, or will retailers be stuck holding the bag on non-guaranteed products?

In the cigarette world, many industry veterans anticipate four price increases in the coming year as the consensus seems to be that the big manufacturers aim to make as much profit on cigarettes as possible as volumes continue to shrink.

Meanwhile, surveys show retailers that sell fourthtier cigarettes are experiencing much better results, 62

CSTORE DECISIONS •

December 2019

and this is in a strong economy with full employment. Will incentives increase for EDLP (everyday low price) products, or will support for products not on the program decrease as the gap between major brands and off-brands grows wider?

Then we see IQOS (heat-not-burn tobacco) being tested in Atlanta, which at some point should expand to new markets, but will this be the product that resurrects the category, or will it turn out to be another eclipse?

After the success of ZYN, it seems every manufacturer wants to jump into clean pouches and anything else that can be a nicotine delivery piece. But counter space is limited. Retailers are waiting for a company to take the lead on developing a “set” for all the new products already launched and those in the pipeline.

The major segments only scratch the surface of the 2020 outlook and the accompanying chaos. A ban on flavored cigars still lurks and was likely delayed due to the rush to regulate vape. Will premium cigars be subjected to FDA regulations that guide other segments of the tobacco category? Will menthol be banned? No one has a crystal ball, but with all the questions surrounding the industry, we can be sure we will be in for one heck of a wild ride during the next 12 months.

Steve Sandman has worked in the tobacco industry for more than 30 years, most recently as president of Republic Tobacco. His extensive experience includes product management. He can be reached at (812) 569-1388.

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