CSN-0122 by ensembleiq

Convenience Store News January 2022

STUDY 2022

THE 2022 TECHNOLOGY HIT LIST

NAVIGATIN G DETOURS HAS BECOM E A WAY O LIFE FOR T HE CONVEN F IENCE STORE IND USTRY, BUT 2022 BRING S SIGNS OF CAUTIO US OPTIMIS M AND HOPE. Volume 58, Number 1

JANUARY 2022

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VIEWPOINT

Place Innovation Front & Center on Your Resolutions List Don’t let current troubles stifle new ideas ONE OF THE BIG QUESTIONS retailers explored at our recent Convenience Foodservice Exchange (CFX), held late last year in Charlotte, N.C., was the role of innovation and new ideas at a time when so much attention needs to be focused on everyday challenges.

The twin dilemmas of the acute shortage of store workers and the extreme difficulties of getting products due to the massive supply chain backlog have many retailers scrambling just to keep their stores open for normal operating hours and to stock their shelves with the products their customers want to buy. “Who has time for innovation?” one retailer recently asked me, noting that the past year has been a greater strain on him and his company than even the worst months of the pandemic. I know several convenience channel executives, particularly those in store operations, who have exited the industry or retired early due to burnout. Nevertheless, it is critical for retailers to pursue innovation despite the labor shortage and supply chain disruptions. There’s always going to be immediate challenges that need to be addressed, but innovation is what differentiates the great retailers from the good ones. Speaking at CFX, Joe Chiovera, principal at XS Foodservice Solutions, recommended that c-store

operators take a “strategic and proactive” approach to innovation. He explained that setting a pro-innovation culture from the top down is key, and that companies need to be planning for months and even years ahead. Rutter’s, based in York, Pa., has a history of being one of the most innovative chains in the industry. When asked how the pandemic and recent labor and supply chain issues affected the company’s innovation process, Foodservice Category Manager Chad White told the CFX audience that it is about focusing on the important things. “Through menu rationalization and focusing on the most important aspects of the menu, we were able to continue to innovate in small ways, while also maintaining in-stock positions and service levels,” he said. So, if the pandemic slowed your pace of new idea generation, now is the time to get back on the innovation train. In fact, if you haven’t made out your list of New Year’s resolutions yet, here are two items that definitely should be on it: • Resolve to continue taking care of your frontline store employees and field operations staff. They’ve borne the brunt of the pandemic-related risks and challenges. • Resolve to always maintain a structured and strategic approach to continued innovation. I hope all our readers have a happy, healthy and prosperous New Year. For comments, please contact Don Longo, Editorial Director, at (201) 855-7606 or dlongo@ensembleiq.com.

EDITORIAL EXCELLENCE AWARDS (2013-2021)

EDITORIAL ADVISORY BOARD

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

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

2013 Jesse H. Neal National Business Journalism Award Best Single Issue, October 2012

2013 Jesse H. Neal National Business Journalism Award Finalist, Best Profile, August 2012

2020 Eddie Award, Folio: magazine Business to Business, Retail, Series of Articles, September 2019 2018 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Website Business to Business, Retail, Full Issue, October 2017 Business to Business, Editorial Use of Data, June 2017 2017 Eddie Award, Folio: magazine Winner, Business to Business, Retail, Single/Series of Articles, May 2017 Honorable Mention, Business to Business, Retail, Single/Series of Articles, June 2016 2016 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2015 Business to Business, Retail, Single/Series of Articles, August 2015

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

2015 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Single Article, February 2014 2014 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2013 Business to Business, Retail, Single Article, February 2013 2013 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2012

Laura Aufleger OnCue Express

Ray Johnson Speedee Mart

Chad Beck Core-Mark

Ruth Ann Lilly GPM Investments LLC

Edward Davidson Ed Davidson & Associates (7-Eleven Inc., retired) Robert Falciani ExtraMile Convenience Stores Jim Hachtel Eby-Brown Co. Chris Hartman Rutter’s

Vito Maurici McLane Co. Inc. Matt Paduano Lakeport Markets Jonathan Polansky Plaid Pantries Inc. Greg Scriver Kwik Trip Inc. Roy Strasburger StrasGlobal

2015 American Society of Business Press Editors, National Azbee Awards Silver, Best Profile (long form), February 2014 2015 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best Special Supplement, November 2014 Silver, Best Profile (long form), February 2014 2013 American Society of Business Press Editors, Midwest Regional Azbee Awards Bronze, Best Editorial/Commentary, July 2012

2020 Trade Association Business Publications Intl. Tabbie Awards Honorable Mention, Best Single Issue, September 2019 2016 Trade Association Business Publications Intl. Tabbie Awards Silver, Front Cover Illustration, June 2015

J ANUARY

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COVER STORY PAGE 33

STUDY 2022

FEATURES

DEPARTMENTS

COVER STORY

VIEWPOINT

SMALL OPERATOR

3 Place Innovation Front & Center on Your Resolutions List Don’t let current troubles stifle new ideas.

26 Dark Days Ahead? The economic pressures of the ongoing COVID-19 pandemic have left the convenience channel’s small operators feeling less optimistic about 2022.

10 CSNews Online

INSIDE THE CONSUMER MIND

33 On the Road to Recovery Navigating detours has become a way of life for the convenience store industry, but 2022 brings signs of cautious optimism and hope. 34 Seeing the Promise of a Better Year C-store retailers are heading into 2022 with more optimism than they had a year ago. 38 Holding the Line Retailers expect to see more of the same in terms of sales for most product categories this year.

20 New Products

82 Pandemic-Driven Spending Habits Are Here to Stay A significant number of Americans are reconsidering the meaning of essential spending.

52 Cautiously Optimistic, But Still Realistic A majority of the convenience channel’s suppliers and wholesalers feel good about their 2022 business outlook, though stumbling blocks remain. 54 Embracing the New Normal Operational challenges and changing consumer behavior will drive convenience store retailers to switch things up in 2022.

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BEST NEW PRODUCT S AWA R D S

CONTENTS JAN 22

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8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631 (773) 992-4450 Fax: (773) 992-4455 www.csnews.com

BRAND MANAGEMENT Vice President/Group Brand Director Paula Lashinsky (917) 446-4117 plashinsky@ensembleiq.com EDITORIAL Editorial Director (201) 855-7606

Don Longo dlongo@ensembleiq.com

Editor-in-Chief (201) 855-7608

Linda Lisanti llisanti@ensembleiq.com

Senior News Editor (201) 855-7618

Melissa Kress mkress@ensembleiq.com

Senior Editor (201) 855-7619

INDUSTRY ROUNDUP

CATEGORY MANAGEMENT

12 The New Year Brings New Leadership at Sheetz

TOBACCO

14 Eye on Growth 14 Fast Facts 16 Retailer Tidbits 16 Supplier Tidbits TECHNOLOGY 59 The 2022 Technology Hit List Frictionless checkout, all things digital, data management and labor optimization are the biggest priorities c-store operators have for technology implementation this year.

56 A Category in Flux — Again C-store retailers are cautiously optimistic about the vapor category despite its challenges.

Angela Hanson ahanson@ensembleiq.com

Managing Editor (201) 855-7604

Danielle Romano dromano@ensembleiq.com

Contributing Editor (303) 741-3377

Renée M. Covino reneek@aol.com

Contributing Editor (201) 280-2614

Tammy Mastroberte tmastroberte@gmail.com

ADVERTISING SALES & BUSINESS Associate Brand Director & Northeast Sales Manager (774) 212-6455

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Associate Publisher & Midwest Sales Manager Kelly Fischer (773) 992-4464 kfischer@ensembleiq.com Account Executive & Classified Advertising Terry Kanganis (201) 855-7615 tkanganis@ensembleiq.com Classified Production Manager Mary Beth Medley (856) 809-0050 marybeth@marybethmedley.com AUDIENCE List Rental (914) 309-3378

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CORPORATE OFFICERS Chief Executive Officer

Jennifer Litterick

Chief Financial Officer

Jane Volland

Chief Human Resources Officer

Ann Jadown

Executive Vice President, Content

Joe Territo

Executive Vice President, Production

Derek Estey

CONVENIENCE STORE NEWS AFFILIATIONS Premier Trade Press Exhibitor

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

Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by EnsembleIQ, 8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631. Subscription rates: Subscription rate in the United States: $125 one year; $230 two year; $14 single issue copy; Canada and Mexico: $150 one year; $270 two year; $16 single issue copy; Foreign: $170 one year; $325 two year; $16 single issue copy; Digital One year, digital $87; two year, $161. Periodical postage paid at Chicago, IL 60631, and additional mailing addresses. Copyright 2021 by EnsembleIQ. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or information storage and retrieval system, without permission in writing from the publisher. Reprints, permissions and licensing, please contact Wright’s Media at ensembleiq@wrightsmedia.com or (877) 652-5295. POSTMASTER: send address changes to Convenience Store News, 8550 W. Bryn Mawr Ave. Ste. 200, Chicago, IL 60631.

6 Convenience Store News C S N E W S . c o m

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CSNEWS ONLINE

MOST VIEWED NEW PRODUCT

Pillsbury Belgian-Style Waffle Carrier Convenience store operators can boost their sandwich game with the Pillsbury Belgian-Style Waffle Carrier, available pre-sliced in a thawand-serve format. The 2.8-ounce waffle carrier is made for sandwiches, with one side featuring a traditional waffle texture and the other side flat for easy assembly. Made with maple syrup and crisp pearl sugar, the product has a slightly sweet flavor profile, and contains no high fructose corn syrup, artificial colors, flavors or preservatives. The case count is optimized for c-stores, containing 36 sandwiches/72 sides per case. General Mills Foodservice Minneapolis generalmillscf.com

INDUSTRY ROUNDUP

The New Year Brings New Leadership at Sheetz Travis Sheetz stepped up as president and CEO at the beginning of January TRAVIS SHEETZ TOOK the reins as president and CEO of Sheetz Inc. at the beginning of January. The nephew of company founder Bob Sheetz previously served as the convenience store chain’s president and its first-ever chief operating officer (COO).

Joe Sheetz, the former CEO and Travis’ brother, moved into the role of executive vice chairman and will continue to support CLI Transport, the dedicated petroleum carrier for Sheetz’s stores, as well as the company’s board of directors, and finance and legal departments. “Over the past 69 years, Sheetz has grown dramatically from a small dairy store in Pennsylvania to one of the fastest growing family-owned convenience retailers with more than 600 locations across six states. Through Travis’ leadership, I am confident Sheetz will continue to grow and innovate to not only meet the needs of customers on the go, but give

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customers the next level of convenience they didn’t even know existed,” said Joe Sheetz. Travis Sheetz began his career at Sheetz Inc. as a real estate site selector before becoming a director in the company’s marketing department. He later worked his way up to vice president of operations and then executive vice president of operations before being promoted to president and COO in 2018. “I am extremely humbled for the opportunity to carry out my uncle’s mission for this company and ensure the family values he instilled when he founded Sheetz in 1952 continue in the future,” Travis Sheetz said. “I look forward to building on the success and innovation Sheetz exhibited during my brother’s time as CEO. Sheetz will continue to put our people first, bring innovation to our industry, and fulfill our vision to create the business that will put the Sheetz as we know it today out of business.”

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INDUSTRY ROUNDUP

Eye on Growth Casey’s General Stores Inc. closed a deal with Pilot Co. for 40 convenience stores. The $220-million acquisition marks the retailer’s entry into the Knoxville, Tenn., market. Alimentation Couche-Tard Inc. picked up Slidell Oil Co.’s 17 convenience stores operating under the Purple Cow banner. The pact also included 23 wholesale fuel accounts across Alabama, Mississippi and Louisiana.

Amoco and BP fuels to 19 Rushco Markets stores and one commissioned marketer location. Quik Mart Stores Inc. is selling its 17-store chain to Southwest Convenience SPE LLC. Fifteen of the stores are owned by Quik Mart in fee, and two are subject to long-term leases. Eleven of the 17 stores sell fuel. Southern Counties Oil Co. dba SC Fuels sold its business to Pilot Co. SC Fuels offers fleet card programs and operates 47 proprietary cardlock locations. Shell New Energies U.S. LLC, a subsidiary of Royal Dutch Shell plc, is buying Savion LLC from Macquarie’s Green Investment Group. The deal will enable Shell to expand its global solar portfolio.

These sites add a combined 380-plus truck parking spaces and 230-plus jobs to the company’s network.

Love’s Travel Stops opened five new locations in just 24 hours. On Dec. 15, Love’s opened travel stops in Heflin, Ala.; Kimball, S.D.; Fillmore, Utah; and Leavenworth, Ind. On Dec. 16, a travel stop opened in Klamath Falls, Ore. Rusher Oil Co., operator of Rushco Food Stores Inc., sold its assets to SampsonBladen Oil Co. Rusher Oil distributed

Refuel Market welcomed customers to a new convenience store in the Point Hope community of Charleston, S.C. The retailer also expanded further into the Myrtle Beach, S.C., region with a new store on Highway 544. PetroCard Inc. finalized its acquisition of the assets of Marc Nelson Oil Products LLC (MNOP). MNOP operates bulk fuel locations in Oregon, and a network of Pacific Pride and CFN commercial cardlock fueling stations.

