Page 1


55% of ATC will go to another store if their regular brand of tobacco is not available

WE’RE INSIGHTFUL

45% of ATC are very likely to consider buying a tobacco product mentioned by a store clerk

74% of ATC are very likely to consider switching stores for lower everyday tobacco prices

Source: 2014 Retail Experience Study (Altria Client Services) Š2015 Altria Group Distribution Company For Trade Purposes Only


VIEWPOINT By Don Longo, Editorial Director

The CSNews Top 100: Shaken & Stirred Top rankings change and new players added as consolidation makes impact

W

elcome to the 2015 Convenience Store News Top 100, the longest-running, most comprehensive review of the c-store industry’s biggest chains. This year’s Top 100 report is bigger and better than ever. Not only do we provide up-to-date store counts of both company-operated and franchised/licensed units, estimated in-store merchandise sales volume and leading store banner names for the 100 largest convenience store chains in the nation, but the CSNews Top 100 also includes: • The top 20 chains in company-operated stores; • The top 20 chains in franchised/licensed stores; • The new additions: retailers that cracked this year’s Top 100; • The dropouts: chains that were on the Top 100 last year but fell off this year; and • The 10 companies on the cusp: c-store chains ranked Nos. 101-110. (We could change the name of our report to the Top 110, but Top 100 just sounds better, doesn’t it?) The CSNews Top 100 report (see page 24) is compiled from Nielsen’s TDLinx database of convenience stores — the same database used by NACS to document the size of the convenience store industry. The numbers are further confirmed by CSNews’ Director of Market Research Debra Chanil through direct contact with many

CSNews has been recognized with more editorial awards, including the prestigious Jesse H. Neal Award for business journalism, in the past six years than any other industry publication. 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 2008 Jesse H. Neal National Business Journalism Award Best Single Issue, October 2007

of the companies. Data is supplemented by Stagnito Business Information’s Directory of Convenience Stores’ dynamic online databases. This year, we’ve added several new charts and breakouts, such as the biggest movers (companies that saw the most significant changes in For comments, please contact Don Longo, Editorial Director, rank year over year). at (201) 855-7606 or In addition, this year’s Top dlongo@stagnitomail.com. 100 report includes profiles on each of the 10 largest retailers, along with analysis into the competitive environment 7-Eleven faces to keep its No. 1 spot; the future of the new No. 2 chain, Alimentation-Couche-Tard, following its acquisition of The Pantry; and the outlook for even more merger and acquisition action in the year ahead. Despite all the M&A activity, in macro terms, consolidation is occurring at a surprisingly slow rate. The Top 100 chains, with a total store count of 66,524 stores, represent 43.5 percent of total industry outlets, an increase from the 40 percent of the past few years. Consolidation’s impact is being felt less significantly at the top. The top 10 chains, with 42,396 stores, comprised 63.7 percent of this year’s Top 100 — just a 1.6-point increase from 62.1 percent last year. CSN

2014 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2013 2014 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Single Article, February 2013 2013 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2012 2011 Silver Eddie Award, Folio: magazine Business to Business, Retail, Full Issue, October 2010 2011 Silver Eddie Award, Folio: magazine Business to Business, Retail, Best Single Article, October 2010 2009 Gold Ozzie Award, Folio: magazine Best Use of Illustration, October 2008 2009 Silver Eddie Award, Folio: magazine Business to Business, Retail, Full Issue, October 2008 2009 Bronze Eddie Award, Folio: magazine Business to Business, Retail, Website

2013 American Society of Business Publication Editors, Midwest Regional Bronze Azbee Award Best Editorial/Commentary, July 2012 2010 American Society of Business Publication Editors, Northeast Regional Silver Azbee Award Feature Article Design, November 2010 2010 Trade Association Business Publications Intl. Tabbie Awards Honorable Mention, Front Cover Illustration, October 2009 2009 Trade Association Business Publications Intl. Tabbie Awards Gold, Front Cover Illustration, February 2008 Honorable Mention, Best Single Issue, October 2008

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 3


CONTENTS July 2015

VOLUME 51/NUMBER 7

24 | COVER STORY The Shakeup Came

Several large M&A deals give this year’s CSNews Top 100 ranking a stir.

INDUSTRY ROUNDUP 12 | Cumberland Farms Turns Focus to C-store Operations 14 | Tobacco’s New Big Three Is Official 16 | Retailer Tidbits 17 | Eye on Growth 20 | Supplier Tidbits 21 | Legislative Corner

HOW TO DO WORLD-CLASS FOODSERVICE 74 | How to Measure Foodservice Success 74 | Call to Action: Foodservice 101 75 | Call to Action: Foodservice 201 78 | Call to Action: Foodservice 301 Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by Stagnito Business Information, 570 Lake Cook Rd. Deerfield, IL 60015. Copyright © 2015 by Stagnito Business Information. All rights reserved. Subscriptions: One year, $93; two years, $152. One year, Canada, $110; two years, Canada, $175. One year, foreign, $150. Payable in advance with a bank draft drawn on a U.S. bank in U.S. funds. Single copies, $10, except foreign, where postage will be added. Printed in U.S.A. Periodicals postage paid at Deerfield, IL, and at additional mailing offices. POSTMASTER: Send address changes to Convenience Store News, P.O. Box 1842, Lowell, MA 01853.

4 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


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CONTENTS 111 Town Square Place, Suite 400, Jersey City, NJ 07310 (201) 855-7600 Fax: (201) 855-7373 www.csnews.com

46

BRAND MANAGEMENT Chief Brand Officer (224) 632-8171

Korry Stagnito korrystagnito@stagnitomail.com

EDITORIAL

88 FEATURES TOP WOMEN IN CONVENIENCE

46 | Females in Force More than 50 honored in our second-annual Top Women in Convenience awards.

CATEGORY MANAGEMENT TOBACCO

80 | An Abundance of Uncertainty Tobacco Merchants Association’s 100th meeting offers insight to where tobacco may be heading.

Editorial Director (201) 855-7606 Editor-in-Chief (201) 855-7608 Managing Editor (201) 855-7614 Senior Editor (201) 855-7618 Field Editor (201) 855-7619 Assistant Editor (201) 855-7604 Contributing Editor (303) 741-3377 Contributing Editor (201) 280-2614 Art Director (224) 632-8245 Director of Market Research (201) 855-7605

Don Longo dlongo@stagnitomail.com Linda Lisanti llisanti@stagnitomail.com Brian Berk bberk@stagnitomail.com Melissa Kress mkress@stagnitomail.com Angela Hanson ahanson@stagnitomail.com Danielle Romano dromano@stagnitomail.com Renée M. Covino reneek@aol.com Tammy Mastroberte tmastroberte@gmail.com Michael Escobedo mescobedo@stagnitomail.com Debra Chanil dchanil@stagnitomail.com

MARKETING & PROMOTION Audience Development Manager Shelly Patton (646) 217-1045 spatton@stagnitomail.com List Rental The Information Refinery (800) 529-9020 Brian Clotworthy Reprints and Licensing Wright’s Media (877) 652-5295 sales@wrightsmedia.com Subscriber Services/Single-Copy Purchases (978) 671-0449 Stagnito@e-circ.net

COLD VAULT

84 | The Future of Beer Sales Leading marketer discusses importance of the millennial legal-drinking-age segment.

EVENTS • MEDIA • RESEARCH • INFORMATION

CANDY & SNACKS

President & CEO Harry Stagnito Chief Information Officer Kollin Stagnito Vice President & CFO Kyle Stagnito Senior Vice President, Partner Ned Bardic Chief Brand Officer Korry Stagnito Vice President/Custom Media Division Pierce Hollingsworth (224) 632-8229 phollingsworth@stagnitomail.com Production Manager Anngail Norris Human Resources Manager Sandy Berndt Strategic Marketing Director Bruce Hendrickson (224) 632-8214 bhendrickson@stagnitomail.com Vice President, Events John Failla (914) 574-5709 jfailla@stagnitomail.com Director of Digital Strategy Matt McGuire (224) 632-8180 mmcguire@stagnitomail.com

88 | Health & Wellness & Candy? A key theme at the 2015 Sweets & Snacks Expo was consumers’ view of candy as a treat.

DEPARTMENTS VIEWPOINT

3 | The CSNews Top 100: Shaken & Stirred Top rankings change and new players added as consolidation makes impact.

UNITED STATES MARKETS Convenience • Grocery/Drug/Mass Store Brands • Specialty Gourmet Multicultural • Green

CANADIAN MARKETS Convenience Pharmacy Foodservice

CONVENIENCE STORE NEWS AFFILIATIONS

8 | CSNews Online

Premier Trade Press Exhibitor

22 | New Products

EDITORIAL ADVISORY BOARD

OUT & ABOUT

Edward Davidson ER Davidson & Associates (7-Eleven Inc., retired) Kyle McKeen Alon Brands Inc.

90 | Celebrating the Entrepreneurial Spirit NRA Show highlights the significant economic impact of foodservice retailers.

6 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Richard Mione GPM Southeast Rick Crawford Green Valley Grocery

Ian Johnstone Cenex Zip Trip

Matt Paduano Nice N Easy Grocery Shoppes

Jon Urbanik CST Brands Inc.

Jonathan Polonsky Plaid Pantries Inc.

Roy Strasburger Convenience Management Services Inc. Joe Hamza Tedeschi Food Shops Jack Lewis Village Pantry LLC

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.


©2015 R.J. REYNOLDS TOBACCO CO. (3Q)

THE ORIGINAL

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change

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CSNEWS.COM ONLINE EXCLUSIVE

TOP 5 Daily News Headlines The most viewed articles online.

Time to Rethink the Boomers?

1 | CSNews Hall of Fame to Honor Kwik Trip’s Zietlow, Coke’s Ard Kwik Trip Inc. President and CEO Don Zietlow and Jay Ard, vice president of national sales, convenience retail for The Coca-Cola Co., have been selected as this year’s inductees into the Convenience Store News Hall of Fame. In addition, CSNews’ blue-chip panel of industry leaders chose Speedway LLC President Tony Kenney as winner of this year’s Retailer Executive of the Year award. 2 | CrossAmerica Acquires One Stop Chain CrossAmerica Partners LP will purchase the Charleston, W.Va.based One Stop convenience store chain in a transaction that is expected to close in the third quarter of 2015. The agreement includes 41 company-operated One Stop stores, along with four commission agent sites, nine dealer fuel supply agreements and one freestanding, franchised quick-service restaurant. 3 | Getty Realty Acquires 77 Stores in ‘High-Growth Regions’ Getty Realty Corp. inked a $214-million acquisition deal with Pacific Convenience and Fuels LLC through which it has acquired fee-simple interests in 77 convenience stores and retail gas stations in several “high-growth regions,” including Northern California, Southern California, Colorado, Washington, Nevada and Oregon. The properties operate under well-known banners including 76, Conoco, Circle K, 7-Eleven and My Goods Market. 4 | TravelCenters Makes $397M Sale-Leaseback Deal TravelCenters of America LLC (TA) inked a deal with Hospitality Properties Trust, its largest shareholder, for sale-leasebacks of 30 of its travel centers for approximately $397 million. Under the agreement, TA will also purchase five travel centers it currently leases from Hospitality Properties Trust for about $45 million.

POLL

5 | Stewart’s Shops Slates Remodel of First Store Stewart’s Shops Corp. plans to give its very first convenience store a modern makeover. The proposed remodeled store in Ballston Spa, N.Y., will occupy 3,000 square feet and feature more gas pumps, a to-go counter, pizza service and a beer cave.

Although convenience store operators are eager to embrace millennial consumers, it is still the baby boomer generation that plays the dominant role in the U.S. economy, controlling 70 percent of the nation’s disposable income. A recent study revealed that younger boomers outspend millennials by nearly $8,000 annually and the typical consumer by $5,000, with spending occurring across most categories. Boomers will control more than half of all dollars spent on grocery foods in 2015, with a particular focus on health and wellness. For more exclusive stories, visit the Special Features section of www.csnews.com.

PRODUCT HIGHLIGHT The most viewed New Product online.

BIC Special Edition Millennial Series

As a part of the “Pick Your BIC” Facebook promotion, fans voted on their favorite lighter designs to create the BIC Special Edition Millennial Series that is shipping this summer. The eight lighters feature quirky designs like a taco, and a dinosaur riding a scooter. Made in the USA, each Special Edition Millennial Series lighter has a suggested retail price of $1.89. BIC USA Inc. Shelton, Conn. www.biclighter.com

Following recent acquisitions of longtime family-run convenience store chains, which chain will be the next to be acquired?

23%

22%

21%

12%

15%

7%

Sheetz

Spinx

Kum & Go

Ricker’s

None of the above

Rutter’s

8 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


A Flavor Changing Experience

g n i t i c x E 2 n i s r o v a Fl Every Piece! Š Ferrero. All Rights Reserved.

Available to ship June 2015


INDUSTRYROUNDUP FAST FACT

Cumberland Farms Turns Focus to C-store Operations Haseotes family will reportedly sell Gulf Oil LP to ArcLight for $1 billion The top 10 chains in the convenience store industry alone represent 27.7 percent of the industry’s total stores, with 42,396 units. Source: Convenience Store News Top 100 report (page 24)

QUOTABLES

“Don’t be afraid to give an opinion about a product or bringing something into the stores. Women should never lose sight of what they mean to the industry. Your opinion matters, so let it be known.” — Tammy Floyd, CST Brands Inc. (page 46)

T

he New England convenience and fuel retailing landscape is in a state of transition as two major players announced acquisition deals within weeks of each other. Most recently, the Haseotes family, owner of Cumberland Farms Inc., is reportedly selling off its Gulf Oil LP fuel business. According to a source close to the transaction, the business will be sold to Boston-based private equity firm ArcLight Capital Partners for more than $1 billion. As first reported by the Oil Price Information Service (OPIS), Gulf employees were told of the pending move at the company’s Framingham, Mass., headquarters in May. Sunoco LP, Speedway LLC parent Marathon Petroleum Corp. and Global Partners LP were among the finalists that also submitted “ambitious bids” for Gulf Oil, which had been up for bid since October, OPIS reported. The deal with ArcLight could close as early as late July or early August, a source told Convenience Store News. Once completed, the Haseotes family will concentrate on expanding the Cumberland Farms convenience store brand. This deal represents ArcLight’s first venture into the branded fuels business, as it will pick up a network of more than 2,500 sites in 30 states. According to

12 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

OPIS, Gulf also owns a transportation fleet of nearly 200 trucks and a network of unbranded fuel sales via proprietary and third-party terminals. When contacted by CSNews, Gulf Oil said it does not comment on the company’s ongoing strategic and operating matters, and particularly “not on rumors and/or speculative matters.” ArcLight has invested more than $13 billion in 90 transactions since it was founded in 2001. The private equity firm did not return a phone call seeking comment. News of the agreement broke just days after 7-Eleven Inc. revealed plans to acquire Tedeschi Food Shops Inc., which operates 182 convenience stores in Massachusetts and New Hampshire. Terms of the deal were not disclosed. The transaction is expected to close in mid-2015.


FOR TRADE PURPOSES ONLY Š2015 ITG Brands, LLC

Introducing ITG Brands, a new company in the U.S. tobacco market designed to be your partner and create more opportunities for you. Our industry experts are committed to keeping everything simple and helping you succeed.

ITG Brands Choices. Expertise. Opportunities. Visit connect.ITGBrands.com for more information.


INDUSTRYROUNDUP

Tobacco’s New Big Three Is Official Reynolds American and Lorillard finalized their merger on June 12

R

eynolds American Inc. (RAI) completed its roughly $27-billion acquisition of fellow tobacco company Lorillard Inc. on June 12, just one month shy of the one-year mark. On the same day, RAI also closed the deal’s related divestiture transactions with ITG Brands LLC, a subsidiary of Imperial Tobacco Group plc, for approximately $7.1 billion. With all the deals now sealed, RAI remains the No. 2 player in the U.S. tobacco space — bolstered by Lorillard — and ITG Brands emerges as the new No. 3. Meanwhile, Richmond, Va.-based The Altria Group Inc. retains its position at No. 1. As a result of the acquisition, Lorillard is a wholly

SC-12

NH-2700

BY: EXCEL®

BY: NAUTILUS HYOSUNG ® 14 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

owned subsidiary of Winston-Salem, N.C.-based RAI. The No. 2’s operating companies now have key brands across major industry categories: Newport, Camel, Pall Mall and Natural American Spirit in combustible cigarettes; Grizzly in smokeless tobacco; and VUSE in the vapor market. “As a result of this acquisition, Reynolds American has a significantly strengthened, balanced and diversified portfolio of iconic brands across all key categories — the most balanced in the industry,” said Susan M. Cameron, RAI’s president and CEO. “The transaction supports RAI’s efforts to lead the transformation of the tobacco industry. The synergies, improved operational efficiencies and higher


sales volumes generated by this combination will better position RAI’s operating companies to fuel continued investment in brand building, research and development, and innovation for the long-term future of the company.” New No. 3 ITG Brands took ownership of the Winston, Kool and Salem brands from RAI and the Maverick and blu eCig brands from Lorillard. These acquisitions build on Imperial’s existing U.S. portfolio at Commonwealth-Altadis, which currently accounts for a 3-percent share of the U.S. market, principally through the USA Gold brand. In addition, ITG Brands acquired Lorillard’s infrastructure, which includes its manufacturing facility, headquarters offices, research and development facility, and approximately 2,900 employees. Imperial’s new U.S. subsidiary is based in Greensboro, N.C. David Taylor, former chief financial officer at Lorillard, leads ITG Brands as CEO. “We will focus on leveraging our enhanced scale

and capabilities to maximize growth opportunities for our portfolio and establish ITG Brands as a major competitive player in the U.S. tobacco market. I’m also pleased to announce senior appointments that will strengthen our management structure and ensure that it is aligned with the group’s ongoing international development,” said Alison Cooper, Imperial Tobacco’s chief executive.

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 15


INDUSTRYROUNDUP

retailer tidbits n Following a portfolio review,

Thorntons Inc. is selling eight convenience stores in various regions of the United States, including all three of its locations in Terra Haute, Ind. Employees at the affected stores will be able to transfer to another site. n Enmark launched a chainwide rebranding initiative and

will now do business as “enmarket.” The new brand is more indicative of the type of stores the retailer operates. n Giant Eagle Inc. is closing down its smaller GetGo con-

venience stores near The Ohio State University. These smaller format stores cannot accommodate the fresh food, in-store dining, fuel and convenience offerings of the average GetGo store. n Casey’s General Stores

Inc. will roll out online ordering chainwide. The retailer’s plan is to add 300 stores per month and have the option in place at all 1,878 Casey’s stores by the end of this calendar year. n The Spinx Co. introduced its large-format convenience

store to its hometown of Greenville, S.C. The store measures more than 6,500 square feet and features indoor and outdoor dining areas, and expanded food and beverage selections. n Exxon Mobil Corp. added the Uber Partner Fuel Card pow-

ered by FleetCor and MasterCard to its Momentum Driver Rewards Program. Discounts are available to Uber drivers throughout Boston, Chicago, New York and Washington, D.C., and will expand nationwide later this summer. n Chevron USA Inc. launched the Chevron and Texaco

Xponent Rewards Card. The card has been introduced in Dallas, Miami, Tampa and Orlando, Fla., and Atlanta. n TripAdvisor recently honored Parker’s Market Urban

Gourmet with a 2015 Certificate of Excellence based on strongly positive consumer opinion. This is the third consecutive year that the Savannah, Ga., store has earned the award.


eye on growth n Global Partners LP com-

pleted its $156-million acquisition of 97 retail gas stations and seven dealer supply contracts from Capitol Petroleum Group. The deal consists of 51 retail locations and seven dealer supply accounts in New York City and 46 retail locations in Maryland.

Village Pantry and Next Door Store brand names. n Circle K expanded its

Southwest footprint by closing a deal for 21 convenience stores and 182 dealer sites with Cinco J Inc. (d.b.a. Johnson Oil Co.) and Tiger Tote Food Stores Inc. The stores will be rebranded to the Circle K banner.

n United Oil acquired a portfolio from Pacific

Convenience & Fuels comprising 251 convenience stores and gas stations that operate under the My Goods Market and Circle K brands. United Oil will now be known as United Pacific. n GPM Investments LLC closed its acquisition of VPS

Convenience Store Group Inc.’s Midwest division. GPM will continue to operate the 161 stores under the

n Gill Energy acquired the

assets of Mohawk Oil Co. The pact includes fee and leased retail gas assets with convenience stores, service bays and snack shops, wholesale supply-only accounts and assignment of the branded Sunoco distributor agreement.

