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April / May 2018 CCentral.ca @CCentral360
Locally invested, community minded
Mid Island Co-op builds loyalty from the inside out
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April / May 2018 Volume 1 | Number 3
ADT Security Services Canada Inc................... 7
05 Editor’s Message Craving convenience 06 The Buzz Cross-Canada round-up 08 T ech Talk Create a personalized c-store for every customer 10 Millennials are the convenience generation Are you making them feel special ? 12 Hall of Fame Time to celebrate the latest Convenience U CARWACS inductees 14 Money Matters Family feud? Having tough conversations with the ones you love
Blast-Off Fireworks.........................................39 Chelan Fresh...................................................35 Conagra Foods...........................................32-33 Convenience U CARWACS Show - Calgary... 37 Ford Motor Company of Canada.....................2 Interac Corp.....................................................15 ITWAL Limited.................................................18 JTI-Macdonald Corp......................................26 Mondelez Canada Inc.......................................4 National Smokeless Tobacco Company......... 22 Regal Confections............................................13 Scandinavian Tobacco Group of Canada........ 11 SSCS, Inc.......................................................... 7
16 Vending ascending? Portable convenience shows (some) signs of growth 19 Locally invested, community minded Mid Island Co-op builds loyalty from the inside out 23 COVER STORY 650 points of light 7-Eleven’s Doug Rosencrans is helping to redefine convenience 27 A step back in time J.A. Moisan’s owners are custodians of 19th-century general store’s heritage store sales
30 Category Check The thrill of the chill: Cold treats mean hot sales in c-stores 34 Category Check A wealth of health: Bring customers into your store for their next snack attack 36 Snapshot Fizzy and extreme: A look at what’s quenching thirst in the beverage aisle 38 Backtalk 4 foodservice questions for Jeff Dover
April / May 2018
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EDITOR’S MESSAGE 20 Eglinton Ave. West, Suite 1800, Toronto, ON M4R 1K8 (416) 256-9908 | (877) 687-7321 | Fax (888) 889-9522 www.CCentral.ca PRESidENT, ENSEMblEiQ CANAdA Jennifer Litterick | email@example.com ViCE PRESidENT/GENERAl MANAGER, EVENTS & MARKETiNG Michael Cronin | firstname.lastname@example.org Editorial EdiTOR, CSNEWS CANAdA Jane Auster | email@example.com EdiTOR, Octane Kelly Gray | firstname.lastname@example.org ONLINE EDITOR Nikki Lockington | email@example.com TRANSLATION | Danielle Hart advErtising salEs SALES REPRESENTATIVE Elijah Hoffman | firstname.lastname@example.org SAlES & EVENTS COORdiNATOR Claudia Castro (on leave) DESIGN AND production diRECTOR OF PROduCTiON & dESiGN CANAdA Derek Estey | email@example.com PRODUCTION MANAGER Michael Kimpton | firstname.lastname@example.org ART DIRECTOR | Christian Lemay AUDIENCE DEVELOPMENT MANAGER Lina Trunina | email@example.com WEB OPERATIONS MANAGER Valerie White | firstname.lastname@example.org CORPORATE OFFICERS EXECUTIVE CHAIRMAN | Alan Glass ChiEF EXECUTIVE OFFiCER | David Shanker Chief Operating Officer & Chief Financial Officer Richard Rivera
Chief Brand Officer | Korry Stagnito President, Enterprise Solutions | Therese Herbig CHIEF DIGITAL OFFICER | Joel Hughes ChiEF huMAN RESOuRCES OFFiCER | Jennifer Turner Senior Vice President, Innovation | Tanner Van Dusen SUBSCRIPtion services Subscriptions: $65.00 per year, 2 year $120.00, Outside Canada $100.00 per year, Single copy $12.00, Groups $46.00, Outside Canada Single copy $16.00. Email: email@example.com Phone: 1-844-694-4422, between 9 a.m. to 5 p.m. EST weekdays Fax: 1-844-815-0700 / Online: www.ccentral.ca/subscribe LICENSING AND REPRINTS Please contact Wright’s Media | firstname.lastname@example.org 1-877-652-5295 CONVENIENCE STORE NEWS CANADA / OCTANE is published 6 times a year by EnsembleIQ. CONVENIENCE STORE NEWS CANADA / OCTANE is circulated to managers, buyers and professionals working in Canada’s convenience, gas and wash channel. Please direct inquiries to the editorial offices. Contributions of articles, photographs and industry information are welcome, but cannot be acknowledged or returned. ©2018 All rights reserved. No part of this publication may be reproduced in any form, including photocopying and electronic retrieval/retransmission, without the permission of the publisher.
Craving convenience I live in a busy hub of retail activity. Within a three-block radius of my home are Shoppers Drug Mart, Sobeys, Loblaws, 7-Eleven, Mac’s, Dollarama, two “traditional” mom & pop c-stores, and one local corner store selling fresh plants and flowers. You could say I am spoiled for choice. Not everyone is so fortunate, but increasingly, customers do have numerous options for spending their retail dollars. In the “noise” of retail, how do consumers decide whether to shop at your store...or that other place? The whole concept of convenience is being upended with the blurring of the retail channels, and that’s leaving convenience retailers redefining their brand and revisiting the whole notion of convenience. Recently I sat down with Doug Rosencrans, vice president and general manager of 7-Eleven in Canada. He came to Canada after joining 7-Eleven in Texas in 2010 to head up the fuels team and then becoming responsible for retail operations. He is acutely aware of the need to redefine convenience to meet the changing expectations of customers. As he told me, “We are all competing for a finite number of customers. It’s many times a shared customer. We have to be cognizant of how we appeal to them, so I think we’re all competing for that finite tool. I have to make sure as a brand we differentiate ourselves from all of them in one way or another.... Quite frankly, if the experience is better at those stores, if that value equation is better in the customer’s mind at those stores, then that’s where they’ll go. It won’t matter whose name is out front.”
Rosencrans travels the world studying retail models, including those of parent stores in Japan, a country known for retail experimentation. Expect to see some of the innovations piloted here in Canada.
In the “noise” of retail, how do consumers decide whether to shop at your store...or that other place? Who are these customers retailers are trying to attract? Many are the sought-after millennials, a cohort whose numbers recently overtook those of the baby boomers. Millennials are known for craving convenience – wanting goods and services served up electronically, quickly, in person or delivered to them. We heard more about these influential consumers from millennial Doug Coletto of Abacus Research at The Convenience U CARWACs show. We’re featuring these insights and more in this issue. Let me know what you think. How’s your brand? Email me at email@example.com ◗
Jane Auster, Editor
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April / May 2018
THE BUZZ CROSS-CANADA ROUND-UP
People, places, news and events
New app for disabled drivers
Where there’s smoke
Alcohol drink under review
“fuelService” provides disabled drivers a way to connect with local gas stations that have an assistant on hand to fill up their tank for them. The app calls the gas station and asks if they can help in the next 30 minutes. fuelService then tells them when the driver has arrived and lets the driver know how many minutes it will be until they receive service.
When enacted, the Smoke-Free Ontario Act will regulate the sale, supply, use, display and promotion of both tobacco and vapour products. Under the terms of the new statute, convenience stores must put all vape products behind flaps similar to tobacco products, and they will not get an additional in-store sign beyond the three currently allowed.
In the wake of the tragic death of a 14-year-old girl, Couche-Tard has pulled “FCKD UP” from its shelves, and the Quebec company that makes the caffeinated, high-alcohol drink has halted production. Health Canada has now announced a safety review of drinks containing high alcohol by volume.
In the bag
Smokers in Ontario are turning to contraband in increasing numbers, according to a tobacco tax policy review conducted by Ernst & Young. The research suggests that additional tax increases planned by the government will drive the price gap between legal and contraband tobacco to $78 per carton by the end of 2019. The data also suggest legal demand will fall by almost 11% in 2018 and an additional 7% in 2019.
Cold shoulder The New Brunswick College of Pharmacists has barred convenience stores in the province from selling certain medications including Gravol, Advil Cold and Sinus, and Benadryl. The edict was handed down after an unregistered wholesaler was found selling limited-access drugs.
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A staff report recommending the city of Halifax work with the province to ban the use of plastic shopping bags has been rejected by city council, which worried about what dog owners and residents recycling newspapers could use instead. The issue has not been tossed out with the garbage, however. Now council has asked staff to prepare a report on the logistics and feasibility of banning plastic bags.
According to a blog prepared by Reebok, c-stores of tomorrow will be repurposed as fitness hubs. Driving the new business model: increasing use of electric vehicles. The global footwear company has now joined forces with an architecture firm to bring structure to its concept.
Circle K franchising a first For the first time, Circle K will be franchised in this country. Alimentation Couche-Tard Inc. says the offer for franchise opportunities will initially target Ontario with a full range of products and service.
The way we were To celebrate the return of its “stubby” beer bottle, Molson Export has given 25 Montreal dépanneurs, neighbourhood convenience stores, an updated look that resembles the way they were in the 1970s when stubby bottles were de rigueur.
Illustrations by Freepik.com
Up in smoke
Pump it up
Save the dates And the award goes to … On the move
And the unlucky winners are
Halifax’s Mobile Food Market — a fresh produce grocery store on wheels — has been honoured with a national award for helping combat food insecurity. The initiative, launched in 2016, won silver at the IPAC/Deloitte Public Sector Leadership Awards.
The Canadian Federation of Independent Business has presented its annual Paperweight Awards to recognize government departments and agencies responsible for excessive regulation that hurts small businesses. Among the 14 winners from across the country: Quebec’s Labour Department for requiring businesses to post a notice notifying employees they will soon be posting another notice.
June 7 | Brampton, Ontario Canadian Convenience Stores Association (CCSA) Industry Breakfast and AGM www.cstores.ca/en/events/national-events/
September 25-27 | Halifax, NS CCSA/NACDA National Convenience Industry Summit https://nacda.ca/program/
October 17-18 | Calgary, AB Convenience U CARWACS Show http://calgary.convenienceu.ca/
by Tammy Mastroberte
Create a personalized c-store for every customer Consumers today are demanding a more customized shopping experience, or they’ll go elsewhere. In the ecommerce world, personalized offers, website recommendations and product suggestions based on previous purchases are becoming commonplace — led by the industry innovator Amazon. Consumers are looking for the same level of customer service at retail stores, and that includes c-stores. According to a recent NectarOm Marketing Personalization Study, 83 per cent of customers surveyed expect a “personalized” retail experience. “Consumers are demanding it and, as they get it from other areas like Amazon, grocery stores and Walmart, the expec-
« Connecting an individual customer to purchases through the POS and gathering data to segment is the frontend of a personalized plan, but there needs to be technology on the backend to analyze the data and send personalized offers based on it. »
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tation morphs elsewhere,” said Derek Gaskins, chief customer officer at York, Pa.-based Rutter’s, operator of more than 60 c-stores. Whether it’s through loyalty programs, point-of-sale (POS) data, apps or geofencing, there are many technology options available to help retailers get to know their customers — what they purchase, what they don’t, and even when they are near a store. There are technology options for small budgets, as well as large. “The first step is to talk to existing vendors — your POS, digital signage and kiosk providers — and see what they support out-of-the-box,” advises Dennis Egen, founder and president of Engine Room Technologies, an information technology, cybersecurity and technology consulting firm based in Philadelphia. Gathering personal data usually requires integration of more than one technology system with the POS, noted Ed Collupy, executive consultant at W. Capra Consulting Group, based in Chicago. “Retailers often have to marry loyalty data with POS data and bring these two elements together into an analytic tool to slice and dice it,” he explained. “Personalization is not a singular piece of data, but a combination of it.”
The loyalty connection Today’s loyalty landscape is backed by sophisticated technology, allowing retailers to more easily incorporate personalization into their brand. The goal is for a store to be able to: identify customers as individuals rather than a “household” or a segment; understand their purchase behaviour; and direct coupons, promotions or rewards to them based on these data so they will take action. This often starts with customers downloading a company’s app, joining a brand’s loyalty program, or signing up for mobile payments.