FAST FACTS

$1.7B 63% 1/3 Ready-to-eat popcorn generated $1.7 billion in sales as of Oct. 31, 2021, an increase of 9.1 percent from the prior year. Compared to 2019, sales are up 18.7 percent.

Slightly more than two-thirds of Americans, or 63 percent, say they are more likely to order a sandwich if it is made with a unique bread/carrier, such as biscuits, waffles or croissants.

More than one-third of consumers indicate that their pandemic-hardened buying habits will endure even after the pandemic ends.

— National Confectioners Association

— General Mills Foodservice & The Harris Poll

— AlixPartners

14 Convenience Store News C S N E W S . c o m

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INDUSTRY ROUNDUP

Retailer Tidbits 7-Eleven Inc. is teaming up with Drizly to offer alcohol delivery in less than 60 minutes from more than 1,200 of its convenience stores. The pact follows a successful pilot program at 190 7-Eleven stores.

has been in the pipeline since the retailer launched Snappy’s Rewards in spring 2020.

Since December 2019, the company has increased wages by 40 percent.

Rutter’s bumped up its starting wage to $16 an hour. Employees at its corporate headquarters are also receiving a 10-percent wage hike. This marked the third time Rutter’s increased wages in 2021 and the fifth time in two years. Kwik Trip Inc. eliminated the option for customers to pay inside for fuel in an effort to improve customer service. As of Jan. 3, guests must pre-pay or pay at the pump for their fuel purchases vs. filling up and then going inside the convenience store to pay. Snappy’s Convenience Stores is launching mobile food ordering at four Snappy’s Grille locations in Pennsylvania. Mobile ordering

GPM Investments LLC joined with Sbarro to open new restaurants inside four Village Pantry stores in Indiana. Two of the locations were slated to open in December, with the other two anticipated to open in early 2022. BP is installing automated self-checkout at 10 Amoco and ampm convenience stores. The Grabango-powered stores will go live to shoppers in mid-2022. Sheetz Inc. tapped DoorDash to offer on-demand delivery of food and convenience essentials from more than 560 of its stores. Customers can place a Sheetz order for delivery through DoorDash’s website or mobile app.

Supplier Tidbits PDI acquired digital promotions provider Koupon. The combined companies will help retailers secure shopper marketing and trade funds from brands to drive promotions. Krispy Krunchy Chicken received a strategic growth investment from Main Post Partners. The private equity investment firm wants to grow awareness of the brand’s offering.

The centers now focus on three capabilities: the Global Customer Insights Center, the Mobile Customer Innovation Center, and the Hershey Insights Network.

The Hershey Co. revamped its Hershey Insights Centers. The facilities are designed

16 Convenience Store News C S N E W S . c o m

to offer customers the opportunity to develop strategic plans based on retail growth initiatives and the manufacturer’s shopper insights. NCR Corp. published a report on the top retail trends for 2022. They include the impact of labor challenges, micro-fulfillment and its effect on transforming stores, and cryptocurrencies going mainstream. IRI launched IRI Lift for Facebook. Through the program, consumer packaged goods manufacturers and retailers can measure the offline sales impact of their ad campaigns across Facebook and Instagram. The Technology & Services Industry Association (TSIA) honored Diebold Nixdorf as a winner in the “Best Practices in the Delivery of Field Services” category of TSIA’s 2021 STAR Awards. Diebold Nixdorf won for its DN AllConnect Data Engine.

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ADVERTORIAL

SPEAKING WITH...Paul Marobella, President and CMO, Republic Brands

he convenience store landscape is changing as sales of traditional cigarettes decline and interest in electric vehicles threatens fuel sales. Convenience Store News asked Paul Marobella, President and CMO of Republic Brands, to discuss how the company’s portfolio of products can help stores future-proof their business and become a one-stop shop for roll-your-own products.

Convenience Store News: For more than 50 years, your company was known as Republic Tobacco. In 2020, you rebranded as Republic Brands. How does that reflect your approach to the convenience category? Paul Marobella: Republic Brands is the world’s leading rolling company that you’ve most likely not heard of — yet. The landscape is changing, and consumers are embracing the roll-your-own (RYO) and makeyour-own (MYO) experience. Our rebrand represents our comprehensive portfolio of brands and products encapsulating the entire opportunity in RYO and MYO. In many ways we’re like manufacturing companies that thrive in the convenience channel — a parent company that owns, markets, and distributes some of the world’s most iconic brands. In our case, it’s rolling papers and accessories from legacy international brands like OCB

CSN_QA_republic_Jan 2022 issue.indd 1

and JOB, and iconic American brands like TOP, Largo, Premier and Gambler to name just a few. Our research shows that c-store consumers are exploring RYO and MYO options — and Republic Brands offers stores a comprehensive selection of high-quality, all-natural rolling papers and accessories that customers love and trust. C-stores are uniquely positioned to corner this market by becoming the first and only destination consumers stop at when they want their RYO and MYO products — a big plus in this changing landscape. I see convenience stores as the number one place consumers visit to pick up a booklet of OCB Rolling Papers, JOB Cones, or the TOP, Gambler, or Premier brands.

it represents our vertically-integrated manufacturing and supply chain that spans the US, Europe and Africa (where our natural Acacia gum is responsibly harvested for all our papers including our tubes, cones and booklets). By owning our supply chain, we’re able to better meet the evolving demands not only of consumers but of our important convenience store customers. We plan to transform our consumer brands and drive innovation in tandem with the monumental market shift happening now. Our goal is to lead Republic’s 50-year vision alongside convenience stores to meet the rising demand amid an extraordinarily rapid expansion in the RYO market.

CSN: You’ve coined the term ‘From Plant To Puff.’ Why is that important? PM: Consumers appreciate taking a moment to enjoy the little things in life. That’s what RYO is all about. What separates us is our unique “Plant To Puff ” operating philosophy;

CSN: How can partnering with Republic Brands help stores become the place customers think of when looking for papers and accessories? PM: It’s a prime opportunity for convenience stores to partner with an established, growing company. They’re in

the perfect position to capitalize on the once-in-a-lifetime growth opportunities the rolling category will experience over the next decade. The historic shift in market dynamics in the United States offers the ability to connect with convenience shoppers in new, highly relevant ways. Convenience stores offer consumers better hours of operation than other retailers do. They’re also a place where customers can pick up a variety of items like food and drinks. They already offer a one-stop shopping experience — so by adding Republic Brand products, c-stores can and should become the place consumers go when they’re low on RYO and MYO products. We’re excited about raising Republic Brands’ profile and telling the amazing brand stories that live within our company. We’re also energized that convenience stores can take advantage of this remarkable shift in RYO and MYO trends. FOR MORE INFORMATION, VISIT REPUBLICBRANDS.COM

1/3/22 10:21 AM

NEW PRODUCTS

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1. White Owl Swirl Triple Grape Cigarillos White Owl brings a new limited-edition Swirl variety to the market. White Owl Swirl Triple Grape Cigarillos, which launched Jan. 3, blend red, black and green grape flavors, complemented by a triple wrapper. The new product is available in competitive “2 for 99¢” and “Save on 2” formats that allow for retail pricing flexibility. White Owl Swirl Triple Grape Cigarillos are part of the launch of an all-new consumer loyalty program, White Owl Bird Bucks, with points redeemable for exclusive White Owl merchandise.

2. Funny Water Funny Water is an alcoholinfused water with natural flavors, electrolytes, antioxidants, and no bubbles. According to the product’s founders, they saw an opportunity for a non-carbonated, low-ABV alternative in a market increasingly dominated by hard seltzers and craft beers. Featuring a 3.75 percent ABV, Funny Water is most similar in taste to a spa water, with alcohol. It is available in 12-ounce variety packs that include three flavors: Watermelon, Citrus, and Cucumber Mint.

3. Dynamite Pixie Shots

4. Jelly Belly Sugar-Free Gum

Dynamite Pixie Shots are not your typical energy shot. They do not contain water, and no water is needed to consume them. Each tube is filled with a delicious candy-like powder containing Phoenix Energy’s patent-pending Mood•Focus•Energy formula. The sublingual effect makes for a faster and more efficient delivery system, according to the maker. Dynamite Pixie Shots are smaller and more conveniently sized for anytime use.

Jelly Belly Candy Co., the maker of Jelly Belly jelly beans since 1976, in partnership with Ford Gum introduces a new product format under the brand. Jelly Belly Sugar-Free Gum is now available in four iconic Jelly Belly jelly bean flavors: Very Cherry, Watermelon, Island Punch, and Berry Blue. All four varieties of the sugarfree gum come in traditional blister packs of 12. The Watermelon and Berry Blue varieties additionally come in a 55-piece jar.

Funny Water Chicago Phoenix Energy distribution@funnywater.com Boise, Idaho funnywater.com phoenixenergy.com

Swedish Match Richmond, Va. swedishmatch.com

5. Rich’s Fully Finished Glazed Donuts Rich Products Corp. introduces a line of Fully Finished Glazed Donuts. Available in convenient tray packaging, varieties include: glazed yeast ring donut (48 per case); glazed cinnamon roll donut (32 per case); glazed apple fritter donut (32 per case); and plain cake ring donut (48 per case). All of the Fully Finished Glazed Donuts boast a stable glaze that does not degrade over time, a soft texture, and a longer ambient shelf life in the bakery case: 48 hours for the yeast donuts and 72 hours for the cake donuts. Rich Products Corp. Buffalo, N.Y. richsusa.com/fully-finished-donuts 20 Convenience Store News C S N E W S . c o m

Ford Gum & Machine Co. Akron, N.Y. (800) 323-9380 jellybelly.com

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6. Natural Delights Mini Medjools & Snack Boxes Natural Delights debuted a range of new convenient treats made with Medjool dates at the recent NACS Show. They include Mini Medjools, available in six varieties and made with ingredients such as nut butters, seeds, nuts and fruit; and Snack Boxes, featuring a three-count pack of Natural Delights Pitted Medjool Dates and a six-count pack of Mini Medjools. Medjool dates continue to grow in popularity as they are an ideal snack on their own and as a main ingredient in snack foods, according to the company. Natural Delights Yuma, Ariz. naturaldelights.com

7. Crunchmaster Bistro Crisps Crunchmaster Bistro Crisps are guilt-free gourmet snacks containing only 120 calories for 63 crisps. Made with Cassava Root, a gut-friendly root vegetable, the bite-sized crisps are popped, not fried, leaving them light, crispy, and full of flavor. They contain no artificial flavors, zero grams of trans fat, and zero milligrams of cholesterol. They are also grain free, paleo, vegan, gluten free, non-GMO and kosher. Crunchmaster Bistro Crisps are available in three flavor varieties: Vegan Cheddar, Nacho, and Margherita Pizza. TH Foods Inc. Loves Park, Ill. crunchmaster.com

8. European Fully-Baked Danish Pastries Schulstad Bakery Solutions unveiled its new line of European Fully-Baked Danish Pastries at the recent NACS Show. The line offers authentic taste and quality without the need of an oven. The Danish pastries are available in three varieties: Maple Pecan Plait, Apple Crown, and Raspberry Crown. The iced pastries come in small trays, making them ideal for foodservice operators looking for more convenient ways to offer high-quality baked goods without extensive effort or labor, according to the maker.

9. BIC Shop Talk Lighter Series BIC introduces the special-edition Shop Talk Lighter Series. The fun and witty designs ensure that retailers “nail it” with hardworking consumers, according to the company. All lighters in the Shop Talk Lighter Series have a suggested retail price of $2.09 per lighter. BIC Maxi Lighters are long-lasting, reliable, and 100 percent quality inspected. BIC Shelton, Conn. us.bic.com

Lantmännen Unibake USA Inc. Lisle, Ill. schulstadusa.com

10. Hempire Cones Swisher expanded its Hempire product line to include hempbased bulk cones. Made from pesticide-free organic hemp, Hempire Cones are designed to deliver a clean, smooth and slow-burning smoking experience. Like other Hempire products, the cones are vegan, non-GMO, and maintain their all-natural characteristics by remaining completely unbleached and unflavored and containing no synthetic colors or dyes. Hempire Cones are available in bulk units in the three most popular bulk cone sizes of 1 1/4, 98mm and King. Prices range from $62 to $88 for a box holding up to 1,440 cones, and $372 to $528 for a case containing up to 8,640 cones. Swisher Jacksonville, Fla. swisher.com/businesses/hempire 22 Convenience Store News C S N E W S . c o m

LEGAL NOTICE

Purchased Broiler Chicken Indirectly for Commercial Use Since 2008? You Could Get Money from Class Action Settlements Totaling Approximately $103 Million

Defendants Amick Farms, LLC, Fieldale Farms Corporation, George’s Inc. and George’s Farms, Inc., Mar-Jac Poultry, Inc., Mar-Jac Poultry MS, LLC, Mar-Jac Poultry AL, LLC, Mar-Jac AL/MS, Inc., Mar-Jac Poultry, LLC, and Mar-Jac Holdings, Inc., Peco Foods, Inc., Pilgrim’s Pride Corporation, Tyson Foods, Inc., Tyson Chicken, Inc., Tyson Breeders, Inc., and Tyson Poultry, Inc. (collectively, “Settling Defendants”) have agreed to Settlements resolving claims that they conspired to ﬁx prices and manipulated the supply of broiler chickens (“Broilers”), which may have caused businesses to pay more for Broilers. Broilers are chickens raised for meat consumption which are sold in a variety of forms, including fresh or frozen, raw or cooked, whole or in parts, or as a meat ingredient. Settling Defendants deny these claims. The Court has not made any ﬁnal decision as to which side is right.

