Convenience Store Decisions May 2019 by WTWH Media LLC

Volume 30 • Number 5 • MAY 2019 Business Solutions for Retail Decision Makers

Envisioning a

Frictionless Future

As checkout disruption intensiﬁes, c-stores weigh the myriad paths forward.

INSIDE:

Creating Flavor Adventures Gum, Mint Innovation

Why AI Matters for Retail

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May 2019

Vol. 30 • No. 5

CONTENTS 24 COVER STORY

Envisioning A Frictionless Future

As checkout disruption intensiﬁes, c-stores weigh the myriad paths forward.

EDITOR'S MEMO

BACK END

8 Editor’s Memo: What Does Your Future Hold?

64 Product Showcase

FRONT END 10 Proﬁle: Rutter’s Has Storied History, Bigger Plans

68 Quick Stop 69 Ad Index

70 Industry Perspective: Strategizing Food Safety

14 CSD’s Quick Bites 16 Industry News

18 PHA Helps C-Stores Expand Healthy Options 20 Convenience Store Solutions:

The Story for Summer Glory

FOODSERVICE 32 Creating Flavor Adventures

CATEGORY MANAGEMENT

36 Success in a Sweet Segment

40 Gum, Mint Innovation Bubbling

44 Salty Snacks Get Hot and Healthy 50 Meat Snacks Widen Appeal

TECHNOLOGY 54 Tech Solutions to Inventory Management 58 Why AI Matters for Retail

62 LEDs Gaining Share, Marketing Savvy

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44 cstoredecisions.com

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THE CSD GROUP

Convenience Store Decisions • Leading Through Innovation • www.cstoredecisions.com Convenience Store Decisions

CStoreDecisions ecisions .com EDITORIAL

CREATIVE SERVICES

DIGITAL MARKETING

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

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Convenience Store 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. Jim Callahan, Director of Marketing (Retired) Geo. H. Green Oil Inc. • Fairburn, Ga. Brad Call, President Colour Du Jour • Salt Lake City 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 Patrick J. Lewis, Managing Partner Oasis Stop ‘N Go • Twin Falls, Idaho Scott Zaremba, President and CEO Zarco USA • Lawrence, Kan.

NATIONAL ADVISORY GROUP (NAG) BOARD Robert O’Connor, Board Chairman O’Connor Petroleum Co. • Hales Corners, Wis. Mary Banmiller, Director of Retail Operations Warrenton Oil Inc. • Truesdale, Mo. Greg Ehrlich, Chief Operating Ofﬁcer Beck Suppliers Inc. • Fremont, Ohio Doug Galli, Vice President, General Manager Reid Stores Inc./Crosby’s • Brockport, N.Y. 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.

DIGITAL MEDIA SPECIALIST Nicole Lender nlender@csdecisions.com

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

YOUNG EXECUTIVES ORGANIZATION (YEO) BOARD Bart Stransky, Board Chairman RaceTrac Petroleum Inc. • Atlanta

WTWH MEDIA, LLC 1111 Superior Ave., 26th Floor, Cleveland, OH 44114 Ph: (888) 543-2447 EDITORIAL AND NAG 1420 Queen Anne Rd., Suite 4, Teaneck, NJ 07666 Ph: (201) 321-5642

Garet Bishop, Chief Financial Ofﬁcer BFS Cos. • Morgantown, W.Va. 2011 - 2018

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

Convenience Store 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 Convenience Store 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 Convenience Store Decisions, 1111 Superior Avenue, 26th Floor, Cleveland, OH 44114. GST #R126431964, Canadian Publication Sales Agreement No: #40026880. CONVENIENCE STORE 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.

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Caroline Filchak, Director, Wholesale Ops Clipper Petroleum • Flowery Branch, Ga. 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 Truenorth Energy • Brecksville, Ohio Jeremie Myhren, Chief Information Ofﬁcer Road Ranger • Rockford, Ill.

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EDITOR’S

Memo

What Does

Your Future Hold?

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

MALL AND FAMILY-OWNED BUSINESSES RE- dustry needs leaders — specifically, MAIN the backbone of the convenience store industry. family-business leaders — to continMany chains have been successfully passed on from ue pushing the limits of innovation. All this talk of acquisitions does one generation to the next, but more and more, family executives these days seem to be expressing concern about bring up an extremely important issue — family business succession planning. passing the family business on to the next generation. This trend is having a transformative effect on the c- One thing is certain: Most family-business leaders fail to store industry. Smaller companies with next-generation groom next-generation leaders, or they wait until it’s too late. This key issue has been the focus of the National Adleadership voids are selling to larger operators who lack the connection with the communities they serve — and visory Group (NAG) and the Young Executives Organizaeven their own employees — for which family-owned tion (YEO). If you are a multigenerational, family-owned c-stores are renowned. Just last month, the industry business, you need organizations like NAG and YEO saw two outstanding, multi-generational family-owned who share your values and remain committed to helpchains in upstate New York, NOCO Express and Fastrac ing young leaders learn and thrive in the growing convenience store industry. Markets, sell to larger entities. Thoughtful, ongoing planning for succession is a must NOCO Express sold 33 stores to Marathon Petroleum, which promptly announced the stores would be rebrand- for long-term business success and sustainability. Thereed to Speedway. Fastrac sold to EG Group, which af- fore, start now. Develop a clear plan about the succester also acquiring Kroger’s c-store assets and Minit Mart sion of senior leader positions, including who will be from TravelCenters of America, now owns more than next, when the transition will take place and how that successor will be groomed to make the move smoother. 1,000 stores in 24 states. What’s more, additional announcements are coming. The more planning you do now, the better the future will I personally know of three small chains that will be sold, be — for you and your family business. The topic of preparing next-generation leaders was perhaps before this issue of CSD hits the streets. This is so important to our industry because when these family discussed in depth at this month’s YEO Conference in Springfield, Mo. Nearly 50 people from about 30 concompanies dissolve, they are gone forever. Jim Calvin, president of the New York Association venience store chains participated in this event, hosted of Convenience Stores (NYACS), noted that the gap by McLane, which focused on leadership issues and how between larger and smaller c-store chains continues to technology is changing retail. NAG will continue to focus on issues that affect famwiden. “As evidenced by the NOCO and Fastrac acquisitions — and last year’s Express Mart deal — midsized, ily-owned businesses at the annual NAG Conference in homegrown convenience store chains are gradually dis- September in Minneapolis. We have sessions planned on family values, local lobbying, marketing and merappearing,” Calvin said. It is undeniable that this is currently a seller’s market, chandising, how cashier-less sites are impacting tradiwith multiples for c-store chains estimated by financial tional c-stores and foodservice. All of this plus a workconsultants near all-time highs for top-quartile opera- shop exclusively for next-generation leaders. As the retail world around us changes, do not forget tors, and interest rates relatively solid. In other words, a 10-store chain can fetch life-altering money. That is hardly the values that made this industry successful and so speinsignificant, but it’s also a concern for the greater industry. cial. Family businesses will remain a cherished part of this industry. NAG and YEO remain committed to standing by your side as you navigate the new playing field. Grooming Leaders The convenience store industry has become an indispensable part of American culture, based on the work of family leadership. As these innovative, self-made visionaries walk away, it will create a leadership void. The in-

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FRONTEND

Profile

Rutter’s Has Storied History,

Bigger Plans

Rutter’s moves into a third state and plans aggressive expansion over the next three years.

Isabelle Gustafson, Associate Editor

N THE HEELS OF THE 50th anniversary celebration of its convenience store business and the completion of a major headquarters expansion in 2018, Rutter’s hit the ground running in 2019. The company expanded into its third state — Maryland — growing to 75 cstore locations, with plans to increase its footprint to 100 c-stores by 2021. Its c-store chain recently turned 50, but Rutter’s has a long history as a family business, dating back more than 270 years — first as farmers and then a dairy business before it moved into the c-store industry. Rutter’s operated exclusively in Pennsylvania until its 70th c-store debuted in West Virginia last year, followed by the opening of its Walkersville, Md., location in January 2019. Chris Hartman, Rutter’s director of fuels and forecourt, said the ex-

pansion came at the right time. West Virginia and Maryland were a natural fit for the company. The two states border Pennsylvania, so potential customers had likely been exposed to the Rutter’s brand. “While we didn’t have a presence in Maryland until we built that store, we weren’t a completely unknown commodity,” said Hartman.“We also have our dairy, which sends milk and cheese and things of that nature down into Maryland, into grocery stores and other markets.” Walkersville is a northern suburb of Frederick, the second-largest city in Maryland. Rutter’s CEO Scott Hartman said it was the first of seven locations planned for the state. FAMILY BUSINESS Chris Hartman, Scott Hartman’s son, marks the 11th generation to

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join the family business. As the director of fuels and forecourt, he oversees the procurement and retail of all fuel products for Rutter’s c-stores and manages the forecourt experience. Rutter’s is the oldest vertically integrated food company in the U.S. In 1683, the Rutter family — farmers from Germany — settled in Pennsylvania. In 1747, the family acquired 167 acres of farmland in York, Pa., which remains the site of the Rutter’s headquarters today. The Rutter’s Dairy business began in 1921, and the first Rutter’s Farm Store opened in 1968. In 2018, at the start of the 50th anniversary year, the company shortened its name from Rutter’s Farm Store to Rutter’s. But it’s still the same store customers have known and loved all these years.

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Large TV screens help to promote Rutters’ award-winning foodservice menu, known for quality, freshness and local ingredients.

EXPANSION MINDSET With each year and each new generation comes new innovation and growth for Rutter’s. The company completed the expansion of its headquarters in March 2018, which doubled the size of its headquarters to 23,000 square feet. The building addition created room for 50 more Rutter’s team members. Now the company employs about 2,500 people. Chris Hartman said the headquarters expansion supported the company’s overall plans for growth. “We are looking to open up many more stores over the next few years as we continue to grow our business.” “But we’re trying to do it strategically and expand at the right time and in the right places. We have to be careful in our distributions lines in making sure that we’re not stretching ourselves too thin,” he added.

Although the company primarily grows organically, its most recent store opening in Milroy, Pa., was an acquisition. The newest store, it’s 75th, is a former Tom’s Travel Center And Truck Stop location. Over the next few months, the store will remain open as it undergoes a multi-million-dollar renovation to transform it into a fully operational Rutter’s. The renovations, which are expected to be complete in July, are unusual for Rutter’s. Chris Hartman said the stores’ large format makes it difficult to acquire a space that can accommodate everything the Rutter’s brand is known for, including its foodservice and innovative technology. “We’ve begun adding TV screens in different areas throughout the stores to help promote those areas, such as our beer coolers, our foodservice areas,” he said. The Milroy location will also feature multiple fueling options, including flex fuel, unleaded 15, ethanol-free gasoline, kerosene and off-road diesel. Rutter’s now offers E15 at a total of 11 stores, with three more in the works. “There were customers that were asking for it,” said Chris Hartman. “As long as it makes sense for us, we’re willing to do it

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and wanting to do it so that we can really live up to our slogan, which is, ‘Why go anywhere else?’” FOOD AND DRINK Rutters’ award-winning menu emphasizes quality, freshness and local ingredients. Its stores serve breakfast 24 hours a day, in addition to lunch and dinner specialties like chicken pot pie, BBQ beef short ribs, battered cod sandwiches and the Route 30 burger. And thanks to a newly relaxed law in Pennsylvania, many Rutter’s stores now offer beer and wine, too. In addition to local and national wine, the newest location features Rutters’ 29-degree beer cave, with a wide selection of domestic and imported beer and cider. The West Virginia store does, too. But alcohol licenses in Maryland are “not readily available for c-stores,” Chris Hartman said. For now, this leaves the state out of what Hartman calls one of Rutters’ big initiatives: adult slushies. “We’ve begun rolling adult slushies out to all of our beer and wine stores in Pennsylvania,” he said. “We’re really excited about those and the potential they have.” FUTURE FOCUS With the expansion into Maryland, 2019 is already a monumental year for the company. Rutter’s has big plans, but it never loses sight of the family values that have led to decades of cstore success.

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QuickBites AILING WORKERS PREFER HEALTH OFF THE SHELF • U.S. consumers avoid treatment and testing costs of $7.7 billion each year through the use of over-the-counter (OTC) products for pain relief, etc. • 61% of the total OTC savings from prescription costs are driven by three ailments: medicated skin, lower GI and upper GI.

IRSTY OPPERS ARE TH ONLINE FOOD SH and 2018.

between 2013 line more than tripled > Grocery shopping on ry for Amazon, according -selling grocery catego > Beverages are the top cery segment followed gro est h coffee as its larg to One Click Retail, wit uble-digit rates. . Both are growing at do closely by cold beverages azon spending, nt for just 2% of total Am > While groceries accou ceries in 2018. gro se tho about 13% of beverages accounted for n quadruple by 2023 are forecast to more tha > Online grocery sales re consumers become tions increase and mo as online purchase op ing online. comfortable with shopp

ed Facts, Source: Packag

• 13 million Americans who take OTC allergy medications would forgo treatment if nonprescription options were unavailable. • Patients taking OTC products annually save $34 billion in workplace productivity. Source: IRI and Consumers Health, “Value of OTC Medicines to the U.S. Health Care System.”

