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W H AT ’ S N E X T I N C O N V E N I E N C E A N D F U E L R E TA I L I N G

In honor of the 50th anniversary of Convenience Store News, we spotlight the 50 most influential people in convenience store history.

THE CSNEWS TOP 100:

A NEW TRIFECTA

JULY 2019 CSNEWS.COM


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VIEWPOINT

50 Great Ones for 50 Years Convenience Store News marks a half-century of industry leadership OK, WE CHEATED. You might have noticed that more than 50 people made our list of the 50 Most Influential People in Convenience Store History. By combining some family dynasties (like the Thompsons of 7-Eleven, the Sheetz family, and others), we were able to acknowledge 65 people on our list of those who have had the greatest impact on convenience retailing.

Frankly, I wish we had room to celebrate even more of the great people who have had a hand in building this industry. We were overwhelmed by the response from our online audience when we issued our call for help in nominating and identifying these stalwarts. And I’m sure we’ve left out at least one person who deserves to be on our list. But that’s the fun of lists like this. They spark endless and spirited debates. Like: Why did we choose to put the faces of Jere Thompson, Chester Cadieux, Steve Sheetz and Alain Bouchard on our Convenience Store Mount Rushmore? We easily could have chosen Dick Wood of Wawa fame, Don Zietlow of Kwik Trip, or a different Sheetz family member. We certainly could have included on the list our founding publisher, Harry Troutgott, who started the c-store industry’s oldest continuously published publication in 1969 when there were fewer than 11,000 c-stores in the United States and few people could even agree on the definition of a “convenience store.”

Troutgott, an evangelist for the c-store industry, was a big supporter of the industry’s fledgling trade association — NACS. He also recognized the need for reliable data and published the first Convenience Store News Industry Report, which continues to chart the growth of today’s convenience channel. Over the years, CSNews has led the way as the originator of the industry’s highest honor (Hall of Fame, in 1987); the first and only industry awards program recognizing female leaders (Top Women in Convenience, 2014), as well as the iconic CSNews Top 100, Top Wholesalers, Top 20 Growth Chains, and numerous other proprietary research reports. But this 50th anniversary issue of CSNews is not about us. While we are very proud of the role we played in the development of the industry, this issue is a celebration of the hard work, vision and entrepreneurial spirit of the retailers, suppliers and wholesalers who have made the convenience store industry the most vibrant and interesting channel of retailing today. I want to thank all of our readers and advertisers for supporting us for the past half-century.

For comments, please contact Don Longo, Editorial Director, at (201) 855-7606 or dlongo@ensembleiq.com.

EDITORIAL EXCELLENCE AWARDS (2013-2018)

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

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

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

EDITORIAL ADVISORY BOARD

2018 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Website Business to Business, Retail, Full Issue, October 2017 Business to Business, Editorial Use of Data, June 2017 2017 Eddie Awards, Folio: magazine Winner, Business to Business, Retail, Single/Series of Articles, May 2017 Honorable Mention, Business to Business, Retail, Single/Series of Articles, June 2016 2016 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2015 Business to Business, Retail, Single/Series of Articles, August 2015 2015 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Single Article, February 2014

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

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

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

2013 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2012

Brett Atherton Bolla Management

Jack Lewis GPM Midwest

Rick Crawford Green Valley Grocery

Danielle Mattiussi Maverik Inc.

Edward Davidson ER Davidson & Associates (7-Eleven Inc., retired) Jim Hachtel Eby-Brown Co. Ray Johnson Speedee Mart

Richard Mione GPM Southeast Jonathan Polonsky Plaid Pantries Inc. Greg Scriver Kwik Trip Inc. Roy Strasburger Strasburger Retail

Vito Maurici McLane Co. Inc.

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

2016 Trade Association Business Publications Intl. Tabbie Awards Silver, Front Cover Illustration, June 2015

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CONTENTS JULY 19

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Convenience

18 95

FEATURES

DEPARTMENTS

COVER STORY

VIEWPOINT

SMALL OPERATOR

30 Mount Convenience In honor of the 50th anniversary of Convenience Store News, we spotlight the 50 most influential people in convenience store history.

2 50 Great Ones for 50 Years Convenience Store News marks a half-century of industry leadership. 8 CSNews Online

26 Standing Out The convenience store industry’s small operators have a unique opportunity to differentiate themselves from the big chains.

COVER STORY

OUT & ABOUT

STORE SPOTLIGHT

68 Celebrating 50 Years of Convenience Retailing A look at the happenings that have transformed the c-store industry over the past half century.

18 C-store Leaders Get a Place at the Table Industry execs join restauranteurs in discussing the future of dining at the 2019 NRA Show.

95 Hungry for Opportunity Applegreen brings its foodservice and fuel offers stateside by way of acquisitions.

COVER STORY

70 What Will the Next 50 Years Bring? Continuous change is the one thing that all c-store industry insiders seem to agree on. FEATURE

77 The New Trifecta Marathon Petroleum joins stalwarts 7-Eleven and Couche-Tard at the helm of the Convenience Store News Top 100 ranking.

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NEW HORIZONS OUT & ABOUT

20 Shining a Light on Change & Opportunity IDDBA Show 2019 delivers insights on adapting to the evolution of how consumers eat.

97 Turning Plodding Progress Into a Quantum Leap Female CEOs and board members continue to rise, but not fast enough. INSIDE THE CONSUMER MIND

22 New Products

114 Getting to Know the C-store Tobacco Buyer Seven in 10 cigarette purchasers have tried e-cigarettes or vaping products.

114


GO WITH WHAT YOUr customers KNOW

14 Hands is one of the most established and trusted wine brands. Our new premium wine cans give consumers a familiar grab & go choice in a fast-growing category. Š2019-14 Hands Winery


CONTENTS JULY 19

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8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631 (773) 992-4450 Fax: (773) 992-4455 www.csnews.com Direct Mailing Address for Convenience Store News: 11-43 Raymond Plaza West, 16th floor, Newark, NJ 07102 BRAND MANAGEMENT Vice President/Group Brand Director Paula Lashinsky (917) 446-4117 plashinsky@ensembleiq.com EDITORIAL Editorial Director (201) 855-7606

Don Longo dlongo@ensembleiq.com

Editor-in-Chief (201) 855-7608

Linda Lisanti llisanti@ensembleiq.com

Senior News Editor (201) 855-7618

Melissa Kress mkress@ensembleiq.com

Associate Editor (201) 855-7619

Angela Hanson ahanson@ensembleiq.com

Associate Managing Editor (201) 855-7604

INDUSTRY ROUNDUP

HOW TO

10 Changing of the Guard at Casey’s General Stores 12 Couche-Tard & CrossAmerica Begin Swapping Assets 12 Fast Facts 14 Eye on Growth

73 Attract the CBD Consumer Millennials, baby boomers and women are the biggest customers today. CATEGORY MANAGEMENT FOODSERVICE

14 Competitive Watch 16 Retailer Tidbits 17 Supplier Tidbits

85 What’s Hot on C-store Menus? The latest LTOs are all about staying cool in the summertime. FOODSERVICE

86 Four Steps to Grab-and-Go Success C-store retailers without madeto-order foodservice programs can still be competitive — if they know how to make the most of their grab-and-go programs. FOODSERVICE

89 A Taste of the Future of Foodservice Leading convenience foodservice execs gathered in Austin to share good food and good practices at the 2019 Convenience Store News Foodservice Summit. CANDY & SNACKS

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92 It’s an Exciting Time in Candy & Snacks The 2019 Sweets & Snacks Expo showcased scores of new trends and innovative products.

Danielle Romano dromano@ensembleiq.com

Contributing Editor (303) 741-3377

Renée M. Covino reneek@aol.com

Contributing Editor (201) 280-2614

Tammy Mastroberte tmastroberte@gmail.com

ADVERTISING SALES & BUSINESS Associate Brand Director & Northeast Sales Manager (508) 385-2524

Rachel McGaffigan rmcgaffigan@ensembleiq.com

Associate Brand Director & Western Sales Manager (330) 840-9557

Ron Lowy rlowy@ensembleiq.com

Associate Publisher & Midwest Sales Manager Kelly Fischer (773) 992-4464 kfischer@ensembleiq.com Account Executive & Classified Advertising Terry Kanganis (201) 855-7615 tkanganis@ensembleiq.com Classified Production Manager Mary Beth Medley (856) 809-0050 marybeth@marybethmedley.com EVENTS Executive Vice President, Events & Conferences Ed Several (860) 830-8321 eseveral@ensembleiq.com AUDIENCE ENGAGEMENT Director, Audience and Data (224) 231-6363

Gail Reboletti greboletti@ensembleiq.com

List Rental (847) 492-1350 ext.318

MeritDirect Elizabeth Jackson

Subscriber Services/Single-Copy Purchases (978) 671-0449 EnsembleIQ@e-circ.net PROJECT MANAGEMENT/PRODUCTION/ART Vice President, Production (877) 687-7321 Creative Director (973) 607-1320

Derek Estey destey@ensembleiq.com Colette Magliaro cmagliaro@ensembleiq.com

Advertising/Production Manager (773) 992-4418

Ed Ward eward@ensembleiq.com

Art Director (973) 607-1321

Lauren DiMeo ldimeo@ensembleiq.com

CORPORATE OFFICERS Executive Chairman Alan Glass Chief Executive Officer David Shanker Chief Financial Officer Dan McCarthy Chief Operating Officer Joel Hughes Chief Innovation Officer Tanner Van Dusen Chief Human Resources Officer Ann Jadown Executive Vice President, Events & Conferences Ed Several CONVENIENCE STORE NEWS AFFILIATIONS Premier Trade Press Exhibitor

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

Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by EnsembleIQ, 8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631. Subscription rates: $125 for U.S. addresses; $190 for Canadian addresses; $275 for all other addresses. Single copies (pre-paid only): $20 in the U.S. Foreign single copy sales (pre-paid only): $85.00. Periodical postage paid at Chicago, IL 60631, and additional mailing addresses. Copyright 2019 by EnsembleIQ. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or information storage and retrieval system, without permission in writing from the publisher. Reprints, permissions and licensing, please contact Wright’s Media at ensembleiq@wrightsmedia.com or (877) 652-5295. POSTMASTER: send address changes to Convenience Store News,, PO Box 3200, Northbrook IL 60065-3200.