YOUR

C-STORE TOOLKIT

FOR SUCCESS!

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 17


WHAT’S OUT

© 2015 McLane Company, Inc. All rights reserved.


WHAT’S IN

Technology Evolves Over Time — Just Like Your Business. Outsmart your competition and connect to McLane’s Strategic Merchandising Portal, a web-based system that features new items and current promotions, up-to-date planograms and easy online ordering. It’s designed for businesses of all sizes and is available at no cost to McLane customers, helping them to buy better, sell smarter and profit more. To learn more, visit mclaneco.com/goto/smsportal


INDUSTRYROUNDUP

supplier tidbits n The Coca-Cola Co.

completed its $2.1-billion, 16.7-percent stake in Monster Beverage Corp. In exchange, Monster is gaining access to Coca-Cola’s global distribution network and its portfolio of energy drink brands. n Jack Link’s

Beef Jerky celebrated National Jerky Day June 12 with the unveiling of “Meatzilla,” the world’s largest bag of jerky. In New York’s Meatpacking

District, Meatzilla stood three stories tall and held more than 5,000 standard bags of Jack Link’s jerky varieties. n Newcastle Brown Ale brought

back its popular Independence Eve campaign for a second straight year. Newcastle is leveraging its social platforms and partnering with shopper-targeted digital media to deliver custom content and special offers, and in-store display and point-of-sale materials. n Kalibrate identified the best loca-

tions for establishing a network of hydrogen refueling stations in California. More than 30,000

locations were identified within the state and then ranked from best to worst based on their viability for introducing a station. n Snapple part-

nered with brand agency and retail design consultancy CBX for a comprehensive brand refresh. Its new logo includes a sun graphic in a handdrawn style designed to reflect the playful, natural character of the brand. n Mondelez International is launch-

ing Shopper Futures, a program that will bring together startups and retailers to transform and improve the customer retail experience. QuickChek Corp. is one of the participating retailers. n Heineken USA launched new

seasonal promotions for its Dos Equis and Heineken Light brands. Dos Equis’ program for summer 2015 is known as “Luna Rising,” while Heineken Light launched a 360-degree program called “Best Tasting Light.” n Oberto unveiled “Heroes of

Summer,” a digital campaign spotlighting four individuals whose personal achievements and determination inspire: Seattle Seahawks defensive back Richard Sherman; blind marathoner/mountain climber Randy Pierce; Boston Marathon bombing survivor Adrianne Haslet-Davis; and leukemia survivor Brady Wein.

20 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


legislative corner n E-Z Mart Stores Inc. CEO Sonja

Hubbard urged the House of Representatives’ Energy and Commerce Subcommittee on Health to pass H.R. 2017, the Common Sense Nutrition Disclosure Act of 2015, durSonja Hubbard ing a June 4 hearing. She stressed the importance of passing the bipartisan legislation quickly due to the current compliance deadline of Dec. 1.

gallons coming from advanced biofuels. n The Food and Drug Administration

has given food manufacturers three years to remove trans fat from their products. Trans fat content information has been required on the Nutrition Facts panel since 2006. n Ricker’s Convenience Stores hosted

n Just prior to the June 1 court-imposed deadline, the

U.S. Environmental Protection Agency issued its revised Renewable Volume Obligation figures under the Renewable Fuel Standard. The proposal calls for refiners to use 17.4 billion gallons of renewable fuels in 2016, with approximately 14 billion gallons coming from traditional corn-based ethanol and 3.4 billion

U.S. Rep. Susan Brooks (R-Indiana) as “Clerk for a Day” as part of the In Store Program from NACS, the Association for Convenience & Fuel Retailing. Brooks underwent employee Susan Brooks training, worked behind the counter and interacted with both employees and customers.

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 21


NEWPRODUCTS Tic Tac Mixers Ferrero USA Inc.’s Tic Tac brand added Tic Tac Mixers. Reportedly the first of its kind, the dual-flavored Tic Tac pills change from one flavor to another as they melt in your mouth. Tic Tac Mixers are available in two flavors: Cherry Cola and Peach Lemonade. Cherry Cola transitions from a cherry flavor to a classic cola flavor, while Peach Lemonade changes from a peach flavor to a sweet lemonade flavor. Ferrero USA Inc. Somerset, N.J. (732) 764-9300 www.tictacusa.com

Game Watermelon Cigarillos Swedish Match’s Game Watermelon cigarillos are a refreshing twist on the company’s traditional Game cigarillos, according to the maker. Available starting this month, the limited-time variety combines watermelon flavor with its natural leaf wrapper. Game Watermelon cigarillos are available in two price-point formats: two for 99 cents or “Save on 2” FoilFresh pouches. Swedish Match North America Inc. Richmond, Va. (804) 787-5100 info@smna.com www.swedishmatch.com

Rich’s On Top Whipped Topping Rich Products Corp. introduced Rich’s On Top, a whipped topping for signature beverages, desserts and more. The whipped topping is packaged in a recyclable 16-ounce pastry bag with a decorator tip, and has an easy-open seal that does not require touching the dispensing tip to reduce the risk of food contamination. Available in four varieties — Original, Chocolate, Sugar-Free and Made With Cream — the whipped topping retains its shape at room temperature and is perfect for hot or cold applications like smoothies, pies, cakes, decadent pastries, pancakes, waffles and French toast, according to the maker. Rich Products Corp. Buffalo, N.Y. (800) 356-7094 www.richsfoodservice.com

Crystal Light Frozen Kraft Foodservice’s Crystal Light brand now offers Crystal Light Frozen, a fruit-flavored concentrate that can be added to any frozen drink. The concentrate is available in Cherry Lime and Lemonade flavors, and works with any standard Granita machine. Beverages made with Crystal Light Frozen have 35 percent fewer calories than leading regular frozen fountain drinks, according to the company. Kraft Foodservice Northfield, Ill. (800) 852-9393 www.kraftfoodservice.com

Brookside Fruit & Nut Bars The Hershey Co.’s Brookside brand launched Brookside Fruit and Nut Bars, made with real fruit, whole roasted almonds and signature Brookside dark chocolate. Currently available in two varieties, Brookside Fruit and Nut Cranberry with Blackberry and Brookside Fruit and Nut Cherry with Pomegranate, the 1.4-ounce bars have a suggested retail price of $1.69. A fourcount multipack is also available for $4.99. A third variety, Brookside Fruit and Nut Blueberry with Acai, will soon be available in a 1.4-ounce bar for a suggested retail price of $1.69. The Hershey Co. Hershey, Pa. (800) 468-1714 www.thehersheycompany.com

22 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


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FOR MORE INFORMATION, CONTACT YOUR SWEDISH MATCH REPRESENTATIVE. 800-367-3677 customer.service@smna.com ©2015 SWEDISH MATCH NORTH AMERICA, INC.


COVER STORY

24 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


A Convenience Store News Staff Report

L

ast year, the headline of the Convenience Store News Top 100 report proclaimed: “Steady for Now, but Shakeup Coming.” Well, the shakeup came. Whereas in 2014, the top six companies retained their same spots year over year, only one company in the entire top 10 this year stayed put. All the rest traded places, with Energy Transfer Partners LP (ETP) making the most significant move, jumping up from No. 9 to No. 4. Over the past year, ETP closed on its acquisition of Susser Holdings Corp. whose retail operations consisted of 600-plus Stripes and Sac-N-Pac convenience stores. ETP also formed a new wholly owned subsidiary known as Sunoco LP, which makes its Top 100 debut separately this year at No. 9 on the list. ETP is in the process of dropping down to Sunoco LP all of its retail assets, including the fuel marketing, distribution and retail assets of Sunoco Inc. Once completed, Sunoco LP will have ownership of the Sunoco wholesale and retail businesses, as well as c-stores acquired from Mid-Atlantic Convenience Stores, Susser Holdings, Tiger Management Group (Tigermarket brand), Aloha Petroleum Ltd. and, most recently Westex Capital Ltd. (Pico brand). Combined,

Top 20 Company-Operated Chains Company

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19t 19t

alimentation Couche-tard Inc. marathon petroleum Corp. Casey’s General Stores Inc. 7-eleven Inc. energy transfer partners lp CSt Brands Inc. Kroger Co. Quiktrip Corp. military Gpm Investments llC Wawa Inc. pilot flying J Cumberland farms Inc. Sheetz Inc. Kwik trip Inc. Kum & Go lC Western refining Inc. racetrac petroleum Inc. Holiday Cos. delek US Holdings Inc.

ETP and Sunoco LP have 6,683 locations. Other big Top 100 movers this year are Alimentation Couche-Tard Inc., which climbed from No. 4 to No. 2, and Marathon Petroleum Corp., which moved into the No. 5 slot, up from seventh last year. Acquisitions — the biggest deals of the past year, in fact — drove these changes. Circle K parent Couche-Tard purchased The Pantry Inc. and its 1,500 Southeast Kangaroo Express convenience stores, while Marathon Petroleum’s retail division Speedway LLC purchased the retail network of Hess Corp. and its 1,200-plus convenience stores. Prior to being acquired, The Pantry was the 11th largest U.S. c-store chain by store count and Hess was the 13th largest, according to the Top 100 report published by CSNews in 2014. Despite these mega mergers, 7-Eleven Inc. managed to keep its distinction as the largest convenience store chain in the United States for at least another year. With 8,124 stores, 7-Eleven leads No. 2 Couche-Tard in store count by a margin of 2,751 locations. The CSNews Top 100 is the industry’s longest-running accounting of the largest convenience store chains by store count. The annual report is compiled in partnership with TDLinx, a service of Nielsen. TDLinx defines

Top 20 Franchise/Licensee Chains

Company-operated StoreS

% of total

4,802 2,646 1,890 1,361 1,103 1,035 799 719 698 688 685 580 554 497 450 435 431 387 365 365

89.4% 64.8 100.0 16.8 25.7 95.8 100.0 100.0 100.0 99.3 100.0 97.5 60.2 100.0 100.0 100.0 85.9 54.8 72.7 99.7

Source: Nielsen TDLinx; Company information; Convenience Store News Market Research 2015

Company

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18t 18t 20

7-eleven Inc. Shell oil/motiva enterprises llC Bp north america Chevron Corp. exxon mobil Corp. energy transfer partners lp Sunoco lp CItGo petroleum Corp. marathon petroleum Corp. CHS Inc. phillips 66 alimentation Couche-tard Inc. Cumberland farms Inc. racetrac petroleum Inc. tesoro petroleum Corp. Clark Brands llC Getty realty Corp. Krauszer’s food Store Sinclair oil Corp. Kwik Stop

franCHISe/lICenSee StoreS

% of total

6,763 4,981 3,945 3,572 3,409 3,197 2,228 1,647 1,440 1,370 1,278 571 367 319 202 174 173 145 145 139

83.2% 99.6 100.0 91.9 100.0 74.3 93.5 99.9 35.2 95.1 100.0 10.6 39.8 45.2 73.5 100.0 78.6 100.0 100.0 100.0

Source: Nielsen TDLinx; Company information; Convenience Store News Market Research 2015

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 25


COVER STORY a convenience store as a small-format store of at least 800 square feet; with 500 to 1,500 SKUs; that operates at least 13 hours a day; and carries a limited selection of grocery items, including at least two of the following: toilet paper, soap, disposable diapers, pet food, breakfast cereal, tuna fish, toothpaste, ketchup and canned goods. Once again, this year’s Top 100 is bigger and better than ever. Like last year, we count down the top 100 convenience store chains; the top 20 chains in companyoperated stores; the top 20 chains in franchised/licensed stores; new additions (companies that cracked this year’s Top 100); drop-offs (companies that fell off this year’s list); and the 10 companies on the cusp (Nos. 101-110 in store count). New this year, we’ve also added the biggest movers

Top 100 2015 2014 Rank Rank

Total U.S. Store Count

Company, City, State

(companies that saw the most significant changes in rank), as well as online bonus content including ones to watch (smaller chains with big ideas), and regional breakouts: Northeast, South, Midwest and West. In addition, this year’s Top 100 report includes profiles on each of the 10 largest retailers, along with analyses into the competitive environment 7-Eleven faces to keep its No. 1 spot; the future of Couche-Tard & The Pantry: The New No. 2; and the outlook for even more M&A action. According to TDLinx store count figures, this year’s top 100 chains operate 66,524 stores. These chains represent 43.5 percent of the industry’s total stores, and the top 10 chains alone represent 27.7 percent of the industry’s stores with 42,396 units.

Company-Operated Franchise/ Latest Year-End Sales* Primary Stores Licensee Stores ($000) Store Names

1

1

7-Eleven Inc., Dallas1 8,124 1,361 6,763 Top Franchise/Licensee: Alon Brands2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 283

$24,247,600

7-Eleven

2

4

Alimentation Couche-Tard Inc., Laval, Quebec, Canada3

$27,397,760

Circle K, Dairy Mart, Gas Express, Kangaroo Express

5,373

4,802

571

3

2

Shell Oil/Motiva Enterprises LLC, Houston

5,000

19

4,981

$11,885,432

Shell

4

9

Energy Transfer Partners LP, Dallas4

4,300

1,103

3,197

$15,596,000

Sunoco, APlus, Stripes, Sac-N-Pac

4,086

2,646

5

7

Marathon Petroleum Corp., Findlay, Ohio

1,440

$15,773,940

Hess, Marathon, Rich Oil, Speedway, Wilco

6

3

BP North America, Houston 3,945 0 3,945 Top Franchise/Licensee: ampm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 962

$14,351,116

Amoco, ampm, Arco, Arco Thrifty, BP, BP Connect, BP Shop

7

5

Chevron Corp., San Ramon, Calif.

3,886

314

3,572

$24,267,828

Chevron, Chevron ExtraMile, Texaco

8

6

Exxon Mobil Corp., Irving, Texas

3,409

0

3,409

$8,272,888

Exxon, Exxon On The Run, Exxon Tiger Mart, Mobil, Mobil Mart, Mobil On The Run, Mobil Snack Shop

9

n/a

Sunoco LP, Philadelphia4

2,383

155

2,228

$5,382,016

Sunoco, APlus, Aloha Island Mart, Tiger Market Casey’s General Store

10

8

Casey’s General Stores Inc., Ankeny, Iowa

1,890

1,890

0

$7,915,440

11

10

CITGO Petroleum Corp., Houston

1,648

1

1,647

$3,795,376

CITGO

12

28

CHS Inc., Minneapolis

1,440

70

1,370

$2,400,000

Ampride/Cenex, Cenex, Zip Trip Store

13

12

Phillips 66, Houston

1,278

0

1,278

$3,499,860

76, Conoco, Phillips 66

14

14

CST Brands Inc., San Antonio

1,080

1,035

45

$7,480,000

Corner Store, Nice N Easy Grocery Shoppes

15

15

Cumberland Farms Inc., Framingham, Mass.

921

554

367

$3,391,700

Cumberland Farms, Gulf

16

16

The Kroger Co., Cincinnati

799

799

0

$5,225,740

Kwik Shop, Tom Thumb, Turkey Hill Minit Mart

17

18

QuikTrip Corp., Tulsa, Okla.

719

719

0

$8,577,400

QuikTrip

18

17

RaceTrac Petroleum Inc., Atlanta

706

387

319

$5,297,760

RaceTrac, RaceWay

19

19

Military, Arlington, Va.

698

698

0

$4,126,512

Coast Guard Mini Mart, Marine Corps Shoppette, NEXCOM Mini Mart, Shoppette, Troop Store

20

24

GPM Investments LLC, Richmond, Va.

693

688

5

$1,868,880

Bread Box, Every Day Shop & Café, Fas Mart, Lil’ Cricket, Next Door Food Store, Ranger, Shore Stop, Village Pantry

5

21

20

Wawa Inc., Media, Pa.

685

685

0

$8,617,180

Wawa

22

22

Pilot Flying J, Knoxville, Tenn.

595

580

15

$2,474,160

Flying J, Mr. Fuel, Pilot Food Mart, Pilot Travel Center

26 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


COVER STORY 2015 2014 Rank Rank

Company, City, State

Total U.S. Store Count

Company-Operated Franchise/ Latest Year-End Sales* Primary Stores Licensee Stores ($000) Store Names

23t

23

Holiday Cos., Minneapolis

502

365

137

$3,335,020

Holiday Stationstore

23t

41

Western Refining Inc., El Paso, Texas

502

431

71

$1,841,060

Giant, Howdy’s Foodmart, Mustang, Sundial Deli Mart, SuperAmerica

25

25

Sheetz Inc., Altoona, Pa.

497

497

0

$7,575,620

Sheetz

26

26

Kwik Trip Inc., La Crosse, Wis.

450

450

0

$3,400,020

Kwik Star, Kwik Trip

Kum & Go LC, West Des Moines, Iowa

Kum & Go

27

27

435

435

0

$2,850,000

28

104t United Pacific, Los Angeles6

379

319

60

$972,140

Apro, C Stop, My Goods Market, Rapid

29

30

Delek US Holdings Inc., Brentwood, Tenn.2

366

365

1

$1,807,260

Delta Express, Discount Food Mart, East Coast, Fast Food & Fuel, Favorite Market, MAPCO Express, MAPCO Mart

30

43

CrossAmerica Partners LP, Allentown, Pa.5

365

303

62

$1,207,128

Choice, Express Lane, Freedom Valu Center, Joe’s Kwik Mart, Rocky Top Market, Stop In, Uni-Mart, Zoomerz

31

32

Love’s Travel Stops & Country Stores, Oklahoma City

340

340

0

$944,840

32

31

Stewart’s Shops Corp., Ballston Spa, N.Y.

335

335

0

$1,493,180

33

33

Allsup’s Convenience Stores Inc., Clovis, N.M.

317

317

0

$339,300

34

36

TravelCenters of America, Westlake, Ohio

300

289

11

$1,987,700

35

34

E-Z Mart Stores Inc., Texarkana, Texas

290

290

0

$970,840

36

35

United Refining Corp. of Pennsylvania, Warren, Pa.

277

277

0

$563,160

37

29

Tesoro Petroleum Corp., San Antonio

275

73

202

$1,081,860

38

37

Maverik Inc., North Salt Lake City, Utah

271

271

0

$530,608

Love’s Country Store, Love’s Travel Stop Stewart’s Shop Allsup’s Goasis, Minit Mart, Petro Stopping Center, TravelCenters of America E-Z Mart Country Fair, Kwik Fill, Red Apple Big Johns, Mirastar, Tesoro, USA Fuel Center, USA Gas, USA Mini Mart, USA Petroleum, USA Station Maverik Country Store

39

45

Murphy USA Inc., El Dorado, Ark.

248

248

0

$413,140

Murphy Express, Murphy USA

40

38

Fikes Wholesale, Temple, Texas

245

245

0

$366,080

CEFCO Food Store, Food Fast Store, Taylor Food Mart, Taylor Petroleum

41

39

Getty Realty Corp./Lukoil NA LLC, East Meadow, N.Y.

220

47

173

$649,740

Getty, Kwik Farms, Lukoil

42

42

Jacksons Food Stores Inc., Meridian, Idaho

216

216

0

$209,768

Jacksons Food Store

43

40

Landmark Industries Inc., Houston

210

210

0

$508,820

Timewise Food Store

44

47

United Dairy Farmers, Cincinnati

184

184

0

$329,160

United Dairy Farmers

45

46

Tedeschi Food Shops Inc., Rockland, Mass.1

183

109

74

$220,480

Tedeschi Food Shop

46

48

Thorntons Inc., Louisville, Ky.

180

180

0

$655,720

Thorntons

47

44

Clark Brands LLC, Naperville, Ill.

174

0

174

$445,900

Clark

48

49

The Jones Co., Waycross, Ga.

170

170

0

$560,040

Flash Foods

49

53

Two Farms Inc., Baltimore

165

165

0

$328,640

Royal Farms

50

52

Meijer, Grand Rapids, Mich.

164

164

0

$1,546,480

51

54

Warren Equities Inc., Providence, R.I.

149

149

0

$562,120

Meijer Gas Station Xtra Mart

52t

57

Giant Eagle Inc., Pittsburgh

145

145

0

$1,822,600

52t

56

Krauszer’s Food Store, Edison, N.J.