MILLENNIALS WITH KIDS:

2019.” Market Outlook “U.S. Beverage

ATM Users: Have Cash, Will Spend ▶ Increased restaurant visits by 5% in 2018 compared to 2017 ▶ Made 7.3 billion visits to quick-service restaurants in 2018 WHERE MILLENNIALS WITH KIDS EAT: Other: car, at work Snacks/meals 24% at home

46%

Snacks/meals at a restaurant

20%

Increase in sales for a store with an ATM installed

800

Average number of transactions per ATM per month

23%

Increase in spending by ATM users compared with nonusers

14 Convenience Store Decisions May 2019

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48%

U.S. ATMs owned by ﬁnancial institutions

52%

U.S. ATMs owned by independent deployers

30% Source: The NPD Group, “Future of Dinner” report.

$60

Average ATM withdrawal amount

Source: ATM Marketplace

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INDUSTRY

News

McConnell to Introduce Federal Tobacco 21 Bill

Chevron, Occidental Bid for Anadarko Petroleum

QuikTrip Opens 800th Store, Announces Denver Expansion

U.S. Senate Majority Leader Mitch McConnell, R-Ky., announced plans to introduce legislation in the U.S. Senate this month to raise the nationwide minimum age to buy tobacco products from 18 to 21. Twelve states have enacted laws to raise the purchasing age of tobacco products to 21. McConnell said these bills will serve as guidance for the federal legislation. He also said the bill will include a military exemption. “Raising the age limit to 21 presents fewer opportunities for children to get their hands on vaping devices,” said McConnell.

On April 12, Chevron Corp. announced it had agreed to acquire Anadarko Petroleum Corp. for $65 per share. But on April 24, Occidental Petroleum Corp. offered $76 per share. At press time, Anadarko had confirmed that it received Occidental’s unsolicited bid and said its board would review the proposal to determine the best course of action. “The Anadarko board has not made any determination as to whether Occidental’s proposal constitutes, or could reasonably be expected to result in, a superior proposal under the terms of the Chevron Merger Agreement,” the company said. “The Anadarko board expects to respond to Occidental’s proposal upon completing its review, and accordingly reaffirms its existing recommendation of the transaction with Chevron at this time.”

QuikTrip is expanding into Denver, the company announced on Twitter. QuikTrip said Denver is a good fit because the city has a large, booming population — and recently dropped some restrictions on beer sales. The Tulsa, Okla.-based c-store chain celebrated the grand opening of its 800th store, located in San Antonio, on April 6.

EG Group Buys Fastrac On April 10, the Blackburn, England-based EG Group announced that it agreed to acquire Fastrac Markets’ retail and gas stations, as well as Fastrac’s wholesale fuel business. Based in Syracuse, N.Y., Fastrac has a portfolio of large, modern facilities and an impressive fuel procurement and transportation department. The addition of Fastrac is the latest in a yearlong buying spree that has firmly established EG Group’s American footprint. The company purchased 762 locations from Kroger Co. in April 2018 and added another 226 stores in December after buying TravelCenters of America’s Minit Mart locations. “For the past 18 years, we have had a vision of becoming a leading gas station, convenience store operator around the world,” said Zuber Issa, who founded EG Group with his brother Mohsin in 2001 and serves alongside him as co-CEO. “This is another exciting addition to the U.S. portfolio as we continue on our growth journey.”

Drugstores Selling CBD Rite Aid, Walgreens and CVS have announced plans to sell topical CBD products in select states. CBD, a hemp-derived cannabidiol, is a nonpsychoactive ingredient in cannabis. Although CBD is no longer labeled a controlled substance, the U.S. Food and Drug Administration (FDA) has said companies can’t add CBD to food or sell it as a dietary supplement. However, the FDA will hold a public hearing on regulating CBD on May 31.

16 Convenience Store Decisions May 2019

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“It’s incredible to think that our company started as a small grocery store, and after 60 years, we have reached this point of opening our 800th convenience store,” said QuikTrip Marketing Director Steve Wilson. “Our team has worked hard to stay at the forefront of the gasoline and c-store industry.”

RaceTrac Expands Into Tennessee RaceTrac Petroleum Inc. hosted a ceremonial groundbreaking at its future store location in Murfreesboro, Tenn., on April 23, marking the company’s expansion into the state. RaceTrac plans to build up to 50 stores in middle Tennessee by 2023, with stores set to open this year in Gallatin, Clarksville, Murfreesboro, Smyrna, Spring Hill and Hendersonville. Atlanta-based, family-owned RaceTrac operates more than 500 cstores in Georgia, Florida, Louisiana and Texas. CSD named RaceTrac the 2014 Chain of the Year.

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PHA Helps C-Stores

Expand Healthy Options Convenience stores — including Kwik Trip — commit to offering better-foryou options with guidance from Partnership for a Healthier America. Erin Del Conte, Executive Editor

his year’s Partnership for a Healthier America (PHA): Building a Healthier Future Summit took place in Chicago last month, drawing convenience store retailers, corporations, nonprofits and those creating solutions to combat childhood obesity. Summit workshops provided “actionable solutions” to assist attendees in making “the healthy choice the easy choice” for Americans. More c-store chains, including Kwik Trip, are partnering with PHA to assist them in bringing healthier food to customers. KT COMMITS TO HEALTHY La Crosse, Wis.-based Kwik Trip first began partnering with PHA in 2014 and in 2019 signed on for its third commitment with the organization. “We wanted to make some changes toward offering healthier items within our stores,” said Erica Flint, registered dietitian, food research and development for Kwik Trip, which operates more than 600 c-stores throughout Wisconsin, Minnesota and Iowa. One challenge to adding healthy options is that many alternate ideas of what constitutes “healthy” exist today. “We partnered with PHA because we knew they could guide the direction we wanted to go and give us important feedback and recommendations, so ... we were actually doing something worthwhile,” Flint said. PHA is creating partnerships with multiple different players in the field of health and nutrition — beyond 18 Convenience Store Decisions May 2019

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food, Flint noted. “They’re looking at this as a bigger picture and at a higher level than we’re able to look at it, so that is beneficial to us in terms of making changes more globally,” she said. FRUIT, VEGGIES & WATER Through KT’s original partnership with PHA in 2014, the chain committed to providing fruits and vegetables at the c-stores. While KT already offered produce at the time, this partnership meant committing to offering a specific number of fruits and vegetables and a certain number of linear feet devoted to that section. It also began installing bike racks outside its stores. KT also worked with PHA’s Drink Up campaign to help promote the consumption of water. To remind customers to drink more water, KT includes door clings, window clings and runs promotions over the summer, including on social media. Kwik Trip offers a number of healthy choices in its fresh case. Its latest PHA

commitment loops in PHA’s FNV — fruits and veggies — Campaign, which targets youth and aims to counteract junk food advertising with healthier messages. “They’re taking produce and marketing it in that same vein,” Flint said. KT is running the promotion in its Wisconsin-based stores — posting graphically-appealing promotional materials with celebrities marketing fruits and veggies. Fruits and vegetables are available in Kwik Trip’s fresh case, including precut, ready-to-eat options. “We have a lot of dinner-time solutions in our stores with our fresh-meat cases. We have vegetables that are not just fresh cut, but large-scale items too — so we might sell tubs of lettuce in there, mushrooms, things like that that would complement a meal,” Flint said. KT also sells potatoes, onions, tomatoes and avocados. When guests use KT’s loyalty app, after 15 visits to a KT store, they get to select a free item from a list. While the ‘free’ offerings change, KT now includes healthy items such as a fruit cup, fresh fruit or bottled water. As more c-stores commit to providing healthier options, it’s helping to change the perception of the convenience store industry as a whole. “I think it’s only helpful to all c-stores as this perception continues to evolve and people recognize that the c-store industry is responding to customer wants and needs … for healthier options … and changing that market,” Flint said.

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CONVENIENCE STORE SOLUTIONS

The Story for Summer Glory Cleanliness and customer appreciation will help stores drive sales and proﬁts.

Jim Callahan, Contributing Editor

HE LATE COMEDIC AND GIFTED actor Jackie Gleason often used the phrase, “How sweet it is.” This line popped into my mind as I began writing this column. As the star of the classic “The Honeymooners” TV show, Gleason delivered his catchphrase with great gusto, making sure that his enthusiasm would pique both the curiosity and full attention of his audience. Over many years in this industry, I have found that gaining the attention of your customers is crucial to keeping them engaged with your brand. But while it’s of great importance to gain their attention, it is also absolutely critical that, once you have their loyalty, you deliver on your promise to meet their needs. For example, many YouTube viewers no longer take its video titles seriously because they so often fail to represent the video they are promoting. In this case the “sweet” for those in the convenience store industry is the boost in business that naturally accompanies hot summer weather, such as increased beverage and snack sales, new ice cream and frozen sales and, of course, a greater interest in portable foodservice items. And, if you have delivered your message effectively, customers may take advantage of your car wash promotion while they are buying fuel. Simply put, executing properly means more trafﬁc, which equates to more sales and more proﬁts.

WHAT’S YOUR MESSAGE? While this may sound routine, it’s important to understand that to maximize sales and proﬁts, you must fulﬁll the unwritten promise that every consumer demands — that loyalty is a two-way street. Accordingly, if your stores fail to deliver friendly service, cleanliness, a well-stocked inventory, up-to-date working equipment and competitive pricing, your summer — as well as the other seasons — are going to take a big hit. Each of the items is extremely important and requires daily effort to protect. Time is short, and the stakes are high, so let’s home in on improving where we can. 20 Convenience Store Decisions May 2019

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Jim Callahan has more than 40 years of experience as a convenience store and petroleum marketer. His Convenience Store Solutions blog appears regularly on CStoreDecisions.com. He can be reached at (678) 485-4773 or via email at jfcallahan1160@ gmail.com.

Friendliness, in my opinion, is the easiest winning characteristic to develop. It’s also the most important. For frontline employees, how hard is it to say with a smile and enthusiasm, “Thank you for your business,” “What else may I get you?” or at least a simple, “My pleasure”? Don’t forget to train employees on how to suggestive sell the items your company has on promotion, and how to dress and act professionally. It is basic customer service, but you would be surprised how often I see companies miss the mark in this area. Make the investment of time and effort to lead your frontline team because they are the face of your brand. Other notable tips include having your employees stay off their cell phones. Texting and games should be done on their time, not when they are on the payroll. Customers will notice and appreciate the difference. Cleanliness should NEVER be a problem, but it often is for many stores. Managers must be trained to start every day by looking at their store as if it were their own home. They should make notes on what needs improvement and follow through on assigning a cleaning schedule. Use praise for performance and don’t accept excuses. Remember, your foodservice program will never achieve its full potential with dirty restrooms or an unkempt store. In terms of maintaining inventory, don’t forget to write down out-of-stock items as well as asked-for items that you presently don’t carry. See that all delivered inventory is unpacked, properly priced and placed in the right location. Similarly, make sure all out-of-order equipment is reported in a timely manner. Customers get frustrated and discouraged when they encounter nonworking toilets, fuel dispensers or credit card acceptors. These are seemingly little things, but they all contribute to the success or failure of your business. Work hard to achieve your goals, feel pride in your brand and, most of all, enjoy the journey. cstoredecisions.com

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BURNING ISSUE 1

Local Lobbying: Why your voice matters more than ever. Whether it's increasing tobacco taxes, rising minimum wages, fuel regulations or credit card fees, convenience store owners need to make their voices heard on the important issues integral to store sales. Lobbying is an essential part of our democratic system and can help bring about change. This session will delve into how convenience store owners can make their voices be heard with lawmakers at the local and state levels to influence change that is good for business. Moderator: Tom Briant, Executive Director, National Association of Tobacco Outlets (NATO)

BURNING ISSUE 2

How Cashier-less Sites Will Impact the Convenience Store Industry. Amazon and other cashier-less concepts are no longer a novelty. They are fast becoming destinations in markets such as San Francisco, Seattle and Chicago, and they are challenging conventional convenience stores in the race for time-pressed customers. Beyond retail competition, the concept is also changing consumer behavior to expect a frictionless experience. While some municipalities are passing laws to require stores to accept cash, convenience store owners must develop a strategy to compete with this emerging trend.

BURNING ISSUE 3

Equipped for Foodservice Success: How to execute a successful foodservice strategy in small spaces. Space limitations used to be the bane of convenience store operators who wanted a professional foodservice program. But now manufacturers are stepping up to the plate with equipment that serves multiple purposes and still fits nicely within the c-store footprint. Choosing the right equipment can often be an overwhelming task given the range of options available, so retailers must also focus on cost, machine life, maintenance and ROI considerations.