“Stores need a way to easily identify a single person, not a segment or a group of customers. They need to know who I am and that my name is Jake,” explained Jake Kiser, chief revenue officer at Hatch Loyalty, based in Chicago. “In a c-store, if you want to get me inside
the store to buy more high-margin items, you need to understand what I care about. When people enrol in a loyalty program, retailers should have qualifying questions to start segmentation, and capture and store that data.” When someone signs up for a loyalty program or downloads an app connected to such a program, all c-store operators should have an enrolment process set up so that customers start sharing data about themselves right away, Kiser noted, explaining the retailer should pick about five questions they want to ask to begin creating customer segments. When connected to the POS, customer behaviour and purchases can be recorded and segmented, such as how often customers visit for gas, the types of items they purchase, and how often they come into the c-store. This intel, and more, can be used to communicate and influence a customer’s future behaviour, said Jeff Hoover, c-store data strategist at loyalty provider Paytronix, based in Newton, Mass.
use a mobile app to identify themselves, they can be targeted and sent an offer though the app to come into the store for a free cup of coffee, he pointed out. “You want to look at their behaviour and see if the offers you send them change or influence it,” Hoover said. Connecting an individual customer to purchases through the POS and gathering data to segment is the frontend of a personalized plan, but there needs to be technology on the backend to analyze the data and send personalized offers based on it.
The c-store industry as a whole is still working to get to the point where some drugstore and supermarket brands already are. These companies know a customer’s entire shopping history and present offers based on it. These are industries to watch. ◗ Tammy Mastroberte is a contributing editor for Convenience Store News.
A technology component to aggregate the data is a must to identify the opportunities to personalize offers and influence customer behaviour.
C-stores can also segment gas-only customers, so when they
Illustrations by Freepik.com
April / May 2018
C onvenience U CA R WAC S show
Millennials are the convenience generation
Are you making them
feel special ? Text by Talbot Boggs
Convenience retailers need to look at the future of their industry through the eyes of the millennial generation to provide the products, services and experiences this important cohort wants and needs.
For example, millennials currently make up 25.6 per cent of Canada’s population (9.3 million people). They are the most ethnically and culturally diverse, tech-savvy and entrepreneurial generation, consisting of a greater number of women with degrees. Each year, millennials are forming some 270,000 households in the country. “This generation is having a huge impact on everything from retail to political voting,” Coletto said. “Just look at what’s happening in Ontario. The OHIP+ program (free prescriptions for those under 25), increases in the minimum wage, free tuition and rent controls all are aimed at millennials.” Millennials are probably the most technologically-sophisticated generation of all time. Eighty-five per cent check Facebook every day and rely on it for their source for
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breaking news. Seventy-one per cent say they love being connected to the internet, compared to 36 per cent of boomers. Ninety-four per cent own a smartphone, 25 per cent don’t subscribe to either cable or satellite, and they use Amazon, Uber and Netflix regularly.
David Coletto, CEO, Abacus Data
Millennials also love upstart brands (59 per cent compared to 37 per cent for boomers). They are most interested in food, drink, travel and adventure, and 42 per cent of millennial men are the primary cooks in their households and the ones who do the shopping. “This is a big change in the market that has the potential to revolutionize the convenience and grocery channels,” Coletto said.
The challenge for convenience retailers is to start thinking about ways to satisfy this huge market and give millennials the experiences they are looking for. “Millennials were empowered when they were growing up,” Coletto said. “They were over-protected and developed high esteem about themselves, believing that anything is possible. Twenty per cent say they want to make a difference in the world. Their desire for instant reactions, speed and convenience is changing their expectations about virtually everything – even waiting to get their coffee.” In a connected world that never sleeps, Coletto said retailers should consider staying open 24 hours, featuring more healthy food options, adding prepared food and adopting the latest in ordering and pay technologies, such as installing Amazon lockers in their stores, which allow customers to order online and pick up on site. “We are a huge market for you,” Coletto added. “With the rise of digital technology we are the convenience generation. Your challenge is to make us feel good. Tell us your story – why we should shop with you. Provide what we need and give us the experience we are looking for.” ◗
Illustrations by Freepik.com
Millennials – those born between 1980 and 2000 – will dominate Canadian society for the next three decades and exert great power and influence over almost every aspect of life from government public policy to the ways in which they search for and buy products from their local convenience store, David Coletto, CEO of Abacus Data, told attendees of the Convenience U CARWACS show in Toronto.
Tobacco advertising is not available in the digital issue
THE Convenience U CARWACS Show
Time to celebrate the latest Convenience U CARWACS inductees Text by Nikki Lockington | Photography by GoldMedia
Each year the convenience, fuel and car wash industry comes together in Toronto at The Convenience U CARWACS Show to share ideas, discover innovation, and celebrate the hard-working individuals who make up the channel. In 2016, the show introduced the Hall of Fame Awards, an opportunity to recognize those retailers making a big difference in the Canadian market.
“The convenience channel in Canada is going through immense change and retailers like our Hall of Fame winners are leading the way with new products, innovation, capital investment and community involvement,” said Ontario Convenience Stores Association CEO Dave Bryans. Each year the awards recognize one independent retailer and one chain retailer who have faced the industry’s challenges head-on and continue to improve their offering and the customer experience.
Introducing the 2018 winners Independent: That’s Entertainment Since 1989, That’s Entertainment has been operating in the community of St. Catharines, Ont., offering movie rentals and sales, in addition to a full-service convenience store. The 14,000 sq. ft. complex provides customers with a unique, one-stop-shopping experience. Over the years, owners Nick Novakovich and Vaso Manojlovich have adapted to the changing needs of their community. At a time when other video stores are closing their doors, That’s Entertainment is refining its offer and continuing to grow its customer base. They’ve carved out a niche for themselves, and their customers have responded. The team have also embraced the spirit of the community by lending their support to important causes and programs that benefit the local high schools and hospitals.
The 2018 sponsors
Every year the awards are supported and presented by industry partners. This year, the Ontario Convenience Stores Association, The Great Canadian Meat Company, Adapt Media and Lumsden Brothers came together to sponsor the awards.
“Being able to present the award this year gave us a chance to share in the celebration of the achievements of those we respect within our industry. It also allows us to connect with the honoured retailers and congratulate them for their dedication, leadership and contribution to the convenience industry,” said Valerie Principe and Christine Meredith, The Great Canadian Meat Company.
For Adapt Media, these awards fit perfectly with their focus in the channel. “A major focus for Adapt Media in the past years has been helping stores clean up their appearance: cleaning graffiti, installing cameras and attracting a wider spread demographic of shopper to the stores,” said Adapt Media’s president Jamie Thompson. “In this spirit, Adapt Media is proud to support the recognition of the people in this industry that strive for excellence.”
The OCSA’s Dave Bryans knows convenience retailing, and understands what it takes to be great in this industry. “Both 2018 winners drive traffic with lottery sales complemented by high impulse items that reflect the demographics of their community,” noted Bryans. “Developing a strong and loyal customer base takes the hard work of all employees and they should be thanked and recognized for being part of this award. Bragging rights are well earned!”
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Chain: Parkland Parkland is a growing chain that continues to evolve and strengthen the Canadian c-gas industry as a whole with some of the best-known c-gas banners from coast to coast. Parkland exhibits impressive industry leadership, with strong voices contributing to the development of the Canadian Convenience Stores Association and the regional associations. With their own Ian White as chair of the CCSA and Eli Mail as director on the OCSA board, Parkland has been an important industry voice for retailers and the many issues and challenges they face every day. Just like our independent retailer honouree, Parkland makes giving back a priority. For example, Pioneer Petroleums’ Children’s Foundation proudly supports a number of community-driven programs, including Ontario Children’s Hospitals Initiatives, CHML Christmas Tree of Hope and United Way of Burlington and Greater Hamilton.
Congratulations to this year’s winners! CCentral.ca
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by Mike Jaczko and Max Beairsto
Having tough conversations with the ones you love
Often, when the day children receive their inheritance “arrives,” the next generation is ill prepared to manage the type of wealth they inherit. I hear lots of excuses for reasons parents avoid having conversations about inheritance, from “we will when they grow up” to anxiety over whether knowledge about inheritance will undermine a child’s work ethic. I ﬁnd that parents’ predisposition to communicate with their family about family wealth exhibits a high correlation to subsequent ﬁnancial disputes within the family. Incomplete or ineffective wealth communication typically lies at the heart. Wealth tends to sneak up on you as you pay off your ﬁrst c-store mortgage and the surpluses start. Learning how to live with wealth is in fact, a new skill that needs to be learned, just like you learned your professional skills. It takes time, but the time is well worth it especially in family-run convenience retail operations.
Interactive not didactic Engage with your family and give them an opportunity to voice opinions and express concerns. Avoid treating a family discussion as a one-way lecture about the family legacy since that could send a negative message that their opinions and views are not valued. Expressing your wishes to your family is fair game, but don’t assume that your kids will buy in. Encourage them to ask questions, and listen to their concerns. You don’t necessarily have to agree with everything they say, but at least you’re listening!
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When is the right time? Some retail families I work with don’t have a problem talking to their kids about wealth, but they’re unsure about how or when they should initiate the conversation. Others welcome a hand in preparing and providing structure for a family meeting. There’s nothing wrong with an organized discussion, but most of the time, our knowledge of how wealth works (and how it affects our lives) happens spontaneously, as we navigate through life events that touch upon money and personal ﬁnance. Learn to make the most of these money moments. For example, a child’s wedding might be a good time to talk about transitioning wealth to the next generation. Similarly, the birth of a grandchild could be an excellent time to discuss wills and estate planning.
Keep an open mind When it comes to transferring wealth from one generation to the other, you may have a ﬁrm view of what you want to accomplish. Carefully listen to your children as they may have ideas of their own. Taking a “my way or the highway” approach when it comes to passing on family assets could result in a recipe for resentment and hostility. The key word in family wealth is “family.” That means being open to feedback from family members and understanding that their ideas may differ from yours.
Treat family wealth communication with openness and be aware of the opportunity family dynamics present. Talk with well-seasoned wealth advisors who have walked in your shoes, so when the opportunity arises you’re prepared and conﬁdent to engage your family. Ideally, the conversation should be organic – something that grows, develops and evolves over the years to adapt to changing ﬁnancial and family circumstances. Much like building your c-store business, communication isn’t a 100-yard dash, it’s a marathon that requires a committed and methodical approach to succeed. Z MMike Jaczko CIM®, a small business owner by background, is a portfolio manager, partner and member of K. J. Harrison & Partners Inc., a Toronto-based private investment management ﬁrm servicing families across Canada. Max Beairsto, B.Sc., MBA, CVA is a certiﬁed valuation analyst and business intermediary with Enterprise Valuators, an Edmonton-based valuation, and business sales advisory ﬁrm.
A steady hand The frequency of family meetings is important. Adopting a “man, am I glad that’s over” mindset every ﬁve years is worthy of reconsideration.
Illustrations by Freepik.com
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Portable convenience shows (some) signs of growth Text by Mark Cardwell
But could the recent rise in the number of employee-less, electronically-paid vending services that offer more products and healthier foods in some big-city residential and industrial settings point to a change in direction? Likely not – at least not anytime soon – say several Canadian convenience and consumer marketing experts. Still, vending is a trend to watch. “Vending is an interesting crack in the lines between e-commerce and brick-andmortar businesses,” says Ken Wong, a professor at the Smith School of Business at Queen’s University and one of Canada’s leading thinkers and speakers on marketing and business development and strategy. “We can expect to see more of it, though I’m not sure it will ever get beyond being a niche in convenience, much like an ATM is to a bank.” According to Wong, two issues – technological advances in regards to payment and labour costs – are the likely drivers in the fast growth of vending machines and so-called micro markets in countries like the United States. According to a 2017 report by Houston-based research firm Bachtelle and Associates, micro-market sales south of the Canada/U.S. border increased 42 per
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cent in 2016 to $950 million. There were also more than 5,000 new site placements, bringing the total number to nearly 18,000. Bachtelle projects that number will double to 35,000 micro-market locations by 2022, generating annual revenues of $1.6 billion by 2027.