145

0

145

$280,280

Krauszer’s Food Store

GetGo

52t

51

Convenient Food Mart Inc., Mentor, Ohio

145

64

81

$240,188

Convenient Food Mart

52t

55

Sinclair Oil Corp., Salt Lake City

145

0

145

$301,028

Sinclair

56

58t

QuickChek Corp., Whitehouse Station, N.J.

143

143

0

$1,007,760

QuickChek

57

58t

Kwik Stop, Plantation, Fla.

139

0

139

$286,520

Kwik Stop

58

60

Englefield Oil Co., Heath, Ohio

122

122

0

$505,440

Duchess Shoppe

59

65t

Go Mart Inc., Gassaway, W.Va.

119

119

0

$579,280

Go Mart Food Store

60

61

Martin & Bayley Inc., Carmi, Ill.

116

116

0

$658,060

Huck’s

61

64

Hy-Vee Food Stores Inc., West Des Moines, Iowa

111

111

0

$268,840

Hy-Vee Gas Station

62

63

Plaid Pantries Inc., Beaverton, Ore.

110

110

0

$223,860

Plaid Pantry

63

62

7-Eleven Stores of Oklahoma, Oklahoma City

109

109

0

$225,420

7-Eleven

64

67

Little General Stores Inc., Beckley, W.Va.

107

107

0

$508,300

Little General

28 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


COVER STORY 2015 2014 Rank Rank

Company, City, State

Total U.S. Store Count

Company-Operated Franchise/ Latest Year-End Sales* Primary Stores Licensee Stores ($000) Store Names

65

70

Terrible Herbst Inc., Las Vegas

97

97

0

$65,884

66

71t

Town Pump Inc., Butte, Mont.

96

96

0

$294,580

Town Pump Food Store

67

74t

Blarney Castle Oil Co., Bear Lake, Mich.

94

94

0

$507,000

E Z Mart

68

74t

True North Energy, Brecksville, Ohio

93

93

0

$168,480

True North

69t

71t

Mountain Empire Oil, Johnson City, Tenn.

92

92

0

$172,640

Roadrunner Market

69t

68t

Panjwani Enterprises, Houston

92

92

0

$197,444

Star Stop

71t

68t

Sam’s Food Stores, Rocky Hill, Conn.

91

91

0

$168,480

Chucky’s Food Store, Sam’s Food Store

71t

74t

Gulshan Enterprises, Sugar Land, Texas

91

70

21

$163,280

Handi Plus, Handi Stop

73

73

Admiral Petroleum Co., Coopersville, Mich.

90

90

0

$143,520

Admiral Petroleum

74

104t Mirabito Energy Products, Binghamton, N.Y.

87

78

9

$241,020

Manley’s Mighty Mart, Mirabito, Quickway

75

77

Victory Marketing LLC, Ridgeland, Miss.

82

82

0

$137,020

Sprint Mart

76

92

Spinx Oil Co. Inc., Greenville, S.C.

81

81

0

$273,780

Spinx Store

77t

80

M.M. Fowler Inc., Durham, N.C.

80

80

0

$212,160

Family Fare

77t

79

MFA Petroleum, Columbia, Mo.

80

79

1

$143,780

Break Time, MFA Oil, Petro Card 24

77t

81

C.N. Brown Co., South Paris, Maine

80

80

0

$127,660

Big Apple, C.N. Brown

80t

83t

Sunmart Inc., Spring, Texas

78

40

38

$181,740

Sunmart

80t

87t

FKG Oil Co., Belleville, Ill.

78

78

0

$302,640

Moto Mart

82t

87t

Toot ‘n Totum Food Stores, Amarillo, Texas

74

73

1

$189,020

Toot ‘n Totum

82t

93t

Newcomb Oil Co., Bardstown, Ky.

74

74

0

$234,520

Five Star Food Mart

84t

65t

Gas Mart USA Inc., Leawood, Kan.

73

73

0

$215,280

Eddy’s Mart, Gas Mart USA, Jumpin Jimmy’s

84t

83t

Farm Stores Grocery Inc., Miami

73

29

44

$134,680

Farm Store

84t

97t

Johnson Oil Co., Rock Falls, Ill.

73

73

0

$150,800

Express Lane

87t

87t

Certified Oil Co., Columbus, Ohio

72

71

1

$48,360

87t

99

Express Mart Franchising Corp., Syracuse, N.Y.

72

72

0

$125,060

Express Mart

87t

95t

Sampson Bladen Oil Co. Inc., Clinton, N.C.

72

72

0

$122,720

Handee Hugo’s

90

101 Buchanan Oil Co., Omaha, Neb.

71

71

0

$308,100

Bucky’s Express

91

87t

70

70

0

$231,920

Daily’s, Twice Daily

92

109 Jet Pep, Holly Pond, Ala.

69

0

69

$107,120

Jet Pep

93t

83t

Flash Market, West Memphis, Ark.

68

67

1

$150,540

Flash Market

93t

95t

Fast Stop, Bloomington, Ill.

68

0

68

$97,760

93t

97t

Dandy Mini Marts Inc., Athens, Pa.

68

68

0

$143,520

Dandy Mini Mart

96

104t Weigel’s Stores Inc., Powell, Tenn.

66

66

0

$175,240

Weigel’s, Jug O Milk Store

97

87t

65

65

0

$158,340

Gate Food Post

98t

107t Stinker Stations, Boise, Ida.

64

64

0

$273,624

Stinker Station

98t

103 MNS Ltd., Honolulu

64

64

0

$50,180

ABC Store

63

63

0

$381,118

Enmarket

100 n/a

Tri-Star Energy, Nashville, Tenn.

Gate Petroleum Co., Jacksonville, Fla.

Enmark Stations Inc., Savannah, Ga.

Terrible Herbst

Certified

Fast Stop

source: Company information; Convenience Store News Market Research 2015; Nielsen TDLinx, April 2015 *Latest year-end sales are stated where available from company information or public record. In all other cases, All Commodity Volume (ACV) is provided by Nielsen TDLinx. ACV is an annualized range of the estimated retail sales volume of all items sold in a store that pass through the retailer’s cash registers. Lottery sales are not included; gas sales are included where applicable. The Nielsen TDLinx ACV is an estimate — a directional measure to be used as an indicator of company size. 1 7-Eleven

Inc. is in the process of acquiring Tedeschi Food Shops Inc. Delek US Holdings Inc. owns a 48-percent share in Alon Brands’ parent Alon USA Energy Inc. 3 Alimentation Couche-Tard Inc. operates convenience stores in both the United States and Canada. For this ranking, only U.S. stores are included. 4 Energy Transfer Partners LP is in the process of dropping down all of its retail assets to Sunoco LP. 5 CST Brands Inc. owns the general partner of CrossAmerica Partners LP. 6 United Pacific recently changed its name from United Oil. 2

editor’s note: Licensees are included in the total store count of the parent’s banner name. For example, Alon Brands is included in 7-Eleven’s total count. Data includes store count information as of April 2015, and was obtained from each company or provided by Nielsen TDLinx, which utilizes the convenience store trade channel definition endorsed by NACS and Convenience Store News. The convenience store trade channel includes small-format stores of at least 800 square feet; with 500 to 1,500 SKUs; that operate at least 13 hours a day; and carry a limited selection of grocery items, including at least two of the following: toilet paper, soap, disposable diapers, pet food, breakfast cereal, tuna fish, toothpaste, ketchup and canned goods. This channel includes stores that may or may not sell gasoline and offer fast-food services.

30 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


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NATURAL LEAF CIGARILLOS

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COVER STORY

Top 10 Chains 7-Eleven Inc.

No.1

Dallas-based 7-Eleven Inc. remains at the top of the Top 100 with more than 8,000 stores in the United States. This number is poised to grow even more as the retailer pushes forward with its recently announced acquisition of Rockland, Mass.-based Tedeschi Food Shops Inc. In addition, 7-Eleven is pursuing organic growth. The retailer spread its wings with the opening of its first store located inside a U.S. airport terminal at Los Angeles International Airport’s Tom Bradley International Terminal. The c-store giant plans to open a second in-terminal store in its own backyard in the post-security section of Dallas/Fort Worth International Airport’s (DFW) Terminal A this fall, followed by another DFW store in Terminal E at a future date. The retailer has also been busy building up its franchise locations through its Zero Franchise Fee Initiative. Under the program — which ran through the end of June — the company waived the franchise fee on select U.S. 7-Eleven stores available for franchise, a savings of up to $80,000. Approximately 250 stores across the country were eligible for the initiative. The franchising process can take anywhere from five to seven months to complete. Inside its stores, 7-Eleven is beefing up its offering. In recent months, the chain added Ultra Mobile prepaid service plans at more than 6,700 of its convenience stores nationwide. It also reached out to lottery players to expand its foodservice reach. Through a partnership with the Virginia Lottery, those testing their luck were able to purchase a 7-Eleven scratch-off ticket that included a coupon attached for a food item, regardless if the ticket was a lottery winner. And in another highlight of this past year, 7-Eleven bolstered its technological reach with 7Rewards, a new loyalty platform on its mobile app. 7Rewards allows customers to receive a free beverage for every six purchased. Different from some loyalty programs, 7-Eleven counts every beverage its sells served in a 7-Eleven cup toward the seventh free item.

No.3

Alimentation Couche-Tard Inc.

No.2

Alimentation Couche-Tard jumped up two spots to become the second-largest convenience store chain in the United States, thanks largely to its acquisition of Cary, N.C.-based The Pantry Inc. News of Couche-Tard’s acquisition of the Southeast chain broke in mid-December and the transaction was completed this spring. The deal between the parent of Circle K and the parent of Kangaroo Express added approximately 1,500 c-stores to Couche-Tard’s existing portfolio of 6,000 retail locations throughout North America. In the U.S., the Laval, Quebec-based retailer has a total store count of 5,373 — 4,802 company-operated and 571 franchise/licensee locations. In the past year, Couche-Tard also made moves overseas by penning an acquisition agreement with A/S Dansk Shell for its retail, commercial fleet, commercial fuels, aviation, and connected trading and supply products businesses. The businesses will be managed by Statoil Fuel and Retail A/S (SFR), a wholly owned, indirect subsidiary of Couche-Tard. Shell’s Danish retail business comprises 315 sites, of which 225 are full-service stations, 75 are automated fuel stations and 15 are truck stops. Of the 315 sites, 140 are owned by Shell, 115 are leased from third parties and 60 are dealer-owned. Most recently, in the states, the company’s Circle K Southwest division purchased 21 c-stores, 151 dealer fuel supply agreements and five development properties from Cinco J Inc. (d.b.a. Johnson Oil Co.), Tiger Tote Food Stores and their affiliates. Couche-Tard’s busy growth year coincided with Brian Hannasch taking over the role of president and CEO in September. He replaced company founder Alain Bouchard, who now serves as executive chairman of the board of directors.

Shell Oil/Motiva Enterprises LLC

Capitalizing on another year of growth, Shell Oil/Motiva Enterprises landed in the No. 3 spot on this year’s Top 100 list, down from its No. 2 spot last year. According to Nielsen TDLinx data, Shell’s retail network, which is comprised almost entirely of franchisees and licensees, includes more than 5,000 stores that generate annual sales of more than $11.8 billion. Most recently, the Houston-based company continued its stride to become a top liquefied natural gas (LNG) producer when its parent company Royal Dutch Shell plc struck a deal to acquire BG Group for $70 billion. Not only will the deal make Shell an LNG powerhouse, but the transaction will add 25 percent to its oil and gas reserves and 20 percent to its production capabilities.

32 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Additionally, Shell remains focused on growing its Fuel Rewards loyalty program, which launched in 2012. This year, the program hit the half-billion-dollar milestone in savings after less than three years. It currently has more than 5 million members and a national network of partners that includes more than 10,000 restaurants, 1,400-plus retail locations and nearly 700 online merchants. Simultaneously, Shell has launched its largest North American fuel campaign and one of its largest campaigns ever for new Shell V-Power NiTRO+ Premium Gasoline. According to Shell, NiTRO+ combines two key cleaning agents that perform better than the single component in the previous Shell V-Power formulation, as CSNews Online reported.


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COVER STORY

Energy Transfer Partners LP/ Sunoco LP

Nos.4&9

Two of the top 10 chains on this year’s Top 100 list are related: Sunoco LP (at No. 9) and its parent company Energy Transfer Partners LP (at No. 4). Sunoco LP owns the former legacy Susser Petroleum Partners wholesale business. It also owns Aloha Petroleum, Mid-Atlantic Convenience Stores (MACS) and Tigermart. Sunoco LP’s parent company, Energy Transfer Partners LP (ETP), is in the process of dropping down its entire retail division to Sunoco LP and reiterated in May that it will be done no later than mid-2017. Once this transaction takes place, Sunoco LP will become one of the biggest players in the convenience store industry, as it will take on the Sunoco Inc., Stripes and Sac-N-Pac retail assets now owned by ETP. “[Sunoco] LP is on the path to become one of the leading wholesale and retail platforms in the country,” said Sunoco LP CEO Robert Owens. As for Sunoco LP’s current assets, Owens noted Aloha and MACS are performing so well that the company is seeking future c-store acquisitions boasting similar assets to these two retailers. “We checked every box of what we are looking for in an acquisition [with those transactions],” Owens reported in May. “They have strong assets, demand growth in key markets and were acquired at attractive prices.” The master limited partnership is also bullish on the future of the c-store industry thanks to the potential for growth and margin expansion in foodservice. “People are becoming increasingly more comfortable purchasing prepared food at convenience stores,” Owens relayed. ETP’s current retail assets are also performing well, led by in-store merchandise sales. In 2015’s first quarter ended March 31, ETP’s retail division (primarily consisting of Stripes and Sac-N-Pac stores) achieved gross margins of $438 million, compared to $255 million in 2014’s first quarter. Motor fuel gallons sold throughout ETP’s retail division were also strong, increasing year over year from 1.392 billion gallons sold to 1.88 billion gallons sold.

No.6

No.5

Moving up two spots to No. 5, Marathon Petroleum Corp. boasts an overall store count of 4,086 locations, 2,646 that are corporate-owned and 1,400 that are franchise/licensee. The Findlay, Ohio-based company’s biggest boost came when it added Hess Corp.’s 1,200store retail network to its Enon, Ohio-based Speedway LLC retail division in September. The $2.82-billion transaction also included Hess’ transport operations and shipper history on various pipelines. As a result of this deal, Marathon is in the process of introducing the Speedway brand to a new region (the Northeast) and reintroducing it to another region (the Southeast). Rebranding efforts began in Florida before switching to the Northeast — mainly the New York and New Jersey area — in the spring. The company will turn its rebranding focus to the Carolinas later this year and finish all conversions by early 2016. In addition to growing its footprint, Marathon is expanding upon the Speedway brand with its new Speedy Rewards MasterCard. The one-swipe technology allows customers to pay for their purchases and manage their rewards points with one card, eliminating the need for a separate Speedy Rewards membership card. Cardholders earn 50 points per dollar by using the card for purchases at Speedway and 10 points per dollar on all other purchases. Speedway is not drawing all of Marathon’s time and attention, though, as the parent company rolled out Cents Off Marathon, an instant cents-off-per-gallon discount program on fuel purchases throughout its Marathon-branded marketing network. As of late 2014, nearly 80 percent of Marathon’s independent jobbers and dealers had enrolled in the program, which uses technology developed by Drop Tank. The program will be made available through deployment and installation, occurring during this year.

BP North America

BP takes the No. 6 spot in this year’s Top 100 list, dropping three positions from its consecutive No. 3 hold in 2014, 2013, 2012 and 2011. Nielsen TDLinx puts BP’s total store count at 3,945 — all of which are franchise/licensee locations. BP’s retail banners include Amoco, ampm, Arco, Arco Thrifty, BP, BP Connect and BP Shop. The company’s latest year-end sales amounted to approximately $14.3 billion. Following suit to its testament of “strategic refocusing,” in the past year, Houston-based BP introduced a new technology solution deployed at the point-of-sale, inside PIN pads, electronic payment server, forecourt controller and network for its BP-branded retailers. In doing so, the company provides its BP-branded marketers the ability to accept EMV (Europay, MasterCard and Visa) credit cards and debit cards. The technology platform is also designed to allow

34 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Marathon Petroleum Corp.

branded marketers to accept mobile payments and more effectively implement loyalty programs. On the consumer side, British-based parent company BP plc teamed up with Synchrony Financial to provide new private-label and co-branded credit card programs for customers. The new BP credit card programs, launched in the second quarter of this year, are accepted for purchases at more than 7,000 BP gas stations, as well as other retail sites. Additionally, on the consumer side, BP simplified its Driver Rewards program, whereby motorists can choose from three different loyalty cards: BP Visa with Driver Rewards, BP Credit Card with Driver Rewards and BP Driver Rewards Loyalty Card. BP-branded retailers now have an easier and more cost-effective program to manage as well.


COVER STORY

Chevron Corp.

No.7

After a year of no major acquisitions, Chevron slipped two spots in 2015 and landed at No. 7 on the Top 100. The San Ramon, Calif.-based company focused on internal improvements of existing locations rather than aggressive growth. Chevron’s store count stands at 3,886 stores, of which 314 are corporate-owned and 3,572 are franchise/licensee locations, according to Nielsen TDLinx, which also reported its latest year-end sales at more than $24 billion. Its banners include Chevron, Chevron ExtraMile and Texaco. This June, Chevron USA launched the Chevron and Texaco Xponent Rewards Card, a reloadable, prepaid card that lets users save five cents per gallon of fuel based on their everyday purchases at participating Chevron and Texaco stations. Cardholders can also increase fuel savings by using their card for purchases at participating merchant locations. Chevron USA also now embraces mobile payment at its c-stores. The company in October 2014 began accepting Apple Pay, which lets consumers make payments using their Apple mobile devices if they own a Visa credit or debit card issued by Bank of America, Capital One, Citi Bank, Chase or Wells Fargo Bank. Chevron initially accepted Apple Pay for in-store transactions at 3,000 stores and later announced plans to add it at the pump in 2015. Multiple surveys conducted in the past year showed that Chevron enjoys a good reputation with employees and customers alike. Chevron was praised for its friendly service in a study conducted by retail design firm King Retail Solutions, and the corporation ranked No. 155 on Forbes magazine’s America’s Best Employers 2015 list. On the marketing front, Chevron launched fall campaigns based around the themes of two classic American pasttimes: country music and sports. This included the tailgate-themed University of Texas Football Instant Win Game and the Game Day Chef Challenge, which concluded in a grand finale cook-off at the 2015 Rose Bowl.

No.10

Exxon Mobil Corp.

No.8

After holding steady at No. 6 for several years, Irving, Texas-based Exxon Mobil Corp.’s retail arm dropped two ranks on this year’s Top 100 as other chains pursued ambitious growth and its own convenience store count saw a slight decrease. ExxonMobil currently has 3,409 locations, all of which are franchise/ licensee locations. Its c-store banners include Exxon On The Run, Exxon Tiger Mart, Mobil Mart, Mobil On The Run, Mobil and Mobil Snack Shop. The company’s latest year-end sales totaled approximately $8.3 billion, according to Nielsen TDLinx data. Rumors that ExxonMobil would buy BP plc began to swirl in March after Exxon sold $8 billion of debt in its largest bond offering ever, but the company ultimately made no major acquisitions since last year’s Top 100 list. Rather than increase its number of stores, Exxon has focused on ways to increase loyalty at its current locations and signed on with multiple platforms designed to provide added benefits to consumers. In June, the company added the Uber Partner Fuel Card powered by FleetCor and MasterCard to its Momentum Driver Rewards Program. That same month, Exxon also joined up with AT&T Inc., Macy’s Inc., Nationwide Mutual Insurance Co., Rite Aid Corp., Direct Energy and Hulu to launch Plenti, a U.S.-based coalition loyalty program that lets consumers earn and use points for purchasing a wide variety of products, regardless of what payment method they choose.

Casey’s General Stores Inc.