BURNING ISSUE 4

Developing Your Digital Strategy: How artificial intelligence is impacting retail. The hype around artificial intelligence (AI) has never been higher and one industry where it has a chance to make a major impact on profits is retail. From interpreting data to predicting sales needs, artificial intelligence is redefining retail. This panel will discuss how a digital strategy ties into all aspects of the store including loyalty, the back-office and the POS system. It will also discuss how retailers can use AI to engage customers through communication and experiences, better manage inventory and price products optimally. Moderator: Paul Roetzer, Founder and CEO, The Marketing Artificial Intelligence Institute

BURNING ISSUE 5

The Importance of Family Values in the Convenience Store Industry. Family-owned small businesses are the backbone of our economy. They provide 55% of all jobs in the U.S. and 54 percent of U.S. sales, according to the Small Business Administration. Strong family values can prove extremely productive in business and this is evident in the convenience store and petroleum industries. Family businesses have left an indelible impression on convenience store chains across the country by providing outstanding leadership, innovation and stability in the communities they serve. In this session, we will hear how three unique chains have made their mark on the convenience store industry. Moderator: John Lofstock, Executive Director, NAG Speakers: Margaret Dinneny, Chief People Officer, Wawa

BURNING ISSUE 6

Merchandising and Marketing for Success: What are your customers looking for? From foodservice to the cold vault, customers see c-stores as a destination, but how closely do you track where they go once they enter your store? New technology, such as heat maps integrated with high-resolution cameras, allow retailers to see where customers are going, what they are looking at and how much time they spend in each area of the store. This data can help c-stores design integrated merchandising plans to drive sales. Moderator: John Matthews, President and CEO, Gray Cat Enterprises Speakers: Kyle Schrader, Schrader Oil

YEO BREAKOUT SESSION

How Millennial Insights Can Connect Your Brand with Customers Speaker: Linda McKenna, Managing Partner, EPS Inc.

OPERATIONS BOOT CAMP:

Best practices and a conference wrap up with John Lofstock, Executive Director, NAG, and Brian Unrue, Vice President of Operations, Clark's Pump N Shop.

* Speakers confirmed through March 25.

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1) New and Emerging Fuels. Shell's push into hydrogen and electric vehicles, plus the push to expand E-15/ethanol sales, could change the retail landscape on fuel. Moderator: Bob O'Connor, President, Jetz Convenience Centers

4) Foodservice: Forecasting demand. Leading convenience store chains avoid waste to stay more profitable. Hear how the experts learn to predict foodservice demand.

2) HR: There's an app for that. From scheduling to communicating with employees, there's an app to maintain constant contact with your employees and your customers. Learn how c-store chains are using technology to navigate rising wages and win the best store talent.

5) How is Industry Consolidation Changing the C-Store Industry? Change is inevitable. Should you be buying stores? Is selling the right thing to do for your family businesses? How is vendor consolidation affecting costs? This breakout session will help c-stores get answers to these tough questions.

3) The Future of CBD and Vape. What the future holds for this growing category and how FDA regulations can impact sales. Moderator: Tom Briant, Executive Director, National Association of Tobacco Outlets (NATO)

6) LEED Certification and Embracing the Green Movement. Your customers, especially Millennials, want your brand to stand for something in order to gain their business. LEED Certification and marketing local products help earn their business.

Join us in

SEPTEMBER!

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Cover Story

2019 Human Resources Study

Envisioning a

Frictionless Future

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As checkout disruption intensiﬁes, c-stores weigh the myriad paths forward. Erin Del Conte, Executive Editor

rictionless — meaning to reduce friction or pain points impeding convenience — has infiltrated retail vernacular with a vengeance. Retailers and technology companies alike have been racing to crack one of the biggest points of friction at retail — the checkout experience — since Amazon Go debuted its ﬁrst cashierless store in 2016 and announced plans for 3,000 cashierless stores by 2021. Retailers across channels are coming at the issue of friction from all angles — scan-and-pay via mobile apps, selfcheckout kiosks, order ahead, delivery and more. At Amazon Go, Prime members download an app, enter their payment information and scan the app to enter. Then, overhead cameras and shelf sensors determine what customers buy, allowing them to walk out and receive a receipt moments later on their phones. Zippin, a San Francisco-based Amazon Go rival, which debuted an automated store in 2018, also uses a mobile app, artiﬁcial intelligence (AI), machine learning and shelf sensors, but it uses fewer ceiling cameras than Amazon. Santa Clara, Calif.-based AiFi introduced NanoStore, which spans 160 square feet and uses fewer cameras and more AI compared to Amazon Go for realtime customer tracking and receipts. Customers at NanoStore swipe a credit card or tap an app to enter, select items and walk out.

C-STORES WEIGH APPROACHES What’s certain is frictionless checkout is coming. “The larger companies in our industry are testing and exploring. These payment systems aren’t a big part of our industry yet and may not be for years. It’s so early in the game that our approach will be to watch, study and see what sticks,” said Bill Kent, CEO of Midland, Texas-based Kent cstoredecisions.com

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Cos., which operates 45 Kent Kwik stores in three states. Kent is skeptical that frictionless checkout is imminent and questions if Amazon will succeed in ramping up to 3,000 cashierless stores within two years. “I believe they will grow, but not to that size in that time frame.” While he called Amazon’s model “impressive,” he said he’s not convinced it’s the model of the future. “It will play a part, no doubt, but it’s not going to work everywhere.” Kent noted Kent Kwik’s fuel supplier is pursuing various payment and frictionless systems. As a smaller operation, “we’ll watch and let our fuel partner Chevron test and roll out what makes sense and then decide if the economics and acceptance warrant action.” He added, “Technology will change, evolve and get more cost effective. Being ﬁrst here is for the big boys.” When frictionless checkout does arrive, Kent anticipates it will look more like a scanand-pay via mobile app model rather than the Amazon model. A number of c-stores — including Cruizers, Enmarket and Domino — are moving in exactly that direction, testing a frictionless checkout experience using the Skip app, which allows customers to scan the barcode on items they want to purchase and pay via the app before leaving the c-store. Holmes Oil’s Cruizers, with 27 c-stores in North Carolina, tested the app at its Raleigh, N.C., location before rolling it out chainwide on April 3 — making it the ﬁrst c-store chain nationwide to offer a frictionless option at all stores. “During our test phase at our Raleigh location, we had zero issues when it came to customer interaction,” said May 2019 Convenience Store Decisions 25

4/24/19 2:15 PM

Cover Story

Frictionless Future

7-Eleven first piloted its Scan & Pay mobile app feature in November at 14 Dallas stores, allowing customers to check out by scanning product barcodes using their mobile phones. The c-store behemoth continues to test the Scan & Pay technology and plans to roll it out to additional locations in 2019.

fenced area near one of the pilot stores for the Scan & Pay feature to appear. As they shop, customers scan the barcodes of items they wish to purchase using the guides on their phone. When it’s time to check out, they do it right in the app using Apple Pay, Google Pay, Samsung Pay, or a traditional debit or credit card. Scan & Pay stations with clear shopping bags are located inside the store. 7-Eleven’s goal is to “become a customer-obsessed, digitally-enabled company,” he said. “With consumers’ expectations of what convenience means to them — continuously moving the bar higher — we cannot afford to wait. We need to innovate new experiences for our customers, and that’s exactly what we are doing.”

Mike Wilson, director of operations c-stores in Dallas, allowing customers for Holmes Oil Co. “Our biggest prob- to use their smartphones to scan and lem came from missing promo items. pay for items while they shop. “With our large scale of 67,000 Once we addressed that on the back global stores — 9,100 here in the U.S. end, things went rather smoothly.” One major concern the chain had in — we have a unique opportunity to offering this type of frictionless system redefine convenience,” said Gurmeet Singh, chief digital officer and chief was how to control shrink. “So far, two months into this, we information officer for 7-Eleven. “The have not seen any real increases challenge I gave to my team was, STANDARD STORE in shrink,” Wilson said. He credits ‘How do we disrupt this? How do we In August 2018, Standard employees greeting Skip customers by make our shopping even more con- Cognition, a technology company, name, and Skip’s back-end audit func- venient and delightful? How can we opened a functional c-store in San tion. “When customers sign up, they enable our customers to skip the line Francisco called Standard Store (origimust provide a form of payment, which every time?’” nally Standard Market). eliminates anonymity,” he added. Standard Store allows the com7-Eleven created an end-to-end Cruizers selected Skip over other experience for customers by inte- pany to demo how its technology options because the hardware neces- grating Scan & Pay with its 7-Rewards works in a c-store environment and sary to launch proved minimal. “It is loyalty program, which is already inte- gain real-world insights into perfecting also incredibly easy for the customer grated within store technology. the experience. A drugstore chain in to use. Employee training is also sim“We tested Scan & Pay at the store Japan called Yakuodo recently rolled ple,” Wilson said. located at our headquarters for three out the technology, said Michael So far, 60% of customers who tried months prior to launching. Employees Suswal, chief operating officer and Skip at Cruizers used it again on sub- and local customers could test out the co-founder of Standard Cognition sequent visits. new feature and provide feedback, Autonomous Checkout, with offices in Meanwhile, 7-Eleven is the first which was invaluable,” he said. San Francisco and Tokyo. c-store chain to offer a frictionless Standard Store offers typical c-store 7-Eleven continues to test Scan & checkout experience built in-house. Pay and plans to roll it out to other mar- fare, including food, snacks, drinks and In November 2018, it piloted its Scan kets in 2019. household goods, as well as multi& Pay feature of its mobile app at 14 Customers must be within the geo- ple checkout options. Customers can 26 Convenience Store Decisions May 2019

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download the Standard technology app, enter the store and check in via the app. “There is no gate that prevents you from entering,” Suswal said. “When you’re done shopping, you just leave, — Gray Taylor, and you get automatically Executive Director, Conexxus charged.” The other option is to shop without an app. Behind the scenes, the system recognizes shoppers, assigns them an anonymous number and monitors their selections. When customers are finished shopping, they stand in front of a kiosk. “This kiosk is unlike anything else out there. They don’t scan anything or tap any buttons. They just stand in front of it, and it automatically displays everything they bought,” Suswal said. “When they want to leave, they can pay with cash, credit card or Apple Pay — right at the machine.” “Cash is a big piece for us. We take cash, and also we use no biometric data. We use cameras on the ceiling. There’s nothing else. There are no shelf sensors.” While Standard Store serves customers, Standard Cognition is not looking to compete with c-store retailers, but to gain insights on how to continue growing its technology. “Retail, it turns out, is really hard,” Suswal said. The kiosk exists for several reasons. For one, most retailers aren’t prepared to eliminate cash. Some cities have moved to ban cashless stores, but “cities banning cashless stores doesn’t move the needle nearly as much as people’s desire to pay with cash, at least for now,” Suswal said. Other customers may not want to download an app. What’s more, alcohol and tobacco regulations differ between retailers and regions. The kiosk offers flexibility in handling age verification. It can alert staff if certain items are purchased or an employee can verify age near the kiosk.

FIRST THINGS FIRST Crone Consulting LLC’s proprietary research found that in five years, one-third of all retailers will be cashless, up from 17% today and 10% of brick-and-mortar stores. But before c-stores jump into autonomous checkout, Richard Crone, CEO of Crone Consulting, noted there are incremental steps to master first. “That starts with order ahead, or buy online and pickup in store,” he said.“We’re a long ways off from just dropping autonomous checkout into the c-store format and being off cstoredecisions.com

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with the added risk that the mixed (payment) format and the exceptions will kill it,” Crone said. What’s more, Amazon Go struggles to stock shelves fast enough with 5-10 employees, and c-stores are often manned by one person. Once a c-store chain has perfected order ahead, Crone recommended next integrating it with the store experience and perfecting cross-selling inside the app. Then create an AI-driven predictive analytics model that helps customers with shopping lists and knows what they may need next. and running because what challenges them are the exceptions,” he said. Exceptions include tobacco and alcohol that require age verifications. Loose produce and prepared foodservice also trigger exceptions for the technology, which early versions of autonomous checkout haven’t yet overcome. “Amazon Go has changed the merchandising mix to eliminate the exceptions,” Crone said, “meaning they simplified their SKUs and storagekeeping units. ...” Before focusing on autonomous checkout, Crone urged c-stores to master order ahead via their own — not a third party — five-star-rated app. “That way they can use the exceptions as a competitive advantage and buy some time before incurring the capital expenditure of re-engineering their entire in-store merchandising model for autonomous checkout,” he said. And it addresses the main need for frictionless checkout, Crone noted, which is convenience and speed. “If c-stores jump straight to autonomous checkout, then they’re missing that whole segment that leads up to it, 30 Convenience Store Decisions May 2019

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THE DATA BUSINESS Gray Taylor, executive director for Conexxus (formerly PCATS) said that going forward, every business is going to be in the data business and “first-mover, data-master cultures” are going to dominate over the next five years. But digitization is the easy part — transforming to a digital culture is more challenging. Top quartile retailers are already moving in this direction. Taylor noted that order ahead/pick up in-store is challenging for c-store retailers, many of which “can’t tell you how many bottles of ketchup they have in their store,” a “perpetual problem” with remote ordering. “There needs to be a transformation of the platform, which is usually a second step in digitization. You’ve got to get your store system to where you know down to the item what you have in each store,” he said. Otherwise, mobile or online sales could create a demand c-stores can’t meet. “C-stores have to change tires while the race is on. It’s going to get harder to change those tires as we go on because the race is going to get faster,” he said.