« Vending is an interesting crack in the lines between e-commerce and brick-andmortar businesses» In Canada, where there has been a recent spate of business stories about vending services selling everything from fresh salads in Montreal subway stops to milk, eggs and bacon in Vancouver highrise condo complexes, a country report on vending issued by Euromonitor in Feb. 2017 found far flatter growth. “Vending reported a negligible increase in current value terms in Canada in 2016,” says the report. The report called Canada “an increasingly cashless society” where people are becoming less likely to carry physical money.
“To address this issue, an increasing number of vending machines offer non-cash payments,” added Euromonitor. “The increasing number of non-cash vending machines and more convenient payment methods, such as Apple Pay, made it easier for Canadian consumers to purchase in this channel.” Still, the report also noted that two traditional vending mainstays – packaged foods and drinks – continued to account for the majority of sales in vending in Canada.
Canada is NOT Japan That doesn’t surprise Wong. “Vending works for some categories here,” he says. “But it is far from being as socially acceptable and technologically sophisticated as in Japan, where you can buy almost anything from a vending machine – from sushi and noodles to pharmacy products.” Hugh Large agrees. “Vending has been around a long time and there are now more services carrying better foods than peanuts and candies,” says Large, a Victoria, B.C.-based c-store retail consultant with the bold website address of www.convenienceguru.ca. “But I’m not sure I buy
Illustrations by Freepik.com
Vending machines in Canada have long been associated with candies, peanuts, pop and spare change.
into talk that it will be big, and I certainly don’t see it as a challenge to convenience.” For Large, vending machine-dispensed packaged sandwiches with shelf-life-enhancing nitrogen flushes will never rival the visual appeal of the fresher, higher quality grab-and-go foods and beverages that smart c-store operators like Mac’s or 7-Eleven now offer in their newest facilities as a way to replace traditional sources of revenues like tobacco and grocery.
« I’m not sure I buy into talk that it will be big, and I certainly don’t see it as a challenge to convenience.» “The key to success in food retail is freshness,” says Large. “That flies in the face of what you get in vending. The bottom line is that vending will continue to be around and they will continue to tinker with their offerings. But I think it will have an awfully hard time making inroads with consumers who are fairly suspicious of the quality of products in machines.”
Vending – a niche opportunity? Though he admits to not being a vending machine expert, Toronto-area retail consultant and former Loblaw executive David Bartolini says he too sees and understands the entrepreneurial attraction of unmanned stations.
“What’s not to like about making sales without maintaining a human presence?” says Bartolini. “It’s an opportunity to reduce overhead now that the minimum wage is up to $15.” Despite the future possibilities of vending in an increasingly wireless and automated world with cloud-linked smartphones and self-checkout, Bartolini thinks Canada and Canadians lack both the cultural conditioning and critical mass to make vending services more than a niche market for the foreseeable future.
“I see it going in specific retail-restricted places like airports – but not becoming big like in Japan where they have a deep saturation of people who are trained and accustomed to buying high-quality foods and other items from vending machines,” he says. “I think the impetus here for increased vending services will be minimum wage. It won’t be consumer demand for items that most people can get fresher and cheaper from regular retailers.” ◗
Top takeaways Vending may be growing. Higher minimum wages and technological improvements in pointof-sale payments are driving an increased interest in the vending channel. Vending will remain a niche market in Canada. Retail experts here believe Canadians don’t instinctively turn to vending machines when in search of quality foods and products, but rather for snack foods. Fresh foods are the future for c-stores. Smart c-store operators are doubling down on the rising popularity of grab-and-go quality food sales to offset the decline of traditional revenue pillars like tobacco and groceries.
April / May 2018
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Coldstar Solutions Inc. - BC J & F Distributors Ltd. - BC Morton Clarke & Co. Ltd. - BC Pratts - AB/SK/MB Shoppers Wholesale Food Co. - BC Wallace & Carey Inc. - BC/AB/SK/MB
Beaudry & Cadrin Inc. Ben Deshaies Inc. Consultants de L’Arctique Distribution Regitan F. Charest Ltée. Roland et Frères Ltée.
Beech Brothers Ltd. Campbellford Wholesale Co. Ltd. Courtney’s Distributing Inc. Falls Wholesale Ltd. Farquhar Massey Wholesale Ltd. Fortier Beverages Ltd. Hyde’s Distribution J.N. Webb & Sons Ltd. Loudon Bros. Ltd. Ritchie’s Wholesale Ltd. Wallace & Carey Inc.
Brown Derby Wholesale Ltd. - NL Capital Foodservice Ltd. - NB Carol-Wabush Distributing - NL C.L. Comeau & Cie Ltée. - NB E.L. Bugden Ltd. - NL F.J. Wadden & Sons Ltd. - NL Goulding’s Wholesale Ltd. - NL J.B. Hand & Sons Ltd. - NL Kays Wholesale Inc. - PEI Nor-Lab Ltd. - NL
Kirby Hodgson (senior clerk), Michelle Nowotka (assistant manager), Shawna Allan (store manager), Steven Danesin (senior clerk), Ian Anderson (general manager).
community minded Mid Island Co-op builds loyalty from the inside out Text and photography by Lawrence Herzog CCentral.ca
April / May 2018
Last year, Mid Island Co-op donated more than $150,000 to the Vancouver Island communities it serves. “Social responsibility and concern for community is our mandate,” says general manager Ian Anderson. “It’s one of the seven international principles upon which co-operatives are built.”
Repeat business is key in the c-store channel. Once people get into a pattern of coming to your store once or twice a day, that’s where you make it.
- Blair Gjevre, Petroleum Operations Manager
Mid Island Co-op supports a broad range of local groups, organizations, events and charities, and puts priority on those that build long-term capacity in the community. In the last year, it has provided an $8,500 donation to Nanaimo Food Share’s Solar Panel Project,
The co-op has created a Green Fund and reserves are generated each time a member reloads the Mid Island Co-op Loyalty fuel card at any location. The most recent project is a riparian zone reclamation and enhancement of Beadnell Creek in the town of Lake Cowichan, adjacent to one of their properties. “We believe we have a responsibility to conduct business in a way that is environmentally sound, and that project fits perfectly with our values,” Anderson says. Reaching out to help extends beyond its service area, too. Last September 19th, co-ops in Western Canada teamed together for Fuel Good Day. The locations each donated at least five cents per litre of fuel purchased and together raised more than $570,000 for local charities and non-profits. Mid Island Coop donated most of their proceeds from the day to local food banks.
$25,000 to refurbish the Parksville Beach Spray Park, and $5,000 to help make the playground at McGirr Elementary School accessible for children with disabilities, among others.
| April / May 2018
and valued. “We’ve built a culture here where we treat people like family,” says gas bar manager Shawna Allan. “And a lot of our young staff, and many of the more senior ones, come from families that have long been members and so they understand how important that is.” A friendly atmosphere helps build loyalty and positive word of mouth, Gjevre says. “Repeat business is key in the c-store channel. Once people get into a pattern of coming to your store once or twice a day, that’s where you make it.” The stores offer a coffee card which provides customers with a free coffee for every five they buy. “We also have a slush card, and that targets a lot of families who come into this neighbourhood for activities at the park,” Allan says. Centralized promotions, including monthly deals and seasonal offers, also help drive sales. Product selection varies at each location as does the hot food program, Gjevre says. “One of our sites has a lot of industrial around it, and so it does a fabulous lunch business. We’ve sold 1,800 hot dogs in a week there.”
Clean and modern fuels loyalty
Rewards of belonging
Mid Island Co-op operates 15 gas bar/ convenience stores, seven commercial cardlocks, and two liquor stores. Their retail locations are clean, bright and modern. “We have updated our locations with state-of-the-art equipment and we pay attention to things that matter – like clean washrooms,” says Blair Gjevre, petroleum operations manager. “That makes a big difference, for all our customers.”
“You don’t have to be a member to shop Co-op, but it pays to join,” is how the company explains its approach. For a one-time investment of $10, member-owners share in the profits of the organization. Purchases are recorded each time they use their member number and, at the end of each year, they’re entitled to a share in the profits based on their purchases.
Staff training focuses on friendliness, and the organization’s surveys show that customers appreciate feeling welcomed
What continues is a commitment to community. “There’s a sense of pride that ripples right through the organiza-
tion and the members feel it, too,” Anderson says. “They know that when they spend their money in our locations that they are helping to employ local people, and the profits stay right here in the community. They can see the good it is doing.”
Deep roots into the communities it serves also helps with recruitment and retention. “People who come to work with us like feeling good about where they work,” he says. “That’s true of our younger workers and also our older workers, and we’re seeing more people in their 50s and 60s coming to work for us. They love the flexibility. ◗
Mid Island Co-op’s
top tips Support your community and it will support you back. Greet your customers with friendliness and appreciation.
Modernize your operations to ensure locations are clean and bright. Promote your loyalty cards to encourage repeat visits Ensure top flexibility for hours to attract and keep your best workers.
• Mid Island Co-op, headquarters in Nanaimo, BC • Founded in 1959, now more than 57,000 members • 15 gas bars/convenience stores, 7 commercial cardlocks, 2 liquor stores • Number of employees: 175 • Members pay $10 to join • Top sellers: coffee, salty snacks, packaged beverages, sweet treats • Top draws: friendly service, modern locations, loyalty rewards
April / May 2018
Tobacco advertising is not available in the digital issue
650 points of light
7-Elevenâ€™s Doug Rosencrans is helping to redefine convenience Text by Jane Auster Photography by Adam Blasberg
April / May 2018
Convenience redefined. That’s what 7-Eleven Canada under Vice-President and General Manager Doug Rosencrans talked about with Convenience Store News Canada. Convenience where and how customers, urban or rural, from global backgrounds, young and old, want it. Convenience that comes to customers through e-delivery or is ready for pickup after e-ordering. Fresh foods and baked goods that turn 7-Eleven into an eating destination. It’s all on the table... and much more. How do you plan to reach your customers in a changing retail environment? The most important aspect for us is to be where the customer wants us and needs us, regardless of how we manage to get there. The key message for us is to be close and convenient for the customer. So, where are they? And how do we put ourselves in the position to take care of them and serve them?
in three 500 sq. ft. spaces. We operate in airports in Vancouver and Toronto today which are in smaller formats. As urbanism continues and customers move more to public transportation, we could potentially be looking at mass transit stations like many of our sister brands around the world. That’s a space that we would look at, again because it’s convenient to the customer, it’s close and on their way. We have to flex to meet their needs and their patterns rather than, okay I’ve built it, now show up. What are some of the key trends that you’re looking at? Urbanization is one. Additionally, how people eat and what they eat. Food and proprietary beverages are clearly at the centre at our strategic map. Customers want more from their food. (As a customer) I want to know what’s in it, I want to know what the caloric makeup of it is, I want to be able to know what those ingredients are. Nutritional transparency is important. So, when we look at how we develop, we have to keep those things in mind.
I also have less time as a customer, so I want all these things at a value. You can traditionally value price, but we believe it involves these other factors as well: quality, speed of service, my experience in the store. That then takes us into the omni-channel consideration. It’s no longer good enough for us to have just a box for the customer to come visit. Working habits have changed, patterns have changed, school has changed. Customers are looking for different ways to get the goods and services they need. How have your customers changed? Our customer base has switched over time, more from a blue-collar, traditional, “got a set work schedule on these days, I come in the store every day at this time,” to what I’ll call a gig-economy. People are moving all over the place, working at different times, working in different locations. It’s not always convenient to come to us, so how do we go to the customer? How do we reach that customer with those goods and services they need? We now need to be able
How are you becoming more convenient? Are store size and format changing? The store format and size all depend on who we’re trying to take care of. We can flex from 3,000 sq. ft. and we’re now
Food and proprietary beverages are clearly at the centre at our strategic map.
| April / May 2018
to go to them, rather than just relying on them to come to us. Are you talking about delivery? Yes, it’s really the digitization of convenience. How do we move into being able to work with this in order to meet the customer’s needs? So, if I want a Slurpee and a bucket of chicken and a salad for lunch, but lunch is at 3 o’clock in the afternoon and I really don’t have time to go...They can go to their phone, order what they need, we can deliver it. Or if they want, they can come pick it up, it’s up to them. E-commerce comes into it directly. You’re redefining convenience There’s so much blurring that’s going on in the channels, whether it’s pharmacy, grocery, QSR, etc. but at the end of the day the customer’s making all the decisions. They also hold the microphone for feedback through social media. And so, the experience becomes just as important as anything else. We can deliver an experience that is memorable and good, as well as what they’ve actually ordered, the physical items. That’s how we believe we’re going to win. Being open 24-7, having a store in a convenient location, maybe you have gas, maybe you don’t, that’s table stakes. Our job is to try to stay at least with, if not a step ahead of where the customers are. You mentioned competition: pharmacy, grocery, dollar stores. Who are your biggest competitors? We are all competing for a finite number of customers. It’s many times a shared customer. We have to be cognizant of how we appeal to them. I have to make sure as a brand we differentiate ourselves from all of them in one way or another. I don’t have one particular one (competitor) in mind because our business, our industry touches the fringe of so many of them. And again, that channel blurring has occurred: pharma has been getting into packaged beverages, QSR is always involved, grocery has now gotten into more single serve, so we have to consider all channels and how they are servicing the customer. Quite frankly, if the experience is better at those stores, if that value equation is better in the customer’s mind at those stores, then that’s where they’ll go. It won’t matter whose name is out front. I’m more concerned with what the customers think, and am I providCCentral.ca
ing the flexibility that we have within 7-Eleven, to tailor the assortment for that neighbourhood, to that corner, to that customer base, so we can appeal to that group more directly than perhaps somebody with a static offer. That’s our ability to differentiate.