Despite falling two spots to No. 10 on the Top 100 list, Ankeny, Iowa-based Casey’s General Stores turned in one of its best years ever. Nearly all aspects of its in-store operations had a banner 2015 fiscal year, with the foodservice, grocery, packaged beverages, salty snacks and tobacco categories leading the way. The owner and operator of 1,890 convenience stores posted sales of more than $7.9 billion in its fiscal year ended April 30, and also saw profits rise significantly to $180.6 million. Casey’s grew both organically and via acquisition during its latest fiscal year, opening 45 new-build stores and purchasing 36 locations. The retailer also completed 27 store replacements and 27 major remodels. For its 2016 fiscal year that began May 1, Casey’s has set a target to build or acquire 72 to 108 stores and replace 25 locations. To help

36 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

facilitate growth in its newest markets of Arkansas, Kentucky and Tennessee, Casey’s is on track to open a second distribution center in Terre Haute, Ind., in February or March of 2016. The Midwest retailer also plans to reach new customers via its online ordering service, which is rolling out chainwide. Customers can order online to indulge in pizza, sub sandwiches and related products. Casey’s plans to add this service to 300 stores per month and expects to have online ordering available in all of its stores by end of this calendar year. Also in the foodservice realm, pizza delivery is another source of continued growth, as Casey’s plans to expand this service to an additional 100 stores in its fiscal year 2016.


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COVER STORY

No. 1 No More?

7-Eleven still holds the top spot, but other chains’ growth puts its dominance into question

A

s it sits atop the Top 100 list for yet another year, 7-Eleven Inc. remains a dominant force in the convenience store industry that is capable of setting trends and serving as serious competition to other stores in its markets. While it still holds a lead of several thousand stores, the industry has seen a number of changes that prompt a new question: Could this be 7-Eleven’s last year in the No. 1 spot? At first glance, the Dallas-based company has nothing to worry about — 7-Eleven’s store count of 8,144 locations puts it more than 2,700 units ahead of No. 2 Alimentation Couche-Tard Inc., and it is twice as large and then some compared to most other companies in the top 10. However, other chains boosted their store counts by incredible figures year over year. Couche-Tard is up 1,047 stores compared to this time last year, while Marathon Petroleum Corp. is up by 1,263 units and CST Brands Inc. by 973. 7-Eleven added just 395 stores year over year. According to some industry experts, the disparity in growth is just a matter of perspective, as a net gain of nearly 400 stores would be viewed as more than acceptable growth in a year without the landmark acquisitions that Couche-Tard, Marathon and CST made. “I don’t think anybody is concerned about who is biggest,” said Dennis Ruben, managing director of NRC Realty & Capital Advisors LLC. “7-Eleven has decided it is better off selling non-strategic assets that are either too small or not in core markets.” Ben Brownlow, equity research analyst with Raymond James & Associates Inc., also dismissed serious concern about a shift in ranking. “7-Eleven always has the scale and capital to compete,” he said. “It is on the same footing.” Others view 7-Eleven’s smaller addition as a calculated choice rather than it lagging behind. “7-Eleven has slowed its growth because it appears to have changed its business plan,” said Terry Monroe, president of American Business Brokers. Instead of expanding through acquisitions, such as its deal to purchase the 182-store Tedeschi Food Shops chain, 7-Eleven is putting more effort into converting

38 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

company-operated stores into franchise stores. This strategy discourages acquisitions unless 7-Eleven can immediately convert purchased stores into franchises, Monroe said. By having more franchisees, it can focus on selling a greater amount of proprietary food items. “Other chains are expanding and they should, with all of the cheap money that is available to them,” Monroe added. “Which in turn has made store valuations higher than they have been in years. So, it is a great time to be a buyer and a great time to be a seller.” What ComEs NExt

The current climate of growth is likely to continue while it is feasible, according to experts, as there will unlikely be such a promising opportunity for expansion for a long while. But major acquisitions like Couche-Tard’s purchase of The Pantry Inc. aren’t likely to happen regularly. Most predict 7-Eleven will retain its crown in 2016, but the gap between it and the runner-up may narrow, and it is likely to be challenged in the future as industry consolidation continues. “It will put more pressure on the chain to be flexible, more controlled from a centralized perspective and hopefully it will realize just being the largest doesn’t mean they are the c-store leader,” said Tim Powell, principal and owner of Think Research & Consulting. For the moment, 7-Eleven does not need to chase growth for its own sake. “It is obvious 7-Eleven is more concerned about profitability than they are number of stores. They like to focus their stores in large metropolitan areas where they have commissaries and they can supply their stores, which enables them to offer their proprietary food offerings to their customers,” Monroe said, noting foodservice offers a high gross profit. “7-Eleven has done a very good job of executing the food side of the business and will continue to as they grow.” Ultimately, while 7-Eleven may not always be the country’s largest c-store chain, it may just be business as usual for the longtime leader. — Angela Hanson


COVER STORY

Sliding Into Second New No. 2 Couche-tard boosts its powerhouse status with the Pantry

I

t can be said that 2014 was a rollercoaster year for The Pantry Inc. The Cary, N.C.-based operator of Kangaroo Express convenience stores began the year challenged by an investor group called Concerned Pantry Shareholders (CPS). Spurred by an underperforming stock price, CPS proposed the election of three independent board of director candidates. CPS argued that the current board had presided over a “prolonged underperformance,” noting “The Pantry has had four CEOs in the past five years and continues to lack a strategically coherent plan to stop the value destruction.” The group’s concerns were heard and in March 2014 The Pantry’s shareholders voted for change, electing three new members proposed by CPS to the board of directors. The Pantry again grabbed headlines late in 2014 with news that it had quietly put itself up for sale. Alimentation Couche-Tard Inc. emerged as the winning suitor. The roughly $1.7-billion acquisition agreement closed March 16 of this year — almost a year to the day that The Pantry’s shareholders cast their votes for new blood on the board. What’s emerged now is a bigger, stronger CoucheTard that added approximately 1,500 convenience stores to its Circle K Southeast division. As a result, the Canada-based retailer operates a total of 7,800plus stores in North America. So, what happens now? According to industry insiders, Couche-Tard embarks on a journey of combining the best of Circle K and The Pantry’s Kangaroo Express and further stakes its claim as a convenience retailing powerhouse to be reckoned with. “From within the store, when you think about the aspects of Circle K’s strategy, Circle K in my view was further along with supply chain efficiency,” said Ben Brownlow, equity research analyst at Raymond James & Associates Inc., noting the retailer is utilizing Core-

40 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Mark, the second-largest distributor behind McLane Co. Inc. “Core-Mark is well known for spearheading foodservice offerings that you don’t typically expect at a c-store.” For its part, The Pantry maintains a supply agreement with McLane. “I think you’ll see some improved execution on the foodservice side at Kangaroo sites, possibly some more consistent product offering that is also better tailored to regional demographics,” Brownlow said. On the fuel side, the deal brings an improved purchasing scale and mutual shared data on fuel pricing between the two companies. “Consumers could possibly see more competitive pricing at the pump. But ultimately, I think the savings, if any, that consumers see will depend on how much Couche-Tard management balances competitive pricing vs. reinvesting cost savings for future growth,” Brownlow explained. Looking at what The Pantry brings to the table, he points to the retailer’s success with promotional activity. “The Pantry, before it was bought out, had undertaken a multi-year initiative to deliver more relevant in-store product offerings and improve its promotional execution, like the Roo Cup promotion. The Pantry was very successful with that promotion and they are still running that promotion,” he said. “While I think Circle K is further along in the product offerings, I think the company still can benefit from that promotional data and even some of the demographic data that The Pantry has harvested.” Tim Powell, founder and principal of Think Research & Consulting, believes that Circle K brings “excellent national recognition and is also adept at branding, particularly beverages. We may see some merging of proprietary brands, but I expect Kangaroo Express to keep to its brand to maintain a loyal base.” Strategies of The Pantry that may survive the transition include its foodservice execution and its ability to


COVER STORY

know its customers, Powell added. From a real estate perspective, there’s a chance not all stores will survive the acquisition. “It’s kind of like apples and oranges because they have different business models,” said Dennis Ruben, managing director at NRC Realty & Capital Advisors LLC. “About 75 percent of The Pantry’s properties were leasebacks that involved negotiating a lease with a landlord. How many of those Pantry sites wind up staying in the system in the next five years is anyone’s guess.” Analyzing the portfolio will take time, according to John Sartory, managing director at Petroleum Capital and Real Estate LLC. “I think it’s going to take a while for everyone to figure out how to rationalize those assets. There are a number of Pantry sites [CoucheTard] will probably not hold on a long-term basis,” Sartory said. “They may sell some for alternative real estate use or sell them to dealers and look to have nothing more than a supply relationship.” Finally, what does this combined company mean to other players in the convenience channel? The way Brownlow sees it, anytime you combine the scale of any of the top operators in the industry, smaller operators with less capital will be increasingly challenged to keep up, both with the in-store offerings as well as the competing fuel prices. “Broadly speaking, what you’ve seen with not just Couche-Tard and The Pantry, but with ETP [Energy Transfer Partners] and Susser [is that] the industry consolidation as a whole is a greater threat to the mom-andpop operators vs. operators like 7-Eleven, which are better adept to keep up with these changes,” he said. “7-Eleven always has the scale and capital to compete. It is on the same footing.” Speaking of 7-Eleven, the No. 1 c-store chain does not need to start looking over its shoulder, according to the industry experts. “I don’t see it directly affecting 7-Eleven. There is still no national c-store chain. There is no McDonald’s in our industry. 7-Eleven will focus on expanding in those areas in which they can logistically,” said Brownlow.

New Additions to the List Sunoco LP Mirabito Energy Products Buchanan Oil Co. Jet Pep Weigel’s Stores Inc. Stinker Stations MNS Ltd. (ABC Store) Enmark Stations Inc.

Drop-Offs From Last Year The Pantry Inc. Acquired by Alimentation Couche-Tard Inc.

Hess Corp. Retail assets acquired by Marathon Petroleum Corp.

VPS Convenience Store Group Acquired by GPM Investments LLC

My Goods Market Acquired by United Pacific

— Melissa Kress

On the Cusp (Nos. 101-110) 2015 Rank

Company, City, State

Total U.S. Store Count

Company-Operated Franchise/ Latest Year-End Sales* Primary Stores Licensee Stores ($000) Store Names

101t

Family Express Corp., Valparaiso, Ind.

62

62

0

$138,580

Family Express

101t

Dash In Food Stores Inc., La Plata, Md.

62

62

0

$189,540

Dash In Food Store

103

7-Eleven Hawaii Inc., Honolulu

61

61

0

$76,440

7-Eleven

104

CHR Corp., York, Pa.

60

60

0

$98,540

Rutter’s Farm Store

105

BFS Foods Inc., Morgantown, W.Va.

59

59

0

$165,100

BFS Foods

106t

Sam’s Mart, Matthews, N.C.

58

53

5

$161,200

Sam’s Mart, Express Mart

106t

Pester Marketing Co., Denver

58

58

0

$178,880

Alta Convenience

108t

Rebel Oil Co. Inc., Las Vegas

55

55

0

$193,440

Rebel Plus

108t

CoGo’s Co., Pittsburgh

55

42

13

$133,120

Jiffy Mart

108t

Southeast Petro Distributors, Cocoa, Fla.

55

46

9

$139,100

Sunshine Express, Sunshine Food Mart

Source: Nielsen TDLinx, April 2015

42 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


Merger Mania

Experts don’t expect the furious c-store m&a activity to slow down any time soon

M

erger & acquisition (M&A) activity has been rapid in 2014 and 2015, with no signs of slowing down. Evidence of these fast-paced changes can be found when doing year-over-year comparisons of the Convenience Store News Top 100 rankings. Many names fell off the list this year after being acquired, while others made impressive moves up the rankings, and another group of companies entered the list as new kids on the block. With the exception of 7-Eleven Inc. ranking as the No. 1 U.S. c-store player in terms of locations for another consecutive year, most other companies saw position changes. In fact, none of the other top 10 c-store chains on this year’s list occupied the same position last year. If economic cycles tell us anything, it’s that the feverish M&A activity in the convenience and fuel retailing industry has to end someday. However, experts don’t think the day is near. “There’s no reason right now to believe the dynamics moving everyone toward further consolidation are going to subside,” said John Sartory, managing director of Petroleum Capital and Real Estate LLC. M&A in different shapes and sizes should continue. Whether it’s a one- or twostore acquisition that garners little fanfare, or something as big as Alimentation CoucheTard Inc.’s recent purchase of The Pantry Inc., he said nothing is out of play. “I think you will see a wide

spectrum of transactions that are bigger, smaller and inbetween,” revealed Sartory. “I think there will be a lot of smaller sellers who have no more than 10 or 15 sites, and I think you will have larger mega-deals. I think these deals will occur because the appetite is there and the credit is available.” Tim Powell, founder and principal of Think Research & Consulting, also sees no sign of an M&A slowdown. “There is still a lot of room for activity,” he said. “There are far more single stores and independents to be had. Location is the name of the game and regional chains are looking to buy share.” Also in agreement is Ben Brownlow, equity research analyst for Raymond James Associates Inc. “There is still a ton of opportunity,” he stated. “There are 150,000 fuel/convenience stores in the country and two-thirds are mom-and-pop operators, so it’s still a very fragmented industry with a ton of consolidation left.” As for the retailers likely to be acquirers, Dennis Ruben, executive managing director of NRC Realty & Capital Advisors LLC, named CST Brands Inc. and Sunoco LP. “Also, there are other master limited partnerships (MLPs) that will continue to be buyers,” he said. “Interestingly, there are two MLPs coming to market [as initial public offerings] in GPM [Petroleum] and Empire [Petroleum Partners]. These companies have been growing at aggressive rates.”

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 43


COVER STORY

BiggEST MOVERS 2015 2014 Rank Rank

Company

Spots Moved

28

104t

United Pacific, Los Angeles

74

104t

Mirabito Energy Products, Binghamton, N.Y.

76 30

84t

65t

Gas Mart USA Inc., Leawood, Kan.

19

23t

41

Western Refining Inc., El Paso, Texas

18

92

109

Jet Pep, Holly Pond, Ala.

17

12

28

CHS Inc., Minneapolis

16

76

92

Spinx Oil Co. Inc., Greenville, S.C.

16

30

43

CrossAmerica Partners LP, Allentown, Pa.

13

84t

97t

Johnson Oil Co., Rock Falls, Ill.

13

87t

99

Express Mart Franchising Corp., Syracuse, N.Y.

12

90

101

Buchanan Oil Co., Omaha, Neb.

11

82t

93t

Newcomb Oil Co., Bardstown, Ky.

11

Source: Nielsen TDLinx; Convenience Store News Market Research 2015

In fact, even the acquirers could become the acquired. In a recent Barron’s article, Mario Gabelli, chairman and CEO of Gamco Investors, said CST Brands — which along with its partner CrossAmerica Partners LP has purchased multiple c-store assets in recent months — could itself be taken off the market by a competitor. “CST’s CEO Kim Lubel isn’t opposed to a takeover if somebody knocks on the door and offers the right price,” said Gabelli. CaN aNYthING stoP thE PaRtY?

Right now, little can slow down the M&A environment that Ruben of NRC Realty characterizes as a “perfect storm in a positive way.” “You have low interest rates, multiples that have been high, and strong fuel margins allowing customers to have more disposal income,” he said. “The trends we’ve seen for c-store retailers for the past six months have been very positive. Before long, you will have one-third of the convenience stores in this country in the hands of a half-dozen people.” There is likely only a couple of ways to slow down the flurry of M&A activity the c-store industry is seeing, according to Sartory. Macroeconomic events, including weakening of the credit markets or the overall economy, would curtail such activity. “Something that pushes the economy into a recession would be one way. Also, it looks like the Fed [Reserve Bank] will look to raise short-term interest rates. This could cause the stock market to go down. It’s even possible the market could correct by more than 10 percent once this happens.” 44 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

The Federal Reserve kept interest rates at zero during its June 17 meeting. But industry pundits such as Phil Orlando, chief equity strategist and portfolio manager at Federated Investors, point to September as the first time the Fed would look to raise interest rates, with the possibility of another rate hike in December. If the stock market corrects, several potential acquirers could hold back on M&A activity fearing they must maintain their capital. Sartory stressed, however, that an interest rate hike alone doesn’t necessarily mean a big stock market decline will take place. “The market only tends to act violently if unintended consequences occur,” he said. “If interest rates only rise 25, 50 or 75 basis points over the next year, I don’t see that throwing cold water over the M&A market. Historically, we would still be in a very low interest rate environment and I think the party continues.” The party could stop, though, if supply and demand metrics change. Plenty of c-store assets are currently on the market because sellers are seeking — and recently have been receiving — premium prices for their assets. If buyers find out that purchased assets have not been performing up to expectations, they can remove themselves as acquirers, leaving plenty of sellers on the market and few buyers, which would make asset price tags come down sharply. “If a company makes an acquisition and a year later learns they overpaid and it is not reaching their financial goals, that may make some public companies that have been very aggressive in their bidding think twice,” responded Sartory. At least in the near-term, Ruben believes there will be no seller shortage. But looking out further, c-stores are performing so well now that some sellers may sit on the sidelines and enjoy the ride as opposed to shedding assets, he noted. “Sellers may look at their assets and say, ‘I understand the multiples are very strong, but I’m making a lot of money right now. If I cash out, tell me where I can park this money to get the same kind of return?’” he concluded. “It’s a really good question.” — Brian Berk

Bonus Content on CSNews.com

Check out the special features section of CSNews.com for additional content, including: · Ones to Watch (smaller chains with big ideas) · Regional Breakouts: Northeast, South, Midwest and West


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Females in

FORCE More than 50 honored in our second-annual Top Women in Convenience awards

46 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


Top Women in Convenience

A Convenience Store News Staff Report rom the c-suite to the store level to the independent entrepreneur, women are making their mark on the convenience store industry these days in greater numbers than ever before. Case in point: The second-annual Convenience Store News Top Women in Convenience awards program honors 58 females, almost double the 30 recognized in its inaugural year. The Top Women in Convenience program celebrates a diverse array of women — from retailer, supplier and wholesaler companies — making a positive impact in the convenience retail channel. This year, in addition to senior-level leaders (positions of vice president and above), rising stars (job titles above store manager, but below vice president) and store managers, the program has been expanded to also recognize mentors (women who have made an extraordinary impact on the careers of their colleagues) and singlestore owners. The honorees are chosen based on nominations received from their peers. Drawing from achievements during the previous 12 months, nominators were asked to illustrate the candidate’s innovative corporate initiatives, extraordinary financial and strategic accomplishments, astute-problem solving acumen, exceptional performance and selfless charitable participation, along with other attributes that go above and beyond the call of duty. This year’s judging was conducted by Convenience Store News in conjunction with the Network of Executive Women (NEW) and the newly formed Top Women in Convenience Advisory Board, which includes all five 2014 Women of the Year honorees. The judging panel selected 22 senior-level leaders, five mentors, 18 rising stars, five store managers and three single-store owners to receive the esteemed title of Top Women in Convenience for 2015. Like last year, the panel also chose five nominees as the best of the best from among all the nominations and award-

F

ed them the title of Women of the Year. Recognized for their exceptional impact on the success or direction of their company, as well as their positive impact on the convenience store industry, the 2015 Women of the Year are: • Jenny Bullard, chief information officer, Flash Foods Inc. • Kimberli Carroll, senior vice president, foodservice division, Ruiz Food Products Inc. • Tammy Floyd, vice president/controller, CST Brands Inc. • Stacy Loretz-Congdon, senior VP/chief financial officer, Core-Mark Holding Co. Inc. • Sandra Morgenstern, president/CEO, Par Mar Oil Co. All of the honorees will be celebrated at an awards presentation taking place during the 2015 NACS Show, the largest annual gathering of the convenience store industry. The event will begin at 5:30 p.m. Oct. 12 at the Las Vegas Convention Center. Read on for spotlights of this year’s Top Women in Convenience.

2015 Top Women in Convenience Advisory Board •Kim Lubel, chairman, president and CEO, CST Brands Inc. •Allison Moran, CEO, RaceTrac Petroleum Inc. •Gwen Forman, vice president of marketing, Cumberland Farms •Barbara Poremba, vice president of national retail sales for the Foodservice in Retail Center of Excellence, Coca-Cola Refreshments •Jennifer Rhoads, president/CEO, Ohio Petroleum Marketers and Convenience Store Association •Joan Toth, president/CEO, Network of Executive Women •Blake Benefiel, director of trade and state relations, training and compliance, Altria Group Distribution Co. •Beth Jarocki, customer vice president for c-store channel, Kraft Foods Group

The 2015 Convenience Store News Top Women in Convenience program is sponsored by:

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 47


Top Women in Convenience

WOMAN OF THE YEAR:

Jenny Bullard Chief Information Officer, Flash Foods Inc.