Mobile self-checkout may be easier for retailers because they don’t need to know what’s in the store, Taylor said. C-stores can transition perhaps more easily from in-app loyalty programs to also doing in-app checkout. Friction, Taylor said, is different to each customer. Those who like mobile checkout don’t want to wait in line. Others like kiosks so they can pay with cash or card. How customers want to pay might also change day to day. Frictionless checkout also presents an opportunity for c-store retailers to open smaller stores in urban higherrent areas at lower labor costs, feature highly-targeted merchandise and do cost-based retail — setting prices based on product and operating costs. “It’s ... easier to maintain that than to maintain a store with 3,500 SKUs and 5,000 square feet,” Taylor said. Taylor recommended picking high performers in key areas like accounting, operations and merchandising, and invest in training them in big data and AI. “Get them to become the boots-on-the ground experts who then lead the team into a digital future.” The c-store industry has seen five great years of profitability, and savvy retailers are using profits to reinvest in their culture and technology to start competing with digital disrupters and experimenting with new business models, “so in three years they’re not reactive because they’ve been proactive,” Taylor said. If a recession or economic downturn occurs as expected within three years, it’s going to be harder to compete with Amazon and its 2,000-plus automated stores, he advised. “I would have a very significant plan in place to reach the digitization sooner rather than later.” CSD

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4/24/19 4:52 AM

Foodservice

Global Flavors

Creating

Flavor Adventures Incorporating on-trend international ingredients and ﬂavor proﬁles in sandwiches and other menu items is helping retailers appeal to customers craving something new and fresh. Marilyn Odesser-Torpey, Associate Editor

averik bills its more than 330 convenience stores in 10 states as “Adventure’s First Stop,” and that applies to its foodservice offerings as well. At the chain’s condiment bar, customers can ﬁnd numerous global-inspired toppings for sandwiches including spicy green salsa, roasted red pepper salsa, pico de gallo, jalapeño cream sauce in a squeeze bottle, chipotle mayonnaise and jardiniere with banana peppers, said Kyle Lore, Maverik’s corporate chef. Lore said one-third of the stores also have robust burrito and taco programs. Between the breakfast and lunch menus, there are nine different varieties of made-to-order burritos. A recent addition packs a double punch with a Korean pork in gochujang sauce burrito. Lore and his team are working on a new hot sandwich program for Maverik’s made-to-order stores. In the world cuisine realm, trending protein flavor proﬁles such as carne asada (steak), pork carnitas, spicy tomatillo chicken, chorizo and traditional ground beef will be avail-

32 Convenience Store Decisions May 2019

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able. All stores undergoing remodeling and new locations will also have the hot sandwich program. Two-and-a-half years ago, Maverik launched street tacos, which remain top sellers. In the last week of March, this item trended 14% up from the year before, Lore reported. Nachos topped with the same proteins are also available. Rutter’s c-stores came up with two international-inspired specialties by combining a popular appetizer, Jalapeño Bites, with its Ultimate Burger and Ultimate Chicken Sandwich. Customers are also invited to build their » International ﬂavors add own Ultimate Burritos, Tacos adventure to the menu. and Quesadillas, choosing from a wide range of proteins: » Sauces and dressings easily grilled chicken, Philly steak, fried shrimp, barbecue beef amp up taste appeal. short ribs, tavern battered cod, pulled pork and pork belly. » Many trending international L a s t y e a r, t h e s t o r e s foods ﬁt with consumer switched from using standard, demand for healthier items. shelf-stable, jarred salsa to using a fresh charred chipotle

Fast Facts:

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Foodservice

Global Flavors

salsa to provide a more authentic experience, said Ryan Krebs, Rutter’s director of food service. “The fresh, smoky, cilantro-infused salsa is an outstanding topping for burgers, too.” In addition to regular tacos, Rutter’s also offers snack-size “walking tacos” composed of bags of Doritos, such as Nacho or Flamin’ Hot, loaded with customers’ favorite toppings. “We sell a ton of soft-shell tacos; they’re often ordered in quantities,” he said. “We can cross-utilize the meat in dozens of different menu items.” For the burritos and quesadillas, customers can choose from traditional, sundried tomato or whole-wheat tortillas and have them toasted in the oven or pressed on the panini grill. They can top their Hispanic creations with regular, chipotle or black-bean salsa; guacamole and sour cream. “Our entire menu is available 24 hours a day so if someone is craving burritos at midnight they can get them here,” Krebs said. Some customers are choosing international ingredients to create healthier versions of traditional items. For example, some are topping salads with black-bean salsa instead of a mayonnaise-based dressing, he noted. To expand its Hispanic-influenced offerings, Rutter’s, which has 75 locations in Pennsylvania, Maryland and West Virginia, is looking at items such as cilantro dressings for salads, bean options for bowls and side dishes; and spicier salsas. “Consumers’ palates have developed an increased tolerance for heat since sriracha exploded,” Krebs said. Rutter’s is also considering creamier, sweeter cheeses such as queso fresco and queso blanco; mole made with chilies and chocolate; chorizo; and more citrus and cumin for flavoring. “Items like the cilantro dressing can be cross-utilized to be a marinade for a grilled chicken sandwich,” he said.

TRADITIONAL FARE A growing interest among consumers for traditional Mexican street food

makes tacos an increasingly popular choice for meals and snacks, according to Charley Orwig, marketing director at Datassential research firm. “They fit right into cstores because they’re a handheld item that’s neat and easy to eat on the go,” he said. While 15 or 20 years ago, Hispanic foods may have appealed mostly to a younger demographic, the flavor profiles of these foods now have universal appeal. One opportunity for c-stores, he suggested, is to feature chilaquiles, which is basically just tortilla chips loaded with ingredients such as chicken, cheese and other toppings, like poutine. Another is the torta, a Mexican sandwich made on telera bread filled with different meats; vegetables; refried beans; chilis, such as jalapeños for heat; tomato; and avocado. “The torta makes it easy to bring in a lot of on-trend Mexican flavors in a hand-held application,” Orwig said.

INTERNATIONAL & HEALTHY Alltown Fresh, a convenience market in Plymouth, Mass., with more stores scheduled to open this summer throughout New England and Upstate New York, wasn’t necessarily looking to get into the international foods category when it introduced its Middle Eastern Wrap, said Jason Cooper, the company’s head of food and beverage. “We wanted to offer a healthful and tasty protein alternative for vegetarians and vegans,” he said. “We build the sandwich with baked instead of fried falafel fritters, our homemade garlic hummus and Mediterranean salad and top it with tahini all in a whole-wheat wrap.”

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An alternative use for the protein is a Colossal Falafel Salad, which combines the baked fritters with fresh avocado; chopped Mediterranean salad; a three-grain blend of brown rice, quinoa and wheatberries; green leaf lettuce; garlic hummus and Mediterranean dressing. Falafel fritters can also be added to any bowl or salad for an extra $2. Alltown’s house-made hummus is also the foundation for another wrap that pairs the spread with green leaf lettuce, shredded carrots, cucumber and honey Sriracha sauce on a whole-wheat wrap. A roasted turkey breast, applewood-smoked bacon and aged cheddar sandwich gets a Latin American kick from a spicy chipotle aioli. Ditto on the Latin flavor for a grilled chicken, roasted broccoli, chickpea and quinoa bowl with a sweet chili lime sauce. Two other bowls are also influenced by Asian flavor profiles. Northern Africa is even represented at Alltown, with a Minty Moroccan Salad, a mixture of quinoa, shredded beef and carrot salad, mint and Mediterranean dressing. Cooper said these offerings “fit right in with our efforts to offer a breadth of flavors and healthful choices across our menu.” CSD

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Category Management

Chocolate

Success in a

Sweet Segment Innovative varieties and bigger bags dominate the c-store chocolate segment, while merchandising creates impulse opportunities. Lisa White, Contributing Editor

share from an established item to has seen a few ongoing trends something new, and then back to impacting chocolate — a category that established item,” said April Americans indulge in two to three Hogue, category manager, candy, times a week. “One significant one is that preat Maverik, a Salt Lake City-based 300-store chain. When new items mium chocolate continues to rise launch, they perform well, Hogue in popularity; in fact, growth in this noted, “but the incrementalism segment has been an influential driver of overall chocolate category doesn’t hold.” C a r l y S c h i l d h a u s , p u b l i c growth,” Schildhaus said. While the overall chocolate cateaffairs manager for The National Confectioners Association (NCA), gory has grown in the convenience channel by around 1% year-overyear, Schildhaus pointed out that 59% of that growth comes from premium chocolate. But even mainstream chocolate » Americans enjoy chocolate two to three times a week, according to products see trends in flavor profile the National Confectioners Association (NCA). innovations. “As c-store retailers seek differ» While the overall chocolate category has grown in the convenience entiation, they are more open to channel by around 1% year-over-year, 59% of that growth comes carrying products made with more from premium chocolate, according to NCA. unusual fruits, spices and nuts,” said Schildhaus. “This is largely driven » Although unique flavors remain a small portion of the c-store chocoby millennials, who are looking for late business, this sector is growing fast. these unique experiences in their

he chocolate category in convenience stores welcomes a revolving door of innovative flavor launches and updated packaging formats to ensure something new tempts customers as they make their way to the checkout. “Customers want innovation in chocolate and eventually go back to their tried-and-true favorites, which drives a temporary shift in

Fast Facts:

36 Convenience Store Decisions May 2019

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Category Management

Chocolate

treats. Novelty chocolate is also being introduced to c-stores, and there is a strong trend towards collaboration between manufacturers and c-store operators around seasonal treats.” Also, packaging innovation is driving c-store choices, with companies providing both larger and smaller sizes to meet consumers’ varying needs.

SIZING UP ASSORTMENT According to Liza Salaria, senior principal consultant at Impact 21, a retail management consultant based in Lexington, Ky., although exotic and unique flavors remain a small portion of the c-store chocolate business, this sector is growing fast. “We’re seeing an infusion of sea salt, caramel, turmeric, chile, ginger and other flavors in chocolate,” she said. “Yet c-stores tend to lag behind because it’s a challenge to optimize mainstream brands and get the right assortment of products, while obliging the larger manufacturers’ contracts.” Major brands are becoming more limited-time-offer (LTO) forward when it comes to innovations, said Hogue. Maverik’s bestsellers include Hershey Reese’s Peanut Butter Cup (regular size), followed closely by Mars king Snickers, Hershey king Reese’s Peanut Butter Cup and Kit Kat (regular).

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At The PRIDE Stores, a Warrenville, Ill.-based chain, the five top-selling candy items are all chocolate. These include Snickers (king size), Snickers (regular), M&Ms Peanut (king size), Reese’s Cup (king size) and Twix (king size). The chain also carries Chicago’s Fannie May chocolates. “In 2018, we saw some chocolate candies enter the novelty candy subcategory, which for years has been heavily dominated by fruit flavors,” said Nicolette Jaeger, The PRIDE Stores’ loyalty and foodservice manager. “Chocolate candies, such as Kinder Joy and Yowies, exploded in popularity that year; we will continue to see this trend carry over into 2019.” Jaeger expects to see more chocolate and fruit combinations, such as chocolate-covered gummies, as well as more chocolate and coffee combinations like M&M’s coffee nut combination, which was successful enough that the chain opted to keep it in its permanent lineup. At the Arlington County, Va.-based Marine Corps Exchange (MCX), which has 17 locations across the country’s military bases, the top-selling chocolate items, in order, are Snickers singles and king sizes; Reese’s Peanut Butter Cup singles and king sizes; M&M Peanut singles; Kit Kat single; Reese’s Peanut Butter Big Cup king size; Twix Caramel single size; and Kit Kat king size. “For guilt-free and healthy indulgence, more chocolate brands are shifting toward natural and organic ingredients, eliminating artificial additives and high fructose corn syrup, using organic or fair-trade-certified cacao beans and providing consumers’ favorite chocolate items in smaller portion sizes,” said Ashely Davis, MCX’s food and candy consumable buyer. More chocolate items are made from dark chocolate, which many cus

tomers perceive as having health benefits. Reese’s Peanut Butter Cups, one of MCX’s top-performing SKUs, has a new product called Reese’s Thins that are 40% thinner and individually wrapped, so customers can indulge on-the-go while reducing calories.

PACKAGING SIZES Although more smaller-sized chocolates are allowing for portion control, the king-size market is also on the rise, as it offers more value for the price, said Salaria. She predicted resealable packaging will continue to play a big part in the market. “Chocolate king-sized and regular bars are declining year-over-year, but chocolate bagged candy is increasing,” said Maverik’s Hogue. “We’ve had double-digit increases year-overyear for the past two years on bagged candy. I believe part of that success is driven by how we promote candy, but also the customer opting for larger sizes/ounces in resealable bags.” The reason? Consumers want portion control and on-the-go snacking. “Consequently, we are seeing an increase in stand-up pouches, resealable and shareable packages, which have driven a significant sales increase for the category,” said MCX’s Davis.