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CSNEWS ONLINE

ONLINE EXCLUSIVE

TOP VIEWED STORIES

1

FDA Proposes New Deadline for E-Cigarette Applications

The Food and Drug Administration (FDA) told a court that it will move up the date for premarket tobacco applications (PMTA) for electronic cigarettes to next year, instead of the 2022 date it had previously set. The agency’s new deadline is in response to a May 15 ruling by U.S. Judge Paul W. Grimm of the U.S. District Court for the District of Maryland.

2

FDA Sets Course for New CBD & Cannabis Task Force

The FDA held a public hearing on cannabidiol (CBD) products on May 31. While no regulations were expected to come at the end of the hearing, the testimony is expected to help shape the agency’s approach to CBD going forward. The FDA formed a task force on CBD and marijuana products that will focus on legislative proposals.

3

7-Eleven & Shell Among the 20 Most Popular Stores in America

4

Sheetz Kicks Off ‘Unforgettable’ Summer Sweepstakes

According to a report by 24/7 Wall St., 7-Eleven and Shell are among the top 20 most popular stores in the United States. In compiling the list, the news outlet reviewed foot traffic patterns provided by data service company Placed Insights — which calculated the percentage of Americans aged 13 and older who visited various stores in April 2019 — as well as U.S. sales and store count data from company financial documents.

Which CBD Products Hold the Most Potential for C-stores?

Although the Food and Drug Administration (FDA) has yet to rule on food and beverage products with cannabidiol (CBD), items are flying off the shelves in the states where the sale of these products is currently legal. While millennials and baby boomers are the demographic segments most interested in CBD, many experts believe the use of these products will increase across the board once the FDA makes a ruling on guidelines, and consumers become more familiar with the ingredient. “When we speak to people who don’t live in states where it’s legal, they think the products will make them high, but once enough people know that isn’t the case, the market will really open up,” Sarah Marion, director of syndicated research at The Hartman Group, told Convenience Store News. For more exclusive stories, visit the Special Features section of csnews.com.

Sheetz Inc. celebrated the start of the summer season with the kickoff of its 2019 Summer “Shweepstakes” on June 1. The sweepstakes will run during June, July and August. Each month, one Sheetz customer will be selected to win $100,000.

5

Shell Launches Its Most Advanced Premium Fuel

Shell Oil Co. debuted Shell V-Power NiTRO+, which includes the brand’s proprietary technology to help reduce friction in an engine and improve efficiency, furthering the brand’s competitive advantage. It can be found at roughly 13,000 Shell-branded stations.

PHOTO GALLERY:

A Visit to Amazon Go’s Newest Chicago Store Convenience Store News visited the newest Chicago Amazon Go store — the fourth in the Windy City — located on East Wacker Drive inside the Illinois Center, a mixed-use urban development. The store’s front foyer makes it clear that while Amazon is an international retail giant, Amazon Go has its eye on local favorites, keeping the store stocked with products from Chicago-area suppliers. The latest Chicago Amazon Go store also has several shelves of non-consumable convenience goods, as well as an endcap of Amazon-branded paraphernalia. But the vast majority of the store’s offering consists of snacks, food and beverages, showing that even as a convenience-channel newcomer, Amazon has built its product mix around the idea that food is the future of growth in the industry.

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Bud Light Lemon Tea

Bud Light is expanding its citrus peels portfolio with Bud Light Lemon Tea, a light lager that’s brewed with real lemon peels and aged over black tea leaves to give the beer a distinct flavor profile. Bud Light Lemon Tea is a seasonal offering, available now through September nationwide. It complements the already-popular Bud Light Lime and last year’s new beer innovation, Bud Light Orange. Bud Light Lemon Tea features icons that highlight that it is brewed with no corn syrup or artificial flavors. Anheuser-Busch St. Louis anheuser-busch.com


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INDUSTRY ROUNDUP

Changing of the Guard at Casey’s General Stores Industry veteran Darren Rebelez takes on the role of president and CEO board of directors appointed Darren Rebelez as president and CEO of the Midwest convenience store chain. He officially stepped into the position on June 24 when Terry Handley, former president and CEO, retired.

CASEY’S GENERAL STORES INC.’S

Rebelez, who also takes a seat on the Ankeny, Iowa-based retailer’s board, joins Casey’s with more than 25 years of business leadership experience focused on operations, marketing and merchandising for large corporations in the convenience store, fuel and restaurant industries. He previously served as president of IHOP, a unit of Dine Brands Global. “We are thrilled to welcome Darren to the Casey’s family,” said H. Lynn Horak, chairman of the board. “Darren brings a remarkable combination of leadership experience in the convenience store, fuel and restaurant industries, and he has an impressive track record of driving performance and innovation.” At IHOP, Rebelez oversaw operational performance and segment earnings growth, developed and implemented

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

digital strategies to connect guests via mobile platforms and online channels, and grew the brand to become the largest full-service restaurant concept in the United States by unit count. Prior to joining IHOP in 2015, Rebelez worked for nearly eight years at 7-Eleven Inc., where he served as executive vice president and chief operating officer. Before 7-Eleven, he held numerous management roles within Exxon Mobil Corp. and Thornton Oil Corp. “I am honored to join the Casey’s team at an exciting and dynamic time for both the company and the industry,” Rebelez said. “I have long admired Casey’s and look forward to working closely with its talented team to continue providing outstanding service to local communities across our markets and creating value for all of Casey’s stakeholders.” Handley stepped down after 38 years with Casey’s. He leaves as the company moves into the second year of its value creation plan. The multi-year, long-term strategy is comprised of several key programs and value drivers: a new fleet card program, retail price optimization, digital engagement transformation, and a focus on controlling operating expenses and capital allocation. “As I reflect on my nearly four decades with Casey’s, I’m incredibly proud of what our team has accomplished, and I’m confident that the business is well positioned for continued success,” Handley said during the retailer’s June 11 earnings call.


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INDUSTRY ROUNDUP

FAST FACTS

77

%

Three in four adults (77 percent) come to summertime events armed with snacks. — Frito-Lay, U.S. Snack Index

9.3 %

Over the 2019 Memorial Day weekend, imported beer sales were up 9.3 percent year over year, and energy drinks were up 8.4 percent. — Wells Fargo Securities LLC, Beverage Buzz

35

%

Roughly 35 percent of respondents in a recent survey said their opinion would be lower of c-stores if they began selling cannabis-infused CPG products. — TrendSource, 2019 Cannabis Industry Report

10billion U.S. drivers logged 10 billion miles driven using E15 fuel as of June 11. — Growth Energy

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Couche-Tard & CrossAmerica Begin Swapping Assets The first tranche of their asset exchange agreement is valued at roughly $58 million and CrossAmerica Partners LP put the first of what will be several asset swaps between the companies in the books.

ALIMENTATION COUCHE-TARD INC.

The general partner of CrossAmerica Partners — CrossAmerica GP LLC — is a wholly owned subsidiary of Laval, Quebec-based Couche-Tard. In this first transaction of a 2018 asset exchange agreement, Couche-Tard transferred to CrossAmerica 60 U.S. company-operated convenience and fuel retail stores (52 fee sites and eight leased sites), having an aggregate value of approximately $58.1 million. In exchange, CrossAmerica transferred to Couche-Tard assets having an aggregate value of approximately $58.3 million. These assets include all 17 of CrossAmerica’s upper Midwest properties and the real property for eight master-lease properties. The full asset exchange agreement between the companies calls for Allentown, Pa.-based CrossAmerica to receive a total of 192 company-operated convenience and retail fuel stores in the United States. Of the sites, 162 are fee-based and 30 are leased. The transaction is valued at $184.5 million. In exchange, Couche-Tard’s Circle K division will receive the real estate property for 56 U.S. company-operated convenience and retail fuel stores currently leased and operated by Couche-Tard/Circle K. In addition, Circle K will receive the 17 CrossAmerica company-operated stores in the upper Midwest region. Fourteen of these sites are fee-based and three are leased. These assets combined have an aggregate value of approximately $184.5 million.


INDUSTRY ROUNDUP

Eye on Growth

Casey’s General Stores Inc. opened 56 new stores and acquired 24 stores during its 2019 fiscal year. In addition, the Iowabased retailer replaced eight stores and has eight acquisition stores under agreement to purchase.

This new store is part of a larger strategy by Parker’s to expand its footprint from Savannah, Ga., to Charleston, S.C.

Parker’s fifth store in Pooler, Ga., welcomed its first customers in early May. Situated on a 9.2-acre site, the store features self-checkout technology, a Parker’s Kitchen with ordering kiosks, and seating for up to 20 guests.

TravelCenters of America LLC grew its franchise network by inking a franchise agreement with an Atlanta-based real estate investor to open a TA-branded travel center in Oregon. The location will open on a 19-acre property. 7-Eleven Inc. cut the ribbon on its fourth store at Dallas-Fort Worth International Airport on May 7. The chain opened its first location at the airport in 2015.

Loop Neighborhood Market opened a new location in Temecula, Calif. The store offers free Wi-Fi, a frozen yogurt station and an espresso bar. VERC Enterprises purchased an Irving gas station in Westminster, Mass. This acquisition brings the number of VERC locations to 30. Broyles Hospitality LLC, a subsidiary of GPM Investments LLC, unveiled a next-generation Dunkin’ store in Bristol, Tenn. The location features a modern look, Dunkin’s signature cold beverages served through an eight-tap system, and a drive-thru.

Competitive Watch Dollar General Corp. plans to open 10 new DGX small-format stores in its 2019 fiscal year. Its fourth DGX location opened in downtown Cleveland on June 20. Dollar Tree Inc. is adding adult beverages to approximately 1,000 Family Dollar stores, and expanding freezers and coolers in approximately 400 Family Dollar stores. In the first quarter of its 2019 fiscal year, adult beverages were added to roughly 45 stores.

Amazon’s drones can deliver in 30 minutes and are limited to goods that weigh five pounds or less.