How do you see foodservice in terms of 7-Eleven’s growth strategy? It is our strategy. Fresh food and proprietary beverages for sure. If you take everything that’s sold within our store – packaged food, fresh food, packaged beverage, proprietary beverage – it’s 43% of our business in Canada. People come to us for food, and that is what they expect from us. The evolution of food is something we have to stay ahead of. Better-for-you options are certainly what customers are looking for, options besides the traditional taquito and Big Bite and things like that, that are more indulgent. They want offers that are going to be easy to bring on the go. It’s a convenience store, and we don’t want to be an inconvenient convenience store. So, we have to balance the expectation of freshness – them wanting to see the product is fresh – so that’s where our proprietary food centres and the daily delivery of fresh items come into play. So, if I go back to the close and convenient theme, how do we tailor that assortment so we’re delivering what those local customers want? So, there’s customization. That’s the secret to 7-Eleven: how you customize for that neighbourhood. We have a very high expectation that our operations team understand who shops your store. If you were to look at 7-Eleven five years from now what do you see? Where we’re as much of a digital service provider for our customers as we are a bricks and mortar retailer. In other words, 7-Eleven will be the omni channel that we have envisioned today. Whether you’re online, in store, on your phone, you can connect with us, and we’ll respond. That could be with food, it could be with non-foods....It’s going to depend again on what customers want. For the next five years we have to be figuring out what customers expect from convenience, how they want it brought to them, and how we do that. It’s not going to be a question of can we do that, it’s going to be how we do that. ◗
Current number of stores: 650 Target: 20,000 for the U.S. and Canada combined. Progress: Just under 10,000 with the recent U.S. acquisition of Sunoco. Goal: By 2027 to reach 20,000; short term for Canada – to reach 1,000 stores by 2020. To read the complete interview, visit ccentral.ca
April / May 2018
Tobacco advertising is not available in the digital issue
A step back in time J.A. Moisanâ€™s owners are custodians of 19th-century general storeâ€™s heritage
Text by Mark Cardwell Photography by Chantale Lecours April / May 2018 | | 27
he J.A. Moisan food store in Quebec City may be the oldest general store in North America.
There’s no doubting the warm atmosphere, rustic décor and world-class selection of gourmet foods and old-time treats that make it a bona fide food market and genuine heritage building in the heart of Quebec’s picture-perfect provincial capital. “Coming in to J.A. Moisan is like stepping back in time,” says Clément Saint-Laurent. He and his wife, Nathalie Deraspe, and his brother François have owned and operated the store since 1999. “Our goal is to respect the history of the store and the neighbourhood like
when the Moisans ran it. It’s a throwback to simpler times when life was good here.” Located just outside the fortifications of Old Quebec’s Upper Town district on the rue Saint-Jean, one of the city’s oldest and busiest commercial streets, the store has been serving the surrounding SaintJean-Baptiste neighbourhood since it was opened by founder J.A. Moisan in 1871. Successive generations of the Moisan family ran the business for more than 100 years. The two subsequent non-family owners have both maintained and restored the store’s original look and feel – from wooden floors and counters to pressed-tin ceilings and traditional music. They have even kept the original Moisan wooden street sign – though it now hangs inside the store to protect it from the elements.
History mixed with today’s convenience But they have also developed a truly impressive list of everyday and hard-tofind grocery items ranging from meats, cheeses, craft beers and picnic-ready
charcuterie to high-end ice cider, teas, chocolates and local specialties like maple products and pastries – even ready-to-eat products made on site using Saint-Laurent family recipes. “The store is still a small corner market that keeps and provides the local population with the basics like milk, butter and bread,” said Saint-Laurent. “But we’ve also added speciality foods and expanded imports of things like controlled origin label olive oil at $50 a bottle that locals would have a hard time finding somewhere else.” A native of Rimouski and engineering technician who spent much of his adult life working on and managing public works and industrial development projects in the remote mining town of Sept-Îles, Saint-Laurent said the store was already a local institution when he and Nathalie, an accountant by trade, decided to leave Quebec’s rugged North Shore region and move to Quebec City in the late 1990s. “We wanted to buy a business – any business, it didn’t matter – and do something different together here in a city we love,” recalled Saint-Laurent. “But we never thought J.A. Moisan would be for sale because it was so well known and busy.” But through his brother François, who had worked in the store as a clerk since 1982, Saint-Laurent learned on New Year’s Day 1999 that the business was in dire financial straits over the failure of a second, larger store that the owner had opened in another area of the city. “François said, ‘If you’re interested, we could buy and run it together,’” recalled Saint-Laurent. Unable to make a deal with the owner, who suffered the ignominy of having the electricity cut off for non-payment – a move that forced the store to close and its perishables to be donated to a local soup kitchen – Saint-Laurent bought both the business and the building from the banks and reopened it in April, 1999.
Coming in to J.A. Moisan is like stepping back in time.
| April / May 2018
With François running the store as general manager and Nathalie in charge of administration and purchasing, Saint-Laurent rehired the business’s old buyer, Walter Fortin, and spent the next two years accompanying him to food shows and other events in an effort to learn the ins and outs of the retail food business. “He really showed me how it worked – what to buy, who to buy from and how
to find things,” said Saint-Laurent. He also helped his partners manage the store’s two dozen employees (most of them full-time) and spent time talking with customers and building personal relationships.
The personal touch From the get-go, Saint-Laurent said he loved being a local grocer. “I feel really comfortable in the store and talking to people not just about our products but also about what they’re doing in their daily lives. “I love that human contact. In my old job it was all business and contracts and solving problems. But this business allows me to have real experience with people as a member of the community. You know everybody, you see kids grow. I love it – we all do,” added Saint-Laurent, 65. In addition to working in the store, Saint-Laurent and his wife operate a fourroom bed and breakfast on the two upper floors where the Moisan family used to live – and where they also now live. “We’ve done everything with an eye to commemorating the memory and spirit of the Moisan family and the history of this area,” said Saint-Laurent. “We’re custodians of that great heritage. But we’re also part of the story now too and we’re very proud of that.”
Snapshot The business: J.A. Moisan - general store and 4-room bed & breakfast The history: Founded in 1871 by the Moisan family and said to be the oldest épicerie-general store in North America. Specialties: More than 3,000 items, including specialty Quebec cheeses, craft beers, and Quebec-influenced dishes from the kitchen. Décor: Think great-grandmom-style Victorian.
Clément Saint-Laurent’s top tips 1. B e there. “An owner has to be present and be available in the store at all times. If not, you leave it up to others to do the work and make decisions about things that arise. But it’s the owner who is closest to the products, the style of the store and the knowledge of the business.”
2. L ive there. “If you buy a store, make sure it’s in a place where you live. If you live far away, you won’t know things that are happening locally. If you live nearby, you have your finger on the pulse of the neighbourhood and know people’s interests and concerns.” François Saint-Laurent, Nathalie Deraspe and Clément Saint-Laurent
3. S tay informed. “If you don’t go to shows or watch cooking or specialized programs on TV, you won’t be aware of new products and trends. And if you aren’t aware of them, then you and your store will soon be out of touch and out of business.” April / May 2018
by Talbot Boggs
The thrill of the chill
Cold treats mean hot sales in c-stores Canadians’ love for quick, tasty ice cream and frozen carbonated beverages (FCB) is pushing sales in convenience stores across the country, aided by in-store point-of-sale and new digital promotion capabilities. Tony Zuccaro, owner of Metropolitan Ice Cream, sees willingness among consumers today to pay more for premium products. A decade ago the Toronto-based Metropolitan tried to introduce wine-flavoured ice cream and “had a heck of a time.” By 2002 the company had expanded from just wine into spirit-flavoured products and now sells them at the foodservice level.
«For single serve it is critical to be ready for the 100 days of summer.»
“What was prohibitive in the past now appears to be affordable,” Zuccaro says. “A premium ice cream product that sold for $3.99 in 1995 now retails for $6.99-$9.99. In the past it was more about quantity, but now with a new generation it’s more about quality. There’s been a shift. People are willing to splurge a bit for premium.”
Shawn Sokell, CSD – Ice Cream with Nestlé Canada, says single serve is the largest segment in the convenience and gas channel, but it is susceptible to weather. The weather during the summer of 2017 was not ideal for impulse single serve ice cream so the segment experienced a small decline. “For single serve it is critical to be ready for the 100 days of summer,” Sokell says. “This means having a clean cabinet full of product with everything priced and appealing point-of-sale materials. Be ready to go as soon as that first warm weekend hits in spring.”
Premium appeals Soft sales of single-serve impulse items were offset by growth in super premium packaged products. The fastest growing segment in the convenience and gas channel is Ben and Jerry’s and Häagen-Dazs super premium packaged ice cream, which is growing by double digits.
| April / May 2018
of FCB consumers make their purchases based on impulse.
Photography by Simson Petrol
According to figures from Nielsen, ice cream is a $1.1 billion category across all channels that grew about two per cent in the last year. In the convenience and gas channel ice cream is a $50 million business whose growth, despite being stunted somewhat in the last year by poor weather, remains healthy.
Local focus Like Metropolitan, Ontario-based manufacturer Chapman’s appeals to customers looking for local options. Although the convenience channel represents only a small part of its business, Ontario-based manufacturer Chapman’s has seen an increase in c-store sales as consumers increasingly purchase impulse items and new offerings at an attractive price point. “We are seeing growth in our brand and bringing in new customers because Canadians like to buy Canadian and support their own industry,” says Mary Breedon, Chapman’s director of information. “More and more customers are into impulse options such as our peanut-free sandwiches or flat top cones for two dollars or less. Peanut-free is a great option that can bring in a whole family on their vacation.”
Don’t forget your cold liquid assets Frozen carbonated beverages (FCB) is a hot category. Lisa Deszcz, director of sales and marketing with Cornelius Inc., says 81 per cent of FCB consumers make their purchases based on impulse. Retailers can maximize sales by keeping their frozen offerings prominent, welcoming and, most of all, exciting. One way to create that excitement is through digital merchandising and advertising on high-resolution in-store screens that allows retailers to brand their frozen
programs, announce and promote new flavours or products, entice participation in loyalty programs, cross-promote with other items in the store and even get immediate customer feedback through easy-to-access analytics.
«In the past it was more about quantity, but now with a new generation it’s more about quality. There’s been a shift. People are willing to splurge a bit for premium.»
Keep a healthy stock of quick, tasty impulse ice creams and frozen carbonated beverages. Gaps in your freezer can be a turnoff for customers, who may question the freshness of your products. Be ready for the single-serve season, and that means stocking up before the hot summer months in case there are warm spring days when your customers will come to you to cool off.
er-priced items. Many customers, looking for quality, will pay for premium.
Build excitement through digital branding and merchandising. Many companies support their products with colourful collateral.