“Being involved in the industry keeps our company at the forefront of technology.”

enny Bullard started working for The Jones Co. right out of high school in the accounting department. When the company started expanding into new technology, she became more involved in this side of the business, bringing her background in computer programming into the mix. Today, she is chief information officer of The Jones Co., holding company for Flash Foods Inc., a chain of 171 convenience stores in Georgia and north Florida. On a daily basis, Bullard works with the executive team on all software development, purchases, system networking, disaster recovery and more, and is also very involved in convenience store industry associations. She served as chair for the National Association of Convenience Stores’ (NACS) technology conference from 2008 to 2010, and is currently a member of the Conexxus Tech Council Committee. “Being involved in the industry keeps our company at the forefront of technology,” Bullard said. “NACS and Conexxus allow me to work not only with peers, but also with solution providers looking to partner with retailers on new technology.” Bullard also was the recipient of the 2004 Convenience Store News Technology Executive of the Year award and the 2005 Pinnacle Hall of Fame Award, and she was inducted into the Conexxus Hall of Fame in 2014.

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She’s spearheaded many successful technology implementations for Flash Foods, including the chain’s recent GoBlue mobile payment application. “We are working on the second generation of our mobile app with new functionality right now,” said Bullard. “We are working with some of our suppliers to offer mobile coupon redemption.” Having been in the c-store industry for more than 40 years, the role of women and the number of women in leadership roles has changed a lot, she explained. In the past, when attending a conference, the room would be 90 percent men. But this is shifting. “There are more women in the industry and more in our company. I think it’s a combination of more opportunities and that women feel more comfortable being in the industry and being a leader in the industry,” she noted. Looking back over her career, she said receiving the recognition by Convenience Store News in 2004 with the Technology Executive of the Year award stands out as the accomplishment she is most proud of so far. “That meant a lot to me personally; not just being the first to get this award, but to be recognized for this award and being a woman in the industry in technology,” she said, adding that the greatest achievement within her own company is having the owners of the company trust her to represent Flash Foods in the industry. “I would not be recognized in the industry without the backing of The Jones Co. having the confidence in me to let me lead the company in technology and giving me the reins to go out in the industry and make Flash Foods a better company today,” Bullard said.

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— Tammy Mastroberte


Congratulations

The Coca-Cola Company congratulates Dagmar Boggs, President, 7-Eleven Global Customer Team, and Kim Williams, Manager, Category Advisory Services, on being named to the Top Women in Convenience by Convenience Store News!

Š 2015 The Coca-Cola Company


Top Women in Convenience

WOMAN OF THE YEAR:

Kimberli Carroll Senior VP, Foodservice Division, Ruiz Food Products Inc. vors and spice levels. “Foodservice has become such an important part of the c-store industry in the last few years,” Carroll explained. “We have wonderful customers who really work with us to partner for success. It’s been an amazing ride, and the team we have here is amazing. It’s a good company to work for where the values are strong and the integrity is so high.” imberli Carroll began her career workBecause Carroll became the marketing director for ing in the fresh produce industry, the California Tomato Commission at just 26 years serving as the director of marketing old, she was accustomed to being one of the for the California Tomato youngest — and often the only woman Commission for six — in the room with her peers. years, and also as the marketing “Women have Today, she said there are many manager for a family-owned more women involved, which is product company, PTG become signifcant helpful in the c-store industry Management Co. where the primary customer In 2001, she joined in the industry at every target is women. Dinuba, Calif.-based Ruiz “Women have become Food Products Inc. as the level, and I’m so honored significant in the industry at marketing manager for its to be among the women every level, and I’m so honfoodservice division, and ored to be among the women was promoted to director of who are helping to who are helping to drive the marketing for the foodservice industry forward,” she noted. and c-store divisions that same drive the industry One of her favorite parts year. Today, Carroll is senior of the job is creating and buildvice president of sales, foodservice. forward.” ing the right team, something she “As director of marketing, I startbelieves she’s been successful at doing. ed on a journey working with industry And one of her greatest accomplishments associations to understand all the elements of so far has been participating in the creation of the the c-store industry. We were really new to the c-store Tornados line of products. industry and it was starting to evolve. We had the “To be part of that was exhilarating. That is what good fortune to work with 7-Eleven as our first major is so meaningful to me — to look beyond the trees to c-store foodservice customer,” Carroll recalled. see what the future can be, and partner with the right In 2003, Ruiz introduced its Tornados product into people to make sure we get there,” Carroll said. “Here the c-store space as an answer to declining roller grill I am 50 years old, and I feel like every day is a new sales, and Carroll spearheaded the effort. It not only day, and I’m very excited about what we still have allowed Ruiz to grow its overall foodservice business, but also has become one of the top roller grill products available for us to do and accomplish.” in the United States, available in a wide variety of fla— Tammy Mastroberte

K

50 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM


KRAFT

is proud to honor our top women in Convenience 2015 Senior Level Leader

Rising Star

Kathleen Byrd

Associate Director National Accounts, Convenience Store

Alissa Ecker

Customer Development Manager, C-Store Integrated Supply Chain

TOP WOMEN IN CONVENIENCE

Our Compliments to All the Winners!


Top Women in Convenience

WOMAN OF THE YEAR:

Stacy Loretz-Congdon Senior VP/Chief Financial Officer, Core-Mark Holding Co. Inc.

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ith a Bachelor of Science degree in accounting from California State University, Stacy LoretzCongdon started her career as an auditor for Coopers & Lybrand. In May 1990, she joined Core-Mark International Inc. as an accounting manager when the company was going through a restructuring. She eventually moved into financial planning and analysis, but after six years, was looking to take on different responsibilities. “I started working as the support person for the treasurer and that eventually grew into me becoming treasurer,” she said. “I’ve always had a high learning curve, and Core-Mark always satisfied my need to grow.” In January 2003, she became vice president of finance and since December 2006, has served as the senior vice president and chief financial officer of CoreMark Holding Co. Inc. She oversees all the company’s financials, and her daily job depends on what strategic initiatives the company is working on at the time. “Companywide, the finance department is 300 people, and in my direct corporate department there are 70 of us. My job is to make sure we have adequate resources from capital all the way to people,” she explained. One of the reasons she loves the convenience store industry is because it is always changing. There are always new aspects to learn and new solutions crop-

ping up every day, in both the industry and her job. “The dynamic, ever-changing growth trajectory makes the industry fascinating to me,” LoretzCongdon said. “It is evolving and to watch that evolution has been a lot of fun and keeps me engaged.” As a member of NACS and the Convenience Distribution Association, she is involved in the industry outside her company as well, attending roundtables and conventions that help her and her employer stay on top of trends, especially since Core-Mark is a public company and talks about forward-looking trends in its financial statements. Becoming CFO is one of the accomplishments she is most proud of in her career, along with starting an intern program for Core-Mark. She is currently working on a mentoring program, and knows success is all about the right team and resources. “I’m really proud of these [programs] because it allows us to attract talent, and it’s all about resources. The millennials are looking for that development. The program has been very successful, and I’m hoping mentoring will do the same.” Loretz-Congdon recently marked her 25th year at Core-Mark, and said longevity is pretty common at the company. There’s even an employee who’s been there more than 50 years. “When I started, we were around a $1.6-billion company and we [reached] over $10 billion last year,” she said. “Our company is a small company in a big box because we still have the values of a small company. I can pick up the phone and call any one of our 31 divisions and they know me and I know them.”

“The dynamic, ever-changing growth trajectory makes the industry fascinating to me.’’

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— Tammy Mastroberte


on being named the Convenience Store News Women of the Year

Jenny Bullard

Kimberli Carroll

Tammy Floyd

Stacy Loretz-Congdon

Sandra Morgenstern

CIO, Flash Foods Inc.

Senior VP, Foodservice Division, Ruiz Food Products

Vice President, Controller, CST Brands Inc.

Senior VP, CFO, Core-Mark International

President/CEO, Par Mar Oil Company

Your Source for Tobacco Category Solutions


Top Women in Convenience

WOMAN OF THE YEAR:

Tammy Floyd VP/Controller, CST Brands Inc.

there were several options for colors and signage, and I participated in making those decisions. I get a lot of satisfaction from that.” When it comes to her greatest accomplishment so far, it’s building a solid “Women team to support her and the company. Before the spinoff, the U.S. and should never lose Canadian divisions operated inderaduating from sight of what they pendently. She worked to build a the University of team to operate as one. Houston with a mean to the industry. “I started on that from day degree in accountone, and it didn’t happen overing and a minor Your opinion matters night, but I’m proud of the way in Spanish, Tammy Floyd started so let it be the team is functioning today,” working in the convenience store she said. industry in 2007 when she joined known.” Acknowledging there are more Valero Energy Corp. on the refinwomen in the industry today than in the ing side as a manager in budgeting and past, Floyd knows the role of women in conforecasting. When the company was thinking venience is important because many companies are about spinning off the retail division, Floyd particitargeting the female customer. pated in the survey process and eventually went over “In our industry, women are a sought-after customto the retail division for a year to help get accounting er base. The industry is recognizing women are a tarset up and running efficiently. get market, and they are seeking us out more because “We looked at our systems and set it up so we they want to cater to us and get us into the store,” she could automate things, and then I went back to the noted. As a Valero and now CST Brands employee, refining side until the IPO [initial public offering] Floyd has given her opinion on what women would was eminent in April 2012. Then I came back,” she recounted. She is now vice president and controller for want from the chain. For instance, when Valero started building bigger CST Brands Inc., based in San Antonio and operating stores and was working to create the designs, Floyd approximately 1,000 convenience stores. had a 1-year-old child and mentioned it would be nice Floyd is responsible for the accounting operations to have a changing table in the bathroom. Now, each of the company, including periodic financial reports, store has that option. maintenance of accounting records, integration and Her advice to other women in the industry is to not development of newly acquired assets, and more. But be afraid to speak up, because their opinion means a that isn’t her favorite part of the job. lot to the industry. “There are a lot of technical aspects to my job, “Don’t be afraid to give an opinion about a prodbut my favorite part is I get to have a seat at the table uct or bringing something into the stores,” she said. where decisions are being made, and the product of “Women should never lose sight of what they mean to those decisions consumers are seeing. It’s impactthe industry. Your opinion matters so let it be known.” ing thousands of people on a daily basis,” Floyd explained. “When creating our large store format, — Tammy Mastroberte

G

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Top Women in Convenience

WOMAN OF THE YEAR:

Sandra Morgenstern President/CEO, Par Mar Oil Co.

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being the only woman at the conventions she attended. She was only the second woman to ever serve on the board of the Ohio Petroleum Marketers and Convenience Store Association. Today, a lot has changed. “We see many more women in the industry and in leadership roles, running companies. But it certainly wasn’t that way years ago,” she noted. Today, Morgenstern and Par Mar are focused on continuing the development of the company’s foodservice program, both branded and proprietary, especially since many of the chain’s stores are in rural locations and are the only store in town. “We see and recognize [that] food is the perfect opportunity to offer our customers, attract new ones and keep them coming back,” she stated, adding that she feels fortunate to have a dedicated and hardworking team by her side each day. Of all her accomplishments, she is most proud of giving back to the communities where Par Mar Oil operates. She was instrumental in developing Wednesday Wish Day 15 years ago, the company’s fundraising program for children on Christmas morning. Three years ago, she also played an instrumental role in starting a new program, Draw for Success. “We partner with local elementary schools in our communities. We tell the history of Par Mar to the students in different classrooms, and they use their artistic talents to create drawings,” she said. “Then, the art department teachers judge them and we give the winners $50 savings bonds for recognition, which they can put aside for their future education.”

“The main beneft for me being active in the industry is there is so much to gain from others.”

andra Morgenstern started at Par Mar Oil Co. as a part-time receptionist 25 years ago. Today, she is the president and CEO, directing the company’s growth to a 50-store chain with 16 quickservice restaurants and more than 800 employees in three states. “Par Mar purchased a lubricant distributor I was working for and I always say I was inherited with the package,” Morgenstern said. “My first role was working four hours a day answering the phone as a receptionist and taking lubricant orders.” Having grown up with a father who was a jobber and owner of a gas station and service center that “hauled and distributed fuel,” Morgenstern was no stranger to the industry. At Par Mar, she worked her way through the ranks, becoming president and CEO 12 years ago. Along with progressing at Par Mar, Morgenstern is also past director of OMEGA, the West Virginia Oil Marketers and Grocers Association, and currently serves on the board of the Ohio Petroleum Marketers and Convenience Store Association. “The main benefit for me being active in the industry is there is so much to gain from others. The different associations offer networking and the ability to bring so much to the business,” she explained. Early on in her career, Morgenstern remembers

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— Tammy Mastroberte


Top Women in Convenience

Karla ahlert

VP Finance/ Treasurer, RaceTrac Petroleum Inc.

• Ahlert’s primary responsibilities include overseeing the company’s capital planning and funding, treasury operations, corporate cash and investments, and trade credit. • She was appointed to chair RaceTrac’s Finance Committee from 2010-2013, and was selected to represent RaceTrac on the Merchant Customer Exchange (MCX) board in 2013, holding an ongoing board member position. • She is a member of the Association of Finance Professionals, the Merchant Advisory Group and Fifth Third Bank’s Treasury Advisory Council.

Senior-Level

LEADERS Dagmar Boggs

President, Global Customer Team, Coca-Cola North America

• Boggs is president of the 7-Eleven Global Customer Team, Coca-Cola’s largest convenience retailer with 55,000 outlets in 16 countries. • She is an active member of the Women’s Foodservice Forum, the Network of Executive Women and Women’s LINC at The Coca-Cola Co. • Outside of work, Boggs is a founding member of Ribbons of Hope, an Atlanta-based charity for women that identifies worthy causes related to women and families.

Kathleen ByrD

Associate Director, National Accounts, Kraft Foods Group

• As the leader of Kraft’s c-store national accounts team, Byrd is responsible for almost 60 percent of the company’s convenience store revenue. • She is credited with growing national account sales by two times the channel growth across Kraft’s portfolio of five retail business units and the foodservice unit. • Her professional involvement includes the Women at Kraft Employee Resource Group (ERG) and the NACS Supplier Membership Committee.

myra CanterBury President, Simmons Corp.

• Canterbury is involved with future developed programs that will be offered to retailers of several different industry segments that sell and track fuel inventory. • Her previous role at Simmons was vice president of information technology, and she is a recognized authority in office and system automation. • She served as chairwoman for the NACS Standards – Device Integration Committee and chairwoman of the E-Commerce Committee for the NACS Supplier Board.

DeBBie armentrout

General Manager/ Owner-Operator, Allen Oil Co.

• Armentrout is tasked with category management, store sets, marketing, foodservice development, system/technology implementation and inventory control for the company’s Quik Mart and More chain. • Armentrout and her husband started their careers in gasoline wholesale distribution as the owners and operators of Allen Oil and bought their first c-store 30 years ago. • One of her first foodservice initiatives was to introduce a homemade Stromboli to the seven-store chain as a unique item to draw in customers.

WenDy Chronister CEO, Chronister Oil Co.

• As chief executive of the family business, she is responsible for the management of its Qik-n-EZ convenience stores in central Illinois. • Chronister serves on the board of directors of NACS, the Association for Convenience & Fuel Retailing, and is chair of the NACS Show. • Before joining Chronister Oil, she was a partner in the law firm Kirkland & Ellis and a partner in a private equity firm.

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Top Women in Convenience

niKi DePhiliPs

Senior VP, Store Development, Kum & Go LC

• Her primary focus at Kum & Go is to oversee all activities related to site selection, government approvals and construction of 20 new convenience stores annually. • She began her career with Kum & Go as an administrative assistant at 22 years old and rose to her current position in just 12 years. • DePhilips is a Certified Commercial Investment Member (CCIM), received her Six Sigma Greenbelt Certification and was honored as a “40 under 40” in 2014.

Carolyn hooD

Director, Convenience Channel, KIND Healthy Snacks

• Hood joined the company in 2012 to lead KIND’s growth expansion into the convenience channel. She oversees the c-store business for the company’s Western division and works closely with c-store wholesalers such as McLane Co. Inc. and Core-Mark Holding Co., and retailers such as 7-Eleven Inc. • She helped KIND grow to 20 independent wholesalers and gain huge distribution all-commodity volume for the brand. • Hood is an advocate for adoption and an incoming board member for nonprofit adoption agency The Gladney Center.

Kelly FulForD

Senior Category Development Manager, General Mills Convenience

• Fulford joined General Mills in 2003 and currently leads the category management team for General Mills Convenience. She is responsible for analyzing category data along with consumer insight research to identify how retailers can drive sales and profit throughout the store. • She has won several retailer awards including the 2014 Maverik Strategic Snacks Outfitter of the Year, the 2013 Kum & Go Strategic Partner, and the 2012 Circle K West Silver Award of Excellence.

Jeannine Peterson Director of Foodservice, Circle K

• Peterson is responsible for the discovery of new product offerings, and directly negotiates and procures products and equipment from suppliers, vendors and other representatives for Circle K’s Arizona division. • She oversees 650 stores in her division, or 20 percent of the Circle K locations in the United States, and is responsible for monitoring and evaluating store performance. Previously, she served as a Circle K category manager for 10 years. • Peterson founded a nonprofit animal rescue and ran it as a founding director until 2008.

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Jane green VP, Marketing, Swisher International

• Green leads marketing strategy and new product development for mass-market cigars, including all advertising, point-of-sale and field sales support programs. • She spearheaded the introduction of Swisher Sweets’ limited-edition cigarillos, the first time that limited-edition tastes have been developed for the Sweets brand. • Green is involved with the Sunbelt Expo Southeastern Farmer of the Year program, which is sponsored by Swisher Sweets. Celebrating 25 years in 2014, the program honors an outstanding farmer in 10 Southeast states.

sharon Porter

Director, Sales & Marketing, Insight Beverages Inc.

• Porter is responsible for new business development in the convenience channel, and development and execution of company and channel marketing strategy. • She has more than 30 years of c-store industry experience in both retail operations and corporate office chain management. • Porter participates in numerous roundtables, advisory panels, the NACS Retailer Convention Committee – Content and the NACS Supplier Board Committee – Manpower.

CinDy henDerson

Executive Director, Operations Support, CST Brands Inc.

• Henderson is marking her 14th year at CST Brands, 12 of which were with Valero Energy Corp. She oversees the retail stores’ daily operations, as well as operations projects, new programs and new initiatives. • She became involved with the National Association of Truck Stop Operators (NATSO) a year ago. • Henderson has 34 years of experience in the industry, previously holding positions with 7-Eleven Inc., a 7-Eleven licensee company and a privately held convenience store company in Texas.

nanCy riggs VP, Quik Stop, C-stores/Small Format Division, The Kroger Co.

• Riggs oversees operations, merchandising, fuel, facilities and real estate and is responsible for budget oversight, sales growth, EBITDA growth, new store growth, store conditions and associate development. • She won several awards for sales increases and store appearance during her time as a district advisor. As an executive team member at Loaf ‘N Jug, Riggs contributed to the banner’s success in earning the Kroger C-Stores Banner of the Year award for four years. She was promoted to her current position this year.


www.core-mark.com

Congratulations to this year’s Top Women In Convenience winners. Core-Mark would like to thank and acknowledge Sr. Vice President and Chief Financial Officer Stacy Loretz-Congdon, winner of Top Woman in Convenience 2015, for her leadership and contribution to the industry.


Top Women in Convenience

Kathy ronan Customer Sales Executive, Northeast Convenience, The Hershey Co.

• Ronan works in conjunction with c-store partners and internal Hershey teams to provide marketing and consumer insights, as well as develop sales and marketing plans to grow profitability. • She was instrumental in building a successful partnership between Hershey and Rutter’s Farm Stores, having helped develop Hershey’s participation in the launch of the Rutter’s Rewards program. • Ronan has been recognized as a top sales performer and honored for her commitment to partner success.

teresa smith VP of Operations, Tom Thumb, C-stores/Small Format Division, The Kroger Co.

• Smith leads the operations team across four states and participates in planning, analysis and approval of capital projects. • She coordinates store openings, including startup support, merchandising, training, store sets, point-of-purchase and execution of all. Additionally, she participates in the site selection and remodel design processes. • Smith lists “shaping a culture laser-focused on both associate and customer engagement” as one of her most important missions.

melissa rosen

Founder & CEO, Locali Conscious Convenience

• Rosen is involved in every facet of the business and has daily involvement in store operations that span menu development to staff training. • She served as the driving force that grew Locali from a simple neighborhood market to a thriving three-store chain. Rosen plans for Locali to begin national expansion via corporate-owned and franchised units in 2016. • As a small business consultant, Rosen advises local food artisan startups and woman-owned entities. She was named one of Los Angeles’ most influential businesswomen of 2010.