Amazon Inc. expects to begin using self-piloted drones to deliver packages to customers’ homes in the coming months. The drones are fully electric and can fly up to 15 miles. Target Corp. is testing Snack Bar — a self-service, grab-and-go concept — at several locations nationwide. One Snack Bar, located in northeast Minneapolis, features an ICEE machine, items from Pizza Hut, salads and popcorn. Whole Foods opened a Whole Foods Market Daily Shop in New York’s Chelsea neighborhood. The 2,500-square-foot store focuses on grab-and-go items and features self-checkout kiosks in addition to staffed checkouts.

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INDUSTRY ROUNDUP

Retailer Tidbits

Casey’s General Stores Inc. is expanding its sale of E15 fuel to more than 60 additional locations. The move follows the Environmental Protection Agency’s recent approval of the year-round sale of E15.

Kwik Trip Inc. also began stocking CBD products at its c-stores.

Sheetz Inc. added an extensive line of premium cannabidiol (CBD) products to more than 140 of its stores across Pennsylvania. The products include topical rubs and patches, tinctures, vape pens, and oral pouches. EG America, the U.S. division of EG Group, is rebranding the Minit Mart portfolio it acquired from TravelCenters of America LLC. The stores will feature its new U.S. banner, EG America. The retailer kicked off the rebranding in Kentucky. TravelCenters of America’s board of directors approved a plan to convert from a Delaware limited liability company, or LLC, to a Maryland corporation. The company expects to complete the conversion before the end of 2019.

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Retif Oil & Fuel LLC has put four convenience store and gas station properties in Louisiana on the market. All four locations carry the Chevron fuel brand. High’s rolled out Skip frictionless checkout across its 36 stores. The launch makes High’s the first c-store chain in Baltimore to bring the Skip mobile checkout platform to its customers. Chevron Corp. is partnering with EVgo to add electric vehicle fast charging to select gas stations in California. More than a dozen EVgo fast chargers are currently under construction or already operational at five Chevron stations. FriendShip’s recent revamp of its rewards program has led to in-store visits increasing by 5 percent and gallons purchased increasing by 18 percent. The c-store chain launched its refreshed rewards program less than a year ago.


Supplier Tidbits

ings, parent company of Hu Products and Hu Kitchen This marks the company’s second venture investment as part of SnackFutures, its innovation and venture hub.

A newly formed Altria subsidiary, Helix Innovations LLC, will become the parent company of Burger Group subsidiaries.

Altria Group Inc. will acquire 80 percent of certain companies of Burger Söhne Holding AG and begin commercializing on! oral nicotine products worldwide. The $372-million investment is slated to close in the second half of the year. The Coca-Cola Co. launched “Enjoy CocaCola,” its first summer campaign in six years. Fans can win 150,000-plus exclusive prizes by using their phones to scan the Sip & Scan icon on cans and bottles of Coke, Coke Zero Sugar and Coke flavors. Mondelez International Inc. made a minority investment in Hu Master Hold-

Ford Gum entered into an agreement to produce a line of sugar-free gum based on popular Jelly Belly jelly bean flavors. The line initially includes four of the most popular Jelly Belly flavors based on consumer research: Island Punch, Watermelon, Very Cherry and Berry Blue. Champs Chicken, the flagship franchise of PFSbrands, celebrated its 20th anniversary. The first Champs Chicken location opened in 1999 at Show Me Oil Co. in Auxvasse, Mo. Summit Distributing LLC tapped ADD Systems Inc. as its back-office software provider. Functionality includes wholesale billing, c-store accounting, itemlevel pricebook, consignment posting and reporting capabilities.

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OUT & ABOUT

C-store Leaders Get a Place at the Table Industry execs join restauranteurs in discussing the future of dining at the 2019 NRA Show By Angela Hanson THE MAY 18TH KICKOFF of the centennial National Restaurant Association (NRA) Show marked a milestone for the U.S. restaurant industry, but it also drove home the major changes within the convenience store industry as c-store representatives joined NRA CEO Dawn Sweeney on the Grand Ballroom stage for the event’s most prominent session, “Signature 2019: The Future of Dining.”

Chris Gheysens, president and CEO of Wawa Inc., and Randy Edeker, CEO, president and chairman of the board at Hy-Vee Inc., took part in the panel, which discussed how dining segments have changed and what, where and how consumers will dine in future years. By responding to where the customers are and providing what they want, Hy-Vee is keeping pace as Americans diversify where they’re willing to eat, according to Edeker. “We’ve evolved with our customers as best we can. That’s how you speak to survival as a brand,” he said. Above all else, the panelists agreed that execution is what’s most difficult on a daily basis. “Our stores have gotten incredibly complex,” Gheysens said. He compared a typical Wawa to a set of LEGO blocks, where each component makes sense but depends on everything else. The rapid pace of change in foodservice and the c-store industry at large also add to the challenges of execution. Increasingly, foodservice operators today need to consider their approach to both on-premise and off-premise dining and determine how delivery must factor into their plans. How well c-stores succeed with delivery will likely depend on location, Gheysens said, noting that university-area stores that offer it will certainly do well. Still, he doesn’t expect delivery to be as big for Wawa as it will be for some other foodservice players, but the company is learning from its data how to best roll out the option. “We still intercept customers going from point A to point B, but getting into delivery ... is a convenience play,” Gheysens said. “If you’re getting to be a convenience store, it’s not just residing in your four walls.” Edeker stressed that the key to delivery is

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This year’s National Restaurant Association Show marked the event’s centennial.

maintaining a focus on excellence and delivering quality. He noted that the off-premise business is evolving in many different ways at once, and he expects the development of meal kits/meal solutions to be a big part of it as well. Another major theme of the 2019 NRA Show, held May 18-21 at Chicago’s McCormick Place, was the issue of labor, as seen in both education sessions and vendor booth visits. With unemployment low and the bar for foodservice workers getting higher, numerous exhibitors showed off products and services designed to, if not replace human labor, streamline duties so that employees can be more effective and efficient in their roles. CSN


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OUT & ABOUT

Shining a Light on Change & Opportunity IDDBA Show 2019 delivers insights on adapting to the evolution of how consumers eat By Angela Hanson TODAY, GROCERS, convenience

store operators and other foodservice retailers do business in a space full of new challenges and opportunities, but as International Dairy Deli Bakery Association (IDDBA) Chairman Rick Findlay pointed out at the group’s recent annual show, change isn’t coming — it’s already here. Findlay, who also serves as vice president of fresh at Fresh Thyme Farmers Market, discussed some of the most important changes during the opening general session of the 2019 IDDBA Show, held June 2-4 at Orlando’s Orange County Convention Center. “Consumers no longer shop in the same manner they did before,” he said. This includes venturing beyond the local supermarket to other channels and specialty stores, but it also means consumers are

“That’s simply a trend we can’t ignore,” he cautioned show attendees. Lastly, Findlay advised attendees to look outside the grocery industry and be aware of and learn from competitors. E-commerce, frictionless brick-andmortar stores and specialty stores all offer consumers a different way to get what they want. He also highlighted convenience stores as an example of competitors that leverage their strengths, specifically offering a time savings to “time-crunched” consumers who want to be in and out quickly. “True to their name, they offer convenience,” he said of c-stores. Other retail insights provided during the general session came from Kevin Ryan, founder and CEO of Malachite Strategy and Research, an insights and innovation agency focused on the consumer packaged goods and foodservice sectors.

Thousands of food industry professionals gathered in Orlando for this year’s IDDBA Show.

actively seeking out new flavors, tastes and products. At the same time, they still enjoy eating at home and turning to their personal go-to comfort foods. The key to success is identifying how consumers have evolved and adapting to meet their needs today. The market for natural and organic offerings is growing significantly as consumers try to cultivate a lifestyle in which they eat healthier, feed their families better and live longer, according to Findlay. “It’s growing well ahead of traditional groceries,” he noted. Plant-based products and alternatives to traditional items also have skyrocketed in recent years, outpacing overall food sales by a factor of 10, the chairman cited.

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Ryan discussed the ways that digital activity affects consumers’ perception of the real world, and what it means for IDDBA Show attendees. This includes a “double-click culture,” in which consumers assume everything has a deeper story and they have the ability and right to see it. “Everything is a hyperlink,” he said. One response to this world view could be adding transparency cues, such as QR codes on products, which can provide more information. Ryan also noted that despite advances in artificial intelligence (AI), driverless vehicles and frictionless checkout, some consumers feel anxiety over the rising level of automation. Eventually, some retailers will and should re-add more human interaction, he said. “We’re going to have to have those conversations within our companies,” Ryan said. CSN


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NEW PRODUCTS

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1. Sour Big Chewy Nerds

2. Simply Smoothies

3. Lil’ Pickle Snack Packs

The Nerds brand is moving into the growing sour candy segment. Sour Big Chewy Nerds feature a sour, chewy center covered in a sweet, crunchy candy shell. The new product is available in a 4.25-ounce concession box with a $1.09 suggested retail price, a 6-ounce medium peg bag with a $1.99 suggested price, and a 10-ounce standup bag with a $2.99 suggested price. Each package contains a variety of sour flavors, such as Brainiac Blue Raspberry, Streaming Strawberry Lemonade, Wiki Watermelon and Blood Orange Byte. Ferrara Candy Co. Oakbrook Terrace, Ill. ferrarausa.com

The Coca-Cola Co.’s Simply Beverages brand introduces Simply Smoothies, a line of chilled, ready-to-drink fruit smoothies. They are made only with not-fromconcentrate juices and purees, along with natural flavors. Simply Smoothies are available in single-serve, 11.5-ounce bottles, as well as the signature Simply multi-serve, 32-ounce carafe. Varieties include Strawberry Banana, Mango Pineapple and Orchard Berry. Simply Smoothies offer an easy and convenient way to consume a healthy snack, according to the company.