AM I INCLUDED? Your company may be included if, from January 1, 2008, through July 31, 2019, it indirectly purchased Broilers from a Defendant or co-conspirator in the United States for use in commercial food preparation. The largest categories of purchasers included are businesses that purchased Broilers through distributors such as restaurants, grocery store deli counters that commercially prepare meals, and institutional purchasers such as nongovernmental hospitals, nursing homes, and schools. A more detailed notice, including the exact Class deﬁnitions and exceptions to Class membership, is available at www.chickencommercialsettlement.com.

WHAT DO THE SETTLEMENTS PROVIDE? The Settlements provide for the combined payment of approximately $103 million in cash to the Settlement Classes to resolve all Settlement Class claims against the Settling Defendants and their aﬃliates. If the Settlements are approved, the Settling Defendants will be dismissed from the case. The Settling Defendants have also agreed to certain types of cooperation in the pursuit of claims against the other non-Settling Defendants and certain Settling Defendants have agreed to injunctive relief.

HOW CAN I GET A PAYMENT? In order to be eligible to receive a payment from the Settlements you must submit a valid Claim Form no later than March 2, 2022, and have made your indirect Broiler purchase in one of the following states: Arizona, California, Connecticut (only for the Amick Farms settlement), District of Columbia, Florida, Hawaii, Illinois, Iowa, Kansas, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, West Virginia, and Wisconsin. You may submit a Claim Form either online or by mail. More details about how the funds will be allocated and the Claim Form are available at www.chickencommercialsettlement.com.

WHEN WILL I GET A PAYMENT? Payments from the Settlements will not be distributed until the Court grants ﬁnal approval of the Settlements, any objections or appeals are resolved, and all claims have been processed and veriﬁed. Updates will be provided on the website at www.chickencommercialsettlement.com.

WHAT ARE MY RIGHTS? If you do nothing, you will be bound by the Court’s decisions concerning these Settlements. If you want to keep your right to sue one or more of the Settling Defendants regarding Broiler purchases, you must exclude yourself from the Settlement Classes in writing by March 2, 2022. You may exclude yourself from one or more of the Settlements. If you exclude yourself from a Settlement, you will not be eligible to receive money from that Settlement. If you stay in the Classes, you may object to one or more of the Settlements in writing by March 2, 2022. The Settlement Agreements, along with details on how to exclude yourself or object, are available at www.chickencommercialsettlement.com.

THE FINAL FAIRNESS HEARING? The U.S. District Court for the Northern District of Illinois will hold a hearing on April 18, 2022, at 10:00 am, at the United States District Court for the Northern District of Illinois, 219 S. Dearborn Street, Chicago, IL 60604 to consider whether to finally approve the Settlements. Class Counsel will also request service awards in an amount not to exceed $15,000 per class representative, attorneys’ fees of up to 35% of the Settlement Funds, and reimbursement of litigation costs and expenses not to exceed $10,658,854.99. You or your own lawyer may appear and speak at the hearing at your own expense, but you do not have to. The hearing may be moved to a different date or time or may be held by video conference without additional notice, so it is a good idea to check the above-noted website for additional information. Please do not contact the Court about this case. If the case against the other Defendants is not dismissed or settled, Class Counsel will have to prove their claims against the other Defendants at trial. Dates for the trial have not yet been set. The Court has appointed the law firms of Cotchett, Pitre & McCarthy, LLP and Gustafson Gluek PLLC to represent Settlement Class Members.

For More Information: 1-800-983-6533/www.ChickenCommercialSettlement.com

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Convenience Store News: It is mission critical for c-stores, facing encroaching competition from all channels, to be retail ready. How can Siffron help c-store operators venture into new categories shoppers demand while maximizing the profits in their existing footprints? Robb Northrup: Siffron has been in the retail display and fixture business for more than 60 years. We offer over 6,000 retail fixtures, including shelf management systems, peg hooks, Data Strip, loss prevention, and stock displays. We offer solutions across the store, not just in one category. With our whole store solutions, retailers can consolidate vendors for maximum efficiency. Siffron can work with retailers to optimize categories to reflect changing consumer shopping habits. For instance, we can convert cooler cases into fresh produce areas or turn refrigerated cases into readyto-go meal displays.

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CSN: In addition to housekeeping, how can you maximize shelf productivity? RN: The SKU-intensive candy category is a good example of how our ﬁxtures can compress space and maximize the productivity of a high-traffic, impulse area. Using our NEXT™ Pusher Tray system, we can typically get 25 to 30 percent more facings into the space where products are typically hung on peg hooks or packed onto shelves. That means more product availability, more facings to sell, and each and every product is brought up to the front to make every product visible and available for customers. Another example of how we boost results and elevate the shopping experience is where we add LED lighting in high-interest, high-impulse areas. We’ve found an 18 to 20 percent sales lift in a category when you add our Allura LED lighting. You realize your return on investment within a few months through the sales lift of that category.

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CSN_Siffron_ QA_Jan 2022 issue.indd 1

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12/16/21 4:10 PM

SMALL OPERATOR

Dark Days Ahead? The economic pressures of the ongoing COVID-19 pandemic have left the convenience channel’s small operators feeling less optimistic about 2022 By Danielle Romano WHAT A DIFFERENCE a year can make. After heading into 2021 with a glasshalf-full headspace, the convenience store industry’s small operators (those operating 20 stores or less) appear to see dark clouds overhead as they consider their business prospects for 2022.

Company View of U.S. Economic Conditions in 2022

6% 28%

The small operators surveyed for the 2022 Convenience Store News Forecast Study are feeling the continued unprecedented economic pressures brought on by the ongoing global coronavirus pandemic. Sixty-seven percent of them view the U.S. economy in a negative light, a 38-point increase when compared to their outlook heading into 2021.

50%

28%

67%

At this stage in the pandemic, only six percent of small operators report a sunny disposition on the economy, compared to 50 percent of c-store chain operators (those with 21 stores or more). When asked about their respective businesses, a lower percentage of small operators this year predict their sales will increase year over year — 50 percent this year vs. 69 percent in the 2021 study. Thirty-nine percent of small operators predict their sales will stay the same, while the remaining 11 percent believe their sales will decrease in 2022. On a scale of one to five — where 1 represents “Terrible, wake me up when it’s over” and 5 represents “It’s going to be our best year ever!” — less than a quarter of small operators (22 percent) rated their optimism at a 2, while 39 percent each chose a rating of 3 or 4. No small operator surveyed this year gave their 2022 business outlook a rating of 5. When it comes to the factors that will impact their sales and profitability in 2022, the convenience store industry’s small operators’ top three concerns are labor turnover and hiring (cited by 78 percent), motor fuel prices (56 percent), and the COVID-19 pandemic (33 percent). These concerns

26 Convenience Store News C S N E W S . c o m

22% Small Operators Very/slightly positive

Large Operators Neutral

Very/slightly negative

Expectations for Average Sales Per Store in 2022 Decrease

Decrease

11%

Stay the same

Increase Small Stay the Operators 50% same

17%

Large Operators Increase

39%

Average % Expected Increase = 19%

78%

Average % Expected Decrease = 15%

Average % Expected Increase = 18%

Source: Convenience Store News 2022 Forecast Study

Average % Expected Decrease = 15%

SMALL OPERATOR

Overall Outlook for Business in 2022 are similar to the ones reported in the 2021 Forecast Study, when small retailers were also worried about declining foot traffic and new leadership in the White House. Other factors that small operators anticipate will affect their businesses in the year ahead are brick-and-mortar competition, tobacco and e-cigarette regulations, the rise in e-commerce, consumers’ changing expectations of “convenience,” and industry consolidation. Perhaps the best indicator of their on-thefence feelings about the coming year is the fact that only 22 percent of small operators say they plan to increase their store count this year vs. 94 percent of large operators who plan to do so. On the upside, no respondents indicate plans to decrease their total store count, which is consistent with the 2021 Forecast Study.

Boosting Their Bottom Lines Just 28 percent of this year’s smalloperator respondents expect that foot traffic to their stores will increase in 2022. The majority (61 percent) expect status quo. The other 11 percent are bracing for a decrease in foot traffic. One area in particular affecting small operators’ outlook on foot traffic is the expectation that cross-channel competition will increase in the year ahead, as cited by 67 percent of small operators in this year’s study. The top five channels small retailers say pose a threat to their businesses are dollar stores (cited by 56 percent), mainstream grocery stores (44 percent), quick-service restaurants (33 percent), online grocers (28 percent), and Amazon (22 percent). Despite their trepidations, small operators are determined to make their stores more attractive to consumers. This includes offering “enhanced convenience” services. Thirty-nine percent of small retailers currently operate a drive-thru, and 22 percent offer curbside pickup. In the year ahead, 6 percent plan to add a drive-thru, and 28 percent plan to add curbside pickup. Tapping into emerging retail technologies is also top of mind for small operators. Currently, 33 percent offer mobile payment at the pump and 28 percent offer mobile payment in-store.

It’s going to be

Terrible, wake me 1 when it’s over

5 our best year ever!

22%

39%

Small Operators

39%

56%

Large Operators

Anticipated Impact of Issues on Sales & Profitability in 2022 (% of Small Operators identifying as “Biggest Impact” and in Top 3) Labor turnover and hiring

33%

Motor fuel prices

11%

COVID-19 pandemic

11%

Brick-and-mortar competition

78% 56%

33%

11% 22%

Tobacco/e-cig regulations

6% 22%

Rise in e-commerce

6% 22%

Declining foot traffic

6% 17%

Demographic changes

6% 17%

Changing expectations of “convenience”

11%

Emerging technologies

11%

Industry consolidation

11%

RANKED BIGGEST IMPACT RANKED IN TOP 3

Expectations for In-Store Foot Traffic in 2022 Will increase

28%

Stay the same

Will decrease

61%

Source: Convenience Store News 2022 Forecast Study 28 Convenience Store News C S N E W S . c o m

11%

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SMALL OPERATOR

In the coming year, some small operators are planning to kick off initiatives around contactless shopping experiences: 22 percent plan to add contactless shopping via kiosks, 17 percent plan to add contactless shopping via app, and 11 percent plan to add contactless shopping using artificial intelligence/sensors.

Other initiatives topping the list for the new year include adding delivery both in-house and via a third-party service, as well as implementing ordering at the pump for in-store items. CSN

Biggest Cross-Channel Competitive Threats Dollar

56% 56%

Expectations for Cross-Channel Competition in 2022 QSR

33%

44%

Decrease

Amazon/Amazon Fresh

22%

28%

Small Operators

Stay the same

50%

67%

Online grocery sites

28%

Increase

39% Grocery

44% 22% Drug

22%

17%

39%

Stay the same

Mass

Large Operators

83%

Increase

28% 28% Fast casual

Small Operators Large Operators

17% 11% Enhanced Convenience Services Offered by Small Operators

Currently offer

17%

39%

33%

Plan to add

28%

17%

17% 28%

Mobile pay at pump

Mobile pay in-store

17% 17%

22% 11%

Drive-thru

17%

Curbside pickup

Source: Convenience Store News 2022 Forecast Study 30 Convenience Store News C S N E W S . c o m

In-house delivery

11%

Contactless using app

Third-party delivery

22% 11%

6% At-pump order for in-store items

Contactless using kiosk

Contactless using AI/sensors

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COVER STORY

STUDY 2022

NAVIGATIN G DETOURS HAS BECOM E A WAY O LIFE FOR T HE CONVEN F IENCE STORE IND USTRY, BUT 2022 BRING S SIGNS OF CAUTIO US OPTIMIS M AN A ND DH HO OP PE E.

A Convenience Store News Staff Report A YEAR AGO, as the calendar turned the page to 2021, the COVID-19 pandemic was casting a big shadow over the convenience store industry’s outlook on the year ahead. Now, as the calendar turns the page to 2022, the pandemic is still ever-present, but the c-store industry’s retailers, suppliers and wholesalers have become pros at navigating detours and finding new routes to satisfy consumers’ changing expectations for convenient shopping. Half of the convenience channel’s retailers, and a majority of the industry’s suppliers and wholesalers, are heading into this new year optimistic about their overall business prospects, according to the findings of the 2022 Convenience Store News Forecast Study. Read on to learn more about what the industry’s key players predict for 2022, the challenges they’re ready to meet, and what they have planned to boost their sales and profitability.

J ANUARY

20 22

Convenience Store News

RETAILER FORECAST

STUDY 2022

Seeing the Promise of a Better Year

C-store retailers are heading into 2022 with more optimism than they had a year ago By Linda Lisanti LAST YEAR AT this time, most U.S. convenience store retailers were on the fence regarding their overall business outlook for 2021 and considerably less optimistic than they were the year prior.