Karin thriFt Director of Sales, Convenience, Clif Bar & Co.

• Thrift creates and executes the c-store strategy for Clif Bar and develops trade spend, customer event budgets and accountspecific marketing plans. • Along with leading and mentoring a team that executes strategy through a national broker network, Thrift co-leads the sales team training task force that is responsible for the ongoing professional development of the entire sales team at Clif Bar. • She helped co-found Discover Y.O.U., a leadership skills development program for highschool students.

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toBi-lee russell

VP of Human Resources, Cumberland Farms

• Russell is responsible for talent management, acquisition, benefits and engagement at Cumberland Farms, where she drives organizational change through strategic design, development and implementation of leadership, employee engagement, recruiting and training, and benefit initiatives. • She leads a team of 28 human resources professionals. • To enhance company leaders’ skills at engaging and motivating their teams, Russell designed and implemented a leadership development roadmap.

ginny WeBB

Chief Information Officer, Love’s Travel Stops & Country Stores

• Webb is responsible for technology solutions that support the current business along with future growth. • She recruited and hired a team that is responsible for technology infrastructure, applications and support, and worked with other business teams to deliver new financial processes and reporting plus a mobile app for Love’s TireCare business. • She prioritizes collaboration, mentoring and empowerment to allow her team members to own their decisions and responsibilities.

BeCKy shotWell President, Stop’nGo of Medina

• Shotwell has been involved with the family-owned c-store business since 1987 and has experience in store operations, training, acquisitions and marketing. • She is a past chair of the Ohio Association of Convenience Stores board and has served on the board for more than 20 years. She also served as a past chair for the National Convenience Store Advisory Group. • Awards presented to Shotwell include the Medina County Development Business Leader of the Year Award and the Medina Jaycees Distinguished Service Award.

Whitney WooDWarD VP of Human Resources, RaceTrac Petroleum Inc.

• Woodward leads RaceTrac’s human resources team in attracting and hiring top talent, assessing and developing current talent, and retaining and rewarding RaceTrac’s store support center and field team members. • She oversees approximately 100 team members. • Woodward is a founder of RaceTrac’s LEAD program, a women’s initiative designed to link, empower, achieve and develop future leaders, and is enrolled in a Women’s Leadership Program through the Kellogg School of Management.


Cassandra MaTos

Product Director, Confection & Snacks, McLane Co. Inc.

• Matos began her career with McLane Co. Inc. in 1999. • Her current role as product director includes direct oversight and accountability for 22 McLane teammates (two category managers and 20 purchasing specialists). • Not only does she lead by example, but Matos also has a knack for grooming new McLane teammates and future leaders. Always willing to take time to explain and coach, she is responsible for the growth and development of many current leaders within the McLane organization.

sherry Bevers

Senior Customer Accounts Manager, U.S. Oil/U.S. Venture Inc.

• Bevers has held several roles during her 29 years at U.S. Oil. She has a team of six outside customer service reps that she enjoys mentoring. • Called “mama bear” by some of her reps, Bevers’ goal is to get her team as excited about their careers as she is about hers. Last year, she took the lead on the company’s acquisition of 160 branded dealers to ensure they all felt welcomed and fully supported. She also brought to life an enhanced online customer portal.

dayna reed

Director, Promotions & Market Research, RaceTrac Petroleum Inc.

• Reed joined RaceTrac in 2009. She assumed her current role in 2012 and leads the charge to inspire, create and direct successful marketing promotions that drive guests to RaceTrac stores. • She provides mentorship and direction to a team of nine, eight of them women and the majority of them are less than five years into their careers. Under her leadership, 15 of her team members have been promoted. • Reed’s passion for mentoring extends beyond the job as she volunteers with Everybody Wins, a children’s literacy program.

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diana Farquhar

Floating Training Manager, Alon Brands Retail

• Farquhar serves as the floating trainer for the Abilene, Texas, region. She has been with Alon since 2002. • A former store manager, she is the first person managers call when new programs are implemented in the stores. She was one of the key people when the company started scanning, and again when it introduced Pinnacle software. Her peers say she “gives her heart every time she walks into a store.” • Farquhar is involved in fundraising to purchase service dogs for autistic children. Her grandson is autistic.

RISING STARS

MENTORS

Top Women in Convenience

Tonjalia Green

Zone Manager, Houston Southeast & Southern Louisiana, CST Brands Inc.

• Green joined CST Brands Inc. in May 2013 after more than 30 years with Valero Energy Corp. She has been a store manager, retail auditor, area manager and later promoted to a zone manager in the Southern Region. She has seven direct reports and a work team of 675 people. • As a mentor, Green shares her wisdom freely with anyone from direct reports to co-workers looking to move up in the organization. “Our employees are our most important asset,” she said.

Tara anderson

Category Manager, Lunch Daypart, Holiday Stationstores

• Anderson’s responsibilities include management of more than 500 Holiday stores in 10 states, for which she develops and drives retail initiatives by implementing programs for fresh food, cold and frozen dispensed beverages, and 21 branded fast-food locations. • She also creates operational tools such as product guidelines, foodservice training programs, planograms, company contest initiatives and store sampling events. • After two years of focusing on Holiday’s culinary, freshness and integrity in ingredients, Anderson has changed the culture of the company’s food program.


DDIRECTOR IRECTOR OOFF SSALES ALES - CCONVENIENCE ONVENIENCE CCHANNEL HANNEL

Congratulations

KARIN THRIFT FOR BEING NAMED ONE OF THE

TOP WOMEN

IN THE CONVENIENCE INDUSTRY

© 2015 Clif Bar & Company. Trademarks and registered gistered trademarks are owned by Clif Bar & Comp C Company, any, or used with permission. MB15.0635


Top Women in Convenience

leti anDraDe Director, Human Resources Integration, CST Brands Inc.

• Andrade oversees all aspects of human resources integration for new stores and industry acquisitions, as well as benefits, payroll, employee relations and training for new employees integrated through acquisitions. • She has 18 years of experience in various human resources leadership roles in industries including health care, professional services, hospitality and education. • Andrade is a member of the Society for Human Resource Management and the Southern Management Association.

Perri Brackett

Account Executive, Procter & Gamble

• Brackett, who has been with P&G for 30 years, manages the largest portion of its convenience channel business, which includes the Texas/Southern market. Her region is delivering three times the current business performance compared to the U.S. • She is one of the Dallas Morning News’ “Community Voices” columnists and is on the Network of Executive Women College Outreach Committee, where she coaches and mentors women in the MBA program.

kelly anDrus Manager, Credit Card Services, Tesoro Refining & Marketing Co.

linDa Bell

Regional Operations Manager, Turkey Hill Minit Markets, C-stores/Small Format Division, The Kroger Co.

lauren Bowers Regional Manager, GSP

• Andrus is responsible for payment card acceptance, payment accounting, payment chargebacks and planning around payment acceptance (for example, EMV). • She actively participates with the Merchant Advisory Group and sits on both the Communications and Advocacy committees, as well as the National Petroleum Energy Credit Association’s Retail Program Planning Committee. • Andrus previously worked at Alliance Data for nearly 11 years, where she held various positions in merchant banking.

• Bell, who holds an MBA from Rosemont College, is responsible for the sales, profitability and overall operations of 83 stores in seven markets in central Pennsylvania, as well as implementing business and strategic plans for each district and establishing programs to protect the company’s assets including shrink, security/safety, internal theft and regulatory compliance. • After serving in the U.S. Army, Bell began her career in 1995 with Amoco/BP as a field specialist and foodservice coordinator.

• Bowers is responsible for the management of more than 10 retail accounts (Alon Brands, Circle K, QuikTrip, Stripes and Tesoro among them). Her job entails account service, maintaining client relationships, project management and coaching/ mentoring the account team, as well as having control over the central U.S. geographical sales/ account region, which includes budget oversight and account team management. • Under her guidance, GSP won an American Advertising Award in innovative branding for work completed for Stripes.

karen Brown

Michelle DelaMielleure

alissa ecker

• DeLamielleure oversees a team of six and manages General Mills’ primary and analytic research budgets both internally and externally with key retailers, as well as determines what research the company performs to address key business issues. • She won General Mills’ Best Manager of the Year, Champion Award for work on Progresso soup, and has been named manager of General Mills’ mentoring program.

• Ecker is responsible for the execution and integration of supply chain strategies within Kraft and growth channel customers, with key projects including joint business planning and collaboration on E2E projects driving cost savings and network efficiencies. • She has made improvements in leadership in five key areas: Eby-Brown/Armada Dry Network consolidation, c-store bracket pricing audit/ compliance, opportunities with McLane Co., customer service and striving for supply chain improvements.

Category Team Leader, AnheuserBusch

• Brown leads all category management functions, including space management, pricing analysis, promotional analysis, assortment and more, and is responsible for beer category growth for the third largest c-store account in the U.S. • She specializes in providing shopper-centric retail solutions to drive total store business and consults retail channels by building joint business plans utilizing trade marketing, revenue management, shopper insights, point-of-sale data and space management.

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Senior Manager of Consumer Insights, General Mills

Manager, Strategy & Customer Development, C-store Integrated Supply Chain, Kraft Foods Group


Top Women in Convenience

leah eManuele

Assistant to the Director of Marketing, GetGo (Giant Eagle Inc.)

• Emanuele develops and executes grand-opening launch plans for new GetGo locations and manages communication to store teams for all promotional activities. • She presides over a grandopening budget of more than $1 million, with a main goal of building community excitement about new GetGo locations, including scheduling VIP parties, radio remotes, ribbon-cuttings, sweepstakes and more. • She is a member of Giant Eagle’s Young Professional Organization.

aBBy Panfil

Retail Director, Sales Strategy & Planning, Kellogg Specialty Channels

• Panfil leads the internal group that collaborates with the Kellogg Specialty Channels’ retail sales team, responsible for driving growth in the c-store, vending and alternative retail channels. • She won the 2013 Golden K Award for performance excellence with the internal team and for customer responsibility. • The Purdue University graduate participates in the Supply Chain and RQT Task Force. She is also the Southwest community leader for Kellogg’s Women’s Employee Resource Group, Women of Kellogg.

Jessica irwin

Merchandising Manager, Center of Store, GetGo (Giant Eagle Inc.)

• Irwin establishes the category plan, negotiates marketing agreements and delivers sales and margin goals for the candy and general merchandise/ seasonal categories for GetGo. In the past year, the c-store chain’s seasonal business experienced double-digit growth under her watch. • Prior to joining GetGo, she spent nine years working in parent company Giant Eagle’s merchandising department. • The University of Pittsburgh graduate led the retailer’s United Way campaign in 2014.

shaunna Patrick

Director, West Area Convenience Business, The Hershey Co.

• Patrick is responsible for managing and delivering sales targets and financial budgets for The Hershey Co.’s West Area convenience business, which spans from Texas to Oregon. • The 10-year sales and category management veteran has held leadership roles at Anheuser Busch In-Bev SA in addition to Hershey. • Patrick is involved with several charitable organizations, including the Juvenile Diabetes Research Foundation and the Boys & Girls Club of America.

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aMy Jowell

Zone Merchandising Leader, 7-Eleven Inc.

• Jowell manages 7-Eleven’s South Florida zone from a merchandising aspect, which consists of approximately 500 stores. • She’s achieved a 9.4-percent increase in revenue and a 9.6-percent increase in gross profit under her tenure, grabbing the top spot within the retailer’s Eastern Region, and is on pace for a second consecutive record-breaking year. • A four-year 7-Eleven veteran, she is an active member of the Network of Executive Women.

JaMie roDgers

Senior Manager, Food Programs & Offers, RaceTrac Petroleum Inc.

• Rodgers leads a team that manages food programs for more than 380 RaceTrac locations. She implements strategies to grow the retailer’s foodservice business via new product development, item optimization and promotions. • Rodgers and her team have been instrumental in growing food sales and margins at RaceTrac while reducing product waste. She helped create the c-store chain’s new Speedy Avocado made-to-order foodservice program. • She is an active member of RaceTrac’s LEAD women’s initiative.

elena lau

Regional Operations Manager, Loaf ‘N Jug, C-stores/ Small Format Division, The Kroger Co.

• Lau coordinates daily operations for nine convenience stores (all with gas), as well as four car washes and three food locations that average monthly sales of more than $1.1 million. She also mentors and manages a team of more than 80 associates. • Her team won Kroger’s Most Profitable District award in 2013 and 2014 and the Committed to Community award in 2012 and 2014. Lau has also received the President’s Choice Award for her customer-first attitude.

stacie tonniges

Category Manager, Cigarettes & Tobacco, Casey’s General Stores Inc.

• Tonniges is responsible for many facets of Casey’s tobacco category, including analyzing sales and profit margins, negotiating contracts with manufacturers, analyzing competitors and adding new items to the category. • A Casey’s veteran of five-plus years, her tobacco product and merchandising decisions are implemented throughout more than 1,850 c-stores in 14 states. • The Iowa State University graduate was recently elected to the board of directors for the National Association of Tobacco Outlets.


kiM williaMs Senior Category Advisory Manager, The Coca-Cola Co.

• Williams leads the national account team for Coca-Cola’s second-largest U.S. convenience store customer. She collaborates with the shopper insights team and applies her learnings to identify customer and sales growth opportunities. • She helped Coca-Cola earn the honor of “most valuable supplier” for the large c-store retailer’s West Region for the past two years. • Prior to joining Coca-Cola, the Emory University MBA graduate was a three-time President’s Award recipient at Abbott Laboratories.

SINGLE-STORE OWNERS

Top Women in Convenience

gigi colosiMo

General Manager/ Owner-Operator, On The Go

• Colosimo has been in the convenience store business for more than 30 years. • She rebranded her Exxon station as “On The Go” with matching graphics that also included an upgraded coffee bar. • Colosimo has turned her eye toward category management. She went category by category, and made sure her product mix was superior to her competitors and that she was priced aggressively to gain volume.

Melissa lacour

Owner, Black Bear Convenience Store

• She was a truck driver for many years, as well as a clerk for NAPA Auto Parts before she and her husband bought a sporting goods store. After her husband had a heart attack, they purchased a convenience store/gas station, which she operates herself. • A self-taught entrepreneur with only a sixth-grade formal education, Lacour has increased revenue for the Black Bear Convenience Store, while also inspiring the entire community with her dedication to community service.

We congratulate our own

JENNY BULLARD as one of this year’s Convenience Store News 2015 Top Women in Convenience

We are honored to have Jenny recognized for her: • Commitment to Excellence • Great Leadership • Insight

• Innovation • Enthusiasm • Advocacy

Congratulations to all the winners! Each and every one of you can be proud of your inspiring achievements.

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Top Women in Convenience

STORE MANAGERS

d’Juana mccartney

Part Owner/ Manager, Wooly’s One Stop

• McCartney oversees all aspects of the store, from hiring and firing to budget and layout. Her stated philosophy is “Customer service comes first; we’ll deal with our problems after the customer is taken care of.” • McCartney is a mentor to her employees at work and at home. She has reportedly saved marriages, fixed broken homes, helped abused and neglected children, sheltered battered wives and counseled customers. • She is an elected school board member and plays an active role in the community.

Veronica Holguin

Store Manager, Alon Brands

• Holguin oversees five employees at her store, where she manages daily operations including staff training, scheduling, inventory order management, maximizing sales by implementing the placement and promotion of new product lines, and promoting the store. • She joined Alon Brands as a sales associate in 2001, was promoted to assistant manager two years later and during her time with the company, has managed five stores, earned her associate’s degree and served in the Army Reserve.

Soo Sang

Store Manager, CST Brands Inc.

• Sang is responsible for 12 employees at her location, as well as the total store operation including profit and loss, employee staffing and retention, employee training, safety/ security, environmental compliance, customer service, marketing/merchandising, and more. • She began working for Valero Energy Corp. (now CST Brands) in 1981 at the age of 23, shortly after coming to the United States from Korea. She started as a customer service representative before working her way up to assistant manager and then store manager.

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leSlie conSidine

Complex Manager, Ports Petroleum Co. Inc.

• Considine oversees one store with seven employees, where her responsibilities include customer and vendor relations, ensuring federal and state safety and labor regulations are followed, employee management and more. • When the company purchased three gas stations in southern Indiana and Ohio, she spent weeks away from her own station to provide two of the locations with training and support. • Considine is a part of the company’s new manager mentoring program.

Janet Stembridge Store Manager, RaceTrac Petroleum Inc.

• Stembridge oversees one store and 13 team members. She manages the day-to-day operations, develops team members, increases sales and builds lasting relationships with RaceTrac guests. • For eight consecutive years, Stembridge has earned a spot on the RaceTrac Chairman’s Council, an annual competition that recognizes RaceTrac store managers in each region who rank in the top 10 percent for profitability, inside margin, team member performance and guest feedback.

tina Felton Store Manager, Rutter’s Farm Stores

• Felton supervises 32 employees and oversees the management and implementation of operations procedures, marketing initiatives, human resources policies, and executive directives including sales growth, customer service, employee training and hiring, expense management and merchandising. • Since May 2006, she has been promoted to store manager at three higher volume Rutter’s locations. • Felton was named Store Manager of the Year in 2013 and was a Store Manager of the Year finalist in 2014, 2012, 2011 and 2008.

Join in the Celebration! The 2015 Convenience Store News Top Women in Convenience will be honored at a special reception held during the NACS Show* in October. The event will take place Monday, Oct. 12 from 5:30 p.m. to 6:30 p.m. in Room N258 at the Las Vegas Convention Center. Each winner may bring a guest and two other attendees from their company. Attendance is limited to the honorees and their guests, or by invitation only. For more information, contact Editorial Director Don Longo at (201) 855-7606 or dlongo@stagnitomail.com. Business leaders, solution providers and consumer packaged goods firms may participate as sponsors. For sponsorship information, contact Chief Brand Officer Korry Stagnito at (224) 632-8171 or korrystagnito@stagnitomail.com. *Convenience Store News is not affiliated with, endorsed by or approved by the National Association of Convenience Stores or the NACS Show® trade show.


Top Women in Convenience

Expert’s View

Opening the (Talent) Pipeline Petroleum marketer Speedway values diversity and its CFO Beth Hunter is leading the way

S

peedway LLC — the nation’s second-largest company-owned and operated convenience store chain — is known for its successful marketing strategies (more than 4 million loyalty program members), its customer service (download the Speedway app) and its strong community outreach. Less known is Speedway’s commitment to gender diversity. Chief financial officers, like Speedway’s Beth Hunter, like to talk numbers. Recently, she shared a few eye-openers with me. Women, she noted, make up fewer than 10 percent of the petroleum industry’s 186,000 employees. But at Marathon Petroleum Corp. (MPC), By Joan Toth, Speedway’s parent company, women comNetwork of prise 20 percent of employees. Executive Women At U.S. fuel dealers, Beth told me, slightly more than 40 percent of employees are women. At Speedway, operator of 2,750 stores, nearly 65 percent of employees are women, a number that has held steady for several years. Half of its store managers and supervisors are women. Beth is a living example of gender diversity. She started her career in petroleum marketing in 1987, when J.R. and Bobby were still feuding over Ewing Oil (for those millennials out there, that’s the once popular “Dallas” TV series). She has personally experienced the c-store industry’s evolving workplace culture, one that increasingly values — and benefits from — the insights, experiences and leadership qualities of talented women. “Opportunities for women to advance to leadership roles is improving,” she told me, “and from my vantage point, it looks like women’s leadership will not only continue to improve, but accelerate. There are very talented, driven women in management

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positions. I believe there’s a pipeline of strong talent that we will see reflected in leadership over the next several years.” Beth said a “push and pull” approach has opened doors for women at Speedway. “When it comes to pull, management can and should continually look for new ways to identify and acquire high-potential talent, encourage women to seek out leadership roles and help them succeed,” she said. “But there must also be push — and this is the more important driver. Women need to prepare for leadership roles and seek them out.” AvOiding TrAPS, TAking riSkS

Women need to avoid the traps that tend to stall their careers. One of these traps, according to Beth, is defining yourself too narrowly.


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TAMMY FLOYD WOMAN OF THE YEAR

TONJALIA GREEN MENTOR AWARD

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CST IS PROUD TO RECOGNIZE OUR

TOP WOMEN IN CONVENIENCE

YOUR CONTINUING SERVANT LEADERSHIP, STRATEGIC THINKING, ENTREPRENEURIAL SPIRIT AND INNOVATION HELPS GROW OUR BUSINESS AND DELIGHT MORE CUSTOMERS EVERY DAY.