McClure’s Pickles introduces Lil’ Pickle Snack Packs. These 2.2-ounce packages offer consumers an easy way to enjoy McClure’s most popular pickle flavors in a grab-and-go format. Available varieties include Spicy, Dill, and Sweet and Spicy. McClure’s describes the new product as “personal pickles, picked, pecked, packed and ready to party.” Shelf stable and Non-GMO Project verified, each Lil’ Pickle Snack Pack of bite-sized pickles has a suggested retail price of $2.79. McClure’s Pickles Detroit (888) 784-8434 mcclures.com

The Coca-Cola Co. Atlanta coca-colacompany.com

4. PepsiCo Mobile-Enabled Hydration Platform Following its recent acquisition of SodaStream, PepsiCo introduces a Mobile-Enabled Hydration Platform that is the next step in its “Beyond the Bottle” journey. The platform is made up of three components: a water dispenser; a companion, user-friendly smartphone app; and a personalized QR code sticker for reusable bottles that allows consumers to be recognized by the dispenser. The customizable platform offers a variety of zerocalorie flavor, carbonation and temperature options. The platform automatically tracks users’ water intake and allows them to set daily hydration goals. Users can save their preferred drinks in the app, available for iOS and Android devices. PepsiCo Inc. Purchase, N.Y. pepsico.com

5. ZYN Nicotine Pouch Swedish Match North America began rolling out its ZYN nicotine pouch to retail outlets nationwide. The product was previously available in a number of Western states only. The smoke-free, spit-free, tobacco-free nicotine pouch is chemically the same as Nicorette chewing gum, according to the maker. ZYN comes in two strengths — 3 milligrams and 6 milligrams — to help nicotine users be mindful about their intake. Instead of inhaling or chewing, users place ZYN in their upper lip. Swedish Match North America Richmond, Va. us.zyn.com 22 Convenience Store News C S N E W S . c o m

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6. Swisher Sweets BLK Tip Cigarillos Wine Swisher Sweets BLK Tip Cigarillos, a Swisher brand, introduces a new Wine variety. The product is designed to provide a wine taste and aroma unlike any other cigar with its fusion of hand-selected, air- and fire-cured tobaccos that deliver a hands-down unique experience, the maker noted. Packaged in a resealable two-count pouch with the “Sealed Fresh” guarantee, the new Wine variety is being offered in “2 for 99¢”, “Save on 2” and “2 for $1.49” options and single-sale impulse displays. Other flavor varieties in the line include Smooth, Grape, Cherry and Berry. Swisher International Jacksonville, Fla. (800) 874-9720 swisher.com/cigarscigarillos

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7. Modelo Chelada Limón y Sal

8. Country Archer Meat Sticks

9. Ice Age Glacial Water

The newest addition to the ready-to-drink Modelo Chelada line — Modelo Chelada Limón y Sal — provides a new, convenient way to enjoy the classic chelada experience. Simply made with Mexican beer and the refreshing, natural flavor of lime and salt, Modelo Chelada Limón y Sal offers a smooth and refreshing citrus flavor experience, according to the maker. With an ABV of 3.5 percent, the beverage is available in 24-ounce cans nationwide. The Modelo Chelada line also includes the classic Modelo Chelada Especial and the sweetand-spicy Modelo Chelada Tamarindo Picante. Constellation Brands Victor, N.Y. modelousa.com/en-US

Country Archer Jerky Co. is unveiling four new meat stick varieties: Chorizo Beef, Hatch Turkey, Maple Bacon Pork, and Pineapple Pork. Like all Country Archer meat snacks, the new meat sticks are crafted with gourmet cuts of extralean, USDA-inspected, 100 percent grass-fed beef, tender antibioticfree turkey or pork; and are free of nitrites, MSG, gluten, antibiotics and added hormones. The new varieties will be available across North America beginning in mid-summer 2019 for a suggested retail price of $1.99. Country Archer Jerky Co. San Bernardino, Calif. countryarcher.com

Ice Age Glacial Water is an ultra-pure, still bottled water collected as it naturally melts and flows from the edges of the towering and ancient glaciers in the Toba Inlet, deep in the Coast Mountains of British Columbia. The water is free of sodium, fluoride, chlorine and nitrates. Ice Age 9.5 is also available, which infuses the pure glacial water with electrolytes for a higher pH of 9.5, increased hydration and replenishment. Ice Age Glacial Water and Ice Age 9.5 are now available in select U.S. markets. The products come packaged in glass bottles (750 milliliters) and BPA-free plastic bottles (350ml, 500ml, 750ml and 1 liter). The suggested retail price is $1.79 to $1.99. Ice Age Glacial Water Co. Delta, BC, Canada iceageglacial.com

10. Legal Lean Disposable Vape Pod Device Legal Lean’s new Disposable Vape Pod Device is stylish and portable, attaching to a keychain lanyard for an on-the go-lifestyle. The vape pod contains a vapable sleep blend with melatonin to aid with sleep and relaxation. The blend contains no nicotine and is legal in all 50 states. The pod holds approximately 300 breaths, which could amount to a 30-day supply of the sleep aid. Legal Lean Co. Orlando, Fla. (408) 883-5326 legalleanstore@gmail.com legalleanstore.com

10 24 Convenience Store News C S N E W S . c o m


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SMALL OPERATOR

Standing Out The convenience store industry’s small operators have a unique opportunity to differentiate themselves from the big chains By Renée M. Covino A FARM STAND-STYLE MARKET, a Native American menu, gumbo served by the gallon and a growler bar with live music — these are just some of the unique approaches being employed by the convenience store industry’s small operators to set themselves apart from the large convenience store chains in the market.

A major asset of small operators is knowing the pulse of their community and how to support it, according to Marcos Castelán, co-founder of The Navio Group, a retail business consulting firm in Minneapolis. “The best way for small convenience retailers to stand out is to double-down on the in-store experience,” said Castelán. “Large chains will rely on spreadsheets and reports to find out the trends of the area, but if a small store can actively keep a lookout for opportunities and engage with customers, there is little doubt an advantage can be built.” Coupling that with friendly, personalized service is a recipe for small-operator success. “While large chains will be relying on a huge, corporate HR and hiring structure, smaller chains can focus on finding talented and service-oriented individuals who are trained through shadowing the owner and witnessing their values, rather than clicking through a training video,” Castelán explained. “There is no substitute for a caring, intelligent and empowered

workforce — all things that are harder to screen for when you are hiring hundreds rather than a handful.”

Fancier Foodservice One-of-a-kind foodservice is often a focal point for small operators seeking to stand out. Clinton Mini Mart in Salamanca, N.Y., features unique Native American foods on its menu the last Thursday of every month as a way of differentiation. Traditional Indian fare, such as fry bread with bean and salt pork, Indian tacos, corn soup and corn wheels with beans, are available for purchase in an otherwise traditional convenience store. Owner Marcelene Nephew’s inspiration is her mother, a “cook her whole life,” from the Cattaraugus Reservation, according to the Salamanca Press. Tran Huonggian, the owner of Green Acres c-store in Pensacola, Fla., crafted a deli menu centered on her homemade gumbo recipe, which has now grown to a 100-gallon-per-week operation, thanks to word of mouth, according to the Pensacola News Journal. The single store’s hit gumbo recipe may result in expansion this year — in the form of a food truck. Offering regional specialties and locally sourced menu items is an effective way for small convenience retailers to stand out vs. chains, according to Meaghan Brophy, senior retail analyst for Fit Small Business. “Anytime an independent store can source food ingredients or products locally, it’s a win,” she said. “Customers like supporting local businesses and knowing where their food comes from. Sourcing locally also cuts down on shipping costs and delivery times, which means fresher and faster food.”

Appealing to the Emerging Generations

Much of what the most innovative operators in the convenience channel today have incorporated is designed to appeal to the younger generations of shoppers. How can small operators cater specifically to the emerging generations? “Catering to the millennial and Gen Z 26 Convenience Store News C S N E W S . c o m


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SMALL OPERATOR

consumer requires smaller retailers to be as current as possible with consumer trends,” said Ryan Riggs, senior vice president of operations for Alltown Fresh, a new store concept from convenience store chain Global Partners LP.

be placed anywhere in the store), has found through research that millennials are more likely than any other generation to appreciate the “communal aspect” of the grocery shopping experience.

Currently, there is just one Alltown Fresh store in operation, in Plymouth, Mass. The concept focuses on organic, natural, vegan, vegetarian, gluten-free and locally sourced alternatives in an effort to provide guests with cleaner choices for on-the-go.

“With that, smaller c-stores should make it a priority to really understand, know and cater to their local customer — creating an in-store experience that is marked by superb customer service,” said Abhiroop Dutta, Phononic’s product manager, food and beverage.

“Providing the most convenient and frictionless experience possible — while also offering personalized engagement — creates a winning environment for these demographics,” Riggs told Convenience Store News.

In the case of Midway Craft House in Denton, Texas, that means offering up a growler bar with, on certain occasions, live music performances. The unique convenience store recently hosted a two-day anniversary party celebration with special beer tappings, merchandise giveaways and live music, according to the North Texas Daily.

“Modern convenience” doesn’t look the same as it did 15 or 20 years ago. Today’s younger customers want to be able to order ahead through a mobile app and have their orders ready when they arrive, according to Brophy. “If independent retailers aren’t investing in their POS [pointof-sale] and order management systems to make the shopping experience user-friendly, they will never be the most convenient option, no matter how good the product selection is,” she said. Phononic, a semiconductor cooling company that makes technological advances for retailers with limited space (its F200 Merchandising Freezer allows frozen items to

Millennials are also more focused on supporting companies that back local causes and charities. While 66 percent of American shoppers prefer to buy goods from companies that give a portion of their profits to charities, the figure rises to 72 percent among millennials, Phononic reports. Similarly, while three in five Americans (63 percent) say it’s important they purchase goods from companies that support social causes they care about, that increases to 65 percent for millennials. “C-stores that can effectively promote social good or community partnerships may find a home in the hearts of younger generations,” noted Dutta.

Avoid These Big Mistakes

Five Quick Tips for Small Operators John Crossman, CEO of Crossman & Co., which services retail landlords throughout the Southeast, offers the following five quick tips for small operators: 1.

Do things national companies can’t. Be flexible with policies, take social media risks, and be personal and relatable. customers on a first-name basis. Text them personally when there is a sale. Connect with them individually on social media.