Go premium. Don’t be afraid of stocking these high-
Photography by Lindsay Moe
“Our customers have seen double-digit beverage sales growth with digital merchandising,” says Deszcz. “Keeping your message fresh and ever-changing builds excitement with consumers, making it possible to update messages frequently and saving you from the logistically-challenging and costly traditional printed materials. As well, these smart merchandisers track how much and of which flavour you are dispensing, which allows you to see how campaigns are performing faster than ever before and take action immediately.” ◗
Top cold tips
April / May 2018
Side effects include swagger and
For Ontario and Quebec regions E: firstname.lastname@example.org | Toll Free: 1-888-639-7868
DIRECT TO STORE DELIVERY
SLIM JIM GIANT ORIGINAL
SLIM JIM GIANT MILD
SLIM JIM GIANT TABASCO
SLIM JIM MONSTER ORIGINAL
SLIM JIM MONSTER TABASCO
SLIM JIM MILD Beef n’ Cheese
For West and Maritimes regions E: email@example.com | Toll Free: 1-888-412-8684 © ConAgra Foods, Inc. All Rights Reserved
#1 MEAT SNACK¹ IN THE U.S. IS NOW IN CANADA!
CO L E W E OU’R
Edgy personality makes slim jim
BIG WITH 12-17 YEAR OLD GUYS shopping at c-stores.
of Canadians are already aware of Slim Jim
GO FIGURE. NO OTHER MEAT SNACKS BRAND
with the brand having comparable levels of awareness to other leading Meat Snack brands in Canada.2
EFFECTIVELY TARGETS THIS CONSUMER DIRECTLY.
is one of the fastest growing categories in Canada showing in Gas & Convenience % growth channel specifically.3
Source: ¹ RI 52 Weeks ending 01/21/2018. ² Usage and Attitude Study, Meat Snacks. November 2017 Base: All respondents (N=415) ³ Nielsen ConvenienceTrack, National C&G, Latest 52 Weeks Period Ending August 19, 2017 vs August 20, 2016. 4-5 IRI MULCO+C Sales CY14-CY16; 16-074 Meat Snacks AAU – Final Report 2016 *Meat Snacks Category Users; n=1,005.
CONTINUES TO GROW IN THE U.S.
3 OUT OF EVERY 5 MEAT SNACK STICKS SOLD IN THE U.S. ARE
by Talbot Boggs
A wealth of health
Bring customers into your store for their next snack attack The trend toward healthy food options is alive and well and growing in the convenience and gas channel as consumers increasingly look for and buy on-the-go healthy snacks. A recent survey by Lucros Partners Shoppers Intelligence (LPSI) concludes that the introduction of health and wellness options results in increased traffic. More than 75 per cent of shoppers say they are willing to pay more for a healthier product at a convenience store versus a local supermarket with quality, sufficient choice and great prices being the keys to success in health and wellness offerings.
According to data supplied by KIND Snacks, the category, which includes protein boost, energy, healthy snack bars, granola and other minor segments, grew by almost eight per cent for the year ending June 24, 2017. The convenience and gas channel represents a little over two per cent of the total market. “The C and G channel is very strongly developed with premium bars, driven by
«The C and G channel is very strongly developed with premium bars, driven by strength in protein, energy and healthy snack bars, and is seeing strong growth»
strength in protein, energy and healthy snack bars, and is seeing strong growth,” says Todd Kelly, general manager of KIND Snacks in Canada. “However, the channel is losing share to other channels which are growing faster.” Despite this fact, convenience/gas retailers are in a position of strength, in part because of their demographics with younger men eating more protein bars and snacks, and the nature of the channel – more outlets in more locations fits the on-the-go nature of the category. Kelly says retailers face several challenges to ensure shoppers can find what they need easily in a small footprint and to overcome the confusion of many consumers about the difference between energy bars and healthy snacks. The typical energy bar is very high in sugar (sugar = energy) but may not deliver ideal taste or may over-deliver calories for a snacking or indulgence occasion, she explains. “Helping the consumer understand that protein items deliver protein for the post-workout, energy bars provide calories for activities requiring more energy, and consumers have a healthy option if they just are looking for a snack, is critical,” he says.
Snack attacks at convenience
Healthy, on-the-go snacks are a growing trend in convenience retail. Consumers are having more frequent and smaller meals during the day and looking for functional benefits in their snacks such as protein, energy, extreme flavours, size variations, relaxation and indulgence.
Katherine Choi, brand manager of protein snacks at ConAgra, advises re-
| April / May 2018
tailers to make the most of the changing snack landscape. Retailers should take advantage of the impulsive nature of the category by displaying the category’s different segments in multiple locations within the store. They should also offer combo-cross promotions with drinks and other food options. “Meat snacks – very popular among young men – are growing by about 17 per cent a year and provide great opportunities for incremental sales when paired with fun energy drinks,” Choi says. “This segment has great potential and we look forward to working with retailers to develop programs and partnerships that can further support their business.”
More than 75 per cent of shoppers say they are willing to pay more for a healthier product at a convenience store versus a local supermarket with quality, sufficient choice and great prices being the keys to success in health and wellness offerings. Breakfast snacking An emerging trend in the category is healthy and convenient breakfast options, especially for the millennials, many of whom thrive on all-day breakfasts. “There is a unique opportunity to capitalize on the trend for consumers to get the first meal of the day on the go,” KIND’s Kelly says. “Give them the option of a quick, healthy and convenient breakfast bar and tie it into your coffee
station for that basket-building sale. The channel needs to enact strategies to shift to offering the shopper more healthy options that are clearly understood to be healthy and easy to access.” ◗
Top healthy snack takeaways
Modernize and clean up your healthy snack displays to make them look fresh, new and inviting. Group segment brands together and clearly identify and advertise the purpose of the products.
Drive impulse and trial sales by including a premium bar section within your front-end/ cash confectionery location.
Keep functional segments such as protein and energy in the aisles with great cross-merchandising opportunities with energy and active lifestyle products.
Trial new healthy snacks with your customers. Everyone loves new news, so consider offering tasting occasions and special promotions.
by Isabel Morales
Fizzy and extreme
A look at what’s quenching thirst in the c-store beverage aisle As far as choice goes, there’s never been a better time to be a consumer. Thanks to globalization and connectivity, consumers around the world have access to a wider array of product assortment than ever — a trend that’s likely to continue. However, all of this choice doesn’t necessarily mean consumers are putting more items into their shopping baskets. Across the convenience and gas channel in 2017 growth remained relatively flat, with only +1% growth across all categories, in line with 1% inflation. And the $718 million cold beverage category is no different, with +1% growth in the last year (52 weeks ending Jan. 6, 2018). But 2018 may be signaling a shift, with the last 12 weeks of the period seeing +3% growth.
Worth almost $12 million, carbonated water has grown +51% by dollars and +49% in volume in the last year as new offerings, including new flavours and product attributes, entice consumers. Across the cold beverage category in the convenience channel, consumers have their pick of products including
soft drinks, water and energy drinks. As consumers become more health conscious, carbonated water is seeing a boom in sales across the convenience and gas channel. Worth almost $12 million, carbonated water has grown +51% by dollars and +49% in volume in the last year as new offerings, including new flavours and product attributes, entice consumers. Flat water, on the other hand, isn’t seeing the same boost as its bubbly counterpart, as dollar sales dropped by -2%. This doesn’t necessarily mean consumers are flocking away from a plain bottle of water. The category is still worth nearly $114 million, making it one of the largest categories in the cold beverage department. As 73% of Canadians are trying to drink more water and take charge of their health, increasing their water consumption is a guilt-free way to stay hydrated and energize the body. Also adding to the growth of the cold beverage category is extreme energy drinks. The newer category rife with innovation is worth a staggering in $251 million in sales in the convenience and gas channel alone as consumers’ search for a
quick pick-me-up continues. With dollar growth of +3% and volume growth of +4% in the last year, the popular energy drinks category is showing no signs of slowing down. Product add-ons such as vitamins, superfoods, and amino acids seem to be getting consumers’ attention and contributing to the rise of these types of drinks. One thing is certain across the beverage category: consumers’ need to find a refreshing way to energize their bodies will always prevail. Whether it’s water, juice or an energy drink, Canadians will be looking to quench their thirst, a trend which makes beverages an ideal category to attract new and innovative market players. As consumers put their money where their mouths are, the biggest challenge newcomer manufacturers to the market face is endurance – the pressing need to remain current in a competitive marketplace. While they need to create a product that’s distinctive and relevant, that product also needs to, at the same time, be able to endure within the market and make its mark on the retail landscape. In other words, the need to nurture a relationship with the consumer where loyalty is the end result should be a priority. As retailers and manufacturers continue to add new products to their assortment, they will need to ensure they’re developing the right products and marketing them to the right consumers in the right way to see continued success in the “liquid” category. ◗ Isabel Morales is the manager, consumer insights for Nielsen Canada.
| April / May 2018
Where business happens!
OCTOBER 17-18, 2018 BMO CENTRE
4 foodservice questions for
What best practices should convenience operators getting into foodservice take away from the pros (such as successful restaurants/ QSRs/cafĂŠs)? C-stores will need to have a clear vision of the customer base to understand their foodservice needs. They need to decide whether to franchise a concept or develop their own brand. C-stores are attractive to those in a hurry so quick service is likely the most viable option. Here are some top considerations: Labour management. Providing foodservice will likely require incremental labour in the c-store. Stores must make sure that the incremental labour cost is less than the incremental gross margin from foodservice sales.
Photography by Jaime Hogge
Food and beverage cost control. Processes must be put in place to make sure food shrinkage and wastage are minimized (controls for ordering, receiving, storage, preparation, inventory, etc.). Also, menu items must be costed
| April / May 2018
(all ingredients including condiments, takeout containers, etc.) to ensure they are priced properly. Theoretical cost of sales aligned with actual cost of sales. Theoretical cost of sales (menu item cost multiplied by itemized sales) must be compared to actual cost of sales each period and action must be taken immediately if actual cost of sales is more than 1.5% greater than theoretical cost of sales (includes an allowance for normal waste and shrinkage). Food safety standards. Staff must be properly trained on product knowledge, preparation and service. What are the minefields c-store retailers need to avoid in their eagerness to get into foodservice as a potential profit centre? Perishability of product is much greater for foodservice items than for most c-store products, and control is much more difficult when you buy in bulk and sell by the item. This will be a major change for c-store operators getting into foodservice, unless they buy all foodservice items pre-portioned or in single packages. The same employees likely cannot handle both food and cash. Serving food must be done with utensils, wearing gloves or washing hands after handling cash. As well, training (product knowledge, food safety, service) will be more intense than in a typical c-store. Throughput (how fast you serve restaurant customers) is an issue which should not adversely affect speed of service for your customers.
How can retailers think more like restaurant operators? How is the mindset different? C-store operators must realize they are moving from retailing into (food) manufacturing; you are not simply reselling packaged goods. Food quality is important and challenging to achieve – food must be freshly prepared, served at the right temperature, etc. Plus, speed of service is an issue. People “eat with their eyes.” Appealing product presentation and display affect consumer buying behaviour. Upsell appropriate complementary food and beverage items to guest purchases (increase average check size by suggesting add-ons, beverages, dessert items, etc.). Welcome guests, thank them after completing the transaction and invite them to return. Promote the products generating the greatest dollar margin. Co-brand with a QSR like Tim Hortons/ Country Style or offer your own program? Which will set convenience retailers apart? If you decide to build your own brand, it must be done with the thoroughness and professionalism of the leading restau-
rants. That means using an operations manual, following systems and procedures, managing food & beverage and labour costs, and marketing your foodservice program. If you don’t have this expertise, hire a consultant to assist you. Co-branding is a good strategy only if the brand is a proven concept and the business case for working with a brand is carefully analyzed. Will the incremental revenues be sufficient to justify the additional expenses of royalties, advertising fund contribution, amortization of brand-required equipment, franchise fees, etc. Make sure you know the cost of sales for each menu item and remember that franchises typically require restaurants to have a minimum amount of product displayed even in non-peak periods, which may result in greater waste. And...if you have a branded c-store, you may have double your royalty/franchise fees! Jeff Dover is president of fsStrategy Inc., an alliance of senior consultants focusing on business strategy support – research, analysis, design and implementation – for the foodservice industry.