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CST IS AN INTERNATIONAL FORTUNE 500 COMPANY THAT EMPLOYS 14,000 TEAM MEMBERS.


Top Women in Convenience

Expert’s View

“I’m an accountant by training,” she told me, “but when there was an opportunity to work in sales, purchasing and investor relations — all of which helped give me the breadth of experience needed for my current position — I gladly accepted the assignments.” It’s also important to manage your career and take risks. “Some of the positions I took were outside my comfort zone, but it’s very rare for anyone to make great career leaps while remaining in a comfortable position,” she said. “And, of course, some career moves don’t work out and you’ll have to correct your course. Taking risks is an important part of advancement.” Research from the Network of Executive Women (NEW) and other organizations demonstrates the strong business case for women’s leadership. This is especially true in the highly competitive c-store industry and at Speedway, specifically, according to Beth. “The business case for women in leadership is part of the larger business case for pursuing diversity and inclusion in all we do: talent acquisition, retention, training, supplier diversity and advancing senior leadership,” she said. “We all recognize that a wide variety of experience, leadership styles and ways of thinking — especially in an inclusive envi-

This is the second in a four-part series of exclusive educational columns by the Network of Executive Women (NEW), leading up to the 2015 Convenience Store News Top Women in Convenience awards in October. In addition to being a presentation sponsor for the Top Women in Convenience program, NEW and CSNews have partnered to develop this series of columns directed at helping corporate leaders drive more inclusive company cultures. More than 50 of the convenience store industry’s top female executives, managers and mentors will be honored at the secondannual Top Women in Convenience awards presentation, being held during the 2015 NACS Show in Las Vegas. SPONSORED BY:

“We all beneft from a workplace that refects our communities, our customers and our business partners. That means race, ethnicity, religion, sexual orientation and gender.” — Beth Hunter, Speedway LLC

ronment where diversity is valued — can make a company much stronger.” THe diverSiTy dividend

At Speedway, diverse talent has empowered team members to approach day-to-day work from more perspectives, which leads to more solutions that meet the needs of the company’s customers, shareholders, employees and neighbors. “You won’t find many other businesses that compete with one another by changing the price of one of their primary retail products on a daily basis,” Beth said. “So, it’s only natural that we’re continually looking for factors that can give us the edge. Attracting and retaining the best talent is one of the most important of those factors. In all its forms, diversity is a tremendous competitive advantage to industries. “And I mention ‘all its forms’ for a reason,” she continued. “We all benefit from a workplace that reflects our communities, our customers and our business partners. That means race, ethnicity, religion, sexual orientation and gender. It also can mean other factors that distinguish one employee from another — political or generational differences, for example. “To tap the competitive advantages of a diverse workplace, we work hard to make sure our workplace is attractive to the people we want to bring in and keep. That includes the physical setup of the offices, the way our management interacts with employees, and much more.” nOT JuST An Add-On

At Speedway, diversity isn’t just “an add-on.”

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It’s deeply rooted in the corporate culture. “In our industry, it’s important to have frank, open discussions about issues such as race, ethnicity, political orientation and the expectations of different generations,” Beth said. “Talking about how these differences can be leveraged as strengths, by understanding them instead of being barriers to success, is good for operational reasons. But just as important, it gives people a voice, strengthens engagement and helps us retain employees, especially those who have unique viewpoints.” Speedway’s community involvement helps the company keep the best talent — and attract highpotential millennials. “Our employees assume responsibility for our reputation in the communities where we operate,” she told me. “A company that doesn’t do its part to support the community isn’t just doing itself and the community a disservice; it is also risking the goodwill of its employees. After all, employees have to face their neighbors, their kids’ teachers and coaches, their bankers, doctors and many more

members of the community.” Policies that promote work/life balance are another crucial retention tool, especially in an industry where many operations — pipelines, refineries, terminals and c-stores — never close. “This can mean challenging shift work and employees on-call at all hours of the day and night,” Beth said. “Making sure policies reflect the real needs of employees, while still allowing us to be competitive, can make a huge difference in retention of talent.” At this point in the industry’s history, the talent pipeline may be as important to the bottom line as the one carrying crude. CSN Joan Toth is president and CEO of the Network of Executive Women, Retail and Consumer Goods, a learning and leadership community representing 9,000 members, 750 companies, 100 corporate partners and 20 regional groups in the United States and Canada. Toth is a member of the advisory board for Convenience Store News’ Top Women in Convenience awards. Editor’s note: The opinions expressed in this column are the author’s and do not necessarily reflect the views of Convenience Store News.

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FOODSERVICE Prepared Food + Hot, Cold, Frozen Dispensed Beverages

HOW TO

How to Measure Foodservice Success By Maureen Azzato

Call tO aCtIOn: Foodservice 101

• Cost out every recipe and know what you should expect in profit on each menu item. • If scanning is not an option, use daily build-to sheets and manually track how many items are prepared and how many spoiled, with the difference being the total number of items sold. • Do cost inventory weekly, even if you have to count manually using paper and pencil. • Track foodservice on separate P&Ls before rolling it up into total store P&Ls.

Y

ou can’t manage foodservice if you don’t measure it. Foodservice is a numbers business with costs that can easily get away from convenience store operators if they are not carefully tracked and measured, according to the Convenience Store News How To Crew experts. While automation and technology — such as foodservice inventory and operating software, cost accounting, electronic invoicing and scanning — can all make it easier to track and measure foodservice success, operators that can’t afford high-tech bells and whistles can track the business manually using good old-fashioned

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pencil and paper, one CSNews How To Crew retailer said. “If you don’t have good technology, my advice would be to just write everything down,” the retailer said. “In my early days, I did inventory in my restaurant every single day and did not use a computer.” If operators have the financial resources, though, foodservice is best tracked using the numerous automation tools available today. Without question, the foodservice business is most successfully measured and managed using a cost accounting system, which allows operators to more accurately manage food costs instead of the retail accounting


system utilized by most convenience stores for the rest of the store. “Cost accounting, or foodservice accounting, allows each individual ingredient you buy to be used and managed for multiple purposes and menu items. That is why retail accounting simply doesn’t work for foodservice,” the retailer continued. For example, if you buy a wedge of cheese, you can put it on a hamburger that carries one retail price, or on a breakfast sandwich or sub sandwich, both of which could carry different retail prices, he explained. The retail accounting mindset runs contrary to the foodservice business, according to another retailer member of the How To Crew. “With retail accounting, the concern is only on the items that have ‘retails’ associated. So if you did food that way, for example, a hot dog would be retail and the bun would not,” this retailer explained. If someone mishandled, stole or threw away buns, there would be no concern or accounting of those actions in a retail system, but there would be cost for what was missing and more cost to replace it. The hot dog, however, would be monitored and tracked because it had retail attached to it, and that would be the only part audited in a retail system. “In cost accounting, all parts of the sale item are accounted for, which delivers maximum control of the profit and flow of inventory to ensure proper handling, ordering, theft and spoilage controls,” he said. thE Q-FaCtOR

While most members of the How To Crew agree cost accounting is the preferred and more effective method for managing the foodservice business, integrating it into a 24/7 retail operation presents challenges. Cost accounting to some, depending on their experience and business background, can be very confusing, according to David Bishop, managing partner of Balvor LLC and How To Crew expert. “When I started consulting with supermarkets and convenience stores on meal solutions in the ‘90s, it felt as though we were speaking different languages,” Bishop said. “The idea of portion control and food management practices seemed almost foreign, and the topic of knowing your prime cost — or your Q-factor — was met with blank stares. As a result, having an experienced and knowledgeable professional on the team is key, and training and education is paramount to getting off the ground.” Foodservice operators should be able to determine

the cost of the cup, lid and the coffee poured into the cup when calculating Foodservice 201 the true cost of a • Do cost inventory and count weekly, cup of coffee served. or daily for some ingredients that are Calculating the cost highly used. of the coffee requires • Build a strong cost accounting system determining product and procedures. yield (how many • If you or your company lack personounces of coffee the nel with a background in foodservice ground coffee used cost accounting, don’t go it alone. will yield per pot). Identify resources that can assist “All of these with the transition such as software items would then be providers, vendors and suppliers, or explicitly called out outside experts. in the menu costing process/system. The Q-factor is a common term that is short for questionable factor, which covers items that are difficult to measure that support the sale of a menu item,” Bishop said, noting the Q-factor may represent items whose costs should be spread across the sale of several products. Coffee filters, for example, should be considered in the cost of hot coffee, flavored coffee and brewed iced coffee. The costs of straws and stirrers would also need to be considered across the several items for which they are frequently used, including all cold and frozen beverages, and hot beverages. “While debatable, some operators may even include the costs of all condiments such as PC creamers and sweeteners, but determining which items to include under the Q-factor is a subjective decision, driven by the operation and the approach to managing the menu,” Bishop said. “Operators will generally calculate the value of the items used over a period of time and then divide it by the unit sales for the menu items that it could support. The allocated cost would then all be grouped under the Q-factor as opposed to breaking it out separately.”

Call tO aCtIOn:

InVEntORy COntROlS

Strong inventory management processes and systems are key to tracking and measuring foodservice. “I would do weekly or, at the very least, twicemonthly inventories so you can manage the actual cost compared to the theoretical cost of menu items, and most importantly notice any issues that can

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FOODSERVICE Prepared Food + Hot, Cold, Frozen Dispensed Beverages

be corrected before the monthly P&L [profit and loss statement] is closed,” said one How To Crew retailer. He also recommended preparing separate foodservice P&Ls “to see what profitability is being derived from the investment in time, money and people needed to create the food program.” While the foodservice P&L will roll up into the full store P&L, “it is important to see the food through a different lens.” The main challenge of integrating foodservice cost accounting with retail accounting, according to several How To Crew members, is company culture and training. The key in foodservice is understanding cost inventory, portion control,

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managing production quantities, tracking spoilage and the impact they have on the profitability of the food side of the business. “There are tools to both teach and manage all of these factors and that is where the organizational culture becomes important,” the retailer said. “If you want to be in the food business, you need to understand it, make it part of your company’s DNA and use the available tools to manage it.” It’s important to have a strong platform/program that allows stores to easily count and calculate the inventory they have on-hand, according to another retailer on the How To Crew. “The easier it is for stores, the more accurate your inventory counts will be,” he said.


Scanning is another important in-store technology to support foodservice management. “If you scan, then you can actually generate the specific ingredients you should have in inventory in real time,” one retailer said. Another retailer agreed scanning is “critical,” adding that it not only tells you what items you sold “but depending on your program, can also tell you what subsets of items also went out with the finished food item. It gives you market basket information that assists in bundling offers and determining the real profitability of the food program.” The only foodservice category where scanning is not so integral is dispensed beverages, according to some How To Crew members who say most retailers in the convenience store industry still use price lookup (PLU) keys based on cup sizes. The downside of this system is it does not differentiate between beverage flavors; only beverage type and cup size. “When it comes to food, [scanning] is a lot more important,” one retailer said. “Knowing that you have five types of sandwiches and all have the same retail, but-

“Profits are the outcome we all want, but you need to manage product and supply specifications that drive menu costs, Q-factors and production methods that impact labor costs and speed of service, and product waste that may signal a need to change par levels or menu items.” — David Bishop, Balvor LLC

three of the five represent 90 percent of the sales, is very valuable.” While operators can get this information with good build-to programs, “when a store scans and can import that data, it makes it so much easier to identify.” Stores with build-to programs can manually track and write down how many sandwiches they made and how many spoiled, with the difference between the two being sandwiches that were sold, the retailer explained. “This can get you pretty close to identifying sales by SKU without scanning.”

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FOODSERVICE Prepared Food + Hot, Cold, Frozen Dispensed Beverages

ImpORtant KpIS

How To Crew members are fairly aligned about the most important metrics, or key performance indicators (KPIs), to track foodservice program success. In addition to the obvious metrics such as dollar sales, gross and net profit percentages and dollars by item, other top KPIs are: • Prime costs or the Q-factor (which incorporates food, bevFoodservice 301 erage and labor costs) compared to • Establish oversight at headquarters theoretical/expectto do ratio analysis and measure pured costs. chases-to-revenue generation. “This • Units sold by method is only accurate over longer item class and periods of time, but helps signal probtype. For example, lems before things gets out of hand,” biscuit breakfast one retailer said. sandwiches vs. croissant breakfast

Call tO aCtIOn:

sandwiches; then also by meat type — sausage vs. ham, bacon, etc. • Daily spoilage/waste, ideally at item level. Spoilage typically comes from three sources: theft, overportioning and over-production. • Days of supply on-hand. • Market basket of items sold with each menu item. • Items sold by daypart or hour, and day of the week. “Spoilage is a big one that can either be tracked as a total on a subcategory or category level, or ideally at item level so you can see, for example, if 5 percent of your items are causing 70 percent of your spoilage,” one retailer noted. All of the KPIs above will lead an operator to control production and preparation, as well as know when to do those tasks, another retailer added. “They will lead you to combo meals and promotional offers, as well as what items were good sellers but have declined,” he said. The metrics will also reveal “items that never reached the necessary units-sold threshold and those should be removed from the menu, which

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makes room for new item menu development.” From a corporate perspective, foodservice managers and directors must keep their eyes on many metrics that are different from the retail side of the business. “Sales are important, but sales mix is even more important,” Bishop said. “Profits are the outcome we all want, but you need to manage product and supply specifications that drive menu costs, Q-factors and production methods that impact labor costs and speed of service, and product waste that may signal a need to change par levels or menu items.” Other basic elements of a foodservice P&L statement include supply costs, labor costs, and repair and maintenance of foodservice equipment, according to one retailer. And according to members of the How To Crew, if there is one formula foodservice operators should commit to memory, it is this: Beginning Inventory + Purchases + Transfers In – Transfers Out – Ending Inventory/Revenue = Food Cost. This KPI will ensure you take money to the bank. CSn

Our How To Crew David Bishop — Balvor LLC Ed Burcher — Burcher Consulting Joseph Chiovera — XS Foodservice & Marketing Jack W. Cushman — CST Brands Inc. Dean Dirks — b2b Solutions Eric Giandelone — Mintel Foodservice Kane Kulas — CSM Bakery Products Mathew Mandeltort — Eby-Brown Co. LLC Larry Miller — Miller Management & Consulting Services Maurice Minno — MPM Consulting Group Paul Pierce — Pure Plates Tim Powell — Think Research & Consulting Chad Prast — Murphy USA Inc. Bonnie Riggs — The NPD Group Jennifer Vespole — QuickChek Corp. Jerry Weiner — Rutter’s Farm Stores

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devaultfoods.com WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 79


TOBACCO Cigarettes + Cigars + Smokeless + E-Cigs + Other OTP

An Abundance of Uncertainty Tobacco Merchants Association’s 100th meeting offers insight to where tobacco may be heading By Melissa Kress

W

ith the tobacco category making up a large portion of the convenience channel’s business, a lot of focus has been placed on what the future of tobacco holds. At the Tobacco Merchants Association’s (TMA) Centennial Celebration & Conference, which was held May 18-20 in Williamsburg, Va., industry players broke down the category’s possibilities by segment. Although cigarette volume has been on a slow and steady decline, there are bright spots in the tobacco category.

CIGARS

“It’s been an interesting few years to be in the cigar industry,” shared Joe Augustus, senior vice president of external affairs at Swisher International. Swisher is “cautiously optimistic” moving forward, he said. For example, there has been some stability in the marketplace for cigar products, and consumer preference changes have forced cigar manufacturers to adapt to the evolving landscape. In addition, state economies have begun to recover, so legislatures are relying less on tobacco excise tax increases as a revenue booster. That is not to say the cigar industry is worry-free. The Food and Drug Administration’s (FDA) deeming regulation looms over the industry, according to Augustus. Of particular concern for cigars is the proposed fee structure and 2007 predicate date. SMOKELESS TOBACCO

Michael Lavery and Bonnie Herzog participated in an analyst roundtable discussion.

As for smokeless tobacco, future potential may lie in modified risk. In August, Swedish Match North America became the first company to submit to the FDA a Modified Risk Tobacco Product application for its General snus line. The agency’s Tobacco Products Scientific Advisory Committee (TPSAC) reviewed the application in April and while the FDA has not issued a final decision, Jim Solyst, director of federal government affairs at Swedish Match, said the application alone has increased awareness for the snus segment. Time will tell what impact this awareness — which is acting as an education tool about snus to many U.S. consumers — will have on the product. Swedish Match believes the attention “will certainly impact our sales in the U.S.,” Solyst told TMA Conference attendees. “But perhaps the longer-term message will be on harm reduction.” E-VAPOR PRODUCTS

Representatives from various tobacco product manufacturers forecasted what’s ahead for their respective sectors.

80 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

The FDA’s deeming regulation also takes center stage with e-vapor products. John Wiesehan Jr., CEO of Mistic-Ballantyne Brands, said what the agency


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decides to do is anyone’s guess. Two things are evident, though: in the past 24 months, vapor technology has changed rapidly and distribution has changed along with it. “We’ve seen the e-vapor product go from a disposable cigalike to now that being one of the smallest product segments at retail,” Wiesehan explained. “Since August, the industry took a left turn all the way to personal vaporizers.” E-vapor products will continue in that direction, he believes, as consumers look to personalize flavors and nicotine levels.

Dr. Jim Diffley, IHS Global Insight

2040” around harm reduction if there is: • 25 years of innovation; • Regulation and policy that enhances the value proposition; • True and fair presentation of risk and science; • Increased pressure on smoking; and • New accountability in the public health community. NEXT-GENERATION PRODUCTS

While no one has a crystal ball, leading tobacco analysts tried to shed some light on e-vapor and its con-

Farrell Delman, Tobacco Merchants Association

Technology will continue to evolve, Wiesehan predicts. “We haven’t seen the best of the best yet. We are still working on it,” he said. HARM REDUCTION

One main focus of tobacco moving forward is the concept of harm reduction. Science, technology, innovation and new players entering the tobacco industry are all taking key roles in the new era of harm reduction, according to Scott Ballin, director of the Alliance for Health, Economic and Agriculture Development. “Today, it is less important who made the product [and more important] what the product is,” Ballin pointed out. As an advocate of harm reduction, he explained that the idea of engagement and dialogue around the continuum of risk is “slowly catching fire” at many venues and various levels — including the Food and Drug Administration and organizations like TMA, which has made harm reduction a major component of its annual conference for the past few years. According to Clive Bates, founder of Counterfactual Consulting, there is “huge public health potential by

82 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Senator Mitch McConnell

tinuing role in the space during the TMA Conference. Vivien Azer, director and senior research analyst at Cowen & Co., pointed out she is not as bullish on the segment as some of her colleagues. “The problem is there is very good trial, but very little repeat,” she said. “If you don’t have adoption, does it point to a disruptive [product]?” Bonnie Herzog, managing director of beverage, tobacco and convenience store research for Wells Fargo Securities LLC, said she “adamantly believes the technology is going to have to continue to improve across the board because we’re simply not there yet.” Still, Herzog believes e-vapor consumption will surpass combustible cigarette consumption in the next decade — with 2017-2018 emerging as the tipping year. Michael Lavery, director and senior analyst at CLSA, explained that the e-cigarette segment represents a different competitive landscape from traditional cigarettes. Traditional cigarettes have high brand equity, high brand loyalty and high pricing, while on the e-cigarette side, there are unknown players, unknown brands and lower price points. CSN


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COLD VAULT Beer + Wine + CSDs + Energy + Water + Sports + Juice + Dairy

The Future of Beer Sales Leading marketer discusses importance of the millennial legal-drinking-age segment By Don Longo

I

n examining alcoholic beverage trends at convenience stores, it is apparent millennial consumers are driving many of the taste and brand choices in the beer category. Convenience Store News recently conducted an interview with Todd Camassar, commercial marketing director, offpremise channel and customer development, Todd Camassar for Heineken USA about the importance of millennials and how c-stores can sell more to this demographic. CSNews: How does Heineken describe and segment young legal-drinking-age consumers? Camassar: Today’s millennial/ multicultural consumer base is active, astute and wants the best. They are growing exponentially in size and influencing American culture faster than any other group, from the food and beverages we consume to music, sports, film, fashion and more. Their influence is impacting the variety of beer products offered and the way these products are marketed. CSNews: What are the overall attitudes and values of millennial consumers when it comes

84 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

to consuming alcoholic beverages? Camassar: The millennial/multicultural consumer is experimental and eager to expand their other beverage repertoire by sampling different offerings and expanded flavor profiles. They equate cost with quality and, as they trade up with the improving economy, they are more likely to shop the upscale segment where quality, variety and image play a key role. These consumers are estimated to account for 70 percent of future beer category growth. More than any other LDA+ (legal drinking age-plus) consumer segment, millennials are connected 24/7 and sort through information at the speed of light on their phones, tablets and computers. To influence these consumers, we need to cut through the clutter with messaging that resonates and reaches them where they are most active: online. At Heineken, our unique approach to reaching these consumers is through reinvented beer marketing — aspirational and experiential campaigns, with a heavy emphasis in the digital medium. In 2015, we are delivering breakthrough marketing and retail programming that connects emotionally with the millennial and multicultural consumer at multiple touchpoints along their path to purchase (traditional, digital and social media, instore merchandising, special events and sponsorships). We are also focused on innovation to provide millennial consumers with the variety they seek. Our Beers of Mexico, Newcastle Best of


Summer holidays like Memorial Day, the 4th of July and Labor Day are big beer occasions! Tecate is showing Mexican-American shoppers that it’s the authentic beer that understands them by adding one more genuine festa to that list…

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in the club channel, according to Spectra research. The convenience channel offers tremendous upside for upscale import brands such as Heineken, Dos Equis, Tecate and Strongbow and is therefore a top priority for us. Only 3 percent of convenience shoppers shop craft. Upscale imports and mainstream brands are especially popular in this channel. Our strategy in convenience is to drive our single-serve can and six-pack distribution through targeted, account-specific promotions that leverage c-store shopper insights.