PLACEMENT & PROMOS Proper placement and merchandising are key for impulse buys. “We think of candy as a basket builder when it’s an impulse purchase. Finding the best spots can interrupt traffic at different points in the store,” said Salaria. “Retailers need to think about sidekicks, power wings and small twoby-two pods, which are great for store entrances,” said Salaria. “In c-stores, inventory management becomes a challenge, and that’s where we in the space sometimes fall short.” Seasonal, for example, is a big opportunity, said Salaria, “with Oct. 28 being the No. 1 candy selling day.” CSD

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Category Management

Gum & Mints

Gum, Mint

INNOVATION BUBBLING New packaging and functional innovation could give gum and mint sales a boost. Anne Baye Ericksen, Contributing Editor

W Fast Facts: » Sugar-free products accounted for 85% of gum sales in 2018, according to Packaged Facts. » Thirty-two percent of consumers would purchase gum if it eased indigestion and nausea, according to Mintel. » Packaged Facts anticipates a compound annual growth rate of 0.9% for gum in the years 2017–2022.

hile gum sales have been flat, flavor and packaging innovations as well as better-for-you (BFY) and functional options are opening up opportunities for growth in the gum segment. Earlier this year, Gerrit J. Verburg Co., announced the reintroduction of three classic chewing gum brands: Black Jack, Clove and Beemans. Black Jack lays claim to being the first chewing gum brand sold in the U.S., and Beemans traces its history back to the 1800s when it was promoted as a digestive aid. Undoubtedly, the manufacturer is banking on consumers embracing the nostalgia of the products. Time will tell if it can create movement in a segment that traditionally does not experience sales spikes. Overall gum dollar sales at c-stores for the 52 weeks ending Dec. 30, 2018, totaled $10.4 billion, up 1.5% over the previous year, according to research firm

40 Convenience Store Decisions May 2019

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IRI. Sugarless gum fared best with $862 million in dollar sales, up 3.1%. Regular gum saw dollar sales of $182 million, down 5.7%. A March Mintel Group report on gum, mints and breath fresheners described the market as “softening,” partially because consumers are no longer attracted to the fresh-breath message in the modern retail environment. Plus, Packaged Facts anticipates a compound annual growth rate (CAGR) of 0.9% for gum in the years 2017–2022. That said, a few developments have c-store owners and operators feeling sweet on the category.

VALUE PERCEPTION “After years of declines, the combination of ﬂavor and package innovation has helped drive growth,” said Derek Gaskins, senior vice president of merchandising and procurement for Yesway. The Des Moines, Iowa-based c-store cstoredecisions.com

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Category Management

Gum & Mints

Purchase Preferences

When asked if they purchased gum and/or mints during the last few months of 2018, shoppers confirmed they reached for mints first.

Regular mints: 44% Regular chewing gum: 42% (not including nicotine gum)

Regular breath fresheners: 30% Sugar-free chewing gum 29% (not including nicotine gum)

Sugar-free mints: 19% Sugar-free breath fresheners: 14% None of the above: 23% Source: Lightspeed/Mintel data, Mintel Group Ltd.: Gum, Mints and Breath Fresheners, US-March 2019, 2019

chain owns and operates 150 sites in several Midwest states. “As is the case in nearly any category, growth is highly dependent on innovation in packaging and flavors, so both gum and mints look very different than they did five to 10 years ago,” added Carly Schildhaus, public affairs manager for National Confectioners Association, which hosts the annual Sweets & Snacks Expo this month in Chicago. The big news last year was the Tic Tacs brand expanding into gum, earning it the Most Innovative New Product honors at the 2018 Sweets & Snacks Expo. Trident Vibes also made its debut, and Hershey released its Ice Breakers Ice Cube glitter gum. “The latest and greatest flavor to enter our sets has been Orbit Freeze … released last summer. ... Through Q1, we’ve seen some early success with the line,” said Joe Bortner, category supervisor for Rutter’s c-stores, which operates 75 locations in Pennsylvania, Maryland and West Virginia. As for product launches in 2019, Extra Refreshers by Mars Inc. had a nationwide rollout last month. The sugar-free soft chew gum features three flavors, Spearmint, Polar Ice and 42 Convenience Store Decisions May 2019

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Tropical Mist, and is offered in 40-count bottles or 120-count standup pouches. Indeed, packaging appears to be as key of a purchase motivator as flavor. “Our consumers are telling us there’s a greater value in resealable bulk packages,” said Bortner. “Bottle pack/large pack gum flavors and brand offerings continue to expand, so we are working on ways to add more variety of bottle packs into our stores,” said Diana Turgut, buyer for the Army & Air Force Exchange Service, which includes 122 main stores and more than 500 c-stores across the country servicing military personnel and their families. Turgut has devised a three-prong merchandising strategy, starting with expanding bottle gum products in the inline express candy planogram. Part two calls for adding Ice Breaker Ice Cube bottle packs to lane blockers this summer, highlighting additional flavors. For the third element, she hopes to remind people about the freshbreath benefit of gum and mints. “Our coffee condiment rack will be updated with Wrigley’s Extra Refreshers,” she said.

FUNCTIONAL VARIETIES One of the biggest influences on gum and mints sales right now is people’s commitment to BFY snacks. For example, of the approximately $4.1 billion in total U.S. retail dollar sales for gum in 2018, as reported by Packaged Facts, 85% was derived from sugar-free products. According to 360 Research Reports, the global sugar-free segment could climb to $14.9 billion by 2023. Mintel Group asked consumers which healthy qualities they want offered in gum, and 35% identified vitamin and mineral fortification. Close behind was easing indigestion and

nausea (32%), providing an immunity boost (30%), aiding in weight management (27%) and enhancing heart health (26%). There’s a growing focus on possible health benefits by smaller brands, much like Beemans’ original idea of the product being a digestive aid. “A naturally positioned gum/ mint boasting ingredients in consumer-friendly language could well resonate with consumers, particularly if it included natural ingredients that promised an added healthy attribute,” wrote the Mintel Group analysts. “Given the functional nature of gum and mints, it makes sense that ingredients like green tea and other emerging ingredients may grow to be widely used in these traditional product categories,” said Schildhaus. “This year we purchased a shipper of Simply Gum. It has been surprisingly popular, especially on the West Coast,” said Turgut. “It is a unique gum in the natural gum category. They have herbal flavors, such as ginger, fennel and lemongrass, to name a few.” “We may even see growth in caffeinated and cannabidiol (CBD) formulated products to drive more upside,” added Yesway’s Gaskins. “Also, gum and mints have tight correlations with tobacco products, and as flavor bans impact vape sales, it could create an opportunity for more growth in the category to meet consumers’ preference for bold, minty, fruity and other flavors.” Growing profits with BFY products, however, demand c-stores break away from traditional marketing approaches of discounts, multibuys and bundling gum and mints with other products. Bortner believes connecting with consumers through technology, such as smartphone apps, presents an opportunity for the category. CSD

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Category Management

Salty Snacks

Get Hotand

Healthy

C-store customers increasingly want better-for-you snacks with daring ﬂavors. Howard Riell, Associate Editor

hile salty snacks, and especially chips, continue to drive traffic and sales in convenience stores, the product proﬁles consumers ask for — fueled by popular promotions — are shifting alongside evolving trends. While shoppers will always pick up their traditional favorites, Americans increasingly clamor for better-for-you items and a host of daredevil ﬂavors that are anything but traditional.

Consumer tastes are evolving because consumers themselves are changing. “The number of millennials shopping at c-stores is growing, and they want something new and unique. Not all ﬂavors are a home run, but having a unique item gets trial; sometimes the ﬂavors work with consumers, and sometimes they don’t,” said Mike Jackson, category manager for High’s Stores in Baltimore.

Fast Facts: » At c-stores, IRI found total salty snacks sales topped $5.6 billion for the 52 weeks ending Feb. 24, 2019, a 5.4% rise over the previous year. » Customers are seeking healthier snacks and those with functional alternatives. » Customers want hot flavor profiles, and millennials are driving a demand for unique flavors. 44 Convenience Store Decisions May 2019

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H i g h ’s , w h i c h o p e r a t e s 4 6 c-stores in highly-populated areas of the Baltimore-Washington, D.C. corridor, enjoyed big success last summer with Herr’s Sweet Roasted Popcorn, which mimicked the flavor of grilled buttery corn on the cob. “It was a perfect flavor for summer,” Jackson said. Meanwhile at Cenex Zip Trip in Spokane Valley, Wash., salty snack sales are up slightly over last year. “But we are seeing higher margin dollars as we are seeing sales shifting to higher-margin items,” said Jon Fleck, merchandising manager for Cenex Zip Trip, which operates 36 locations in Minnesota, Montana, North Dakota, South Dakota and Wyoming. Managing the category closely is essential. Stores must continue to monitor sales to see what is moving, and alter planograms to increase shelf space for those items, said Fleck. “We must continue to keep our ﬁngers on the pulse of this category.” cstoredecisions.com

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Category Management

Salty Snacks

That pulse remains strong and or functional alternatives to the stansteady. In the convenience store dard c-store offering of chips and salty channel, for the 52 weeks ending snacks,” said Christian Pratt, category Feb. 24, 2019, IRI found total salty manager - snacks for Global Partners snacks sales topped $5.6 billion, a LP’s Alltown Fresh chain. Global 5.4% rise over the previous year. Partners supplies fuel to more than Sales of potato chips reached more 1,600 locations, and owns and operates than $1.7 billion, up 2.6%. Tortilla/ 300 c-stores under various banners. While grab-and-go snacks continue tostada chip sales exceeded $1.1 billion, an increase of 11.6%, and to be the go-to for quick pick-me-ups pretzels recorded $245.1 million in between meals, Alltown Fresh has sales, up 2.2%. And those weren’t seen increased demand for products the only salty snacks to enjoy gains. that provide wellness functions, such Other salted snacks (no nuts) rose as added protein, pre- and probiotics, to more than $919 million, up 6.1%. and other gut-healthy items. “It’s also important to note that Cheese snack sales topped $742 million, a 7.1% gain, and ready-to-eat while guests are seeking cleaner items popcorn/caramel corn sales came in in every c-store category, taste continues to be equally as important as the at $236.5 million, a 3.4% gain. ingredients,” Pratt said. Alltown Fresh executives taste-test all packaged HEALTH HALO Healthy snacks benefit both the products prior to stocking them and encourage guests to sample products body and a customer’s conscience. “Consumers are looking for that and ask questions prior to purchase, snack with fewer calories that still tastes especially with unfamiliar items. Pratt believes c-stores should work good,” Fleck said. “This includes popcorn, which is still seeing steady growth, to incorporate growing health-food though not as high as it has been over trends into product offerings to cater to consumer demand. While younger the past couple of years.” “As the fresh convenience market, millennials are more adventurous in Alltown Fresh has noticed that con- trying bold snack ﬂavors, older millensumers are looking for healthier and/ nials gravitate toward healthy choices. “While it may seem out of character for c-stores to shift in this direction, Alltown Fresh offers classic snack options such as Doritos but continues to see healthier alternatives shine,” Pratt said. The market’s No. 2 product in the salty snack category is Vegan Rob’s Cauliﬂower Puffs. Protein will be a key driver for this category moving forward, Pratt added, as well as clear, concise packaging. “Easy-toread labels and callouts for non-GMO and glutenfree products makes it easy for consumers to understand prod46 Convenience Store Decisions May 2019

44-48_CM_Salty Snacks.indd 46

ucts and know what they’re putting into their bodies.”

FLAVORS HEAT UP The hot trend in salty snacks remains, perhaps ironically, hot flavors. “Intense is the new normal,” Fleck said. “Customers are gravitating to hot, hot, flaming hot. Even regular Doritos now comes in a Flamin’ Hot flavor.” Other popular flavors, he added, include buffalo and wasabi. “Millennials are driving the need for unique flavors, and manufacturers are coming up with some unusual flavors like lime and sea salt, spicy dill pickle, wasabi (and) beer cheese,” Jackson noted. “I think we are going to continue to see the trend to release new limited-time offers (LTO) to continue to meet the wants of the new younger c-store consumers.” To really drive sales, Jackson recommends rotating through new varieties to keep snack options fresh. “If you can find an item and have it before your competition, and it’s a hit, that means the customer will come back to your store to purchase it again. Do not be afraid to try something different. Sometimes an item can set you apart from your competition,” Jackson said. At Alltown Fresh, consumers value variety and a wide range of flavor profiles the most. To enhance the way people eat and shop in c-stores, and to accommodate the market’s adventurous consumer base, the chain has leaned into bold, new flavors that satisfy hunger and cravings. “LesserEvil Himalayan Salt Paleo Puffs, Hippeas Sriracha Sunrise Chickpea Puffs and Prana Exotic Fruit and Nut Mix are classic go-to’s,” Pratt noted. “Snacks with a fruit influence, such as Barnana Fruit Chips, Mavuno Harvest 100% Organic Dried Fruit and Matt’s Munchies Island Mango Fruit Snacks, have been a recent highlight, with Stretch Island Snacks Fruit Leather being a great option for kids.” Driven by taste and texture, Pratt predicted, consumers will concstoredecisions.com

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Category Management

Salty Snacks

tinue to seek out bold flavor offerings and unique ingredients while shifting toward snacks that serve a purpose. “Demanding snacks that taste good, fill you up and have wellness functions will become the standard for c-store guests, with an emphasis on digestive health and prebiotics,” Pratt said.