This year, things appear to be looking up. According to the results of the 2022 Convenience Store News Forecast Study, half of the c-store retailers surveyed feel positive about their overall business outlook for 2022 — an increase of 13 points year over year. On a scale of one to five — where 1 represents “Terrible, wake me up when it’s over” and 5 represents “It’s going to be our best year ever!” — 50 percent of retailers rate their expectations for 2022 at a 4 or 5. Most of the remaining half give the new year a noncommittal rating of 3. For comparison, the majority of retailers (62 percent) last year selected a rating of 3. Retailers appear to be more decisive in their viewpoints this year than they were last year at this time. Still, there is a small contingent of c-store operators that have a very bleak outlook on the coming year: 11 percent chose the “Terrible, wake me up when it’s over” option. This represents a 9-point increase year over year. Given the overall more optimistic outlook among retailers this year, it’s not surprising that more operators are planning to expand their store networks in 2022. Nearly six in 10 retailers (58 percent) intend to increase their store counts — up 9 points vs. a year ago. The remaining 42 percent say they will keep their network sizes as they are now.

Overall Outlook for Business in 2022 It’s going to be

Terrible, wake me 1 when it’s over 2

11%

39%

5 our best year ever!

47%

Expectations for Average Sales Per Store in 2022

Expectations for Average Profits Per Store in 2022

19%

64%

Decrease

Increase

Decrease

56%

Increase

Total Retailers

28%

25%

Average % Expected Increase = 18% Average % Expected Decrease = 15%

Average % Expected Increase = 18% Average % Expected Decrease = 18%

Stay the same

Source: Convenience Store News 2022 Forecast Study

in on the factors that will have the biggest impact on their sales and profitability in the new year. Even more so than last year when it was the second-ranked issue of importance, labor turnover and hiring is high on the minds of c-store retailers as they head into 2022. Nearly four in 10 operators pegged this as their top concern, while 72 percent put it in their top three.

Interestingly, when asked how they will grow their networks, many more retailers this year indicated they will utilize a combination approach of acquisitions and organic growth.

There are multiple dynamics at play when it comes to the labor issue, according to retailers. They cite an overall lack of applicants, a small pool of quality applicants, rising costs to both attract new employees and keep existing ones, a jump in job-hopping, and more.

The percentage of retailers who said they will only grow organically dropped by 20 points.

“People are afraid to work in a COVID world. We don’t have enough staff to meet demand, which places stress on the staff we have and can lead to turnover,” one retailer remarked.

Issues of Importance

These labor woes are negatively affecting store operations and ultimately trickle down to the customer experience, which can then have a lasting effect on brand perception.

As in past years, the 2022 CSNews Forecast Study asked retailers to weigh

34 Convenience Store News C S N E W S . c o m

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RETAILER FORECAST

“Less skilled hires result in less customer service results in less foot traffic. Rinse and repeat,” lamented another Forecast Study participant. Unfortunately, labor is not the only major challenge convenience retailers are having to contend with these days. Another issue top of mind is motor fuel prices. Ranked fifth last year, it is now the second-ranked issue of importance behind labor. High fuel prices have wide-ranging effects. They impact consumers’ decisions to travel, reducing miles driven and fill-ups needed. This leads to lower foot traffic at sites. And high fuel prices also mean less funds available for discretionary spending on in-store items. “We are getting close to $4 a gallon, which historically is when inside sales start to be affected,” one respondent pointed out. Last year’s No. 1 issue, the COVID-19 pandemic, is also still very much in the mix and rounds out retailers’ top three concerns for 2022. The pandemic will soon cycle through its second full year of affecting nearly every aspect of Americans’ daily lives. Still, retailers say continued uncertainty, fear and confusion are having an impact on their businesses. According to one retailer, the pandemic is “still too big of an unknown with vaccine mandates going to court and lockdowns coming and going.”

STUDY 2022

Anticipated Impact of Issues on Sales & Profitability in 2022 (% of Total Retailers identifying as "Biggest Impact" and in Top 3) Ranked Biggest Impact

Labor turnover & hiring

39%

72%

Motor fuel prices

53%

COVID-19 pandemic

28%

Tobacco/e-cig regulations

28%

Rise in e-commerce

11%

22%

Changing expectations of "convenience"

11%

19%

Declining foot traffic

19%

Emerging technologies

17%

Brick-and-mortar competition

14%

Industry consolidation

14%

Demographic changes

E-commerce competition

Expectations for Total Store Count in 2022

58% Increase store count

Optimism for profit growth is slightly weaker, with more than half of retailers (56%) expecting their total profits per store to increase in 2022. A quarter of retailers expect no change in their profits year over year, while 19 percent are anticipating a decrease. Inflation concerns appear to be driving the lower expectations for profits, as retailers note that they will either have to sacrifice margin or push prices up to maintain current margins. They worry, though, about higher prices hurting their foot traffic. “Inflation is bad and getting worse,” one retailer observed. 36 Convenience Store News C S N E W S . c o m

42% Stay the same

Approach for Increasing Store Count in 2022

62% Both

Sales & Profit Projections Despite the obstacles, nearly two-thirds of c-store retailers (64 percent) project their total sales per store will grow in 2022. Only 8 percent are bracing for a decline in sales, while the remaining 28 percent project their sales will stay the same year over year.

Ranked in Top 3

19%

Organic growth

Acquisitions

Source: Convenience Store News 2022 Forecast Study

To boost sales and profitability in 2022, c-store retailers are eying multiple initiatives from enriched foodservice offerings, to more aggressive loyalty programs and mobile app promotions, to data analytics programs, to the addition of “enhanced convenience” services. Currently, mobile payment at the pump (available at 53 percent of c-store retailers) and in-store mobile payment (available at 47 percent of retailers) are the most widely offered “enhanced convenience” services in the channel. In the coming year, an additional 19 percent of retailers plan to add mobile pay at the pump, and an equal amount plan to add it in-store. Other “enhanced convenience” services expected to increase in availability this year are at-the-pump ordering for in-store items (22 percent plan to add this), contactless shopping using a kiosk (19 percent plan to add), and curbside pickup (19 percent plan to add). CSN

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CATEGORY FORECAST

STUDY 2022

Holding the Line

Retailers expect to see more of the same in terms of sales for most product categories this year By Angela Hanson CONVENIENCE STORE OPERATORS projected

cautious optimism for 2021, with sales expected to hold steady in most product categories and grow in some. For 2022, c-store retailers largely expect to see more of the same for most categories, although the current supply chain disruptions and labor shortage have tempered optimism somewhat, resulting in shifts in minority opinions for some categories, according to the 2022 Convenience Store News Forecast Study. Categories with the greatest projected disparity between dollar sales and unit volume include motor fuels and tobacco, primarily due to rising prices. Other categories, such as prepared food, reflect the perception that things are improving — expectations for this category aren't as high as they were two years ago, but more retailers predict sales will see a bump this year. Here are the individual category forecasts for 2022, according to retailers:

Category Forecast: Motor Fuels

Decrease

On the other hand, c-store operators are far less confident about fuel volume. A quarter of retailers expect their average gallons sold per store to decrease, while 47 percent expect gallon sales to stay the same. Just 19 percent believe their gallon sales will rise.

19%

53%

25%

47%

Don't sell

36%

Stay the same

Increase

Don't sell

Increase

Decrease

Stay the same

DOLLAR SALES

GALLONS

Average % Expected Increase = 14% Average % Expected Decrease = 10%

Average % Expected Increase = 14% Average % Expected Decrease = 8%

Category Forecast: Cigarettes

19%

Decrease

Don't sell

MOTOR FUELS Expectations for motor fuels in 2022 are a mixed bag. Optimism about dollar sales is fairly widespread, as 53 percent of c-store retailers expect their average motor fuel dollar sales per store to increase, and 36 percent expect sales to stay the same. Both large and small operators are in agreement that fuel dollar sales are unlikely to decrease in 2022.

39%

Stay the same

36%

Don't sell

44%

Decrease

Increase

DOLLAR SALES Average % Expected Increase = 10% Average % Expected Decrease = 14%

19%

Increase

31%

Stay the same

UNIT VOLUME Average % Expected Increase = 12% Average % Expected Decrease = 10%

Source: Convenience Store News 2022 Forecast Study

Growth in electric vehicles and the increasing movement toward more fuel-efficient cars are among the trends retailers cite as having a likely effect on motor fuel sales in 2022. And Forecast Study participants overall agree on one particular problem: fuel prices.

can no longer afford to fill their cars, but the credit card companies are taking bigger chunks when the dollar amount of the transaction goes up," one retailer said. "We can't win."

"The cost of fuels is skyrocketing. People

"It is hard for the little man to compete with larger organizations,"

38 Convenience Store News C S N E W S . c o m

While large and small operators did not express significantly different sentiments about the category's 2022 prospects, some retailers point out a disparity in impact.

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1/4/22 9:19 AM

CATEGORY FORECAST

another retailer said. "Also, there are times that we run out and our supplier does not deliver in a timely manner."

TOBACCO Similar to motor fuels, pessimism is much higher in the cigarettes category when it comes to unit volume vs. dollar sales. Forty-four percent of retailers project that their average cigarette unit volume per store will decline in 2022, while 31 percent expect it to stay the same, and 19 percent expect an increase. While most c-store operators don't expect cigarette dollar sales to go down this year, they are fairly evenly split on whether average dollar sales per store will increase (36 percent) or stay the same (39 percent). Higher costs, whether driven by tax hikes or manufacturer price increases, are once again to blame, according to study participants, who tend to view the cigarettes category as a must-have yet increasingly challenging segment. "Tobacco is a drug for those that have to have tobacco," noted one retailer. “It is a needed product I feel I must carry to be able to keep a good percentage of my business. It is like trying to balance on the sharp edge of a knife; no matter which way you jump, you will find those that are against/for the product.” The majority of c-store operators do not expect to make changes this year to either the number of cigarette SKUs they offer or the amount of square footage they give the segment. However, the percentage of retailers that say they will decrease the number of SKUs (32 percent) and linear square footage (27 percent) both rose 4 points year over year. When it comes to the other tobacco products (OTP) category, retailer sentiment overall is more positive regarding this segment than for cigarettes. Half of retailers expect their average OTP dollar sales per store to increase in 2022. More large operators than small operators report that they foresee sales in this segment growing. Optimism is more tempered for OTP unit volume. Half of retailers expect volume to stay the same and 36 percent expect it to grow, in a near-reverse of their expectations for dollar sales.

42 Convenience Store News C S N E W S . c o m

STUDY 2022

Category Forecast: Other Tobacco Products

11%

Decrease

33%

Stay the same

50%

Don't sell

Increase

Decrease

Don't sell

36%

Stay the same

Increase

DOLLAR SALES

UNIT VOLUME

Average % Expected Increase = 10% Average % Expected Decrease = 16%

Average % Expected Increase = 9% Average % Expected Decrease = 20%

Category Forecast: Prepared Food

19%

22%

53%

22%

Decrease

Stay the same

Don't sell

Increase

Decrease

Don't sell

Stay the same

DOLLAR SALES Average % Expected Increase = 17% Average % Expected Decrease = 13%

19%

50%

Increase

UNIT VOLUME Average % Expected Increase = 15% Average % Expected Decrease = 12%

Source: Convenience Store News 2022 Forecast Study

Nearly two-thirds of retailers say the number of OTP SKUs they offer will stay the same in 2022, and 71 percent expect the square footage they devote to OTP to stay the same. Product costs, new products and the popularity of vaping are among the list of trends retailers cite as likely to have an impact on OTP’s performance this year. Flavor bans are also top of mind. "With increased vape and flavored tobacco bans, it is anticipated that more previous combustible cigarette smokers will return to

Mentos Gum Paperboard_Ad_EIQ_20211215_FA_OL.pdf

12/16/21

3:35 PM

CATEGORY FORECAST

using combustible cigarettes rather than these alternatives," one retailer pointed out. "While many combustible cigarette smokers will return to what they know, new product offerings make take the place of those products for these consumers," another retailer added.

FOODSERVICE Positive feelings about the foodservice category are rebounding after dropping sharply due to the COVID-19 pandemic. While expectations for 2022 are still far below the pre-pandemic projections for 2020, when 95 percent of c-store operators predicted their foodservice sales would rise, the number of retailers this year who expect foodservice dollar sales and volume to increase both rose compared to the 2021 Forecast Study.

they will increase the number of prepared food SKUs offered in their stores, up 16 points from a year ago. Expectations for square footage are split, with 41 percent of retailers saying they will increase space (up 19 points from last year) and 45 percent planning to keep it the same (down 21 points from last year). Retailers report they are prepared to spend a considerable amount (or have already done so) in order to meet the requests and needs of consumers who are seeking more options, healthier choices and quicker meals. Online ordering, social media advertising and third-party delivery are all expected to have a sizeable impact on prepared food this year. Supply chain disruptions and price increases are challenges to the category, as they are to other product segments, but retailers still see prepared food as one of the best opportunities to generate profit and boost the bottom line. "We are working harder at it because we have to make money somewhere," said one retailer.