There are some ways small operators should not try to compete with the big players. Independent retailers can almost never compete on price, according to Brophy. “Instead, embrace a higher price point, but support it using local goods and ingredients, and by providing top-notch service,” she said. Casting a wide net also is not wise. “Rather than trying to cater to every consumer in the market as larger operators do, small retailers should identify and focus on their niche market to provide their core audience with an optimal experience,” advised Riggs.

2. Know

“Leveraging service and one-on-one interactions with their local community allows smaller retailers to gain loyalty from the neighbors they serve and create their own authentic identity — instead of a chain copy,” he continued.

3. Leverage

Ultimately, local partnerships of all kinds are a great avenue for small operators and could lead to additional product opportunities as the business grows.

social media in a very human way. Promote a local charity or sports team. Spotlight a specific customer when he/she is celebrating something.

4. Be

relevant at a time of crisis. When tragedy strikes your community, reach out and help.

5. Don’t

forget the small stuff. Offer clean bathrooms that women and children can feel safe in.

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

“Seeking out relationships with other small retailers is also a great way to learn best practices from operators that face the same challenges as you,” Riggs added. Small operators should also consider pursuing partnerships with in-store tech providers and investing in partnerships that assist with sustainability efforts, Dutta said. CSN


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COVER STORY

In honor of the 50th anniversary of Convenience Store News, we spotlight the 50 most influential people in convenience store history

Convenience A Convenience Store News Staff Report ILLUSTRATION BY AARON SACCO

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


Perhaps more than any other CPG retail channel, the convenience store industry has undergone massive transformation over the past 50 years. Once the land of tiny corner stores selling “cokes and smokes,” today’s convenience stores are sophisticated operations with large, sleek store designs, made-to-order fresh food and beverages, the newest technology, and much more. It’s taken a lot of people to get the industry to where it is today. Which is why we, at Convenience Store News, thought it was only fitting to celebrate our 50th anniversary and this special commemorative issue by selecting and spotlighting the 50 most influential people in convenience store history. To come up with our list, we put out a call to the industry and you responded with scores of worthy nominations. Then began the really hard work of winnowing it down to the 50 who have had the greatest influence on the development, growth and history of this industry. These 50 individuals include retailers (entrepreneurs, founders, pioneers, innovators, etc.), suppliers and distributors (new product developers, technology innovators, partnership advocates, etc.) who have made significant contributions to convenience retailing. Read on to see who made the cut… J ULY

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Convenience Store News 31


COVER STORY

Henry “Hank” Armour, NACS HE’S LED THE DEVELOPMENT OF THE INDUSTRY ASSOCIATION INTO A GLOBAL ENTITY

As president and CEO of NACS, the Association for Convenience & Fuel Retailing, Henry “Hank” Armour is already in rare company. Only two others, Henry A. Boney and Kerley LeBoeuf, have held the role. And since stepping up to lead the organization and, in some ways, the convenience store industry itself, Armour has made it clear that he is the right man for the job.

Armour’s broad career has given him an equally broad understanding of the c-store industry’s needs, as well as what it can become.

“As a retailer in a past life and leading NACS today, Hank is a visionary and strategic thinker,” said one supporter. “His proactive approach to threats and opportunities continues to move the needle for our industry.”

“We believe that to truly succeed, you have to think big.”

Prior to joining NACS, Armour advanced his education — which included a bachelor’s degree in economics and a master’s degree in economics from the London School of Economics and a return to Stanford for a MBA and PhD in economics — while working for Armour Oil Co., his family’s retail automotive and wholesale transportation business. Learning the fundamentals of pumping gas and selling tires gave Armour an understanding of the business from an early age. He rose to the role of vice president and chief operating officer. In 1980, he joined Standard Oil Co. of Ohio and served as manager of development strategies. Then, in 1983, he founded West Star Corp., which eventually operated 59 NOW! convenience stores, truck stops and restaurants; and in 1988, he founded Epoch Corp., which operated retail enterprises in California. Prior to becoming president of NACS, Armour was an active volunteer with the association, serving two terms as NACS chairman of the board (2001-2003), as well as previously serving as its treasurer/ chairman-elect, vice chairman of research and development, and chairman of the Technology and Education Sessions committees. He was also a member of the Category Management and Future Study 2000 committees.

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

“We believe that to truly succeed, you have to think big,” Armour said to attendees of the 2016 NACS Show’s general session. Under his leadership, NACS has become an increasing force to be reckoned with through its efforts to connect c-store operators and lawmakers; keep a level playing field in everything from credit card fees to tobacco sales regulation; and help retailers navigate labor and benefits issues.

— Henry “Hank” Armour, NACS

Its industry advocacy ranges from major events like the NACS Day on the Hill in Washington, D.C., to the ongoing NACS reFresh initiative, which seeks to enhance positive perception of convenience stores and help retailers address important business topics through tools, facts, data sharing and forming partnerships. Armour also oversaw an increased focus on fresh food and connections with related organizations, such as NACS’ work with the Partnership for Food Safety Education and its support of the Partnership for a Healthier America (PHA), for which NACS was named Partner of the Year at PHA’s 2019 Summit. This work will become increasingly important as foodservice continues to grow as a critical c-store category. Although Armour’s influence on the c-store industry is firmly established, there is no doubt that he will continue to have an effect as long as he remains a part of it.


TRANSFORMING TOGETHER

Congratulations, CSN, on 50 amazing years—and here’s to charting the journey together!


COVER STORY

Alain Bouchard, Alimentation Couche-Tard Inc. HE BUILT NORTH AMERICA’S LARGEST CHAIN OF COMPANY-OPERATED CONVENIENCE STORES

Alain Bouchard entered the convenience store industry in the late 1960s when he joined his brother and sisterin-law to help them run a convenience store they were operating as a dealer for a local company in Montreal, Canada. By 1973, he became a district director for Perrette Dairy and supervised the opening of 80 stores. From 1973 to 1976, Bouchard, while at Provigo, ProviSoir division, supervised the opening of 70 Provi-Soir convenience stores. For the next four years, he operated a franchise in Saint-Jerome and, in 1980, opened the first Couche-Tard store.

By 2007, when he was inducted into the Convenience Store News Hall of Fame, Bouchard had built the largest chain of company-operated c-stores in North America. Today, he serves as executive chairman of Alimentation Couche-Tard Inc. The Laval, Quebec-based retailer is the second-largest convenience store operator in total stores in the United States; a leading c-store and fuel retailer in the Scandinavian countries (Norway, Sweden and Denmark), the Baltic countries (Estonia, Latvia, and Lithuania), as well as in Ireland; and has an important presence in Poland. Bouchard’s vision for what the convenience store industry would look like in the future was ahead of its time. He is perhaps best noted for being a shrewd acquirer of convenience store assets and for successfully integrating these diverse acquisitions within a decentralized management structure. He felt that decentralization was the only way to build a company where the model is to adapt to the local communities.

“If you try to do that in a big, centralized office, it won’t be successful. Being decentralized is a big, big thing for us.”

He told CSNews in 2007, “If you try to do that in a big, centralized office, it won’t be successful. Being decentralized is a big, big thing for us.” In North America, Couche-Tard maintains four geographic business units in Canada and 15 business units in the U.S.

— Alain Bouchard, Alimentation Couche-Tard Inc.

With a visionary like Bouchard at the helm, risk-taking has always been an integral part of the Couche-Tard culture. Operating in a decentralized structure, the company has been able to test new concepts and ideas before expanding the successful ones at a calculated pace.

Bouchard’s dazzling array of acquisitions include the Perrette and Provi-Soir stores where he got his start in the business, other Canadian chains, and numerous U.S. companies, including Dairy Mart, Circle K, The Pantry and CST Brands.

Bouchard told CSNews in 2009 that he knew he was destined to be in the c-store industry in his early 20s. “It was in my early days in the business when I realized how much people were willing to visit small retail boxes for their convenience needs. It was definitely an eye-opener for me.”

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


Don Zietlow

Convenience Store Industry’s Top 50 Most Influential People

Core Values Honesty and Integrity Respect Excellence Humility Innovation Work Ethic


COVER STORY

Chester & Chet Cadieux, QuikTrip Corp. THE FATHER-AND-SON TEAM CREATED AN ICONIC C-STORE CHAIN

“I’ve always said that it is better to be lucky than smart, and boy that was certainly the case with my induction,” Cadieux said in 2011 when he reminisced about his Hall of Fame induction 25 years earlier. He noted that the most remarkable thing about the industry is “that the entire business depends on the people who work in the stores. For us, those guys and gals ARE the company. The rest of us are just here to support them and help them become successful.” Chester

Chet

The late Chester Cadieux, co-founder of Tulsa, Okla.-based QuikTrip Corp (QT), is an easy addition to this list of influential industry leaders. As the first retailer to be inducted into the CSNews Hall of Fame in 1977, Cadieux’s accomplishments compare favorably to such “retailing icons as Clarence Saunders, father of the modern supermarket, Stanley Marcus, the department store impresario, and Sam Walton, king of discount retailing,” former CSNews editor Denise Melinsky said at the time of Cadieux’s induction.

“Chet has taken a company and platform built by his father and taken it to new heights, while redefining convenience.” — Henry “Hank” Armour, NACS Cadieux, along with his partner Burt Holmes, opened the first QuikTrip store in Tulsa in 1958. They were the first to open c-stores in Oklahoma and Iowa, and among the first to adopt self-serve gasoline, self-serve fast food, private label products and test in-store automation. Cadieux’s personal belief in empowering all employees, the value he placed on QT customer satisfaction and his total commitment to store cleanliness have been key pillars of the company’s success, according to one QT board member.