PROMOS & COMBOS Two-fers on smaller sizes help increase sales, Fleck said. “We offer a 5-8% discount when we do this, but the promotional signage draws the customers to the deal, which drives those sales.” In the past, bigger bags did well when promoted, Fleck added, but now consumers are looking for snacks they plan on consuming as part of their lunch, or just to munch. Bundling with cold beverages and roller-grill

48 Convenience Store Decisions May 2019

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items show growth, but signage in each of these areas is highly critical to its success. Jackson has found that two-fer deals work well with some salty snack categories, but not with others. Running a two-fer on tube nuts, for example, usually increases take rate and overall units purchased. “On other hand, with items like chips, popcorn or tortilla chips it does not work as well,” Fleck said. Cenex expects the share of space for intense flavors and better-for-you varieties to continue to grow in the salty snacks segment. “Long gone are the days where regular flavors dominate this category, and their multi-facings in the stores will dwindle as each year ticks by,” Fleck predicted. “I can only imagine what the planograms for chip/salty snacks will look like in another five years.” CSD

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Category Management

Meat Snacks

Widen Appeal

From adventurous ﬂavors to healthy varieties, meat snacks innovate to keep pace with consumer trends. Brad Perkins, Contributing Editor

n all areas of foodservice, consumers crave more choice, variety and taste. They want to know what is going into their food. And they want to know that it’s good for them. So it should be no surprise that these experiences have moved into the » Meat snacks, a $2.8 billion business in meat snacks category, the U.S., are set to grow more than 4% beginning with ﬂavor. through 2022, according to Nielsen. “ A s i t re l a t e s t o » Jalapeño, teriyaki, sweet and hot, u n i q u e i n g re d i e n t s , hot and spicy, cheddar cheese, sugar we’re seeing quite a maple, and sea salt and pepper are few trends — jalapeño, among growing ﬂavor trends. teriyaki, sweet and hot, hot and spicy, cheddar » Meat snacks category shoppers span a cheese, sugar maple, range of ages, and many are healthand sea salt and pepper conscious shoppers. are some of the flavors that have grown exten-

Fast Facts:

50 Convenience Store Decisions May 2019

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sively over time,” said Carly Schildhaus, public affairs manager for the National Confectioners Association (NCA). In addition to a taste adventure, consumers also want health beneﬁts like no allergens, gluten free, no preservatives, low-fat and all-natural. With consumer interest in healthy proteins at an all-time high, meat snack producers have listened to consumers, and products have moved beyond sticks of beef or tubs of jerky next to the cash register. “Meat snacks have grown in recent years as our consumers are more educated about what they’re putting in their bodies,” said Joe Bortner, category manager at Rutter’s. “It’s no longer a category just for ‘Bubba.’” Indeed, the category has expanded to snackers, health-conscious shoppers, teens and every age demographic. Meat cstoredecisions.com

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Category Management

Meat Snacks

snack sales have grown in recent years, with total meat snack dollar sales up 33% since 2013, according to IRI data. Nielsen predicts annual growth of more than 4% for meat snacks through 2022, from a category that is already a $2.8 billion business in the U.S.

BEYOND BEEF A Mintel study showed 41% of consumers want premium meat in their meat snacks, no matter the type of meat. FONA International’s Trend Insight Report on meat snacks surveyed the “most appealing types of meat” and found beef at 80%. “Beef is the most dominant,” said Krisanne Flamini, category manager — total snacks, confections and packaged cakes at Wawa. “The core meat offer is what continues to drive the category, while niche items help bring excitement and new users.” However, the study also showed that nearly half were interested in chicken, turkey and pork. Bison (34%), venison (27%) and salmon (26%) also received more than a quarter of the responses. Sales reflect those views. “Beef and pork are the top sellers; however, we’ve had success with brands that feature venison, boar and others,” Bortner said. Still, the desire for animal protein in snacks focuses on the “big two,” regardless of additional flavors. “Combined total poultry and red meat production is up 15% since 2009, including an estimated 2% gain for 2019,” said Tom Super, senior vice president of communications at the National Chicken Council (NCC). “Consumers have more animal protein to enjoy and will likely continue to see that at least for the next two years.” The NCC cites United States Department of Agriculture (USDA) statistics that show that, in 2018, per 52 Convenience Store Decisions May 2019

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capita consumption of beef was projected to be 57.9 pounds, while chicken was projected to be 92.5 pounds. Add in pork and turkey, and total red meat and poultry consumption is 219.6 pounds per capita. That’s a lot of meat. Combine that with the desire for faster foods, on-the-go snacks and portability, and that’s the perfect storm for an increase in meat-based snacks. As consumers move to leaner meats, chicken snacks have taken off. “Chicken marketers eye the prepared food segment at c-stores knowing $7 of $10 in in-store food sales are spent on this category,” Super said. “Much of this $7 is purchased as a snacking occasion.” And customers increasingly want those snacks to include interesting flavors and health benefits. “Many current trends are being driven by increased interest in unique flavors and combinations of flavors, including multicultural and global influences,” Schildhaus said. “Consumers are ‘flavor explorers’ more than ever before as they seek new experiences — this has proven especially true with millennials. Companies are responding positively, whether through the introduction of completely new products or adapting their existing offerings to match consumer demand.” That demand is leading to new products like Foster Farms’ Bold Bites On-The-Go Chicken Snacks and Yappah Chicken Crisps. “Chicken marketers are working diligently to leverage chicken’s broad appeal so c-store operators can take full advantage, especially for on-thego, hand-held snacks,” Super said.

APPEARANCE MATTERS Packaging also matters. Whether it’s catering to those with diets like Paleo, Whole30 or gluten free, or attracting new customers, packaging has evolved with lists of ingredients, adherence to diet and clear health, flavor and taste options. “I value packaging within our set,” Bortner said. “I believe it’s important for consumers to see exactly what they’re getting. A clear, tightly-sealed pack that shows off the product performs best. It goes right in line with the idea that our consumers want to see exactly what they’re getting.” Size matters, too. “The bigger the better,” Bortner said. “We’re having a lot of success with larger-ounce bags. This trend seems to work at all locations. For 2019, we’ve dedicated more space in all footprints to 10-ounce and larger bags.” With increased demand, retailers must carve out space for new products, and manufacturers must identify the next trend. “This heightened competitive market environment motivates marketers to continue to better understand and execute effective programs regarding how best to slice and dice the many sub-market segments and product categories,” Super said. CSD

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4/24/19 9:55 PM

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4/25/19 10:49 AM

Technology

Inventory Security

Tech Solutions to Inventory Management While best practices in inventory control remain key, technology can aid retailers in loss prevention. Brad Perkins, Contributing Editor

Fast Facts: » Today, scanning, exception reporting, automated ordering, heat mapping, data analysis systems and video audits are all part of loss prevention practices. » Employee training in best practices can help reduce shoplifting. » Circle K Canada uses a GPS tracker to pinpoint cigarette theft.

54 Convenience Store Decisions May 2019

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n certain parts of Ontario, internal and external sources, while Canada, when a cigarette pack integrating technology. “It shouldn’t be that difficult goes missing from a convenience store, the police know almost to control inventory,” said Chris immediately. For the past couple years, McGoey, founder of McGoey Security Circle K in Canada has been using Consulting. “You have to account for tobacco tracker technology in ciga- what’s in the store, what comes in rette packs, helping law enforcement from vendors and what goes out from the point of sale. So why doesn’t that capture more than 50 thieves. “It continues to work phenomenally happen? It always comes down to for us,” said Sean Sportun, manager employee theft and shoplifting.” of security and loss prevention for Circle K’s Central Canada Division. “It’s GETTING PERSONAL understanding the industry and crimiInventory management is more nals and criminal trends out there. We than reviewing numbers and adjusting can’t have people engaging with the accordingly. Prevention is key. Sportun bad guys, and we can’t lock up the has worked with law enforcement to product because that would be bad stop even the idea of robberies. marketing, so we were thinking out“When the police meet with kids of side the box and saying, ‘What if we members of the public, it’s usually in a put a GPS tracker in it?’ It’s about law enforcement capacity; someone’s being a little creative and using tech- done something wrong,” he said. nology in a way that can beneﬁt you.” “But there are so many times where For c-stores, that means updating police ofﬁcers engage community for old ways of preventing loss from both a good reason.” cstoredecisions.com

4/24/19 10:02 AM

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Technology

Inventory Security

Sportun started a “positive ticketing” program to help want. Shoplifters don’t act like that. They loiter in the aisle teens interact with local police and, in doing so, earn a cou- or go back to a corner. Good customer service is the best pon for a free hot or cold beverage, depending on the remedy. Look them in the eye, ask if you can help them, try season. The coupons have the crime stoppers number on to get out from the register and walk up to them.” Being mindful of where items are supposed to be and the back and give the hope that if a teen sees a crime, they how much of them are in stock helps, too. will report it. “Have all items fully faced so the shelf looks full is imporThat bundled program helped build a sense of community that, in conjunction with GPS tracking, led to a 53% tant,” McGoey said. “If a shoplifter takes one item off the decrease in armed robbery and a 40% reduction in youth shelf, you’re going to see it immediately, and if you’re the crime in stores where that had been a problem since posi- only cashier on duty, you’re going to know if you sold it.” tive ticketing began in 2007. In addition to community interaction, staff training is a WATCHING WITH TECHNOLOGY big part of deterring theft. Video and people stationed near coolers watching “Guest service — greeting, making eye contact, being the floor can help. But because of the danger of getting attentive and asking if you can help them find something involved, technology is just as important for keeping invenusually discourages theft,” said Adam Sturdivant, vice pres- tory from slipping out through shoplifters, employees, ident of operations at The Kent Cos., which operates 40 vendors or employees’ friends. Kent Kwik locations in New Mexico, Oklahoma and Texas. “The camera system is a major component to deterMcGoey agreed, saying you can practically recognize a ring theft,” Sturdivant said. “We have recently made a shoplifter when they enter the store. “You know how your significant investment upgrading the cameras in all of our customers act,” he said. “They make a beeline to what they locations. Not only does the new system allow us to review incidents and investigate claims, it also allows us to be proactive in deterring theft.” But only if it’s turned on. “I see stores now having highest-end video surveillance that have the ability to see what’s going on on each shift,” McGoey said, “but managers and franchisees don’t have time to go back and watch a whole shift in real time. Eventually, no one is looking at the video system, and the employees find out very fast that you’re not watching it. If you have a dishonest employee, it doesn’t take them long to find no one says anything about not ringing up sales.” Keeping the cameras on and letting employees know they’re on will help with inventory management. “CCTV and the current platform we have with remote access that can dial into any store at any time has an impact on employees’ psyche,” Sportun said, “because they don’t know when we’re watching, when they’re going to get a call. It keeps them on their toes and makes them think twice about wanting to steal or know that they need to be a little > JUNE 11-13, 2019 more creative. But then we can see and ask why people are doing things that are out of the norm.” ANAHEIM, CA And it’s not just video. “It used to simply be receiving verifications and inventory counts that constituted loss prevention,” Sturdivant said. Retailers, “Today, it is scanning, exception reporting, automated orderclaim your FREE EXPO pass! ing, heat mapping, data analysis systems, video audits — the list goes on. Computer analytics also greatly improve our inventory management. Being able to analyze actual itemspecific or category turns allows us to dial in space allocation.” nrfprotect.com Read more at cstoredecisions.com/2019/04/21/techsolutions-inventory. CSD

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4/24/19 5:12 AM

Technology

AI and Facility Automation

Why

AI Matters for Retail

Artiﬁcial intelligence constantly learns and never forgets. It can be trained to leverage individual behaviors, preferences, fears, beliefs and interests to personalize experiences. Paul Roetzer, Founder, The Marketing Artiﬁcial Intelligence Institute

artner and McKinsey Global Institute forecast trillions of dollars in annual impact from artiﬁcial intelligence (AI), yet most retailers still struggle to understand what AI is and how to pilot it in their organizations. A recent research project from MIT Sloan Management Review and The Boston Consulting Group (BCG) analyzed AI adoption based on a global survey of 3,076 business executives. The report — “Artiﬁcial Intelligence in Business Gets Real: Pioneering Companies Aim for AI Scale” — broke responding companies into four groups: PIONEERS (18%): Organizations that both understand and have adopted AI. These organizations are on the leading edge of incorporating AI into both their offerings and internal processes. INVESTIGATORS (33%): Organizations that understand AI but are not deploying it beyond the pilot stage. Their investigation into what AI may offer emphasizes looking before leaping. EXPERIMENTERS (16%): Organizations that are piloting or adopting AI without deep understanding. 58 Convenience Store Decisions May 2019

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These organizations are learning by doing. PASSIVES (34%): Organizations with no adoption or much understanding of AI. Now, keep in mind, this study is not specific to marketing, so the Pioneers percentage would be significantly less if only applied to our industry. The vast majority of brands we talk to at Marketing Artificial Intelligence Institute (MAII) fall into the Passives group, with some easing into the Experimenters category. No matter how you look at it, we are in the infancy of AI adoption, meaning you and your organization have the opportunity now to be proactive in advancing knowledge and capabilities before your competitors beat you to it. According to the report, “Pioneers, by deepening their commitments to AI, are establishing positions in both customer and labor markets that may make it hard for others to draft off of their hard work. The many advantages reported by Pioneers suggest that early AI movers may be especially hard to catch.”