CANADA’S CAR WASH & PETROLEUM MAGAZINE
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April / May 2018
Volume 23 | Number 3
CANADA’S CAR WASH & PETROLEUM MAGAZINE
13 ADVERTISERS Aerodry Systems, LLC..................................... 11 Airlift Doors Inc...............................................20 Bulloch Technologies........................................ 7 Cantest Solutions Inc........................................5 Drainvac International.....................................12 Eurovac Inc..................................................... 10 FormaShape.....................................................21 Forte Products.................................................. 7 Mighty Flame Canada.................................... 16 Mondo Products Co. Ltd..................................2 Mosmatic Canada Inc......................................12 Oasis Car Wash Systems, Inc.....................15, 17 PECO Car Wash Systems................................. 7 Pumps & Pressure Inc......................................12 Roll-A-Shade..................................................... 7 Wash Tech........................................................12 WashLinks....................................................... 10 World Fuel Services Canada, ULC.................. 14
18 CONTENTS 04 Editor’s Message Have that talk about cannabis with your staff 06 On Site Creating a competitive edge What do your customers see when they pull up to your forecourt? 08 Auto-Spa (part 2) Total package performance The newest AutoSpa is a showcase for the latest car wash technology and service options 13 COVER STORY The service solution For operators looking to stand out, full service might be the way to go
18 Open for Business Car wash doors are your entry to sales Are they up to the challenge? 22 Tire/Lube Add-Ons Winning service: 10 things to consider when introducing additional services to your site 23
24 CCA Industry Forum CCA joins forces with Canadian Federation of Independent Business
| May 2018
20 Eglinton Ave. West, Suite 1800, Toronto, ON M4R 1K8 (416) 256-9908 | (877) 687-7321 | Fax (888) 889-9522 www.CCentral.ca PRESidENT, ENSEMblEiQ CANAdA Jennifer Litterick | firstname.lastname@example.org ViCE PRESidENT/GENERAl MANAGER, EVENTS & MARKETiNG Michael Cronin | email@example.com Editorial EdiTOR, CSNEWS CANAdA Jane Auster | firstname.lastname@example.org
Time to talk about cannabis It’s time to have a talk with your staff about cannabis. Gas stations and car washes are busy places that are filled with hazards This July, Canada will become the first among G7 countries to decriminalize recreational marijuana. For some this means an opportunity to get into some serious chill. However, this chill does not extend to the workplace where standards of behaviour are business as usual. Coming to work high, smoking a joint at lunch or during breaks is a non-starter and for managers it should be seen as a serious HR infraction similar to taking a shift while drunk.
EdiTOR, Octane Kelly Gray | email@example.com ONLINE EDITOR Nikki Lockington | firstname.lastname@example.org TRANSLATION | Danielle Hart advErtising salEs SALES REPRESENTATIVE Elijah Hoffman | email@example.com SAlES & EVENTS COORdiNATOR Claudia Castro (on leave) DESIGN AND production diRECTOR OF PROduCTiON & dESiGN CANAdA Derek Estey | firstname.lastname@example.org
There will be challenges. For example, there is currently no testing method that is showing satisfactory results that could stand up in courts. A worker who goes out on Friday night with friends and ingests cannabis could still be under the influence on Sunday afternoon when reporting for work. Is your staffer too high to perform job functions safely? This could be tough to gauge. Not so tough to gauge would be an employee who takes a few puffs at lunch and shows up unfit to function in duties where safety is a concern and details matter. A simple smell test from clothes or breath may tell managers if workers have crossed this line.
PRODUCTION MANAGER Michael Kimpton | email@example.com ART DIRECTOR | Christian Lemay
When it comes to medical marijuana employers are obligated to accommodate workers just as they would those with disabilities or those requiring any other prescribed medication. Employers will also have the right to establish ground rules and may prohibit non-medical marijuana in the workplace. According to human rights legislation a prescription for medical marijuana does not entitle employees to be impaired at work nor are they entitled to consume cannabis on the job site where smoke-free workplace regulations extend to cannabis as well as tobacco. Also, the medical marijuana prescription does not permit an employee to be absent or late without a proper reason.
CORPORATE OFFICERS EXECUTIVE CHAIRMAN | Alan Glass ChiEF EXECUTIVE OFFiCER | David Shanker
What can be done? Zero tolerance policies may become more challenging once ‘weed’ becomes more commonplace in Canada. First step is communication. Have a frank and honest discussion with staff and establish firm HR ground rules around intoxication in any form in the workplace. If you have staff using taking cannabis under a physician’s care, consider moving them to stations that are not safety sensitive, alternate their job roles, and offer more breaks. It’s the nature of workplaces to demand safety and productivity from employees. In the final analysis it all comes down to personal responsibility and a willingness on the part of your staff to show some restraint in the face of this new social norm. Change is in the wind. Will your staff inhale or just blow smoke? Chances are you are going to find out sooner than you may think.
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April | May 2018
Creating a competitive edge What do your customers see when they pull up to your forecourt?
Before an operator even considers spending capital dollars on plans or market research, they need to reflect on the operational practices in the forecourt. Operators need to compare the appearance of their forecourt with competitors in the immediate area, and they need to look at it from the customer’s view. Is the canopy in good repair or will it fall down in a strong breeze? How is the lighting? Is it dim at night and can it be brighter? Is the brand prominently displayed, or is it difficult to see from the roadway? Is the exterior tidy? Are there years of built up dirt around the fuel dispensers, or are they kept clean? Kevin Anderson, Director of US Operations, Site-Check Research
Are there regular times when associates pick up litter or trash and empty the garbage cans? Is there litter blowing around the parking lot at any given time? Is the site on a regular power washing schedule for the fuel court area? What is the condition of the pumps/MPDs? Are they dirty or are they clean and well maintained? Can customers easily read the prices at the pump or is it a guessing game? How many fuel dispensers does your station have when compared to the immediate competition? The reason these points are important is that businesses often tend to have blindness of their own characteristics when compared to the competition. Known as the halo effect, this is a circumstance where business sees their standards as being better than the competition; while in fact they are not. By critically examining facilities from the customer’s viewpoint, operators can get a realistic evaluation of their standing within their trade area. With this newfound wisdom business can make a more accurate estimate of how capital spending can keep sites relevant in the market.
April | May 2018
Sometimes a lot can be done with a minor remodel of the pumps and canopy. For example, a deep cleaning of the paved areas and a few cans of paint well applied can transform the forecourt. I have seen stations close down for a day and dramatically transform the look of fuel dispensers. If you are a national or even a regional brand, ask about programs to help you refresh your fuel court. Brands are often there to help in these types of remodels (for a price of course!), and they may help you get the financing needed to get your station up to the market standard. They may even help you replace your dispensers for a more modern type. After our analysis we may determine a simple remodel will not bring a site up to market standard. We may advise operators to expand the facilities to accommodate extra pumps (or replace standard pumps with newer multi-product dispenser pumps), or replace/add a full canopy. The limiting factor in adding pumps or canopy can usually be condensed down to two factors: ‘Is there enough land (space)?’ or ‘What do national/regional/local regulations allow?’ You can buy land but it may be cost prohibitive. Or, you can replace a canopy, but building standards may force you to spend a lot more money than anticipated. Here it is important to get professional help at this point because a misstep could cost considerable amount of money. Once we are finished reviewing site information and determining how the location compares to its competitors, we know the limitations for capital expenditures. So, when should a gas station owner consider a remodel? The answer is always. To remain competitive in a competitive market operations must stand out by being fresh, professional, and relevant to customers. Spending money to achieve these goals is just good business. OCTANE
The newest AutoSpa is a showcase for the latest car wash technology and service options Text by Kelly Gray Photography supplied by Mark VII
Photography by Kelly Gray
Total package performance
The latest AutoSpa is big news. Indeed, the over $15 million car wash and vehicle care centre on Platinum Drive in Mississauga represents the next stage in the evolution of North American car wash service. Operated by AutoSpa Operations President Fred Misheal, owner Ehab Shaeen and General Manager Ken Cranston, AutoSpa’s newest location is impressive by anyone’s standards. Inside, customers will soon find three 95-ft. STI flat deck conveyors for express interior detail, two 190-ft. WashTec tunnel exterior washes, fine detailing bays, three-door Jiffy lube, chip repair and window tinting and other services as well as five self-service bays and customer lounge complete with a ‘We Proudly Serve’ Starbucks concept. All are set against a backdrop of huge windows that deliver swaths of natural light into the new facility that is expected to open this April with full service underway by May. “This will be the Taj Mahal of car washes,” said Ken Cranston on a recent tour of the construction site. He points to not just the scope of the service, but the quality of the equipment engineering and design. “We have introduced linear technology. We paid more and we got more as a result. This site is well beyond the standard that is currently in play in the North American car wash sector,” he says. Fred Misheal agrees. Looking out onto the project site, Misheal notes that many of the crew on location are from WashTec’s Germany-based operation as
well as from Mark VII North America. Equipment for the tunnels was built and shipped in containers from Europe. Together, crews have placed CNC precision cut gantries, motors, nozzles, and fittings along wash lines that will be impressive for their low maintenance and high performance. He points out that as a starting point they elected to go with stainless steel rather than powder-coated metal for longer protection and less corrosion. To start AutoSpa designated a prep area where they use high pressure nozzles to manage and move soils away
from the tunnel and conveyor washes. According to Misheal, this first step really helps the overall water reclaim systems and keeps moving parts such as those on conveyor belts in top shape thanks to lower maintenance needs. Dirt and grime from this first step are deposited in below-floor tanks where grit settles. Challenges such as getting at those hard-to-reach side mirrors have been addressed in the new facility. Misheal reports that they undertook an in-house design in combination with WashTec’s engineering skill to come up with a unique blade blower for a consistent dry that works by directing forced air more effectively. From these unique standalone mirror dryers, air is ejected from a blade to direct air flow to places such as mirror cavities and delivers excellent results to achieve a superior dry finish. On the flat deck conveyors teams of detailing pros travel along with the vehicle in a 24-minute, five-stage process that uses a variety of equipment including Eurovac where the new location will use a twin pump system in a lead/lag configuration. Eurovac reports AutoSpa will have 17 drop locations for its Double 30 horsepower vacuum setup. Features include a 48” Baghouse Separator, 36” Wet Pre-Separator, and a blower rack to stack the blowers and save space. Through-put on the conveyor is gauged at 600 cars per day. Altogether this side of the wash uses an average of 16 people, who rotate job functions after each wash completion. “This keeps people fresh with jobs not so repetitive,” says Cranston. Energy efficiency and enviro-friendly touches are key to the new AutoSpa. Designers elected to use energy-sipping variable-frequency drive motors and LED lighting as well as bring in a reclaim system from Germany that has been suc-
| May 2018
cessfully used for many years. According to Misheal, Eco-friendly soaps and chemicals from Mondo and MarkVII are in use throughout the facility with foaming and pre-soak assisted by using fresh and softened water. Overall, use is about 16 gallons of fresh water per vehicle with the site using water reclaim systems in certain dedicated applications throughout the wash tunnel. “This system is monitored in Germany to ensure it is operating as effectively as possible,” he says. Standing in what will be the customer lounge, both Misheal and Cranston point to large plates of glass that provide a complete view of cars in the wash and car detailing area. “This builds customer confidence because they can see the quality of the clean as they relax in the lounge,” says Misheal, who adds that this comfortable lounge zone will feature signature coffee service and state-of-theart furnishings. Adjacent to the lounge area customers can avail themselves of a variety of services including the Jiffy Lube, stone chip repair, windshield replacement, paint protection film, dent repair, and headlight restoration. OCTANE
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engineering excellence • Wide W ide track and low-profile conveyor – Delivers lots of tire room and clearance. This means greater protection for wide rims and tires as well as low profile cars. •S teel conveyer – Tire preservation is guaranteed thanks to smooth-surfaced plastic sidewals with rounded corners. Suitable for tire widths up to 330 mm. • Contour-tracking ontour-tracking C
high pressure and linear
following – Effective high pressure thanks to a rotary high-
pressure bar that tracks the contour of the vehicle closely. Maximum performance primarily at the vehicle’s front and rear with a highpressure station following alongside. Pressure levels are 1200 psi.