Fifty-three percent of retailers predict their average prepared food dollar sales per store will increase in 2022, while 22 percent expect them to stay the same, and just 6 percent expect dollar sales to decline. This optimism is shared by convenience retailers of all sizes, with at least half of both large and small operators expecting dollar sales to grow. The projections for average prepared food unit volume per store are similar, with 50 percent of retailers expecting volume to increase and 22 percent expecting no change.

Foodservice beverages, which include hot, cold and frozen dispensed drinks, are largely expected to see sales consistent with 2021 levels this year, although the number of retailers that expect to see segment sales decline did fall slightly. Overall, 56 percent of retailers forecast average dispensed beverage dollar sales per store to stay the same, while 31 percent expect them to increase. Similarly, retailers believe dispensed beverage volume is likely to resemble 2021 levels, as 64 percent expect the average unit volume per store to stay the same and 22 percent expect it to increase. Unlike with prepared food, more than three-quarters of retailers say the number of dispensed beverage SKUs they offer and the square footage devoted to the segment will stay the same. It is also worth noting that the number of retailers that plan to add more SKUs fell 17 points to 9 percent, while the number of retailers that plan to decrease SKUs rose 8 points to 15 percent. Retailers are looking to increased morning foot traffic and innovative product offerings to boost dispensed beverages, but many acknowledge

A majority of retailers (55 percent) say

Category Forecast: Dispensed Beverages

Decrease

56%

Stay the same

Don't sell

Decrease

Don't sell

Average % Expected Increase = 11%

Average % Expected Increase = 10%

Average % Expected Decrease = 13%

Average % Expected Decrease = 19%

31%

Increase

DOLLAR SALES Source: Convenience Store News 2022 Forecast Study 46 Convenience Store News C S N E W S . c o m

64%

Stay the same

22%

Increase

UNIT VOLUME

STUDY 2022

uncertainty, particularly due to the ongoing effects of the pandemic. Rising prices are also a factor. One retailer predicted a "rebound of coffee, but slowdown on growth across the category with retail hikes.”

Category Forecast: Packaged Beverages

Decrease

Don't sell

Decrease

Don't sell

Others, though, point to the inherent appeal of the segment as a reason it will rebound. "There are those that want to dispense their own beverage, regardless of the negative feeling toward the COVID19 virus," another retailer remarked. "Especially young teenagers and a large number of adults that like to size their drinks."

PACKAGED BEVERAGES The packaged beverages category reaped the benefits of many consumers being unable or unwilling to purchase dispensed beverages early in the pandemic. Expectations for growth have settled down since then, but c-store operators are still confident the category will continue to perform well in 2022. More than four in 10 retailers expect their average packaged beverage dollar sales per store to increase this year, while half expect sales in this category to stay the same.

50%

Stay the same

58%

42%

33%

Stay the same

Increase

DOLLAR SALES

Increase

UNIT VOLUME

Average % Expected Increase = 8% Average % Expected Decrease = 6%

Average % Expected Increase = 9% Average % Expected Decrease = 20%

Category Forecast: Beer & Malt Beverages

25%

11%

53%

19%

53%

Decrease

Don't sell

Decrease

25%

Don't sell

Operators are somewhat more confident that packaged beverage unit volume will at least hold steady from 2021: 58 percent of retailers project average unit volume per store to stay the same, while a third of retailers expect it to increase. Most retailers say they will not change the number of packaged beverage SKUs they offer (62 percent) or their square footage for the category (79 percent). The percentage of retailers that plan to increase either SKUs or square footage also declined from last year. Energy drinks, flavor innovation and stronger demand for better-for-you beverages are among the trends retailers see having a significant impact in 2022. One retailer noted that "the single-purchase consumer is back," which should mean good things for packaged beverages. But rising prices and product outages may serve as stumbling blocks. "This is up to the distributors to fix," another retailer lamented. "Both Coke and Pepsi have decreased their flavor lines due

Stay the same

Increase

Stay the same

11%

Increase

DOLLAR SALES

UNIT VOLUME

Average % Expected Increase = 7% Average % Expected Decrease = 20%

Average % Expected Increase = 6% Average % Expected Decrease = 11%

Source: Convenience Store News 2022 Forecast Study

to closures and inputs being unavailable. The trucking industry has to get fixed!"

BEER & MALT BEVERAGES Like nonalcoholic packaged beverages, the beer/malt beverages category

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CATEGORY FORECAST

saw sales rise early in the pandemic as consumers turned to convenience stores for quick, in-and-out purchases of their favorite brews. C-store operators don't expect that kind of situational boost to repeat this year, but express generally positive sentiments for this section of the cold vault.

Category Forecast: Candy

11%

Decrease

Increase

Among the surveyed retailers that sell beer and malt beverages (a quarter indicated they do not), 70 percent expect their average dollar sales per store in the category to stay the same in 2022, while 26 percent think sales will increase. Average unit volume per store for the category is also projected to stay the same by 70 percent of the retailers who sell beer and malt beverages. Meanwhile, an equal percentage think volume will increase or decrease (15 percent for both). For the most part, c-store operators intend to keep the contents of their coolers and beer caves the same this year. Two-thirds say the number of beer/malt beverage SKUs they offer will stay the same, consistent with 2021 figures. The percentage of retailers that plan to keep the category's square footage the same rose 17 points year over year to 89 percent. The percentage of retailers that plan to expand either SKUs or square footage saw a significant decline, down 19 points and 21 points, respectively.

75%

Stay the same

78%

22%

Stay the same

Increase

DOLLAR SALES

UNIT VOLUME

Average % Expected Increase = 7% Average % Expected Decrease = 5%

Average % Expected Increase = 6% Average % Expected Decrease = 5%

Category Forecast: Salty Snacks

Decrease

Don't sell

Decrease

Don't sell

Notable category trends for 2022 include new brands and flavors, locally sourced products, and "beyond beer" offerings such as ready-to-drink cocktails. Some retailers speculate that the hard seltzer segment has reached saturation. Once again, retailers point to rising prices and product outages as among their frustrations in the packaged beverages category. "You can't sell what you don't have, and I can't whip up some Corona in the kitchen to try to make up for it," one retailer remarked.

CANDY The candy segment is another area where c-store operators largely don't expect sales to get worse, but also don't hold high expectations for improvement in 2022. Three-quarters of retailers expect their average candy dollar sales per store to stay the same in 2022, a notable jump from 2021’s projections. Conversely, the percentage of retailers that expect candy

48 Convenience Store News C S N E W S . c o m

67%

Stay the same

28%

Increase

67%

Stay the same

DOLLAR SALES Average % Expected Increase = 9% Average % Expected Decrease = 1%

25%

Increase

UNIT VOLUME Average % Expected Increase = 9% Average % Expected Decrease = 7%

Source: Convenience Store News 2022 Forecast Study

dollar sales to increase fell 10 points, now at 22 percent. Nearly eight out of 10 retailers forecast average candy unit volume per store to stay the same in 2022. The remaining retailers are evenly split on whether unit volume will increase or decrease (both at 11 percent). Status quo is also the overarching theme when it comes to SKU counts

STUDY 2022

and square footage dedicated to candy, as 83 percent and 94 percent of retailers, respectively, report that they do not intend to make any changes this year. Some c-store operators are concerned that price may have a particular impact on candy, driving customers to rethink treating themselves to small indulgences.

Category Forecast: Alternative Snacks

Decrease

Don't sell

Decrease

Don't sell

"The prices are going up and people are skipping this reward," observed one retailer. Others expect the biggest differencemaker to be focusing on the fundamentals of having the most popular SKUs on the planogram and keeping them in stock, as well as strategically placing products in high-traffic areas to improve impulse sales. "Candy/gum is a very high-profit planogram," noted another retailer.

SNACKS Similar to candy, retailers largely anticipate more of the same from the salty snacks category in 2022, although there is a bit more optimism for this segment. Approximately two-thirds of retailers (67 percent) say their average salty snack dollar sales per store will stay the same in 2022, while more than a quarter (28 percent) forecast an increase. The number of c-store operators expecting no change in sales has risen from last year's figures. Sentiment is very similar for projected unit volume per store, as 67 percent expect it to stay the same and 25 percent predict an increase. More than three-quarters of retailers plan to offer the same number of salty snack SKUs this year vs. 17 percent who plan to increase SKUs. Almost nine out of 10 retailers (89 percent) will keep square footage the same, while 9 percent expect to increase it. Continued interest in perceived-healthier snacks featuring seeds and grains is expected to have an impact on the category this year, as well as bold flavor varieties and spicy options. One operator predicts that Asian flavor profiles will jump in popularity. As with candy, retailers believe that focusing on the fundamentals will help them overcome challenges in the segment. "Salty snacks are high-impulse items also. Strategic placement, with fresh, competitive pricing is essential to success in this category," one operator stated.

67%

Stay the same

69%

19%

Increase

Stay the same

17%

Increase

DOLLAR SALES

UNIT VOLUME

Average % Expected Increase = 18% Average % Expected Decrease = 11%

Average % Expected Increase = 14% Average % Expected Decrease = 6%

Category Forecast: Edible Grocery

17%

Decrease

56%

Stay the same

17%

22%

61%

17%

Don't sell

Increase

Decrease

Stay the same

Don't sell

Increase

DOLLAR SALES

UNIT VOLUME

Average % Expected Increase = 10% Average % Expected Decrease = 16%

Average % Expected Increase = 10% Average % Expected Decrease = 14%

Source: Convenience Store News 2022 Forecast Study

Convenience channel retailers anticipate alternative snacks will follow a similar trajectory this year. Around two-thirds of retailers (67 percent) believe their average dollar sales per store of alternative snacks will stay the same, while 19 percent expect an increase. Just under seven in 10 retailers expect average unit volume per store in the segment to stay the same, while 17 percent expect alternative snack unit volume to rise. A significant majority of retailers (70 percent) intend to offer the same number of alternative snack SKUs this year. However, the 27 percent that plan to increase SKUs marks a 10-point increase from 2021. Nearly nine out of 10 retailers expect to keep the same amount of square

J ANUARY

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Convenience Store News

CATEGORY FORECAST

footage — a 9-point increase year over year. Some retailers expect the "continued movement toward non-traditional snacks," as well as demand for better-for-you items, to keep lifting the category.

Category Forecast: Non-Edible Grocery

14%

Decrease

19%

14%

67%

Don't sell

Decrease

Don't sell

"[It] all depends on the flow of the traffic," said one study participant.

EDIBLE GROCERY C-store retailers are adjusting their expectations for the edible grocery category this year due to diminishing consumer concerns about making longer shopping trips inside larger stores. "People are returning to mass retailers/ grocery stores for their grocery needs after the pandemic," said one retailer. "C-stores [are] becoming less important." The percentage of retailers that forecast their average edible grocery dollar sales per store to stay the same in 2022 rose to 56 percent, while the percentage that expect a decrease likewise rose to 17 percent. Just 22 percent believe dollar sales in the category will increase. Just over six in 10 retailers (61 percent) expect edible grocery unit volume per store to stay the same, while 17 percent expect it to increase, and 17 percent expect it to decrease. Nearly three-quarters of retailers plan to offer the same number of edible grocery SKUs this year, and 77 percent expect to maintain the same square footage. The percentage of retailers that plan to increase SKUs or square footage both declined by 9 to 11 points. Healthy offerings and the increased adoption of third-party delivery services may have a positive impact on edible grocery's future in the convenience channel, but some retailers are pessimistic that it will be a strong category post-pandemic. "Convenience purchases of eggs and milk just don't happen when you can call the grocery store and have your order ready for your car or even on your doorstep," said one respondent. "This is still for the person that forgot to pick something up and this is their last stop before home."

NON-EDIBLE GROCERY The percentage of retailers that expect to see no change in the non-edible grocery category this year also jumped up from 50 Convenience Store News C S N E W S . c o m

64%

Stay the same

Increase

Stay the same

Increase

DOLLAR SALES

UNIT VOLUME

Average % Expected Increase = 21% Average % Expected Decrease = 7%

Average % Expected Increase = 42% Average % Expected Decrease = 4%

Category Forecast: General Merchandise

17%

Decrease

50%

Stay the same

17%

31%

61%

19%

Don't sell

Increase

Decrease

Stay the same

DOLLAR SALES Average % Expected Increase = 18% Average % Expected Decrease = 7%

Don't sell

Increase

UNIT VOLUME Average % Expected Increase = 23% Average % Expected Decrease = 8%

Source: Convenience Store News 2022 Forecast Study

2021 projections. Nearly two-thirds (64 percent) believe their average non-edible grocery dollar sales per store will stay the same. Retailers that think dollar sales will increase or decrease are evenly matched at 14 percent each. Similarly, 67 percent of retailers expect average unit volume per store for non-edible grocery to stay the same, while 19 percent expect it to decrease, and just 6 percent think volume will increase.