HOW DO PIONEERS APPROACH AI? So what can we learn from the Pioneers? If you want to create a competitive advantage through AI, here are ﬁve steps you need to take:

THINK STRATEGICALLY It’s easy to get overwhelmed by AI if you don’t understand it. But at the most basic level, it’s just smarter marketing technology. Therefore, you should think about it the same way you would every other marketing technology investment. AI needs to solve real business problems by reducing costs and/or increasing revenue. There is no magic AI button that makes your marketing more intelligent and effective. And you can’t just go buy a single AI platform to replace all your existing technology. AI is built to perform narrow, speciﬁc tasks at superhuman levels. So your marketing technology stack will likely expand, which obviously creates complexity if you don’t plan ahead. Success with AI requires an cstoredecisions.com

4/25/19 11:32 AM

CStoreDecisions.com is geared toward C-Store retailers, convenience store suppliers, and distributors looking to stay abreast of industry trends, new product offerings and category management best practices.

CStoreDecisions Decisions .com Making Connections that Drive Business

We use the latest media technology, delivering content the way you want it: print issues, digital issues, enewsletters, and videos. Use CStoreDecisions.com to help you strengthen your peer network with social engagement through Twitter, LinkedIn, Facebook, YouTube, Pinterest, and Google+. Browse, bookmark, share and interact with the most relevant industry content and people in the market.

Thank you to our Key Partners:

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4/24/19 2:14 PM

Technology

AI and Facility Automation

understanding of what it is and what it’s capable of doing (and not doing), as well as experimentation, patience and a strategic vision.

VIEW DATA AS AN ASSET A great starting point for thinking about the potential value of AI is to assess opportunities to get more out of your data. For example, if your marketing team spends signiﬁcant time every month organizing and visualizing performance analytics, and developing narratives to tell the story of what’s happening and why, that can all be intelligently automated. You can also look across your marketing and consider the ways you use data, or should be using data, to make predictions. If you strip away all the unnecessary complexity when discussing machine learning (a subset of AI), that’s in essence what it does. It makes predictions based on historical data. But, machine learning continues to “learn” (thus the name) and alter its predictions as new data becomes available, much in the way Google Maps recommends alternate routes in realtime as trafﬁc patterns change. This 60 Convenience Store Decisions May 2019

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can be applied to predicting: email clicks and open rates, lead conversions, customer churn, content and creative performance, optimal ad budget distribution, ideal price points, audience targeting, consumer needs and preferences, product purchases, campaign ROI and hundreds of other use cases. A simple rule of thumb for AI is that if it’s data-driven, a machine can be trained to do it better and more efﬁciently at scale than a human.

FOCUS ON REVENUEBOOSTING USE CASES OVER COST-REDUCING ONES For many organizations just starting with marketing AI, cost-saving use cases are likely to be the most logical for gaining early wins and executive support. However, according to the MIT Sloan Management Review and BCG report, “Pioneers prioritize revenue-generating applications over cost-saving ones.” So as you’re building your marketing AI strategy, look for the obvious opportunities to drive efﬁciency and reduce costs with intelligent automation. But start developing the near-

term vision for how to use AI to grow revenue through improved customer experience and identiﬁcation of new markets and opportunities. It also makes sense early on in your exploration to consider the AI capabilities of your existing marketing technology stack, speciﬁcally your marketing automation and CRM solutions. Again, AI is designed to solve narrow use cases, so you could easily end up adding a dozen or more new technologies as you scale. Talk to your primary marketing technology partners, and see if they have AI-powered features that you’re not using. Ideally, take your list of priorityuse cases from No. 4, and ask how many of those they can help you with.

EDUCATE AND ENGAGE MANAGEMENT

There is a very real chance that the ﬁrst couple marketing AI pilots you run won’t work. Or, at least, they won’t generate the cost savings or revenue growth you hoped for. You can NOT stop because of early failures. That means you’re going to need executive-level understanding and support of AI.

BE CURIOUS, EXPLORE You have a choice. You can sit back and wait for the marketing world to get smarter and change around you, or you can embrace AI and be proactive in creating a competitive advantage for yourself and your company.

Paul Roetzer is the founder and CEO of The Marketing Artiﬁcial Intelligence Institute. He is the author of The Marketing Agency Blueprint (Wiley, 2012) and The Marketing Performance Blueprint (Wiley, 2014). He can be reached at paul@pr2020.com. cstoredecisions.com

4/24/19 9:56 PM

The convenience store industry’s young executives and next-generation leaders face unique challenges as they grow their businesses in the fast-paced, competitive convenience store market. The National Advisory Group’s (NAG) Young Executives Organization (YEO) was formed specifically to addresses these challenges and help the industry’s leaders of tomorrow identify solutions with others in their age group. YEO exists to serve as an effective conduit for getting young professionals more involved and prepared for leadership positions both in their companies and in the broader convenience store industry. Convenience store companies must identify their next-generation leaders and groom them for management positions. This is where YEO can help. YEO membership offers next-generation leaders a network of other young leaders in similar positions. The group meets twice annually at an annual roundtable in the spring and the NAG Conference in September.

For information on joining YEO or NAG, contact NAG Executive Director John Lofstock at jlofstock@csdecisions.com. THANK YOU TO OUR 2019 SPONSORS:

YEO_NAG_2018_7.18.indd 1

4/25/19 8:53 AM

Technology

LED Lighting

LEDs Gaining Share,

Marketing Savvy

Embedded microtechnology helps employees do their jobs and shoppers ﬁll their carts.

Thomas Mulloy, Senior Editor

E Fast Facts: » Long-lasting and durable, LEDs are safer for workers, due to both brightness and decreased risky maintenance maneuvers that could increase slip and fall situations. » Strong LED demand may curb rebate programs in the future. » Combining LED installation with RFID transmitters or with beacon technology can grow savings and revenue possibilities.

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nergy savings has been the savings on the electric bill. “Because big hook for most retailers we took a fixture that may have given who have converted to LED off ‘x’ amount of illumination, we went with a ‘y’ to brighten things up,” lighting. Let’s face it: LEDs are more efficient. Bosworth explained. “We still saved More versatile. Last longer. Illuminate money. We were able to do that with more light.” better. Are safer. The most undervalued aspect of Little wonder that the LED market, estimated at $14 billion in 2014, is LED lighting might be that it is inherprojected to grow the next five years ently safer because it creates better-lit at a 28% annual rate to reach $45 bil- indoor and outdoor spaces. But it also dramatically decreases lion by 2023, according to a 2016 maintenance and with it the need for MarketWatch report. C-store owners should be aware employees to perform potentially danthat initial cost-savings estimates can gerous maintenance maneuvers that be deceiving — they may decide to could put them at risk for slip and falls. That increased safety and low mainadd new lighting to poorly lit areas. Doing that increases the project cost, tenance were what sold Bosworth. And he saw a strong advantage in not but it still may be a wise move. Jim Bosworth is now retail and con- having to dispatch a crew with special venience director with PetroActive equipment to change the more chalReal Estate, but he was president lenging bulbs. “That way I didn’t have to worry of Kerry Oil’s Breeze Thru Markets 17-store chain when it deployed LEDs about my team members climbing at some locations in North Carolina. ladders,” Bosworth said. “It was a He said that the added expense on real advantage to having your store lit, the front end worked to Breeze Thru’s but never having downtime from your advantage given the added cost electrical light.” cstoredecisions.com

4/24/19 1:49 PM

REBATES AND INCENTIVES

decided to switch to LEDs because R e b a t e a n d a s s i s t a n c e p ro- of the 50% reduction in energy use — grams abound for lighting upgrades. and that estimate stands. “The savings that we have proMost are offered by electric utilities. Governments are partnering on these jected in the past still holds true with as well. The rationale is that more those stores where we have installed energy efficiency equates to lower LED lighting,” said Jim DeFilippis, energy bills for businesses who can vice president and general manager of then invest that savings in the economy. NOCO Express. The rebate amounts are typically tied to the type of fixture, usually a AUTO SAVINGS specific amount per lamp replaced or But savings in lighting installed. Generally, the higher watt- costs is just the tip of the age, the bigger the rebate. Most retail iceberg for c-stores. rebates range between $5 and $200. When coupling LED instalFinding rebate programs can be lation with embedded radio as easy as searching the internet or frequency identification checking an energy provider’s web- (RFID) transmitters or with site. Utilities like Duke Energy offer beacon technology that rebates across their entire geograph- transmits information through ical footprint. Bluetooth Low Energy, the State and local governments savings and revenue possioffer incentives, too. According to bilities increase exponentially. the National Conference of State You may have heard of Legislatures, 36 states have some type the Internet of Things (IoT). of efficient lighting program offering Society’s uber-connectivity grants, rebates, loans or tax breaks. has created a critical mass of Check with cities and towns, who personal and industrial techmight also offer economic develop- nology that allows things ment money. like cellphones, appliances, This may be the best time for thermostats, coolers, headc-stores to upgrade, too. With the mar- phones — even store shelf ket for LEDs firmly in place, at some lighting units — to talk to point, won’t the programs disappear? other things. The IoT is basiNot yet, according to Chad Barrett, cally a multitude of devices director of operational support for sending each other small bits the 300-plus, 11-state Maverik c-store of information. chain based in Salt Lake City. Barrett For c-store operators, that means said Rocky Mountain Power’s rebates even more energy savings based on haven’t dropped off. If there is a down- self-adjusting systems. side, he said, it’s that the requirements About two years ago, Maverik keep shifting. That can hamper the began updating its c-store locations planning process, whether for a chain with LED lighting linked to full energy as large as Maverik or for a single store. management systems (EMS) that react NOCO Express, which is set to to changes, automatically gauging a be acquired by Marathon Petroleum store’s lighting needs. Corp., began updating its exterior “They’re set up on a timer — a lighting with LEDs back in 2012 and timer of when sunrise is supposed has been gradually swapping out inte- to hit [or] when the sun goes down,” rior fluorescent lights throughout its 39 Barrett said. “It also has photo sensors stores in western New York. The chain so it can recognize if it’s cloudy outcstoredecisions.com

62-63_Tech_Lighting.indd 63

side, if it’s getting too dark, so it will kind of update and adjust the lighting accordingly.” What if Barrett wants to override the system? There’s an app for that. He does it with his cellphone. Beacon technology embedded in LED shelf lighting alerts convenience store employees that a product needs stocking or that a cooler’s temperature

is rising. It’s a small thing that can lead to big efficiencies. LED lighting seems to make more sense all the time. The one factor that dwarfs all others, is the return on investment (ROI). Both Bosworth and Barrett said the ROI on their retrofits was about three years. Barrett added, though, that the ROI for Maverik’s latest project in Boise, Idaho, was just one year. As LED lighting and its partner technologies evolve, so will the market for them. C-stores will need to do their homework before plugging in. CSD May 2019 Convenience Store Decisions 63

4/25/19 10:35 AM

PRODUCTShowcase Steak and Cheddar Pizza

Vaping Pod System When innovation meets simplicity and fashion, it becomes the ultimate sophistication. U.S.-based Smoking Vapor has introduced the Mi-Pod, which takes vaping to another level, designed to satisfy and delight the adult smoker. Backed by a 100% warranty, the Mi-Pod is a unique pod system that uses two-milliliter refillable pods that can be refilled 4-6 times and work with any e-liquid, including CBD, allowing you to sell profitable e-liquids. With three times the battery life of other pod systems, Mi-Pod is a true all-day vape. The device is discreet, compact and available in a number of luxury styles, which can also be accessorized with a lanyard or chain. The Mi-Pod starter kit comes with a Mi-Pod device, a USB charging cable, a neck lanyard and two refillable two-milliliter pods. Store display cases are available.

Company: Smoking Vapor (800) 775-8970

mi-one.com

Hunt Brothers Pizza’s new, limited time offer (LTO) Steak & Cheddar Pizza is made on Hunt Brothers Pizza’s original crust, cheese sauce, a blend of 100% mozzarella and natural yellow cheddar cheeses, thinly sliced marinated steak and topped with the company’s signature “Just Rite Spice.” To prepare the pizza, just unwrap it, sprinkle on the spice and bake. The suggested retail price (SPR) is $10.99.

Company: Hunt Brothers Pizza huntbrotherspizza.com

Self-Service Popcorn ReadyPop is the self-service solution for popcorn. Reduce labor by allowing customers to serve themselves. Plus, the experience of freshlypopped popcorn will engage customers’ senses. Features include a 16-ounce kettle with a compact footprint to ﬁt into any available space, a crisping system for maximum freshness, a pushbutton-activated dispenser and integrated cup and lid holders.

Company: Gold Medal Products Co. gmpopcorn.com

Card-Processing Service National Retail Solutions (NRS) has introduced NRS PAY: top-quality card-processing services at quality rates. With no application fee and no long-term commitment required, NRS PAY is an ideal ﬁt for retailers of any size and industry. Whether integrating seamlessly with the NRS point of sale, or operating as a stand-alone processor, the NRS PAY program features sleek equipment with friendly, live customer support. NRS PAY processing options include next-business-day deposits, late batch funding, a cash discount program and more.

Company: National Retail Solutions (833) 289-2767 • nrsplus.com 64 Convenience Store Decisions May 2019

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cstoredecisions.com

4/24/19 10:04 AM

PRODUCTShowcase Self-Cooking Oven

Resealable ColdBrew Coffee MOJO cold-brew coffee elixirs are handcrafted with pure, all-natural ingredients. MOJO is a fresh, all-natural coffee — a great alternative to energy drinks and appealing to consumers seeking healthy, tasty options with a caffeinated kick. Conveniently packaged in resealable bottles, MOJO is ideal for people on the go. The suggested retail price (SRP) for MOJO coffee is $3.29 for 10-ounce Original, Unsweet and Black Magic flavors; $3.49 for 10-ounce Decaf Original and Decaf Black; and $8.49 for 33.8-ounce liters of Black Magic.