• High igh pressure underbody washing – The underbody H washing system thoroughly removes salt residue and dirt from the chassis. Twenty-two underfloor washing nozzles clean the underbody with two outwardly slanted nozzles serving specifically to clean the wheel housings. • Linear Linear following for an intensive wash – Linear following roof and side brushes guarantee more impact time spent at each part along the entire vehicle contour. • Electric Electric brush adjustment – Electronic brush adjustment ensures precise and careful positioning of the brushes thanks to the continuous current measurement of the rotary movement. • Precision recision adjustment and gentle washing – P Electronic brush adjustment called ‘SofTecs’ is very gentle and longlasting. SofTecs keeps paintwork gleaming and does not leave any material abrasion. • Linear technology— The contour tracking movement of the roof nozzle near to the car ensures an optimized and energy-saving dry process thanks to linear technology in combination with rotary positioning of the roof nozzles. All motor drives are controlled by frequency converters to maintain long equipment life
| May 2018
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| es le ning high pr OF PRODUCTS MANUFACTURER a | FOR ssure c e l c g | n e e i r r h hp g | ssu lean was re c h | hig anin igh pre | car u e l s lean c s s rota ssure sh | h unions ing | igh pre car wa | rota ssure c h | pre | h pre car was Foam Touch Wash Touchless Wash Tunnel Wash r wa ar y ean ing high s | ca g | rot sure cl r wash unions clean | high | | | e a ns ry h sh union eanin es ng ur h pr ons | c | rota press ar was ry unio cleani igh l r wa y c g a i c e h | | | c | h ure uni sur rota high ning ions pres ar wash rotary re clea ash | unions ning | h press r wash r 190 Southgate Drive, Guelph h g y un i | h | ry ca su rw hig | c lea Ontario, Canada N1G 4P5r wash | unions cleaning igh pres ns | ca g | rota ssure c wash | nions | leaning n c e o h u i i e r r y un ca ure hp | ca sur ar y ean h | (519) 824-5434 • (800) 667-0228 pres ar was | rotary sure cl h | hig nions | g | rot h press ions h n g u i c s s n g y www.wash-tech.ca firstname.lastname@example.org | h CAR CLEANING ry u ani preWASH w| aHIGH PRESSURE ing | h| i ROTARY UNIONS s | ash union e clean | high s | car | rota ure cle wash w r s y g r r su ash y union leanin h pres s | ca | ca pres | car w g ions h re c n g i | hi y union u y | h nions essu wash r h p s u a h r
solution For operators looking to stand out, full service might be the way to go Text by Kelly Gray Photography by Thomas Fricke
| May 2018
« Some people just don’t want to get their clothes dirty pumping e gas. That’s fine becaus » we can do it for them.
In 1995 about half of Canada’s gas stations offered full service. Tires were checked, dip sticks were dipped, and windows were cleaned. Just 10 years later the number of sites had dropped to around 15%. Behind the decline was a rise in labour costs, a big squeeze on gas margins and the climbing expense of real estate acquisition. Everything seemed to cost more and service simply became too expensive for most operators, especially independents.
Still, centres such as Richmond and Coquitlam in BC mandate full service. The idea there is that gas is hazardous and requires a skilled operator to dispense it, a view considered laughable by the vast majority of motorists who think nothing of taking three to four minutes to pump and pay. Recently Oregon voted to allow self-service after decades as a full-serve state. News reports were filled with people’s chagrin at the change. One man mentioned in a report that he was “just
Quality Endurance Passion
going to stay at the pumps until someone came out and put gas in his car.” No word on whether he is still waiting.
Full service more prominent in Canada’s smaller centres In Canada’s rural areas and smaller centres, many sites still offer full service. “It’s just what people expect around here,” says Henry Nickel, general manager of Ste. Anne Co-op, a 14-unit pe-
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troleum retail group based in Steinbach, Man. He reports that service is what sells and as a result they have seen a considerable rise in co-op memberships. “Across the west, whether it’s in cities or in smaller centres like Grunthal or Landmark, co-op’s focus is always on offering service to our members. Service like pumping gas is what we are known for,” he says, remarking that their competitors are often pushed to mirror the co-op offering to remain relevant in their communities. Co-op sites do not up-charge for full service, even at split sites in major cities where they have both self-serve and full service. “You have a choice. Some people just prefer to pump their own gas, even if there is no saving,” he says.
« Who wants to pump their gas when it’s minus 20°C. We do it for you and we do it at a great value that is highly competitive to self service locations. »
In Dartmouth, NS Colby Boudreau has operated a Coast Gas station since 2010. His site offers both fullserve gas and mechanical, a combo that is rarely found these days. He also sells and pumps heating oil from dedicated dispensers at the forecourt, something that has customers lining up more often during this wicked cold winter. Boudreau suggests that full service is valuable for elderly motorists as well as those with disabilities. “Some people just don’t want to get their clothes dirty pumping gas. That’s fine because we can do it for them,” he says, adding that he charges an extra .02 cents a litre over self-service pricing, a value that is less than his full-service competitors, of whom some charge .05 cents per litre.
Making a difference for the disabled For people with mobility challenges fueling can be a daunting process and gas stations are not always prepared to assist. Often disabled drivers may have to drive from station to station looking for one that can help. Now, a new app called fuelService is making forecourts less of a challenge for those with physical disabilities.
Sell the Sizzzle.
The new app tells motorists which nearby stations have staff available to refuel their cars. The app contacts the station, asks if they can help in the next 30 minutes, tells them when the customer has arrived and then lets the customer know how long they need to wait for service. Currently this service is being offered at Chevron sites in Langley and Surrey, BC. Shell has launched the service this past March, 2018
DOMO’s full-service advantage
Mmm, the Sizzzle. It’s BBQ time and you have the perfect location, Right on the Way Home, to hundreds of neighborhood propane grills. MIGHTY FLAME CANADA
DOMO is another gas retailer that uses full service to make a name in the market. In business for 60 years, DOMO is present across Western Canada with roadside kiosks in 91 locations from Manitoba to BC. Not all sites are full serve, but the company’s iconic ‘Jump to the Pump’ slogan implies a willingness to offer something extra. According to Scott Cardno, DOMO’s VP Business Development, they are seeing strong gas sales that gets even stronger when the weather is poor. “Who wants to pump their gas when it’s minus 20C. We do it for you and we do it at a great value that is highly competitive to self service locations.” Scott comments that full service comes with its own set of challenges. Top of the list is human resources. In Manitoba he reports that until recently they had a hiring freeze thanks to low turnover. However, in locations such as Alberta and BC with higher wages and a more difficult labour market they have to be creative. The company offers competitive pay, bonuses and staff get togethers with fun events and
contests as a way to encourage both new workers and keep existing staff. DOMO also uses new technology to enhance the service offering. While many of their competitors still ask customers to leave their cars to pay inside or input card info at the dispenser, DOMO pump attendants use wireless payment devices to accept credit and debit cards while the driver stays in the car. Cardno reports that the full service kiosks also feature a paired down c-store selection such as leading energy drinks, cigarette brands and confectionary that attendants can just bring to the driver. “This means that moms with kids in the car don’t have to leave them while she goes in to pay or find a beverage,” he says, noting that full service gas is just one way operators work to differentiate themselves in the market. OCTANE
Open for Business Car wash door are your entry to sales.
Are they up to the challenge?
Text by Kelly Gray Photography by Thomas Fricke
At Winnipeg’s Red River Coop they are serious about car wash. The group operates 18 wash sites in the city’s capital region and stands out as one of Manitoba’s leaders in gas sales with 33 locations, and two in Northwestern Ontario. Over the past five years they have undertaken a multi-million dollar upgrade to facilities that include card lock, station interiors, gas bar forecourt and car wash. We asked Red River’s Gas Bar Operations Manager Randy Andrusiak about the challenges they face in one of Canada’s harshest climates for vehicle cleaning. He points to entries as a key challenge in keeping the wash running smoothly. “Ice build-up during winter months is a major concern. We often run the wash with outside temperature down to -35ºC and find ice on the door rails and even have the door freeze to the floor. The cold temperatures can also impact the air cylinders on the door pneumatic system and we have to be proactive,” he says remarking that infrared heaters at the entrance door have been a good tool to reduce cold weather challenges. “Maintenance is a must and staff have to be prepared to look for and remedy any problem like ice build-up quickly. A frozen door won’t help you make money.” In the warmer months Andrusiak sees challenges with moisture that can lead to algae build up on doors. Again, the placing bay doors in a stationary position and running the exhaust fan help to curtail this problem and assist inventing this moisture rich vapour.
Two door styles dominate the market There are primarily two types of doors that have been successful in the car
Ice build-up during winter months is a major concern. We often run the wash with outside temperature down to -35ºC and find ice on the door rails and even have the door freeze to the floor. Randy Andrusiak (centre) heads up the Gas Bar team at Red River Co-op
wash market – overhead polycarbonate and vinyl rollups. Since their inception operators have found the polycarbonate door to be speedy when combined with a pneumatic opener, more secure thanks to material that is very close to steel in overall strength and more energy efficient with greater R-values that keep sites warmer longer in cold weather months. Josh Hart, president of Airlift Doors, reports that pneumatic openers have been the most popular style among operators who use polycarbonate doors. He suggests that pneumatic openers made from aluminum or stainless steel are corrosion-resistant and work without heating up or burning out. These openers also attach directly to the door to open and close the entry. Important here is the fact that by being attached directly to the door rather than working to turn the shaft, cables don’t jump if the door stops short of its full cycle. Electric openers are very typical on vinyl doors where systems do not utilize
cables. Hart advises operators to look for electric openers that are completely sealed and offer stainless steel workings to minimize challenges in the corrosive car wash environment. Airlift recently introduced XRS, a low-maintenance, high-speed, all-weather door. Features include breakaway design with automatic reset, complete weather seal, speeds up to 34 inches per second, and individually replaceable components.
Kevlar enhances strength Helping to fight door track challenges is Ultimate Supplies. Based in Raleigh, USA, Ultimate Supplies offers a line of innovative hardware as well as polycarbonate and vinyl doors. According to Ultimate Supplies’ senior account representative, William Stokes, the ElectraFlex high speed vinyl door is designed to eliminate expensive door repairs. He comments that if the ElectraFlex door is struck it pops out of
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« There is a lot of complexity in a car wash and potential for challenges. The entry is often the best place to start looking for improvement. » its guide tracks and then automatically rolls back into the track for normal operation. The design is completely rust-proof and maintenance-free, he says noting that ElectraFlex uses half the clearance space of traditional overhead doors, offers rust-proof guide tracks with no hinges, rollers, springs, counterweights or cables. The door also features a battery back-up making it the only door system with the capability to operate in brown and black outs. Ultimate’s Illuminator Doors are made for the tough carwash environment and include hardware innovations such as HPDE Hinges, bearingless rollers, Kevlar reinforced counterweight belts and Ultra-Belt Pickup pick-up
belts that lift the doors without galvanized and stainless cables. “Kevlar belts prevent doors from “jumping” and falling that commonly occurs with all cable supported doors,” says Stokes, adding that Counterweight belts are also reinforced with Kevlar to prevent failure in counterbalance systems. “These replace cables and straps that typically snap, stretch and unwind that could cause catastrophic door failure,” he says”
Remote monitoring systems Canadoor Door Systems is pushing the envelope with remote monitoring systems from Baywatch that tell operators what they need to know about their wash sites. For example, Canadoor Door Systems’ Sales Manager Ross Bennett points out Baywatch’s Intelliwash can alert a car wash operator that a door is stuck open, an important consideration during cold weather months when an open door can spell disaster. Other features include a single thermostat control that links doors, heaters and heat mats together with a single device. “Staff in c-stores can also see live status reports and remotely operate bay doors right from the till,” adds Canadoor Door Systems’ Account Manager Michael Howe noting that alerts sound if heat in the wash drops below its set temperatures, eliminating photo eye failures that leave the bay doors up and cause the wash to freeze. Toronto’s 5 Star Car Wash turned to Northern Dock Systems for a solution to damage to their high pressure hoses during cold weather. A 24-hour self-service wash site, 5 Star Car Wash had Northern Dock install five 12-ft. by 10ft. vinyl rollup doors to stop heat loss. “We listened to operators and have built door solutions that feature low to no maintenance, high speeds, no compressor and no freezing,” says Northern Dock Systems Account and Project Manager Sean Saliba. As Red River Co-op’s Randy Andrusiak says, a little upfront work goes a long way toward keeping your wash running smoothly. “It pays to do your homework when it comes to entry systems,” he says. “There is a lot of complexity in a car wash and potential for challenges. The entry is often the best place to start looking for improvement.” OCTANE
Randy Andrusiak inspects a door guide for wear.