STUDY 2022

The vast majority of retailers intend to keep non-edible grocery product SKUs and square footage the same year over year (both at 88 percent). For the most part, retailers anticipate supply issues, inflation and online shopping habits having more of an impact than specific product types. Some expect ecofriendly/green products to increase in popularity, while others are of mixed opinions on whether cleaning and sanitizing products will continue to be impactful in 2022. "The costs are going up and people buy less each," one retailer said.

GENERAL MERCHANDISE C-store retailers' expectations for the general merchandise category this year are largely the same as in 2021. Half of retailers expect their average dollar sales per store in the segment to stay the same. More than three in 10 (31 percent) project an increase in dollar sales. Average unit volume per store is even more likely to stay consistent year over year, according to the 61 percent of retailers expecting no change. Nineteen percent foresee unit volume rising, while 17 percent expect it to decline. About two-thirds of retailers (66 percent) plan to offer the same number of general merchandise SKUs in 2022, while one in five expect to increase SKUs. Seventy-one percent of retailers plan to keep the same amount of square footage for general merchandise, while 17 percent expect to increase it. Some c-store operators believe that general merchandise will see less demand as consumers return to their pre-COVID shopping habits, while others think the industry simply needs to rethink its offering in this category. "Expect to see more tech trends, more point-of-sale impulse items," said one retailer.

HEALTH & BEAUTY CARE Opinion on the future of the health and beauty care (HBC) category at convenience stores is shifting slightly this year. The largest proportion of retailers expects sales to stay more or less the same, but the percentage of retailers with negative expectations has risen vs. a year ago. Forty-seven percent of retailers expect

Category Forecast: Health & Beauty Care

25%

Decrease

47%

Stay the same

11%

25%

11%

17%

53%

11%

Don't sell

Increase

Decrease

Stay the same

DOLLAR SALES

Don't sell

Increase

UNIT VOLUME

Average % Expected Increase = 5% Average % Expected Decrease = 12%

Average % Expected Increase = 4% Average % Expected Decrease = 10%

Source: Convenience Store News 2022 Forecast Study

average HBC dollar sales per store to stay the same in 2022, while a quarter of retailers expect dollar sales in the category to decrease. C-store operators are even more likely to expect the status quo for unit volume, as 53 percent of retailers foresee average HBC volume per store staying the same, with 25 percent reporting that they expect unit volume to decrease. Three-quarters of retailers intend to offer the same number of health and beauty care SKUs this year, and 78 percent expect to maintain the same square footage, marking little change from a year ago. Large operators are more likely than small operators to have shifted their plans this year for both from "increase" to "stay the same." At least one retailer, though, is bullish on the HBC business. "This is our bread and butter," they said. "OTC categories must have the mostshopped SKUs, with a renewed focus on converting patients to house brand products to improve sales and profitability. Must have merchandise mix not available online." Some retailers connect pandemic recovery with a general interest in wellness. "Health and beauty is expected to increase as people reconnect face-to-face and become more wellness minded," another retailer predicted. However, rising prices, limited stock and online shopping are seen as issues likely to keep the category from growing, according to numerous operators. "Health and beauty is a very competitive category. Trends are extremely important, as well as competitive pricing," said one retailer. "We do not have the space that big boxes have, so we must be diligent in our product mix and pricing." CSN J ANUARY

20 22

Convenience Store News

SUPPLIER FORECAST

Cautiously Optimistic, But Still Realistic

A majority of the convenience channel’s suppliers and wholesalers feel good about their 2022 business outlook, though stumbling blocks remain By Melissa Kress

Company View of U.S. Economic Conditions in 2022 A NEW YEAR brings the promise of hope. As the two-year anniversary of the COVID19 pandemic inches closer in the United States, the new year brings with it hope for a return to normal — or as normal as 29% possible, considering how the pandemic Very/slightly has changed the convenience channel. Total negative

According to the results of the 2022 Convenience Store News Forecast Study, the channel's suppliers and wholesalers are cautiously optimistic as they head into 2022. Notably, 53 percent feel positive about U.S. economic conditions this coming year. This is down 1 point from a year ago, but far outpaces the 29 percent who report having negative feelings. When asked about their 2022 outlook for their respective businesses, more than half of the c-store industry’s suppliers and wholesalers (51 percent) said they are optimistic about prospects in the new year. However, the percentage who feel positive declined by 6 points while, at the same time, the percentage who feel negative jumped 13 points to 19 percent. Members of the supplier and wholesaler community are more bullish on their particular product categories. More than two-thirds (67 percent) feel positive about their product category, representing an increase of 13 points compared to a year ago.

The X Factors There are several factors in play when it comes to how suppliers and wholesalers view 2022. It should come as no surprise that chief among their concerns is supply chain issues. Specifically, 38 percent of this year’s respondents say supply chain issues will have the biggest impact on sales and profitability in 2022. Additionally, 78 percent rank this concern in their top three.

Suppliers/ Wholesalers

53%

Very/slightly positive

17%

Neutral

Overall Outlook for Business in 2022 It’s going to be

Terrible, wake me 1 when it’s over

5 our best year ever!

14%

29%

41%

10%

Overall Outlook for Product Category in 2022

24%

Very/slightly negative

Total Suppliers/ Wholesalers

Neutral

67%

Very/slightly positive

Source: Convenience Store News 2022 Forecast Study

study, are affecting prices as well as lead times, and finding alternative products is easier said than done.

"Currently, we are experiencing issues with our supply chain, and improvements do not look promising for 2022," one respondent commented.

"Almost every vendor is signaling difficulty. … Chasing down substitutions eats up time and effort for personnel," another respondent explained.

Supply chain woes, according to the

Labor turnover and hiring, and raw material costs, round out the top

52 Convenience Store News C S N E W S . c o m

STUDY 2022

three issues suppliers and wholesalers say will have the biggest impact on sales and profitability in 2022. Raw material costs last year ranked as the fifth biggest concern. Labor has been a major thorn in the convenience channel's side since the pandemic started to take a hold in the United States. Many suppliers and wholesalers contend that it is hard these days to both find and keep qualified workers. "Labor costs are continuing to increase, and the supply of qualified and dependable employees is a challenge in this environment," one study participant pointed out. Last year, the top three supplier/ wholesaler concerns heading into 2021 were the COVID-19 pandemic, consumer spending growth, and new product development in their category. This year, those concerns fell in rank to fifth, seventh and eight places, respectively.

Convenience Is King Even with the challenges and stumbling blocks, the supplier and wholesaler community still has a favorable view of the convenience channel. According to this year’s study, a majority (71 percent) rate the current conditions in the convenience channel as positive. Compared to last year, they also indicate greater positivity toward mass merchandise stores and dollar stores, while sentiment about the convenience channel remained unchanged. However, that is not to say cross-channel competition is not heating up. Nearly 60 percent of the industry’s suppliers and wholesalers expect cross-channel competition against c-stores — including e-commerce — to increase in 2022. That's up two points vs. 2021. The biggest threat is online grocery sales, according to 47 percent of respondents. Compared to last year's competitive view, suppliers and wholesalers also see increasing threats coming from fastcasual restaurants (up 10 points vs. 2021), mass merchandise stores (up 4 points), quick-service restaurants (up 4 points), drugstores (up 3 points), and dollar stores (up 2 points). On the other hand, those members of the c-store supplier and wholesaler

Anticipated Impact of Issues on Sales & Profitability in 2022 (% of Total Suppliers/Wholesalers identifying as "Biggest Impact" and in Top 3) Ranked Biggest Impact

Ranked in Top 3

Supply chain issues

38%

78%

Labor turnover & hiring

19%

47%

Raw materials cost

12%

41%

Rising labor costs

31%

COVID-19 pandemic

22%

Increasing regulations

19%

New product development in category

14%

Consumer spending growth

12%

Consumer spending decline

12%

Retailer consolidation

E-commerce

Emerging technologies

Retailer unit expansion

Current Conditions in Retail Channels Company Works With VERY/SLIGHTLY POSITIVE

NEUTRAL

Mass

61%

Dollar

59%

Drug

17%

71%

Convenience

Grocery

VERY/SLIGHTLY NEGATIVE

12%

32% 26% 21%

57%

41%

44%

8% 15% 21% 15%

Expectations for Cross-Channel Competition Against Convenience Stores in 2022

Decrease

Total Suppliers/ Wholesalers

59%

Increase

38%

Stay the same

Source: Convenience Store News 2022 Forecast Study

community who view Amazon and Amazon Fresh as the biggest threat to the convenience channel dropped 8 points year over year — though it is still a notable number at 33 percent. CSN

J ANUARY

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Convenience Store News

TRENDS FORECAST

Embracing the New Normal

Operational challenges and changing consumer behavior will drive convenience store retailers to switch things up in 2022 By Melissa Kress AS THE CLOCK struck midnight on Jan. 1, 2022, it’s likely many people wished for a year when things return to normal — as in 2019 normal. However, as the global pandemic stretches into yet another year, it is becoming clear that the only normal headed our way may be a new normal.

Wanting to go back to normal and actually doing it are two different things. According to a recent survey by AlixPartners, there is rising optimism among U.S. consumers about returning to pre-pandemic habits once the smoke clears. Yet, large numbers of Americans plan to keep spending less or switch the products and brands they spend their money on — or do both, even after the pandemic ends. The poll by the New York-based global consulting firm found that 73 percent of consumers in the United States are optimistic about vaccines and about the future — which is up from 67 percent in AlixPartners’ previous survey, which was fielded in the winter of 2020. The most recent poll, released in November 2021, is the third wave of an ongoing, nine-country study of how the pandemic is changing priorities in sectors ranging from consumer products to retail to restaurants to travel and leisure. The latest survey revealed that more than a third of U.S. consumers say their pandemic-hardened buying habits will go on even after the pandemic ends — and of that group, 36 percent say they plan to keep spending less than they did pre-pandemic, and 20 percent say that while they plan to spend the same amounts, they will switch the product categories and brands they purchase. As if changing consumer behavior isn’t enough, the convenience channel also has operational challenges it is facing, including a labor shortage and supply chain disruptions. C-store operators will need to make adjustments and embrace innovation to satisfy the changing demands of the business in 2022. Here are a few of the trends the channel can expect to see in the year ahead:

Trying Something New Looking to win new customers in 2022? Give them something new to try. According to AlixPartners, 25 percent of U.S. consumers say they are interested in trying new food/grocery brands, and 37 percent are interested in trying new restaurant brands.

54 Convenience Store News C S N E W S . c o m

Micro-Fulfillment Will Play a Major Role As consumers increasingly welcome same-day delivery and curbside pickup, retailers have homed in on improving their last-mile delivery capabilities. Having the right technology has been, and will continue to be, crucial to efficiently manage micro-fulfillment, according to David Wilkinson, president/general manager of NCR Retail. One key example is retailers looking for their own e-commerce fulfillment system that can seamlessly blend in-store and online experiences, as well as integrate with existing software, all while being consumer-friendly. Another technology transforming microfulfillment is automation.

Turning Inventory Strategy on Its Head After coping with pandemic-driven supply disruptions and consumer demand shifts to online and omnichannel fulfillment, retailers are looking at 2022 as the year to revisit their inventory strategies across the supply chain, especially as it relates to getting inventory into the hands of customers, noted Nikki Baird, vice president of retail innovation at Aptos Retail. In 2022, she predicts retailers will flip fulfillment rules, replenishing stores from their e-commerce distribution centers if inventory is moving faster in stores than online, or holding back a replenishment order for stores and sending it to the e-commerce distribution centers instead if the opposite is happening.

STUDY 2022

Taking Sustainability One Step Further

Beverages Go Bold Driven by the long-term effects of the COVID-19 pandemic, the 2022 forecast for beverages is shaping up to focus on celebrating life’s simple pleasures while striving for balance, according to Flavorman, a Louisville, Ky.-based beverage development company. For instance, beverages will go big and bold; drinks with subtle displays of flavor have previously taken center stage, but that is likely to change this year as beverage makers seek ways to differentiate from their competition. Be on the lookout for flavor-packed, but guilt-free beverages.

Convenience store operators have been making sustainability a priority in recent years. But what if that sustainability push also meant they could stay open when consumers need them most? Budderfly, a Shelton, Conn.-based energy management company, projects that businesses in 2022 will move toward using solar power or geothermal heat pumps, and the batteries that store that power can serve as a generator or backup source of energy in the case of an outage. With micro-grids enabled, in difficult weather or when power systems are overloaded or unreliable, c-stores can stay open and still provide essential goods during emergency situations. CSN

Healthy Snacking Explosion Cooking fatigue from the pandemic combined with the trend of snacking as a meal replacement will continue to make healthy snacks even more popular in American life, according to Kim Baker Foods’ 2022 Food Trends Outlook. A growing consciousness around ingredients and nutrition is shifting diet trends, and plant-based snacking will continue to rise driven by strong growing interest among 18-to-24-year-olds and women.

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A Category in Flux — Again C-store retailers are cautiously optimistic about the vapor category despite its challenges By Renée M. Covino IT WOULDN’T BE the “e” category without constant eruption. Electronic cigarettes and vapor products are the subject of much attention in tobacco news and regulation, and convenience store retailers are responding with mixed reactions.