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

His son, Chet Cadieux, became president of QuikTrip in 2002 and the company didn’t miss a beat. The founder’s philosophy of continuous evolution and a commitment to hiring good people and promoting from within remains an integral part of QT’s continued success. The retailer consistently appears on Forbes’ annual ranking of the largest privately held U.S. companies and on Fortune’s Top 100 Best Companies to Work For list. In 2017, for the second consecutive year, Chet was among the top chief executives in the U.S., according to a ranking by job site Glassdoor. Chet, who serves as president and chairman of QT, was inducted into the CSNews Hall of Fame in 2016, a few months after his father died. He is only the second offspring of a Hall of Famer to be inducted. At his induction, Chet credited his dad for influencing his business life. “Most of what I know came from him, either directly or through someone else he had worked with in the company. He taught me the true joy that can be found from genuinely caring about your employees,” he said. Today, QuikTrip operates nearly 800 stores and is among the top 20 chains in the industry. “Chet has taken a company and platform built by his father and taken it to new heights, while redefining convenience,” said Henry “Hank” Armour, NACS president and CEO, a CSNews Hall of Famer himself and a Top 50 Influential as well (see page 32).


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COVER STORY

Sonja Hubbard, E-Z Mart Stores Inc. SHE BLAZED A TRAIL FOR WOMEN LEADERS IN THE C-STORE INDUSTRY

Sonja Hubbard is well-known for being a champion for the convenience store industry and a trailblazer in everything she does. She broke ground for women in the industry, serving as the first female chair of NACS, the Association for Convenience & Fuel Retailing, from 2008-2009 and then becoming the first woman inducted into the CSNews Hall of Fame in 2010.

Upon receiving her CSNews Hall of Fame accolade, Hubbard said she hoped her induction was a symbol of how far the convenience store industry has come with respect to women in leadership roles.

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

Upon receiving her Hall of Fame accolade, Hubbard said she hoped her induction was a symbol of how far the convenience store industry has come with respect to women in leadership roles. Since then, CSNews alone has honored more than 300 women in its Top Women in Convenience (TWIC) awards program, the first and only c-store industry awards program that recognizes women making outstanding contributions to their companies and the industry overall. Hubbard was recognized as a TWIC senior-level leader honoree in 2014. On the surface, it would appear Hubbard followed in the footsteps of her father, Jim Yates, who founded Texarkana, Texas-based E-Z Mart Stores Inc. in 1970 and led the company until his death in a 1998 plane crash. Yates served as the 1992-1993 NACS chair, was inducted into the CSNews Hall of Fame in 1997, and was renowned as a visionary leader in the industry. Hubbard was the first offspring to ever be inducted into the CSNews Hall of Fame. For her, the decision to join the c-store industry and the family business came easily. She began working for E-Z Mart as a teenager. After graduating from college with a Bachelor of Science degree in business administration, she worked for two accounting firms and attained her accounting license before returning to her E-Z Mart roots. She worked her way up from assistant controller to chief financial officer, and assumed the role of CEO following her father’s death. Hubbard’s list of accomplishments and her service to the c-store industry is lengthy. As chair of NACS, she was a tireless fighter for important c-store issues, especially unfair transaction fees charged by the credit card companies. As CEO of E-Z Mart, she oversaw a complete modernization of the 270-plus-store chain across its operational footprint in Texas, Oklahoma, Louisiana and Arkansas. In December 2017, E-Z Mart reached an agreement to sell all of its stores to GPM Investments LLC.


COVER STORY

Don Lamberti, Casey’s General Stores Inc. HE FOUNDED THE QUINTESSENTIAL C-STORE CHAIN FOR SMALLER COMMUNITIES

Don Lamberti’s retailing experience began literally on his father’s knee, as he grew up working in the family’s multifaceted retail store, gas station, motel, ice and coal business. At the age of 21, when his father’s health failed, Lamberti leased the store, located on East 14th and Broadway in Des Moines, Iowa, and became the sole owner of the business. After nine years of operating that country store, which he remodeled into a convenience store, Lamberti’s gas supplier and friend Kurvin C. Fish suggested that he buy Square Deal Oil Co., a service station available for purchase in Boone, Iowa. With Fish’s idea and Lamberti’s vision and management skills for the new venture, the partners purchased the threebay service station and converted it into a c-store, which opened in 1968 under the Casey’s banner, named after Fish’s first two initials. Looking to duplicate the mom-andpop atmosphere of the Boone location, Lamberti and Fish then went on to open another location, this time in the smaller community of Creston, Iowa. From there, it wasn’t long before Lamberti’s ambitions took shape into something bigger: to build the first Casey’s store totally from scratch in an even smaller community with a population of only 1,500 in Waukee, Iowa. It was at this point that Lamberti realized he was on to something and decided to establish Casey’s stores in communities with a population of 5,000 or less. In the 1970s, Casey’s grew from four stores to 300. Rapid growth continued through the 1980s, with Casey’s going public in 1983, two years after Fish retired and sold his interest in the company. Around this time, Casey’s began to sell doughnuts in its stores and, in December 1984, it introduced pizza, which today is one of its signature items and biggest sellers. From that first store opening in 1968

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

in Boone, Casey’s General Stores has exploded today into a business that operates 2,123 Midwest locations, more than half of which are in areas with 5,000 or fewer people. The company consistently ranks on the annual CSNews Top 20 Growth Chains list. In 2019, it held the No. 5 spot; in 2018, No. 8; and in 2017, No. 10.

From that first store opening in 1968, Casey’s General Stores has exploded today into a business that operates 2,123 Midwest locations, more than half of which are in areas with 5,000 or fewer people. Lamberti headed Casey’s for 35 years before stepping down as CEO in 1998 and taking on the role of chairman of the board. In 2000, he was inducted into the CSNews Hall of Fame. For his service to the business community, he has also received accolades such as the Small Business Administration Iowa’s Entrepreneurial Success Award and the Distinguished Iowa Citizen Award from the Boy Scouts Council. Outside of the business world, Lamberti has served on several boards and made contributions to multiple community organizations. He is a founding member of the National Sprint Car Hall of Fame, Keep Iowa Beautiful and Bridges of Iowa Inc., a faith-based prison release, drug treatment and aftercare program for non-violent offenders. Lamberti is also a past board member of the Mid-Iowa Council of the Boy Scouts of America and On With Life Inc.


COVER STORY

Drayton McLane Jr., McLane Group HE TURNED TO COMPUTERS TO BUILD A ROBUST AND EXPANSIVE DISTRIBUTION NETWORK

As the grandson of a man who opened his first grocery store in the late 1800s, it’s easy to believe that Drayton McLane Jr. had the business in his blood. His early years included time spent sweeping the floors and stacking inventory, which he began doing at nine years of age. From then on, the time he spent assisting with various aspects of the company, which had evolved into a wholesale grocery business, gave him a solid grounding in the business.

“Perhaps more than any other individual, Drayton McLane was instrumental in developing the c-store supply chain we now have.” — An industry insider

McLane joined the family business as an adult after completing his education with a bachelor’s degree in business from Baylor University and a master’s degree in business administration from Michigan State University. Initially under the leadership of his father Drayton Sr., who worked at the company for more than six decades, McLane helped connect convenience stores, grocery stores, fast-food restaurants and other retailers through a robust distribution network. In 1964, Drayton Jr. stepped up to the position of president and CEO, a role he held for 30 years. Under his leadership, the company added 18 distribution centers across the United States and grew into a $19-billion company with average growth of 30 percent or more each year. The most significant milestone in Drayton Jr.’s tenure, though, was computerizing the distribution system. Today, McLane Group and others credit being the first to do so as a key part of the continued success of McLane Co. Inc. today. “Perhaps more than any other individual, Drayton McLane was instrumental in developing the c-store supply chain we now have,” said one industry insider. “From 1975 through the acquisition of McLane Co. by Walmart in 1990, he changed c-store distribution from old-fashioned jobbers and DSD [direct-store delivery] vendors to a computerized system for ordering, point-of-sale and other apps in support of a modern retail enterprise.” In 1990, he sold McLane Co. to Wal-Mart Inc., after which he served as chairman of McLane Co. and vicechairman of Wal-Mart until 1993, when he resigned from both and became chairman of McLane Group, a holding company that currently comprises several entities within the technology, global logistics and food production industries. Apart from his efforts in the wholesale distribution business, Drayton Jr. previously owned the Houston Astros Major League Baseball team. He currently serves as chairman of Texas Central Partners, which seeks to build the first U.S. high-speed rail line between Houston and Dallas. He also serves on multiple boards for organizations such as the George and Barbara Bush Foundation, Cooper Institute for Aerobics Research, MD Anderson Cancer Center Foundation, Heart of Texas Defense Alliance, and Advisory Board for the Bush School of Government and Public Service, among others. Drayton Jr. is also currently Baylor University’s Regent Emeritus for the 2019-2020 board of regents.

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


7-Eleven® is one of the world’s top convenience retailers thanks to the continuous innovation and customer-first approach of founders Joe C., John and Jere Thompson, retail pioneer “Uncle” Johnny Green, and President and CEO Joe DePinto.

1927

1946

1950s

1960s

THE WORLD’S FIRST CONVENIENCE STORE IS BORN

THE NAME CHANGES FROM TOTE’M STORES TO 7-ELEVEN

NEW STORES OPEN BEYOND TEXAS

OPENING OF 1,000TH STORE AND FIRST INTERNATIONAL LOCATION

1970s

1980s

1990s

PRESENT

7-ELEVEN LEADS THE WAY IN SELF SERVE BEVERAGES AND GAS

7-ELEVEN OPENS NEW INTERNATIONAL LOCATIONS

7-ELEVEN STARTS SHIPPING FRESH FOOD PRODUCTS DAILY

Happy 50th Anniversary to Convenience Store News! Thank you for leading the way in helping the convenience store industry improve business performance by providing unparalleled resources and expertise.

68,000+ STORES AND COUNTING


COVER STORY

Bob, Steve & Stan Sheetz, Sheetz Inc. MEMBERS OF THE SHEETZ FAMILY PUSHED FORTH THE CONCEPT OF “CONVENIENCE RESTAURANTS”

president and Steve moved to chairman of the Sheetz Family Council.