Britain and Strongbow hard cider variety packs give consumers the opportunity to try new flavors with a single purchase. CSNews: How does millennials’ frequency of purchasing compare with other demographic groups? Camassar: Convenience shoppers purchase and drink beer most frequently — 30 percent drink beer daily and 22 percent purchase beer daily. They are the most likely to plan which specific brand/pack they will purchase and of those brand planners, they are the least likely to change to a different brand once instore. These shoppers shop the fastest, shop the fewest products and are least likely to examine a product before buying. CSNews: How often do millennials shop in the c-store channel for alcoholic beverages vs. other channels? Camassar: Of all major retail channels, the convenience channel attracts the most millennial beer shoppers — 41 percent of c-store beer shoppers are millennials vs. 28 percent in grocery, 35 percent in liquor and 23 percent

86 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

CSNews: What motivates millennials to make a purchase? Is it a planned purchase or impulse? What triggers impulse purchasing? Camassar: Millennial convenience shoppers typically shop for immediate gratification — 80 percent of c-store shoppers consume the product within one hour of purchase, according to Envirosell shopper research. The occasions they shop for most often include relaxing at home, casual gatherings and winding down after work. The beer brand/pack they will purchase is either determined prior to entering the store or made very quickly at the point-of-purchase. The average time spent shopping the beer section is 11 seconds. The c-store channel has the fewest number of shoppers shopping on impulse compared to the other retail channels, according to our research. To influence the millennial c-store shopper, it is critical to connect with them prior to purchase with messaging that resonates and reaches them online and again at the point-of-purchase. Through digital shopper marketing, we are able to set clear priorities and improve how we target and influence the shopper’s purchase decision before they enter the store. In 2015, we are significantly increasing our investment in digital to touch shoppers at every point along their path to purchase — pre-shop, in-store and post-shop. In-store, the cooler is center stage. Branded coolers and highimpact point-of-sale are the quickest and most effective tools to impact the shopper’s decision. CSNews: How do price and convenience factor into purchase decisions? Camassar: For the convenience store shopper, it’s all about fast and easy — go in, buy beer, get out. In-store, brands need to have visual impact and be easy to find. Only 39 percent of convenience beer shoppers are price sensitive, which indicates these consumers are willing to pay more for the convenience they seek. CSN


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CANDY & SNACKS Chocolate + Non-Chocolate + Gum + Salty Snacks

Health & Wellness & Candy? A key theme at the 2015 Sweets & Snacks Expo was consumers’ view of candy as a treat By Angela Hanson

“Consumers understand what they are getting when they buy candy,” Downs said, citing the extraordinarily high 98-percent household penetration rate of candy, which beats out other products many would consider to be more important, such as toilet paper. He encouraged the industry to “celebrate” candy’s role in a balanced lifestyle. “Life is sweet — celebrate it.” All products can be part of a healthy lifestyle, according to Mary Myers, director of product development at Mars Chocolate North America, who was one of the speakers during an educational session entitled “New Era in Candy Land: Navigating Health and Well-Being.” A new feature of this year’s event was the Retail Impact Forum, where top During the same session, consumer trend analyst, retailers shared their industry perspectives. food marketing expert and “Supermarket Guru” Phil Lempert advised that “people want education” in this subject area because just as retailers face confusion over ith today’s consumers more interested than health and wellness, so too do consumers. ever in better-for-you eating, the intersecIn 1986, 71 percent of people claimed to always tion of health and candy was a frequent avoid snacking. Today, only 39 percent do so, and topic discussed at the recent 2015 Sweets & Snacks avoiding sugar is more important to Expo, and the key takeaway for candy retailconsumers than avoiding fat. As ers including convenience store operaa result, better-for-you is the tors was the importance of messagfastest-growing snack seging and marketing candy as a ment, cited Darren Seifer of permissible “treat.” The NPD Group, who disHealth concerns and cussed the changing role candy’s public image are of snacks in consumers’ issues retailers and supOrganic and better-for-you products that tie into diets as part of another pliers alike should keep consumers’ desire for healthier treats and can fit educational session. in mind, but National into their lifestyle had a significant presence on the “Things change,” Confectioners Association exhibition floor, as did premium and indulgent treats. Seifer said, comparing (NCA) President and Exhibiting suppliers noted today’s consumers are the shift in snacking CEO John Downs pointed increasingly interested in experimenting with new patterns to the tectonic out that consumers would and bold flavors, as well as new combinations of plate movement of the rather adjust their overall familiar flavors. Sour in particular is growing in Earth. “They change slowsugar consumption by cutpopularity, along with cotton candy, sea salt ly, but they change.” ting down on sugar that is and exotic fruits. The timing of snackhidden in non-candy products ing is also changing, as and enjoy candy in moderation snack foods move into as a treat.

W

Seen on the Show Floor

88 Convenience Store News |JULY 2015 | WWW.CSNEWS.COM


main meals and main meal foods move into snacking tors work with manufacturers and brokers to get as occasions. Seifer advised suppliers to understand their much education on the category as possible, and pay products’ proper place during the day in order to conattention to the details they may have overlooked in nect with consumers (and help retailers sell more of the past while focusing on other categories like fuel their product). “There’s a time and a place for these and cigarettes. products,” he said. “It’s a very simple business, but let’s not confuse simFor example, sweet snacks are consumed more ple with easy,” Wilson said. “It’s simple, not easy. And often toward the end of the day, but that doesn’t mean if you can make the simple easy, then you can win.” CSN suppliers should remove sugar in an attempt to reach another daypart. Instead, they should focus on when consumers seek to treat themselves and protect their brand equity. The day before the National Confectioners Association’s 2015 Sweets & Snacks

The Most Innovative New Products

CoNveNieNCe & CANDY

At the expo, Convenience Store News caught up with NCA Vice President of Industry Affairs Larry Wilson to discuss sweets and snacks in the convenience channel specifically. “When we think about candy’s role in the diet, it’s important to distinguish the permissibility of candy,” Wilson told CSNews. “It’s not a snack or a food substitute; it’s a treat.” C-stores should “celebrate” candy by making it widely available and merchandising it throughout the store, he recommended. By thinking about how and when customers buy it, retailers can merchandise candy in a way that reminds them of that usage occasion. He cited Halloween as an opportunity to focus on the occasion rather than a specific brand, and noted that Target and leading non-food retailers have category imagery worth emulating. “I think that the watchword for c-stores is to execute the basics exceedingly well,” Wilson said. “What happens a lot of times for c-stores is that [candy] often isn’t a focus category and yet it has the potential, given its scale, to really add significant sales.” To maximize candy profits, Wilson recommends c-store opera-

Expo opened its doors, a judging panel made of experts from top retailers and industry associations gathered to complete their mission: narrow down nearly 300 products to the top five in nine categories that would serve as finalists in the Most Innovative New Product Awards. The annual awards program serves to honor new candy and snack products that are not only high-quality, but truly inventive and likely to enhance the category at market. Judges had one hour to evaluate the entries in the four categories assigned to them, based on a set of weighted criteria: taste (30 percent), innovation (30 percent), saleability (25 percent) and packaging (15 percent). In part two of the process, each category’s top five products were chosen through a group discussion, during which judges advocated strongly for their picks. While the big names of the industry had multiple entries in the semifinal round, judges focused on the products’ quality rather than brand name. Logistics such as price point were considered too, but it was flavor and creativity likely to excite consumers that broke any ties. All the finalists were then voted on by Sweets & Snacks Expo attendees on the first day of the show to determine the winners. The 2015 Most Innovative New Products are: • Chocolate: Milk Chocolate Peanut Butter Peanuts, Albanese Confectionary Group Inc. • Non-Chocolate: Pancakes & Maple Syrup Jelly Beans, Jelly Belly Candy Co. • Seasonal: Roca Thins Dark Chocolate Peppermint Bark, Brown & Haley • Novelty/Licensed: BeanBoozled Mystery Bean Dispenser, Jelly Belly Candy Co. • Salty Snacks: Kettle Brand Thick + Bold Dill Pickle Potato Chips, Diamond Foods Inc. • Sweet Snacks: Hershey’s Snack Mix, The Hershey Co. • Gourmet/Premium: SuperSeedz Maple Sugar & Sea Salt, Kathie’s Kitchen LLC • Gum & Mints: Project 7 Grapefruit Melon Gourmet Gum, Project 7 Inc. • Savory Snacks: Peanut Butter Snappers, Edward Marc Brands Inc. • Best in Show: Tic Tac Minions, Ferrero USA Inc.

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 89


OUTABOUT &

Spotlighting major industry events

Celebrating the Entrepreneurial Spirit NRA Show highlights the significant economic impact of foodservice retailers By Angela Hanson

T

he restaurant industry encompasses many different styles of eateries and styles of cuisine from across the globe, but it also offers something uniquely American, according to the keynote speakers at the 2015 National Restaurant Association (NRA) Show, which took place May 16-19 at Chicago’s McCormick Place. “The American dream is alive and well in the restaurant industry,” NRA President and CEO Dawn Sweeney said during the keynote presentation entitled “State of the American Dream 2015: Empowerment.” Many foodservice retailers are single-location operators, making them small businesses that have a large National Restaurant impact on the economy, and Association more than 50 percent of people (NRA) Show in the United States work in May 16-19, 2015 the restaurant industry at some Chicago point in their lives. This makes the industry a bridge to even non-foodservice careers by teaching workers skills and the ability to face challenges and failures along the way, according to guest speaker Arianna Huffington, president and editor-inchief of the Huffington Post Media Group. Hundreds of foodservice industry suppliers displayed the latest innovations in products and equipment at this year’s NRA Show, which featured multiple pavilions for exhibitors and attendees with special interests, including organic and natural; special dietary needs; sustainable products and services; and startups and franchises. A significant number of show attendees gathered to learn about the latest advancements in retail foodservice offerings in convenience stores and grocery stores, which have expanded significantly in recent years and show no signs of stopping.

90 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Consumers today view retail foodservice as a convenient opportunity to get meals for themselves and their families, and prepared foods are heating up as time-crunched shoppers embrace ready-to-eat and ready-to-cook meals as alternatives to eating out, said Jim Dudlicek, editor-in-chief of Progressive Grocer and moderator of the panel “Foodservice Advancements in the Grocery and C-store Channels.” Major factors influencing this changing eating behavior include increased buying power of millennials and Hispanic consumers, aging baby boomers and smaller households. Convenience stores are also seeing major change when it comes to prepared food. “Most convenience stores offer some kind of foodservice,” said panel speaker and Convenience Store News Editorial Director Don Longo. The growth of foodservice in c-stores has outpaced that of in-store merchandise for the past decade. “Foodservice has become the most profitable category in the store,” Longo cited. C-store foods driving the growth include sandwiches and wraps, hot dogs, pizza and chicken, with frozen treats showing notable improvement. CSN


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ENTRY DEADLINE: JULY 31, 2015 OFFICIAL RULES 1. All consumer packaged goods SUPPLIERS are eligible. 2. Products introduced from April 1, 2014 through March 31, 2015 are eligible. CONSUMER GOODS ONLY, PLEASE. ONLY PRODUCTS DESIGNED FOR RESALE TO CONSUMERS WILL BE CONSIDERED. No store equipment or technology products are eligible. 3. Entries should include supporting information such as press releases, product/service history, when introduced, C-store sales data since introduction, explanation of why this product is deserving of the award, why the product is important to the C-store channel, and what niche it flls. 4. Entrants must send 3 samples of the product along with the receipt for their online entry and payment, and any supporting material, all in the same package to: Susan Durtschi, CEO and President, Past Times Research, 77 Hudson Watch Drive, Ossining, NY 10562. 5. Complete entries must be received by July 31, 2015. Clearly mark on the outside of all shipping packages "2015 CSNEWS.” In addition, frozen/ refrigerated or other perishables need to be clearly marked “PERISHABLE.” 6. There are 44 award categories. Please clearly indicate which award category you are entering. 7. Each entry requires a handling fee of $125. 8. Winners will receive: a crystal engraved award, coverage in CSNews Dailies at the NACS Show and post-NACS issue, and the right to use the 2015 Best New Product Award logo in all future promotion materials.

9. Products will be judged on the following criteria: Taste: The most important attribute of any food. Non-food items will be based on utility/efciency (30 points) Value: Is it worth it? (20 points) Convenience: Is size/packaging appropriate for a convenience store or to be consumed by shoppers on-the-go? (15 points) Health: Based on nutritional information, is it nutritionally balanced? (10 points) Ingredients: What’s in it, how natural is it, does it meet current consumer trends? (10 points) Preparation*: When applicable, how accurate or good are the directions, or how easy is it to prepare (microwavable in the store)? (5 points) Appearance: Is it appetizing and does it resemble its photo or description? (5 points) Packaging: Is it appropriate for the product and does it have any benefts such as resealability, added freshness, better storage, etc? (5 points) * Products that do not have any preparation will have the full value of points included in their total score.

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HOTPRODUCTS Special Advertising Section

Pizza Program

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HOTPRODUCTS Special Advertising Section

Pizza Equipment

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Plastics

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Age Verifer / POS

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CLASSIFIED ATMs

Petroleum/Equiment

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General Merchandise

DAVY CROCKETT HATS SELL BY THE TENS OF THOUSANDS AT $3.50 EACH. Silver Fox tails are a good seller!

You Can Scan We have: Red Fox tails, Coyote tails, White tails, Racoon tails, etc.

Leopard Rabbit Skin

Rabbit skins come in White, Natural colors, Cheetah, Tiger, Leopard, Ocelot and Black.

LARGEST FUR TAIL DEALER WITH OVER A MILLION TAILS AT LOW WHOLESALE ONLY PRICES. $100 MIN. FREE PRICE LIST.

Strips Inc. Tel.: (718) 786-3381 Fax: (718) 786-0203 http://stripsinc.tripod.com

Check Guarantee Services

Equipment / Supplies

WWW.CSNEWS.COM | JULY 2015 | Convenience Store News 105


Wholesale Refrigeration

570 Lake Cook Road, Suite 310, Deerfield IL 60015 Phone (224) 632-8200 Fax (224) 632-8266 www.stagnitobusinessinformation.com

Harry Stagnito President and CEO 224-632-8217 hstagnito@stagnitomail.com Kollin Stagnito Chief Operating Officer 224-632-8226 kollinstagnito@stagnitomail.com

ADINDEX Alon

www AlonBrands com

61

Altria Group Distribution CompanyNuMark

www.insightsc3m.com . . . . . . . . . . . . . . . . . . . . . . . . . .2,53

Berry Plastics

www versalite com

27

BIC

www BICLighter com

55

Cash Depot

www.cdlatm.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

CB Distributors

www.21stCenturySmoke.com

Clif Bar

63

Coca Cola Commonwealth Altadis

35 49

888 781 9100 darensdorf@cvalet.com

21

Core-Mark

www core-mark com

59

CST Brands

www cstbrands com

71

Del Monte Fresh Produce

www.freshdelmonte.com

37

Devault Foods

www devaultfoods com

79

Ferrero USA

www.ferrerousa.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Fit Crunch Bars

sales@fitcrunchbars.com

Forte Product Solutions

Korry Stagnito Chief Brand Officer 224-632-8171 kstagnito@stagnitomail.com

81,83

Convenience Valet

Flash Foods

Ned Bardic Senior Vice President/Partner 224-632-8244 nbardic@stagnitomail.com

15 67

www.forteproductsolutions.com

17

Global Tobacco LLC

888 597 6653

39

GMPI

www.gmpicompany.com . . . . . . . . . . . . . . . . . . . . . . . . . 20

Terry Kanganis Account Executive & Classified Advertising 201-855-7615 tkanganis@stagnitomail.com Kevin McKay Western Regional Sales Manager 224.632.8246 kmkay@stagnitomail.com

Heineken . . . . . . . . . . . . . . . . . . . . . . www.enjoyheinekenresponsibly.com . . 85 and 87 Regional Innovative Control Systems. . . . . . . . www.icsCarWashSystems.com. . . . . . . . . . . . . . . . . . . . . 16 ITG Brands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 JTM Foods

www jjsbakery net

Kraft Foods Logic Technologies

77 51

www.logicecig.com . . . . . . . . . . . . . . . . . . . . . . . . . . .10-11

Kim Hansen Midwestern Regional Sales Manager 847-726-1590 khansen@stagnitomail.com

Mars . . . . . . . . . . . . . . . . . . . . . . . . . . www.mars24seven.com . . . . . . . . . . . . . . . . . . . . . . . . . . 29 McLane Co Inc

www.mclaneco.com . . . . . . . . . . . . . . . . . . . . . . . . . .18-19

MillerCoors. . . . . . . . . . . . . . . . . . . . . www.millercoors.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Mondelez . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 Perfetti Van Melle

800 283 5988

The Proctor & Gamble Co R J Reynolds Tobacco Company

www.engagetradepartners.com

Rubbermaid

7 41

Rutter’s Save-A-Lot

45 108

Rachel McGaffigan Northeast Regional Sales Manager 508-385-2524 rmcgaffgan@stagnitomail.com

65 www.save-a-lot.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91

Swedish Match . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23,31 Swisher . . . . . . . . . . . . . . . . . . . . . . . www.swisher.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

Steve Lichtenstein Vice President/Southeast Regional Manager 201-855-7613 slichtenstein@stagnitomail.com

Technomic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Tillamook Country Smoker Inc

www.tcsjerky.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Turkey Hill Minit Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 Universal Merchant

www.nynab.com . . . . . . . . . . . . . . . . . . . . . . . . . . . .Outsert

Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by Stagnito Business Information, 570 Lake Cook Rd Deerfeld, IL 60015 Copyright Š 2015 by Stagnito Business Information All rights reserved Subscriptions: One year, $93; two years, $152 One year, Canada, $110; two years, Canada, $175 One year, foreign, $150 Payable in advance with a bank draft drawn on a U S bank in U S funds Single copies, $10, except foreign, where postage will be added Printed in U S A Periodicals postage paid at Deerfeld, IL, and at additional mailing offces POSTMASTER: Send address changes to Convenience Store News, P O Box 1842, Lowell, MA 01853

106 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM

Roz Gilman Ad Manager 224-632-8243 rgilman@stagnitomail.com

Stagnito Business Information U.S. brands:


Help Meal Skippers. belVita is one of the top growth brands across all sweet snack categories, up 56% or +$72MM vs. YAG. belVita provides a convenient on-the-go option as part of a balanced breakfast. Available in Soft Baked and Crunchy. Source: Nielsen Quick Facts


WHETHER DAY OR NIGHT,COUGH, COLD OR FLU—

RELIEF IS HERE

POWERFUL NON-DROWSY 6-SYMPTOM COLD & FLU RELIEF.

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SELLING BRANDS!


Profile for ensembleiq

CSN - July 2015  

CSN - July 2015