On the regulation front, the biggest news revolves around the Food and Drug Administration’s (FDA) still-ongoing decisions for or against the premarket tobacco applications (PMTAs) filed by suppliers for their electronic nicotine delivery system (ENDS) products. Under the PMTA pathway, manufacturers must demonstrate to the agency that, among other things, marketing of the tobacco product would be appropriate for the protection of public health. The FDA must approve PMTA bids for e-cigarette and vapor products to stay on the market. As of mid-December, the FDA had given the greenlight to just seven products. The agency handed out its first approval on Oct. 12, authorizing R.J. Reynolds

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Vapor Co.’s Vuse Solo END system and its accompanying tobacco-flavored e-liquid pods for the U.S. market. The FDA, though, also issued 10 marketing denial orders (MDOs) for the flavored ENDS products submitted under the Vuse Solo brand. On Oct. 19, the agency granted PMTA approval to four oral tobacco products manufactured by U.S. Smokeless Tobacco Co. LLC under the Verve brand. The products include Verve Discs Blue Mint, Verve Discs Green Mint, Verve Chews Blue Mint, and Verve Chews Green Mint. Verve, however, has been discontinued since 2018. Before authorizing a tobacco product via the PMTA pathway, the FDA puts it through the lens of: the likelihood that current tobacco users will stop using tobacco products; and the likelihood that current nonusers will start using tobacco products. The agency received PMTAs for more than 6.5 million tobacco products by its Sept. 9, 2020 deadline. As of late October, the FDA said it was close to wrapping up its sweeping review. The agency is already being sued for several of its refusals. Retail associations have been pressing the FDA to release a list of the ENDS products given denial orders

to date. In an Oct. 14 letter, five trade groups — NACS, Energy Marketers of America, FMI, NATSO and SIGMA — pointed out that the agency has a responsibility to inform regulated businesses of its decisions. “Our members do not need any confidential or detailed information about the products; they simply need to know the names of the products so that they can be identified and taken off the market,” the organizations wrote in the letter. “Asking the hundreds of thousands of tobacco retailers to verify the PMTA status of ENDS products with each manufacturer does not fulfill the agency’s responsibility to inform regulated businesses of its decisions.”

The Vapor Category’s Pros & Cons

The Retailer Perspective Tim Greene, category director at Smoker Friendly, told Convenience Store News that the chain has taken “a relatively conservative approach as it waits for the fallout of the PMTA process.” Still, the vapor category continues to perform well at Smoker Friendly’s stores, driven by disposables and leading pod-based brands. The Boulder, Colo.-based chain of 181 tobacco stores operating in eight states has decided to limit its disposable selection to just a handful of brands that it feels meet customer demand and have aspirations of longterm success, Greene said. “In addition, we are testing a few non-nicotine options in select markets. It’s too early to tell, but early returns are positive,” he noted. “We will continue to monitor the regulatory climate and adapt accordingly as customer demand, regulation and innovation dictate.” There’s a similar conservative undercurrent at Energy North Group, which owns and operates c-stores, gas stations and car washes throughout New England. “We are still gun-shy about adding any product that is non-returnable or non-guaranteed,” said Jonathan Ketchum, vice president of retail. “But having a larger assortment makes a bigger impact on the backbar and draws more attention to the category.” The retailer plans to continue monitoring the category on a weekly basis, and will perform a seasonal reset in the first quarter of 2022 based on consumer trends and spending. Currently, the category is outperforming total store sales by triple. Additionally, category sales are double 2020 numbers, and up by doubledigits compared to 2019 results, Ketchum said, crediting increased SKU and brand count, albeit conservatively. At Greenville, S.C.-based The Spinx Co., the vapor category has been consistent when looking at year-over-year performance in both sales and volume, according to Chris Dillard, tobacco category manager. The fourth quarter of 2021 was slated to bring some deep-discount and targeted promotions in the category, with a focus on driving foot traffic and volume through the end of the year.

“I’m cautiously optimistic on the e-vapor category as a whole and believe that post-PMTA, the category will continue to grow.” — Chris Dillard, The Spinx Co.

PROS: • Growth in the global e-cigarette market has accrued due to the changing consumer perception toward combustible cigarettes, a decline in the consumption of cigarettes, an upsurge in the working population, an uptick in tobacco cigarette prices, and peer influence among youths. • The fastest-growing regional market is the United States due to increasing awareness of safer tobacco alternatives, continuous efforts of anti-smoking organizations shifting tobacco consumers to alternative forms, and increased customer acceptance due to the cost-efficiency of these devices. • The e-cigarette market is anticipated to benefit from trends such as an upswing in Gen Z income, the emergence of flavored e-cigarettes, the increasing influence of social media, and the rise in technological developments by e-cig makers.

CONS: • Growth of the e-cigarette market will be challenged by stringent regulations, nicotine exposure in e-cigarettes, and surging concerns over the side effects of e-cigarettes and vapor products. • The pandemic is causing an adverse disruption through halted production and logistics activities, affecting the demand and supply of e-cigarettes around the world.

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“I’m cautiously optimistic on the e-vapor category as a whole and believe that post-PMTA, the category will continue to grow,” Dillard said. “However, we have been very conservative in our e-vapor product expansions, shying away from many of the ‘pop-up’ disposable companies pushing flavors. And given the recent denials from the FDA, we were smart to take this approach, with many of these products now having to be pulled from the market.” For 2022, Dillard believes the category will see a rise in “synthetic nicotine” and nicotine from fruits in an effort to bypass FDA regulation. He intends to take a conservative approach to all new products, including synthetic. “We want long-term, consistent growth in the category, offering reliable products and not taking an opportunistic approach to bringing in products and companies that are unproven,” he explained. “I’m all in for new products and testing new subsegments, but it must be done in a methodical manner with reliable manufacturing partners.” Another retailer expecting an uptick in synthetic nicotine products is Ray Johnson, operations manager for Speedee Mart, which operates 22 stores in Nevada. He says he is keeping category inventories low “cause I’m assuming the switch to synthetic is near; on the horizon.”

Looking Further Out In early October, the FDA in partnership with the Centers for Disease Control and Prevention (CDC) released the 2021 National Youth Tobacco Survey, which had a major focus on electronic cigarette usage this year. The survey revealed that an estimated 2.06 million U.S. middle and high school students are using vapor products, down from 3.6 million students in 2020, a drop of nearly 40 percent. However, the study’s authors cautioned that this year’s survey was conducted mostly online, and at home with parents around, and therefore cannot be compared to results from surveys done in previous years collected from classrooms.

“We will continue to monitor the regulatory climate and adapt accordingly as customer demand, regulation and innovation dictate.” — Tim Greene, Smoker Friendly

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Nevertheless, a recent Winston-Salem Journal article pointed out that the significant reduction in e-cigarette use so far during the COVID-19 pandemic could play an influential role in how much the FDA opts to further tighten regulations on the product sector. For instance, the survey found flavored e-cigarettes were consumed by 86 percent of high school users, compared with 29 percent using menthol e-cigarettes, so tobacco analysts believe it is likely all flavored e-cigs will be banned. Meanwhile, misinformation threatens progress toward a smoke-free future, according to a new international survey released by Philip Morris International (PMI). This survey — fielded among nearly 30,000 adults in 26 countries by independent research firm Povaddo and commissioned by PMI — revealed that many adult smokers remain unaware that better alternatives to cigarettes exist, are unable to access them, or are confused by false or misleading information that prevents them from making an informed choice. “People expect public health bodies and regulators to reach a scientific consensus around innovative smoke-free alternatives and provide adults who smoke with evidencebased information about these products,” said Gregoire Verdeaux, senior vice president of external affairs at PMI. “Misinformation about smoke-free alternatives — often based on opinion — is a persistent issue that is having realworld consequences.” Nearly half the adults surveyed believe wrongly that e-cigarettes and heated-tobacco products are more harmful than or equally harmful as cigarettes (45 percent and 46 percent, respectively). Asked why they have not considered switching to a better alternative, around a third of smokers surveyed cited lack of information about how these products differ from cigarettes (33 percent), uncertainty about the science (35 percent), and having easier access to cigarettes than alternative products (32 percent). According to PMI, the survey findings also demonstrate how accurate information about better alternatives can help smokers move away from cigarettes. The vast majority of adult smokers who have switched to a better alternative and stopped smoking (91 percent) confirmed that having accurate information about how these products differ from cigarettes was an important factor in their decision. Of adults who smoke, 63 percent said they would be more likely to switch to a better alternative (such as e-cigarettes or heated-tobacco products) if they had clarity on how these products differ from cigarettes and the science behind them. CSN

TECHNOLOGY

The 2022 Technology Hit List Frictionless checkout, all things digital, data management and labor optimization are the biggest priorities c-store operators have for technology implementation this year By Tammy Mastroberte

two years into the COVID-19 pandemic, its aftermath is still having a huge effect on all aspects of retail, including convenience stores and the industry’s technology priorities. Many retailers pivoted quickly when the pandemic hit with technologies initially on the backburner, or part of a five-year plan, moved up the list to priority status.

DESPITE BEING ALMOST

Touchless and frictionless technology, enhanced digital experiences, online ordering and delivery suddenly became must-haves, and the convenience channel jumped in headfirst to keep up with the changing consumer preferences.

“Safety is a key driver for customers in the convenience channel, and the pandemic brought a new awareness to safety concerns, accelerated consumer adoption of e-commerce, and increased interest in frictionless shopping,” Deb Hall Lefevre, executive vice president and chief technology officer at Alimentation Couche Tard Inc., the Laval, Quebec-based operator of more than 7,230 Circle K stores in the United States, told Convenience Store News. As the company focused on personal protective equipment (PPE), enhanced cleaning and plexiglass shields at the point-of-sale — along with other measures to demonstrate its commitment to safety — Circle K also worked to accelerate the testing of technology solutions such as touchless checkout options, and scaling on-demand home delivery, curbside pickup and click-and-collect — both as its own solutions and third-party relationships. “These solutions enabled us to pivot quickly during the pandemic, and we’ll

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continue to learn more about what works best for our customers,” Lefevre said.

pandemic — a lot more than I would have anticipated pre-COVID — and now, a more autonomous checkout is here.”

The same is true at Kwik Trip Inc., based in La Crosse, Wis., and operating more than 800 convenience stores. The pandemic pushed the company into partnerships with third-party delivery services, carryout and curbside options. Kwik Trip is still learning and evolving these options into 2022, according to Tom Colbert, director of IT for the chain.

Frictionless Fever

“We are integrating these options into our current system to try to alleviate any additional labor concerns to execute,” he explained. Frictionless checkout solutions — whether traditional self-checkout machines or mobile app options — are something that exploded during the pandemic, changing the trajectory for this technology substantially as COVID-19 accelerated its adoption, noted Patrick Thomas Raycroft, a partner with W. Capra Consulting Group, a firm based in Chicago. “Consumers figured out through COVID that they don’t see a lot of value spending time at a register, whether because of contact with someone or time,” said Raycroft. “A lot of checkout solutions were implemented with the

“With a stable and secure tech foundation, we are shifting more of our tech spend to drive the growth and transformation of our business to meet the evolving needs of our customers and team members.” — Deb Hall Lefevre, Alimentation Couche-Tard Inc. 60 Convenience Store News C S N E W S . c o m

For many c-store retailers, their top priorities for 2022 when it comes to technology implementation include frictionless shopping and checkout; all things digital; optimizing labor; and data collection, integration and analytics. Building out a frictionless self-checkout solution is top of mind for a lot of the major c-store chains, with some already testing a variety of options and others already in full rollout. This includes visual and artificial intelligence (AI) technology like what is used in Amazon Go stores — although there are still issues to work out when it comes to imaging and foodservice, according to Gabe Olives, chief information officer at Impact 21, a consulting company based in Lexington, Ky. “Everyone is looking to install self-checkout in one form or another, whether it’s allowing people to use their own device as a scanner, traditional self-checkout where one employee monitors several of them, or the imaging model like Amazon Go,” Olives said. “But while visual tech works great for an item on the shelf or in a cooler, it doesn’t for food encased in a bag or Styrofoam, so people still have to scan a barcode.” Circle K stores are testing Grabango checkout-free technology, which allows customers to shop while it tracks the items they pick up, and then they scan the code in the Grabango app to pay for their items. Several other c-store retailers are piloting Grabango. GetGo, the c-store arm of Giant Eagle Inc., based in Pittsburgh, Pa., and operating 266 locations, retrofitted four stores in the Pittsburgh market in September 2021, while BP announced the rollout of Grabango to 10 Amoco and ampm sites in California and Pennsylvania in December 2021. “At our retail lab store on the campus of McGill University in Montreal and in seven stores in Arizona, we are testing several fully frictionless store experiences that use computer vision and AI to enable customers to shop and pay while skipping the line, and carefully looking at how this drives customer satisfaction, shopper behavior and sales,” Lefevre said. Circle K is also continuing to focus on a countertop self-checkout solution that’s currently in more than 300 stores and automatically identifies, prices and totals items placed on a platform. “We are excited about the impact it’s having on checkout speed,” she said. Additionally, the chain is testing frictionless technology at the forecourt in all Circle K locations in Sweden, and will be expanding its pay-byplate option into new markets, according to Lefevre. This option uses license plate recognition technology so that drivers need only pull up, pump their fuel, and then pull away without even having to take out a wallet or phone. One hurdle with frictionless checkout that many retailers will be diving into, including Circle K, is how to handle age-restricted products. This is something the industry is already working on, especially since these types of products make up a large amount of c-store purchases. “It’s promising to see momentum building for a common age verification platform that can be used industrywide,” Lefevre said. “Platforms currently under development in partnership with NACS can help ensure that as an industry, we continue living up to our shared

TECHNOLOGY FOR YOUR FRESH FOOD PROGRAM BOHA! calculates exactly how much food to prep each day AND lets you print,on-demand FDA compliant, Grab ‘N Go labels. And that’s just the beginning. Learn about how our cloud-based system can help your C-Store with temp taking, refrigeration monitoring, task management, even inventory management and food production.