Bob

Steve

Stan

From its earliest days, the convenience store industry has been a family business. While that has changed to some degree, there are still several well-known family names that continue to be a strong presence in the channel. The Sheetz family is one shining example. The Sheetz family has run its Altoona, Pa.-based convenience store business for 67 years. The retailer planted the first seed for its 580-store chain when Bob Sheetz purchased one of his father’s five dairy stores in 1952, establishing Sheetz Inc. Bob opened his next two stores in 1963 and 1969, respectively, but it was not until 1969 when Sheetz Inc. began to really grow — not only as a chain, but also as a family business. That year, Steve Sheetz joined his brother in the business as general manager and the two set an agenda to open one new store a year, with a target to have seven Sheetz c-stores serving customers by 1972. That year, they doubled their retail footprint, expanding to 14 locations. Over the next decade or so, Bob and Steve worked side by side to open 100 stores by 1983. The following year, after more than 30 years in the c-store business, Bob retired and handed the reins of Sheetz Inc. to Steve. “Our vision is one of total customer focus,” Steve, who was the 1995 inductee into the CSNews Hall of Fame, told the publication in 2010. “We are constantly trying to find out what customers want and what we can do to give it to them. We want to create the stores that will put the Sheetz stores as we know them today out of business.” Steve continued to lead the company until 1995 when Bob’s son, Stan Sheetz, took on the role of

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

Sheetz Inc. opened its first modern foodservice-oriented facility in 2004. It was a 10,000-square-foot restaurant, offering a broad menu and indoor and outdoor seating for more than 100 customers. This store launched

“We are constantly trying to find out what customers want and what we can do to give it to them. We want to create the stores that will put the Sheetz stores as we know them today out of business.” — Steve Sheetz, Sheetz Inc.

innovations for the company that include a drive-thru, digital menuboards and touchless bathrooms. Stan served as president and CEO of Sheetz Inc. from 1995 until Oct. 1, 2013, transforming the family business from a chain of 195 convenience stores to a chain of 466 “convenience restaurants,” with annual revenues of $6.6 billion. “My father’s vision was to open 100 convenience stores and then he retired,” Stan said upon his induction into the CSNews Hall of Fame in 2013. “The only way to predict the future is to create the future, and that’s what we’re trying to do.”


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COVER STORY

Jere, Jodie & John Thompson, The Southland Corp. THE FATHER AND SONS CREATED THE CONVENIENCE STORE INDUSTRY’S FOUNDING COMPANY

Jere

Jodie

John

If not for the need to choose only four individuals for our “Mount Convenience” of influential industry leaders, the entire Thompson family could have been immortalized on the cover of this special 50th anniversary issue of CSNews. For more than 60 years, members of the Thompson family were at the helm of The Southland Corp. Joe C. (Jodie) has been called “the father of convenience retailing.” He became one of the original and youngest (age 26) board members of The Southland

“We had to be agile. The products we stocked and sold were always changing to meet customers’ needs.” — Jere Thompson, The Southland Corp.

Ice Co., the forerunner to 7-Eleven. Taking the advice of an employee, John Jefferson “Uncle Johnny” Green (another Top 50 Influential, see page 58), they began to stock groceries at the ice dock in 1927. When refrigeration threatened the ice business, and with cars becoming more prevalent, the company evolved into drive-up grocery stores called Tote’m, named because people toed their groceries away. In the 1940s, the company was renamed 7-Eleven to reflect the hours of operation (7 a.m. to 11 p.m.). Jodie would lead the company until his passing in 1961, handing the reins to his sons John and Jere. A third brother, Joe C. III, joined the company later. John and Jere are often credited with expanding the modern convenience store. They oversaw the chain’s tremendous expansion and were both inducted into the CSNews Hall of Fame in 1991. They also both served on the 7-Eleven board of directors until 1996. Many of convenience retailing’s notable “firsts” occurred under the Thompson family’s watch. Jodie grew the business to 600 stores. John and Jere introduced the first coffee in to-go cups, self-serve soda fountains and 24-hour operations. Iconic products such as Slurpee frozen beverages, Big Gulp fountain drinks and Big Bite hot dogs were introduced — and are still sold in 7-Eleven stores today. During their tenure, the “Oh Thank Heaven for 7-Eleven” advertising slogan was also coined; the company began franchising stores in the 1960s; and 7-Eleven expanded to other countries outside the U.S. in the 1970s and 80s. Interviewed 10 years ago for CSNews’ 40th anniversary issue, Jere Thompson discussed his love for the c-store industry. “We had to be agile. The products we stocked and sold were always changing to meet customers’ needs,” he recalled. In his opinion, “gasoline was the single thing that most dramatically impacted the convenience industry.” Some of the most remarkable things Jere said he witnessed while in the industry was “the growth of individuals in the company, so we could promote them to take on more and more responsibility. Their individual growth was very rewarding and allowed us to expand.” Jere served as a past president and board member of NACS.

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


COVER STORY

George, Grahame & Richard “Dick” Wood, Wawa Inc. THE FAMILY GUIDED WAWA FROM A 1800S FOUNDRY BUSINESS TO A LEADING CONVENIENCE FOOD RETAILER

“Dick has led the company into the 21st century, leading the way in the U.S. on changing the expectations of what a convenience store offers its customers in food and beverage, and to keep bringing them back day after day,” said one c-store industry manager. Grahame

Dick

For nearly 50 years, Wawa Inc. has been synonymous with the convenience store industry in the Mid-Atlantic region. For most of its c-store history, the retailer has stayed close to its Pennsylvania roots, having opened its first Wawa Food Market in Folsom, Pa., in 1964. In July 2012, though, the chain made the leap down south to the Sunshine State. Wawa’s place in the daily lives of U.S. consumers dates back even further than 1964 to the turn of the 20th century when George Wood shifted his interest from a New Jersey iron foundry — which began life in 1803 — to the dairy farm business in 1902. His grandson, Grahame Wood, then took the business and its milk delivery service to the next level with the creation of Wawa Food Markets. While it is Grahame Wood who is known as the founder of the modern-day Wawa convenience store, it is Richard “Dick” Wood who was at the helm of the company as it climbed to the upper echelon of the U.S. convenience channel. Dick was the last Wood family member to serve as the chief executive of Wawa. He joined the family business in 1970 and took on roles in the legal department before branching out to other positions including in IT and as chief financial officer. He was named president in 1977. Today, Dick serves as the chairman of the board. Over the past five decades, Wawa — and the convenience store industry overall — has undergone a great transformation. From its days as a traditional gas-smokes-and-cokes retailer to a fierce and innovative competitor in the food business, Dick has not only had a front row seat to the action, but also taken an active role in blazing the trail.

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

“The industry learned how to become close to the local communities and raise money for charitable causes. ... The industry grew a heart.” — Dick Wood, Wawa Inc.

Another industry insider credits Dick with transforming Wawa and its drive into food. Along with building up Wawa’s presence in the retail world, Dick helped shape the overall c-store industry’s image. Following 7-Eleven’s lead as sponsor of the Muscular Dystrophy Association (MDA) in the early 1980s, NACS became sponsor of the charity’s telethon and Dick was tasked with spearheading the fundraising efforts. His idea: have chains compete in raising funds on a per-store basis. After a few years, the partnership with MDA broke up, but one thing remained: the industry’s commitment to giving back. “The industry learned how to become close to the local communities and raise money for charitable causes,” Dick told CSNews for its 40th anniversary issue in 2009. “The industry grew a heart.” Dick was inducted into the CSNews Hall of Fame in 1996.


COVER STORY

Don Zietlow, Kwik Trip Inc. HE’S BEEN A VISIONARY FOR VERTICAL INTEGRATION AND EMPLOYEE PROFIT-SHARING

Don Zietlow, founder and CEO of Kwik Trip Inc. (KT), has been a visionary in the convenience store world since starting the business in 1972. Early on, he saw the advantages of vertical integration, which included building a state-of-theart distribution system.

Kwik Trip’s model of a convenience store as a food destination is driven by Zietlow’s business model of vertical integration. His mantra: “We make it. We ship it. We sell it.”

Kwik Trip was also one of the first chains to fully embrace the notion that c-stores can be a food destination. In 2002, KT introduced hot foods, fresh cases and take-home pizzas in all of its stores.

Every week, individuals from companies throughout the world visit Kwik Trip’s campus in La Crosse, Wis., to tour its facilities.

Even prior to 2002, though, Kwik Trip was known as a place to buy commodities. The introduction of bananas at 28 cents a pound led to the chain selling 50 million pounds of the fruit annually. Soon thereafter, potatoes and onions were added. Today, big-box retailers often have to lower their prices to match KT’s price on bananas. The retailer’s reputation for selling fresh, healthy food items was further burnished when it became one of the first c-store chains to join the Partnership for a Healthier America.

With its own commissary, bakery, dairy, beverage line and distribution fleet, KT is one of the most vertically integrated retailers in the nation. Customers can buy milk that only 36 hours earlier had still been in the cow. Every week, individuals from companies throughout the world visit Kwik Trip’s campus in La Crosse, Wis., to tour its facilities.

In 2012, KT became an industry fuels leader by providing 34 retail sites that offer compressed natural gas (CNG) to regular consumers. It was one of the first c-store chains to offer CNG to the public through an easily accessible network of stores. Perhaps most important to KT’s success is that Zietlow has built a culture where employees — called coworkers — feel privileged to work there. Known for sharing 40 percent of all pretax profits with its 23,000 coworkers, KT has consistently been rated one of the best companies to work for in the Midwest. Turnover at store level is less than 30 percent and less than 1 percent at the corporate Support Center. The company received 247,165 job applications in 2018. Zietlow founded Kwik Trip with a partner, John Hansen, in 1972. He bought out Hansen in 2000. Today, KT operates more than 600 stores in Minnesota, Iowa and Wisconsin. The chain has appeared on the CSNews Top 20 Growth Chains ranking every year since 2015.

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


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COVER STORY

Vasilios & Aphrodite Haseotes and Lily Haseotes Bentas

Carl Bolch Jr.

Cumberland Farms Inc.

He’s provided a half-century of innovative leadership to the family business

From a “cow and a dream” to one of the top 15 c-store retailers in the nation Vasilios and Aphrodite Haseotes founded Cumberland Farms dairy 80 years ago. In 1957, the couple opened the first Cumberland Farms milk store in Bellingham, Mass., and then in 1962, their milk stores added an entire range of products, from groceries and beverages to health items and cosmetics, becoming New England’s first true convenience store. Their daughter, Lily Haseotes Bentas, carried on the family legacy. She held various leadership positions at Cumberland Farms for more than 40 years and now serves as chair of the board. Her nephew, Ari Haseotes, succeeded her as CEO in June 2014.