Consumers are looking past traditional quick-service restaurants to c-stores for their grab-and-go meals. Retailers are looking to combi ovens for a costeffective way to keep up with this trend while increasing foodservice sales and profitability. Great for high-margin items like prepared sandwiches, chicken and made-to-go items, the Rational SelfCooking Center meets consumer desire for fresher items with higher quality ingredients and greater menu variety. Rational’s combi technology prepares food items at the touch of a button, cooks fully automatically, is self-cleaning and is available in a variety of sizes.

Company: Rational USA rational-online.com

Company: MOJO mojocoffees.com

CBD Gummies Reliva’s gummies are a high-end soluble treat enriched with 0% THC CBD. Formulated to help soothe pain, relieve inflammation and support relaxation, they are an easy and delicious way to supplement the powerful compounds of CBD. They are also non-GMO, kosher and gluten free. The suggested usage is to place the gummy under your tongue and let it melt twice daily. Each package contains 10 gummies. Each gummy contains 10 milligrams of 0% THC CBD.

Party Punch United through a love of music and inspired by the entrepreneurial spirit of Austin, Texas, three millennialaged college friends founded BeatBox Beverages in 2013. They set out to create something that could help everyone #PartyBetter. Their own personal concoction of vodka, Crystal Light and cranberry juice served in a re-purposed Franzia bag had become a hit at parties. Soon, the “The World’s Tastiest Portable Punch” was born. By 2014, they appeared on Shark Tank with their Party Punch and gained a $1 million investment from Mark Cuban — one of the biggest investments the show had ever made. The white-wine based Boozy Punch comes in Fruit Punch, Pink Lemonade, Blue Razzberry and Fresh Watermelon. Low-calorie, low-sugar and gluten free, it is 11.1% ABV.

Company: BeatBox Beverages beatboxbeverages.com

Company: Reliva info@relivacbd.com relivacbd.com cstoredecisions.com

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May 2019 Convenience Store Decisions 65

4/24/19 10:04 AM

PRODUCTShowcase Cold-Brew Coffee Flavors

Touchscreen Drawer Warmers The Hatco Corp. Drawer Warmers, designed to keep a variety of foods hot and ﬂavor-fresh, now come with an optional touchscreen control panel. The control panel allows for precise individual temperature settings for each drawer and features an adjustable timer per drawer with audio and visual alert to remind operators about the holding times set. A USB port is also available for software updates. The Drawer Warmer has completely insulated individual cavities that provide maximum energy efﬁciency, while Hatco-exclusive nylon rollers allow for the heavy-duty drawers to easily slide in and out. Each warming drawer includes a food pan, a recessed individual thermostatic control, a temperature monitor, adjustable vent slides and a power on/off switch. Drawer fronts are available in stainless steel and additional color options.

Company: Hatco Corp.

(800) 558-0607

hatcocorp.com

S&D Coffee & Tea’s new line of cold-brew coffee is available in five flavors to wake up beverage menus and energize sales. The convenient bag-in-box (BIB) format provides a turnkey solution for operators looking to satisfy demand without the added labor or costs often associated with scratch-made, cold-brew coffee. There is no need for in-house measuring and brewing or concerns about running out — the new product is shelf-stable and ready to serve. The cold-brew coffee is available in five on-trend flavors, including: Black & Bold, Café au Lait, Salted Caramel, Horchata and Café a La Mode.

Company: S&D Coffee & Tea

(800) 933-2210

sdcoffeetea.com

vitaminwater’s mission to seek new and inventive flavors continues with the launch of two new products: vitaminwater fire and ice flavors create an experience for your taste buds with tickling and cooling sensations. vitaminwater fire’s mild heat and spice create a fire in the mouth and throat by inciting a slight tingling sensation, with a spicy watermelon lime flavor. While vitaminwater ice elicits a long-lasting, refreshing feeling designed to mimic the experience of ice cooling, with the flavor of cool blueberry lavender.

Company: vitaminwater vitaminwater.com

Peanut Butter Cup Bar ONE Brands, makers of one of the fastest-growing protein bar companies in the U.S., has launched the latest addition to the brand’s dessert-inspired portfolio. Featuring the company’s signature 20 grams of protein and only one gram of sugar per serving, the decadent, sinful combination of salty, nutty peanut butter and sweet chocolate just got a lot less guilty. Featuring high quality, gluten-free ingredients, this sweet-treat bar is a perfect snack on the go, in the ofﬁce or pre- and post-workout.

Company: ONE Brands one1brands.com

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Tingling, Cooling Water

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PRODUCTShowcase Snickerdoodle Protein Cookie Munk Pack launched a new ﬂavor of its plantbased, gluten-free Protein Cookie line — Snickerdoodle. Munk Pack makes nutritious, readyto-eat snacks for consumers on the go. The Snickerdoodle Protein Cookie has 18 grams of plant-based protein and six grams of ﬁber. All Munk Pack Protein Cookies are gluten-free, vegan, non-GMO, kosher and include no soy, dairy, cholesterol, trans fats or sugar alcohols. The suggested retail price (SRP) for a four-pack is $6.99.

Company: Munk Pack munkpack.com

Retro Beer Can To commemorate more than 75 years on the market, Tecate is bringing back one of its original can packages, encouraging millennial beer drinkers and longtime brand loyalists to “Throw Back a Throwback.” Containing the same great beer known for its quality, unique crisp ﬂavor and originality, Tecate aims to reach consumers who are responding to nostalgia in a way that re-captures iconic packaging from the past. Continuing while supplies last into August, this limited-edition can will be released nationally in all seven 12-ounce pack conﬁgurations and supported on- and off-premise with digital media and in-store merchandising materials to drive shopper awareness and takeaway. Company: Heineken

heinekenusa.com

USA

Sour, Chewy Candy Nerds’ newest product offering, Sour Big Chewy Nerds, moves the popular brand into the growing sour candy segment, which is growing +11% with the core consumer being Gen Z, ages 13-24. Featuring a sour chewy center covered in a sweet, crunchy Nerds candy shell, a bag of the new Nerds product contains a variety of sour ﬂavors: Brainiac Blue Raspberry, Streaming Strawberry Lemonade, Wiki Watermelon and Blood Orange Byte. Sour Big Chewy Nerds are available in a 4.25-ounce Concession Box ($1.09 SRP), a 6-ounce Medium Peg Bag ($1.99 SRP) and a 10-ounce Stand Up Bag ($2.99 SRP). Company: Ferrara

ferrarausa.com

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Candy Co.

Kombucha Smoothie Odwalla is launching its most exciting product innovation yet: Smoobucha, the first of its kind to be sold in stores. Combining the delicious taste of smoothies with the health benefits of kombucha, Odwalla Smoobucha offers the perfect blend of flavor and function. Available for $2.99 per 15.2-ounce bottle, Odwalla Smoobucha comes in Citrus & Guava, Berry & Ginger and Apple & Greens, each a unique mix of fruits and vegetables, pasteurized kombucha, fiber and 500-millimeter colonyforming units (CFU) that contain 40% less sugar and fewer calories than typical smoothie items.

Company: Odwalla odwalla.com

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Classifieds /Ad Index ADD Systems 800.922.0972 / www.go.addsys.com/build Apter Industries 800.441.7146 / www.apterindustries.com Blu 888.207.4588 / www.blu.com

Bob’s Red Mill www.BobsRedMill.com/Food-Service CB Distributors 888.824.3256 / www.cbprices.com Curtis www.wilburcurtis.com

55 21 49 45 5,7 47

Del Monte Fresh 800.950.3683 / www.freshdelmonte.com E-Alternative Solutions 877.373.0069 / www.LeapVapor.com Florida Lottery Commission (Select Regions ONLY)

www.flalottery.com/LotteryOffices

Gulfcoast 727.449.2296 / www.gulfcoast.com Hershey www.HersheySolutions.com

35 31 53 3 37

Home Market Foods 17 800.367.8325/www.HomeMarketFoods.com Hoshizaki www.hoshizakiamerica.com

Inline Plastics 800.826.5567 / www.inlineplastics.com

Krispy Krunchy 800.290.6097 / www.krispykrunchy.com

Mars Wrigley Confectionery www.mars.com

Little Debbie 15 800.315.6208 / www.LittleDebbieCStore.com

MasonWays 800.837.2881 / www.masonways.com McLane Company www.mclaneco.com/mobilevtsapp

National Retail Solutions 833.289.2767 / www.nrsplus.com

Nestle Professional 800.288.8682 / www.CMFeelTheLove.com North American Bancard 866.481.4604 / www.nynab.com NRF Protect 2019 www.nrfprotect.com

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Oberto Snacks 877.234.7904 / www.cattlemanscut.com

Prairie City 800.338.5122 / www.pcbakery.com

Quaker Foods www.quakeroats.com

Ruiz Foods www.ruizfoodservice.com

019 Southwest Fuel & 2 Convenience Expo www.sw-expo.com

Swedish Match 800.367.3677 / www.zyn.com

Swisher 800.874.9720 www.optimocigars.com www.swisher.com

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Tyson 71 800.682.7272 / www.tysonconvenience.com

U.S. Smokeless Tobacco

WinCup www.cstorecups.com

2 27

BOOTH #3249

Emergency Spill Centers TOBACCO LOYALTY & REBATES PROGRAM SM

Windshield Service Center

WWW.NRSPLUS.COM

CALL: (833) 289-2767

USE PROMO:

CSD987

Bases for Beer Caves Storage & Display

www.masonways.com 800-837-2881 cstoredecisions.com

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INDUSTRY

Perspective

Strategizing

Food Safety

Jessica Williams is the founder and CEO of Food Forward Thinking LLC, which specializes in new product development, menu labeling compliance and food safety for restaurant, convenience and grocery chains. Contact her at Jess@ FoodForwardThinking.com or read more at FoodForwardThinking.com.

Food safety at c-stores starts with clean hands and proper hold times, but employee training and best-practice habits are crucial to success.

Jessica Williams, Founder & CEO, Food Forward Thinking LLC

hat does food safety look like in convenience stores? Is it different than food safety in restaurants? Yes and no. Mindset and standard operating procedures are critical no matter where food is sold.

For example, the shelf life of an item like hamburger buns may have a frozen shelf life, thawed shelf life, and an expiration time once it’s a component of a hot hamburger in a grab-andPREPARE FOR BATTLE go case; operators must understand the importance of apArming team members with the proper mindset, as plying the right hold time depending on the environment. State and local regulations typically require food hanwell as the proper tools, can help convenience foodservice operators not only overcome the “gas station food” dlers to become certified in some type of food safety trainshadow, but also create a food destination. A mentality ing, and this knowledge can empower team members to of waging war on neighboring quick-service restaurants make choices that promote quality, safe food. ServSafe is possibly the strongest tool convenience operators have food handler and manager certifications can be helpful tools to ensure staff is trained in the basics of how to propto win the trust and dollars of hungry guests. All team members within a convenience location erly clean food surfaces and handle food. should know they are battling against all surrounding business, especially restaurants and grocers. Whether or EXCELLENCE IS A HABIT Little things add up to a safe, appetizing environment. not an employee has a direct role in foodservice, everyone helps to sell food; a clean lot, working fuel pumps, Aristotle is attributed with saying, “We are what we reclean trash bins and well-stocked shelves all set the stage peatedly do. Excellence, then, is not an act, but a habit.” With this advice in mind, c-store operators should build for a second-to-none food destination. great habits into hourly and everyday routines. Some best SAFETY 101 practices include encouraging team members to clean as It is said that cleanliness is next to godliness — and it they go, never walk past trash anywhere on the propercan also be said that cleanliness is next to transactions. ty, whether on-the-clock or not, and maintain a mindset Spotless aprons, dirt-free nails and neatly-restrained hair of beating the competition on cleanliness. Routine store establish the foundation for a clean environment, and walks to check for spills on the floor can prevent injuries. safety builds from there. The U.S. Department of Agri- Checking for spills at self-serve food, coffee and fountain culture advises that cleanliness is the best way to prevent areas can prevent negative customer perceptions. Restaurants have the advantage of being positioned as foodborne illness, specifically by focusing on four areas: clean hands and surfaces, avoid cross-contamination, appetizing in every aspect as a destination for food. By cook correctly and refrigerate properly. By mimicking contrast, c-stores are typically positioned to be perfectly practices long followed by restaurants, c-store operators convenient for everything, with foodservice being added to many locations relatively recently. By focusing on overall are best prepared for selling food safely. One of the best ways c-stores can successfully execute store cleanliness and personal accountability to execute at hold times is by using a labeling system with defined cat- a high level, c-store operators can build store sales and egories. Team members should be confident in labeling steal share from neighboring foodservice competitors. Appetizing cues within food environments are actually food with correct expiration times, which is critical to protect customers from foodborne illness. Clearly posted ref- the same, no matter what else might be for sale on the erence materials are a must. Printing technology can help. property.

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