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TECHNOLOGY

commitment to responsible sales of age-restricted products as the technology continues to evolve.”

Digital Experiences & Data The continued migration and integration of digital experiences into the c-store is another big trend that will continue in the new year. This includes delivery, said Raycroft. “With COVID, many stores launched a lot of things because they had to, and many opted for third-party delivery. But a huge problem is these delivery companies own the customer, so now many chains are going to spend the next year or two figuring out how to claw back the experience and the data to make it more efficient as part of their own operation,” he noted. One option is for c-stores to leverage third parties for what they don’t want to do internally, which is often the actual delivery and fulfillment. However, Raycroft said they should aim to own the checkout experience, payment, loyalty, and everything that leads up to it. “The big conversations c-stores are starting to have are around data infrastructure and creating a core set of data integrations, so they can function and react quickly to new technology,” he explained. “It’s about a data foundation of common ways to extract, normalize and store data, so they can quickly bring in new technology into stores, including new digital experiences.” Master data and Internet of Things (IoT) will be focal points for Kwik Trip in 2022 as many of the devices in its stores are “becoming smart devices that can provide us data that will help make smarter decisions,” said Colbert. “Because of our vertical integration, we have a large software stack, and Master Data management will help put rules around the critical business data.” In fact, Colbert believes data should be top of mind for all c-store operators, because there are now so many data collection points available to them through their technology systems running in the store — from point-of-sale to loyalty and more. “We need to be able to decide what is important to consume and make better decisions and predictions with this information,” he said.

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“Consumers figured out through COVID that they don’t see a lot of value spending time at a register, whether because of contact with someone or time. A lot of checkout solutions were implemented with the pandemic — a lot more than I would have anticipated pre-COVID — and now, a more autonomous checkout is here.” — Patrick Thomas Raycroft, W. Capra Consulting Group

Optimizing Labor Convenience store operators are always looking for ways to free up store staff so that they can be more available to customers, while also saving on labor costs. This is one of the benefits of more advanced technologies like frictionless checkout, as well as other autonomous options. “Automation robotics is something a lot of retailers are looking at for inventory receiving and for tracking inventory using smart shelving — things normally done by staff members,” Raycroft pointed out. “Selfcheckout also reduces the amount of time store associates spend behind the counter and gets them closer to the buying experience, helping customers.” In addition to its focus on data in the new year, Kwik Trip is looking for technology that can help save labor at the chain’s stores, according to Colbert. And this is a focus for Circle K, too. “With a stable and secure tech foundation, we are shifting more of our tech spend to drive the growth and transformation of our business to meet the evolving needs of our customers and team members,” Lefevre explained. “This means more investment in technology and capabilities that enhance the experience for our customers, both in-store and on the forecourt, while also freeing up our store teams and giving them resources they need to deliver great service to our customers.” Circle K has been testing technologies to automate inventory management and food safety compliance, so it can “reduce the strain on our store staff and free them up to spend more time engaging with customers,” she said. The chain also will be keeping an eye on how autonomous driving and robotic automation will affect operations and impact the work experience for team members — both at the forecourt and in-store with tasks such as cleaning and food prep. “[The industry] should watch for how these technologies enhance supply chain operations such as picking, loading, and other tasks at warehouses and distribution centers,” she said. CSN

AN EYE ON D&I

Utilizing Allyship in the Workplace A recent Convenience Store News webcast explored why allyship is important and how c-store industry companies can join the movement By Danielle Romano THE BUSINESS BENEFITS

of diversity and inclusion efforts vary by company, but globally, industries understand they cannot afford to squander opportunities to do right through implementing effective DEI (diversity, equity, inclusion) practices.

She immediately helped establish an executive advisory board. Comprised of 50 percent men and 50 percent women, the board pledged to support DEI efforts across the company and set forth an internal mission for Couche-Tard to look more like the communities it serves, as well as its workforce.

One key part of the DEI equation is tackling the subject of allyship — the importance of getting non-minority leaders on your side to successfully implement an authentic and meaningful diversity program at your company.

Then, last March, Laval, Quebec-based Couche-Tard announced that its President and CEO Brian Hannasch had joined the CEO Action Pledge, a coalition of CEOs committed to advancing diversity and inclusion within the workplace. Couche-Tard became the first c-store retailer to join the initiative. To go along with this pledge, the retailer launched an internal global campaign titled “Together we make a difference,” where all employees had an opportunity to join Hannasch and make their own personal “I ACT On” pledge.

A recent webcast hosted by Convenience Store News and the CSNews Diversity & Inclusion Advisory Board explored the critical components of allyship, including what actions companies can take to advance the effort, how to recruit allies to effectively promote allyship, and how to foster productive conversations about differences.

Allyship in Action

“I took the pledge,” said Strand, whose native country is Norway. “What I’ve seen in Europe and North America is that if you really want to create change, you have to have everyone involved and represented. As an ally, it’s about engaging, listening, and trying to learn.”

All companies are not at the same place in their DEI journey.

In the distributor realm of the convenience channel, Elmwood, La.-based Imperial Trading Co. LLC has made sure to involve the younger generations in its DEI efforts.

At Alimentation Couche-Tard Inc., the parent company of Circle K, Chief People Officer Ina Strand acknowledges that the retailer began its journey a little late. Strand was brought into her role four years ago to advance gender equity.

For example, Imperial Trading President and CEO Wayne Baquet approached Marketing Manager Stacy Matthews with an initiative called the “Sun Shines For All,” which focuses on minority groups. Members of the task force were comprised of the executive team’s children who are currently in the workforce.

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“The idea behind this was twofold: One, they work for progressive companies to benchmark ideas; and two, we learn how much influence the younger generation has on those at Imperial and ultimately who are the allies that we desire to have work for us,” Matthews explained, noting that Imperial has two Black executives in leadership — Baquet and Chief Marketing Officer Emile Cantrell; no other wholesaler in the industry has this unique makeup.

Building Inclusiveness Technology can be used as an enabler of diversity and inclusion, Steven Kramer, co-founder and CEO of WorkJam, a frontline digital workplace platform, noted during the CSNews webcast. According to the executive, WorkJam has a diverse workforce based in Montreal, which is a diverse city. As part of the company’s DEI efforts, it builds inclusiveness into the organization’s values, flowing this mission from the top down. “We take a stand on issues. For example, we send companywide emails reaffirming values on inclusiveness. We also built collaboration software to use internally to keep channels open between team members to discuss things that happen outside of work to bring them together and build community,” Kramer explained. “It’s more than members talking to each other who may not have worked together because they work in different departments, but it’s people from all different backgrounds talking about their experiences,” he added. “This builds a sense of community within the organization, and we’re proud to have technology that enables our customers’ frontline workforce to do the same thing.” iSee Store Innovations, which was “founded by three old white guys,” is likewise evolving the company’s conversations to be more inclusive of culture and ethnicity by listening and learning, according to founding partner and CEO Joe Vonder Haar. The 28-year Anheuser-Busch veteran noted that when women began joining the iSee executive team, inclusive conversations surrounding childcare and accommodations for mothers became integral. Now, those conversations are progressing. “We’ve grown from being founded by three old white guys to a team of 18 so, by definition, we’re diverse on age and diverse in gender,” Vonder Haar pointed out. “We’re not quite 50/50, but we have women running operations and marketing, so it’s time for us to purposefully and actively add cultural and ethnic diversity to our company.”

Taking Action The 36 Lyn Refuel Station in Minneapolis, the city where George Floyd was murdered, sees customers from all walks of life and prides itself on being the “Cheers” of

“At the end of the day, we think of the word ‘ally’ as more of a verb because it’s something you do, and these are actions that speak more than words.” — Ina Strand, Alimentation Couche-Tard Inc. the convenience store industry, where every employee knows the guests’ names. In order for this symbiotic relationship to work, communication is key among the station’s owner, team members, vendors and suppliers. “It’s fun to engage in discussions with my staff or potential frontline employees, as well as engaging with vendors and suppliers, about issues that are important to me and the industry, and also different groups that we’re collaborating with to identify allies early on and to identify the goals we are trying to accomplish,” expressed Lonnie McQuirter, owner and director of operations for 36 Lyn Refuel Station. “There has to be a level of trust between my customer and me, my community and me, and my staff and me.” When asked what actions companies can take to advance allyship, the panelists said: • “Just get started. Don’t be afraid to open your mouth. You have to start the conversation at some time, no matter how vulnerable you feel. We have to have these conversations to have a better tomorrow.” — McQuirter • “Invest in people at all levels of the company. When employees feel valued, they align their focus with the values of the company. Some of the most effective solutions aren’t even designed with allyship in mind. I find that when initiatives are more organic, you get less resistance because if it doesn’t feel forced, it will increase the likelihood of it becoming successful.” — Matthews • “Be purposeful in what you do and be transparent to create alignment up and down the organization.” — Vonder Haar • “WorkJam technology was designed to bring people together and communicating. We say that communication equals respect.” — Kramer • “Educate. At the end of the day, we think of the word ‘ally’ as more of a verb because it’s something you do, and these are actions that speak more than words.” — Strand CSN

Convenience Store News is partnering with founding underwriter, Altria Group Distribution Co., and supporting sponsors The Hershey Co. and WorkJam, on a new c-store industry initiative around diversity and inclusion. The new platform is a multi-touch digital and print program that will focus on the business case for greater emphasis on diversity and inclusion in the convenience channel, and is designed to be a catalyst for discussion, innovation, engagement and action.

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1/6/2022 8:54:00 PM

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1/6/2022 8:54:01 PM

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ADINDEX Wholesale Refrigeration Add Systems.......................................17

National Confectioners Association..........................................32

Altria Group Distribution.................2 Perfetti Van Melle USA.....................43 A.B. Data, Ltd......................................23 Premier Manufacturing.....................39 BIC USA Inc.........................................5 Procter & Gamble..............................35 E-Alternative Solutions....................27 Republic Tobacco..............................18-19 Forte Products....................................32 siffron....................................................24-25 Furmano Foods..................................29 Sugar Foods Corporation................40-41 GlaxoSmithKline Consumer Health Care......................7 Hunt Brothers Pizza..........................15

Swedish Match North America.......21 Swedish Match North America LLC............................8–9

Island Lifestyle Importers................37 Swisher International, Inc................13 ITG Brands...........................................44–45 The Boston Beer Company..............84 King & Prince Seafood Corp...........11 TransAct Technologies Inc...............61 Liggett Vector Brands......................31

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Universal Merchant Services...........Polybag Mars Wrigley Confectionery...........1

JANUARY

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2022

Convenience Store News

1/6/2022 8:54:01 PM

INSIDE THE CONSUMER MIND

Pandemic-Driven Spending Habits Are Here to Stay A significant number of Americans are reconsidering the meaning of essential spending Despite rising optimism regarding an eventual return to pre-pandemic life, a large number of Americans say that even after the COVID-19 pandemic ends, they plan to keep spending less, or switch up the products and brands they spend money on — or do both, according to a consumer survey recently released by global consulting firm AlixPartners. The poll was conducted among 1,015 U.S. consumers aged 18 and older, with demographics balanced across gender, age, income, education, and location (city/ rural/suburban). Other findings from the survey include:

of consumers in the United States are optimistic about vaccines and about the future — which is up from 67% in winter 2020.

However, at the same time, more than a third of U.S. consumers (36%) say their pandemic-hardened buying habits will continue even after the pandemic ends.

Of those who say their pandemic-driven spending habits will endure:

plan to keep spending less than they did pre-pandemic

of Americans in the all-important 18-to-34 age group say they intend to trade down, trade up, or shift their spending to other categories and brands — well above the for Americans of all ages.

82 Convenience Store News CSNEWS.com

say that while they plan to spend the same amounts, they will switch the product categories and brands on which they spend their money

Of those who reported spending less in recent months (the preceding three months), 51% say they have reevaluated what “essential spending” means to them.

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academy.csnews.com

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Articles inside

Pandemic-Driven Spending Habits Are Here to Stay

The 2022 Technology Hit List

A Category in Flux — Again

Embracing the New Normal

Cautiously Optimistic, But Still Realistic

On the Road to Recovery

New Products

CSNews Online

Holding the Line

The New Year Brings New Leadership at Sheetz

Seeing the Promise of a Better Year

Place Innovation Front & Center on Your Resolutions List