10 things to consider when introducing additional services to your site
Building your business can mean improving your current service, or, with a little research and investment, it can mean introducing entirely new offerings that expand your scope of expertise. The latter has the benefit of drawing in new customers and creating that one-stop-shop experience that time-strapped customers want. For example, a car wash that introduces a quick lube service has just given customers two reasons to choose their business over the competition. So, how do you know what sort of service you should add on to your existing car wash or gas station? Our experts outline 10 things you need to consider when looking to expand into a new service.
1. Research. Nikki Lockington, Digital Editor CSN-Canada
Whether you decide to add quick lube, windshield repair, paint repair, dent repair, tire change and storage, or something else all together, it all starts with researching the options for your specific site. What does your area need? What can your site handle? How will it affect traffic flow? How will it affect staffing needs? There’s also the cost factor. “The operator must realize that there can be a measurable investment required in equipment, staffing and materials,” says Ian Hutchison, Castrol Automotive Marketing, Wakefield Canada.
2. Demand. As with any new business venture, you want to ensure there’s demand for the specific service you’re planning to offer. What’s already available nearby? Have your customers asked you for specific offerings? Don’t be afraid to conduct a survey amongst your existing customers – would they be more likely to visit you for glass repair? Tire service and storage? Oil change? What’s most needed in your community?
3. Location. First off, your location might present logistical challenges. “The Quick Lube business is very different than a traditional car wash, and in some cases can present a challenge for zoning and creating appropriate facilities, equipment and traffic flow,” says Hutchison.
April | May 2018
Second, your location will determine how convenient business will be for customers. “Location is key,” says Scott Demay, Quick Lube Sales Manager for Valvoline Canada. “Today’s quick lube shops need to be in prime destination areas. It’s ideal if you can build the quick lube where people are spending their time, such as shopping areas. It’s important to create a one-stop-shopping experience,” he adds.
4. Space. Do you have the necessary square footage for the service you’re planning to offer? Speak to potential franchisers about their specific requirements so you can get a sense of the space you’ll need to allot to the new service, as well as traffic flow, entrance and exit requirements, and zoning bylaws.
5. Staffing. Increasing your service offer can mean introducing a new host of staffing challenges. “There can be challenges when it comes to having and maintaining competent and credible staff. The staff you’ll require will typically demand a higher degree of engagement and in some cases a higher hourly rate,” says Hutchison. “Having said that though, the quick lube business can be a high-margin one, especially if the staffing demands can be shared (to some degree) between the car-wash and the quick lube,” he adds.
6. Service. What’s really going to set your site apart is the customer service experience. Do you offer Wifi? Is there free coffee or water for customers as they wait? What are your hours of operation?
Don’t underestimate the importance of customer service, says Demay. “A strong crew and a hands-on owner from the beginning are very important. Your hours of operation are key, too. Are you open seven days a week? Is it convenient for people to choose your business? Customer service is key and having the correct employee is important. Smiles are essential!”
7. Franchising. Working with an existing franchise can provide you with instant brand recognition, trust and training opportunities. For example, if you’re looking to introduce a windshield repair franchise, well-known brands such as UniglassPlus or Ziebart will offer the necessary expertise and training to get your business off to a good start. “We train you to professionally handle and market all aspects related to automotive windshield repair, windshield replacement, window tint, paint protection films as well as high-end detailing and structural protection,” says Doug Jacques, Director of Franchise Development with Uniban Canada.
8. Cross-promotion. One of the biggest benefits of introducing additional services is the opportunity to cross-promote and build business organically. “Quick Lube customers drive business to your location, and once they’re there, they will see the car wash,” says Demay. “One big attraction for quick lube/car wash owners is cross promoting. For example, purchase an oil change and receive a free car wash.” Hutchison agrees. “What we know is that some of the most successful independent quick lubes in Canada and the US are linked to car washes. We believe this can be attributed to the ability to cross-promote between services. It’s a natural and a logical leap for consumers,” says Hutchison.
9. Expertise. As you hire individuals with more specialized skills, staffing costs will go up, so it’s important to have potential employees state their salary or hourly wage expec-
tations up front. Build industry standard wages into your business plan from the very beginning so there are no surprises. “There is more to the quick lube than just a motor oil change. Good lube shops offer many services and can service all fluids in the car that may need changing, such as transmission, coolant, power steering and brakes. They also change all filters like cabin and air, plus with today’s GDI (Gas Direct Injection) engines they can service the fuel system of the vehicle,” says Demay.
10. Trust. When it comes to car maintenance, customers need a business they can trust. “We know that consumers choose their oil change based not on price, but much more on the quality of experience and trust. Therefore its important to consider the employees you have, and choose a [well known brand] that brings with it a high degree of trust for consumers. This allows you to create instant credibility in the market and hit the ground running,” says Hutchison. OCTANE
Product NEWS PRODUCTS, EQUIPMENT AND SERVICES
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Self Service Steam Cleaner
Transform your location into a profitable location with our latest innovative self-service steam cleaner. The all-in-one hygiene self-service steam cleaner provides full interior detailing with ease. Not only does it clean, it also sanitizes all hard to reach areas.
RDM is the industry’s leading remanufacturer of Petroleum & Carwash electronic equipment. Specializing in circuit boards, intercoms, displays, printers, POS systems, consoles, tank monitors, probes, bill validators, PLC’s, controllers, power supplies, bill dispensers, and timers with new products available. Located in NC, CO, & FL – fully stocked with ready-to-ship inventory.
SUPPLIERS,WHAT’S NEW IN YOUR PRODUCT LINE? Contact ELIJAH HOFFMAN at 647.558.0103 or email@example.com to promote your product, equipment or service here. CCentral.ca
| May 2018
CARWASH CARWASH ASSOCIATION ASSOCIATION
Directors Christopher armena – Brad Baldwin – mike Dietrich –
CCA BoArd ElECts JAson KAyE As PrEsidEnt
Zep VehICle Care InC.
parklanD Fuel CorporatIon
Domenic Dimonte – terry Fahey –
Crosstown Car washes
Brad Goetz –
monDo proDuCts Co. ltD.
alex Grieve – Jason kaye –
Valet Car wash
BayVIew Car wash ltD.
sean mcBride –
CleanInG systems InC.
kirsten potvin –
rudy van woerkom –
auto n truCk wash
mark Vella –
NATIONAL OFFICE Finance Director Karen Dalton cae operations Director Kiki cloutier manager membership elizabeth Tang Canadian Carwash association 783 annette street toronto, on m6s 2e4 tel: 416.239.0339 Fax: 416.239.1076 firstname.lastname@example.org www.canadiancarwash.ca
CaRWaSH › The carwash search feaTure ‹
on the CCA website has close to a thousand member sites on it. Is your carwash listed? Member sites are listed for free, so contact email@example.com for more information.
n April 12, the newly elected National Board of Directors confirmed the election of Jason Kaye, of Bayview Car Wash Ltd, as the new President of the Canadian Carwash Association for a one-year term. Domenic DiMonte, Crosstown Car Washes was elected to serve a second term as Vice President and Treasurer and Sean McBride, Cleaning Solutions Inc. became Vice President, Manufacturers/Distributors/Suppliers. Rudy van Woerkom, Big City Auto N Truck Wash was elected VP, Carwash Owners/Managers. Directors include Christopher Armena, Mark VII; Brad Baldwin, Zep Vehicle Care Inc.; Mike Dietrich, Parkland Fuel Corporation; Terry Fahey, Fahey Electric/Capital Wash Systems; Brad Goetz, Mondo Products Co. Ltd., Kirsten Potvin, CarWash Connect, Mark Vella, 7-Eleven and Alex Grieve, Valet Car Wash. Learn more about the CCA Board of Directors on the CCA website. Ten years ago, Jason Kaye joined his father, Derek Kaye, in the operation of both Bayview Car Wash and Don Mills Car Wash located in Toronto. Jason’s expertise is in the full-service carwash model which he has been exposed to his entire life. He is now a thirdgeneration carwash operator as his grandfather started in the business in 1960. Jason joined the CCA Board in 2014. MArK VEllA of 7-ElEVEn And AlEx GriEVE of VAlEt CAr WAsh Join CCA BoArd
Mark Vella joins the CCA Board after close to 40 years in retail and nine years with 7-Eleven. He has worked in merchandising as a Category Manager and in operations as a Market Manager for Southern BC and when 7-Eleven acquired the British Columbia and Alberta gas and carwash assets from Imperial Oil in 2016 Mark was appointed National Gasoline Manager for Canada. Alex Grieve, Operations Manager, Valet Car Wash, joined the firm in 2012. Valet has 10 locations in Ontario. Over the past six years, he has dabbled in repairs and maintenance as well as the normal day-to-day operations of running a car wash.
INDUSTRY FORUM INDUSTRY FORUM D eD I c a T e D TO s harING KNOwLeDG e a N D B e s T P r a c T I c e s I N T h e c a r w a s h I N Dus TrY
2018 CCA Golf tournAMEnt sEPtEMBEr 13th Now that it’s finally warming up, it’s time to get out to the greens to practice your swing ahead of the 2018 cca Golf Tournament. Members come every year to network with each other and trade tips and information on the carwash business, on their golf game, or both. The full day of golf ends with a dinner and prize draws, with proceeds going to support Trout unlimited canada’s Yellow fish road program. This year’s tournament will be held at Blue springs Golf club in acton, Ontario on september 13th. Visit the cca website at www.canadiancarwash.ca/golf for more information on how to sign up for the tournament. for sponsorship opportunities, contact the National Office at 416-239-0339 ext 222 or firstname.lastname@example.org.
CArWACs Bus tour Visits thrEE ontArio CArWAsh sitEs More than 100 carwash operators and prospective owners joined the CCA’s CARWACS bus tour visiting an Esso/Circle K Brampton, ON location with Mark VII’s Choicewash XT carwash equipment that uses Zep Vehicle Care chemicals; a Pioneer/Parkland Fuel Corporation tunnel wash in Ancaster, ON with SpinLite technology from Belanger with Mondo chemical products; and ended the tour at Valet Car Wash’s newest location in Brantford, ON which includes a 125 ft express exterior Sonny’s tunnel carwash with Transchem chemicals and dispensing equipment and an eight bay interior cleaning area.
CCA MEMBErs noW rECEiVE CfiB BEnEfits Members now receive full access to both the Canadian Carwash Association (CCA) and the Canadian Federation of Independent Business (CFIB) member benefits through an industry partnership. Effective April 1, 2018, all current members of CCA, have become full members of CFIB. Fees for the new joint membership are $395 for operators and $445 for supplier/associate members. Between April 1st 2018 and March 31st 2019, renewing CCA Members will receive a $100 discount off of the new rate in the first year and a $50 discount in the second year. Join or Renew now and receive these additional benefits. http://canadiancarwash.ca/membership.aspx If you have any questions about this new partnership, please contact Karen Dalton, CAE, APR, Director of Finance in the CCA National Office at 416-239-0339 Ext. 222 or visit the CCA website.
CArWAsh findEr rebrands as CArWAsh ConnECt carwash finder has changed its name to carwash connect to reflect new features in its digital solutions for the car wash industry. “we received valuable feedback over the past four years as we have rolled out our platform,” said cca Board member Kirsten Potvin, Business Development, carwash connect. “we took client feedback and implemented some amazing new features, building upon an already solid foundation,” she added. You can find out more about the new platform at www.carwashconnect.ca.
CANADIAN CARWASH ASSOCIATION CANADIAN CARWASH ASSOCIATIO