RaceTrac Petroleum Inc.

In his 2009 CSNews Hall of Fame interview, Carl Bolch Jr. — whose father founded RaceTrac Petroleum Inc. in 1934 — stated that convenience would be the driving force in the c-store industry’s future. No words could be truer in today’s convenience retail landscape. With the mindset of “using the marketplace as your teacher,” Bolch has championed convenience and innovation as RaceTrac and the c-store industry entered the 21st century, according to his nominator. Under his 52-year leadership, Atlanta-based RaceTrac has grown from 100 stores in two states to more than 770 stores in 12 states.

“My grandparents started Cumberland Farms in 1939 with nothing but a cow and a dream. Here we are 80 years later, and it’s hard to believe how far we’ve come,” Ari told CSNews upon his selection as Retailer Executive of the Year in 2016.

During his tenure as president of SIGMA, the Society of Independent Gasoline Marketers of America, Bolch inspired retailers to join together to support their own interests over those of refiners, marking the first time fuel retailers formed a unified approach to marketing the industry. He was also the first fuel retailer to serve as chairman of NACS.

Today, Cumberland Farms operates nearly 600 convenience stores. The chain ranks No. 14 on this year’s CSNews Top 100 list.

Bolch officially joined family-run RaceTrac in 1967 and celebrated his 50th anniversary with the company in 2017. He currently serves as executive chairman.

Rahim Budhwani

Robert Buhler

Encore Franchises LLC

Open Pantry Food Marts of Wisconsin

He was the first Indian-American chair of NACS

He led the industry’s focus on female shoppers

Rahim Budhwani, CEO of Alabama-based Encore Franchises LLC, started out as a computer programmer with a degree in engineering and became a silent partner in a convenience store in 2001. Right after he signed the contract, his partner decided to pull out and he found himself the sole owner with a 10-year oil company contract — and he still had to maintain his day job. “I would start my day at 4 a.m. to open the store with employees and work until I had to get to my day job, and I was going to school at night. I would get back to the store to close at 11 p.m. and it went on like this for eight months before I decided to dedicate all my time to the store,” he recalled. Today, Budhwani is the chief executive of Encore Franchises. Since 2015, the former independent operator has been franchising single c-store operations under the Encore Stores banner. Budhwani was named NACS chairman at the 2016 NACS Show in Atlanta. As the association’s first Indian-American chair, he has had a huge influence on the ethnic community, both in the U.S. and abroad. He and other U.S. retailers met with Indian Prime Minister Narendra Modi to discuss bringing best practices from the U.S. c-store industry to India. 52 Convenience Store News C S N E W S . c o m

Robert Buhler helped change the c-store industry significantly from 1997 to 2012 as president and CEO of Open Pantry Food Marts of Wisconsin. After a 17-year career in investment banking, Buhler acquired his family-owned 52-unit c-store business in 1997 and disassembled the 38 franchised sites — converting Open Pantry to corporate-owned stores only. Once unencumbered by the franchise structure, Buhler aggressively began both an in-store remodel and site acquisition program. Open Pantry bought and sold more than 90 sites from 2001 to 2009 in Wisconsin and Illinois, and created a core of 35 superb corporate stores. In 2006, Buhler told CSNews, “We are diligently looking at growth trends or new strategic locations to acquire and apply our up-image look to reposition the c-store experience in the minds of consumers.” Buhler focused on true “female-friendly” c-stores. “To find incremental customers, you have to invest,” he said. Open Pantry’s high-end stores included 72-inch gondolas, flatscreen TVs above the coolers in lieu of signage, a beer cave glowing with ice blue lighting and stocked with a huge microbrew offering, a stone fireplace surrounded with leather chairs, and computers with Wi-Fi. Restrooms were also high-end, stylized with granite countertops and hotel-quality furnishings.


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COVER STORY

Joe Burke

Mike & Brad Call

The Coca-Cola Co.

Maverik Inc.

He was the first supplier executive inducted into the CSNews Hall of Fame

The cousins transformed Maverik into “Adventure’s First Stop”

In 2003, Joe Burke became the first individual inducted into the supplier wing of the CSNews Hall of Fame. Before that, only supplier companies were recognized. The long-time retail industry affairs executive for The Coca-Cola Co. began his career at the beverage giant in 1978. He earned his bachelor’s and master’s degrees with the support of the company, and often spoke about how he would rise at 3 a.m. to study before going to work. Shortly before retiring in 2013 after three decades of leadership and service to Coca-Cola, Burke was honored with the Food Marketing Institute’s William H. Albers Award in recognition of his retail industry relations in the supplier community. “In his 34 years at Coca-Cola, Joe has been not only a tremendous leader for our business, but also a tireless advocate for food retailers across North America. With his dedication, vision and commitment to working with partners, he has left a lasting mark,” said Coca-Cola Americas President Steve Cahillane.

Maverik founder Reuel Call’s grandsons, Mike and Brad Call, created more than a tagline when they dubbed the family’s Salt Lake City-based company “Adventure’s First Stop.” Together, the cousins created a culture and a way of life that touches every part of the organization from its headquarters — which the company refers to as Base Camp — to its now 300-plus Maverik convenience stores across 11 western states. The tagline communicates Maverik’s goal of being a destination for its active, adventure-oriented core customers. “We’ve created a company that thinks strategically, not functionally. That’s why we are so funky in so many ways,” Brad, who served as vice president of adventure culture, told CSNews about the retailer’s adventure theme. To that wit, Mike wasn’t president; he was chief adventure guide. With large, food-forward stores, Maverik’s high-energy Adventure’s First Stop brand has created millions of raving fans throughout the Intermountain West region with its premium BonFire food — made fresh in-store every day — and exclusive products such as fresh-made, gourmet burritos, sandwiches, pizza, cookies, coffee blends from around the world, and more.

Jim Cox

Joseph DePinto

CITGO Petroleum Corp.

7-Eleven Inc.

He’s ushered in positive change for independent operators

He’s driven the chain’s growth and innovation for more than a decade

For more than 38 years, Jim Cox has held various executive leadership positions in the c-store industry — working for powerhouses like 7-Eleven Inc. and Circle K, to supporting thousands of independent operators in the field with CITGO Petroleum Corp. As retail development manager for CITGO, Cox leads the CITGO Retailing Institute. He supports roughly 5,000 CITGO independent operators — on location, listening, learning and “doing” more than just talking. He’s a passionate believer in the continued future of independent operators in the c-store industry. At Circle K, Cox spent 14 years as a regional vice president, division president and marketing director, among other important posts, with responsibility for 550 Circle K stores in the Southeast. Said one of his supporters, “He is the definition of what confident, yet humble should look like. With all the expertise and experiences Jim has, you never hear him boast.”

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

As the longtime CEO of 7-Eleven Inc., Joseph DePinto has served as a leader not just of his own company, but the convenience store industry as a whole. During his tenure, Irving, Texas-based 7-Eleven has chased major growth, with DePinto overseeing the chain’s biggest acquisition in its history when it purchased approximately 1,030 Sunoco convenience stores. Known for always having an eye on the future, DePinto embraces cutting-edge technology and services, which includes everything from useful partnerships with third parties — such as KeyMe self-service locksmith kiosks and Amazon Lockers — to drone delivery. While some retailers plan for the last mile, DePinto focuses on the last block, and in 2018 told CSNews that “we’ve only scratched the surface.” His push for innovation also includes growth in fresh food, and the opening of a lab store and testing ground. DePinto was the 2017 retailer inductee into the CSNews Hall of Fame and he’s been honored as an “Industry Titan” by the Women’s Foodservice Forum for his efforts in driving gender equity.


COVER STORY

Bill Douglass

Dean Durling

Douglass Distributing

QuickChek Corp.

For many years, he was the face of the c-store industry in Washington, D.C.

He’s led QuickChek to be an innovative regional leader in foodservice and technology

Bill Douglass, founder and CEO of Sherman, Texasbased Douglass Distributing, got his start in the c-store industry at just 16 years of age, working at an Esso station. By 1981, he fulfilled his dream of becoming an entrepreneur when he bought out an Exxon-branded distributorship that included six service stations, some rural commercial accounts, an Exxon transport division, tank wagon division, lubricant division, and a tires, batteries and accessories division. Today, Douglass Distributing distributes more than 130,000 gallons of fuel annually and operates the Lone Star Food Stores retail division with 22 co-branded sites. Douglass made a firm imprint on the c-store industry during his years as NACS chairman (2004-2006). During that time, he testified numerous times before Congress on behalf of convenience industry issues. He worked tirelessly to educate lawmakers about the unfair, negative impacts of such hardships as credit card fees and PCI compliance. Douglass was inducted into the CSNews Hall of Fame in 2008.

Dean Durling’s 40-year career with Whitehouse Station, N.J.-based QuickChek Corp. has allowed him to serve in many capacities, from director of real estate and construction, to assistant director of human resources, vice president of marketing, executive vice president, vice chairman and CEO, and finally chairman and CEO. Durling’s “restless dissatisfaction” with the status quo has led QuickChek to become one of the most innovative regional retailers in the industry, particularly in foodservice and technology. QuickChek was the first convenience store chain to test and implement self-checkout stations at select stores and is now looking at new technology like mobile payment and frictionless. The retailer is also a four-time winner in CSNews’ Foodservice Innovators Awards program. Durling, a past chairman and board member of NACS and a CSNews Hall of Famer, is also known for investing in employee wellness. The company is annually voted a “Best Place to Work” in both New Jersey and New York. QuickChek currently operates 159 stores throughout New Jersey, New York’s Hudson Valley and Long Island, including 79 with fuel.

Greg Gilkerson

Chris Girard

PDI

Plaid Pantry Inc.

He brought unprecedented efficiency to the convenience channel

He saved the now-thriving Pacific Northwest chain from bankruptcy in the late ‘80s

Elected into the supplier wing of the CSNews Hall of Fame in 2009, Greg Gilkerson has been helping c-stores automate their systems for more than 35 years. Gilkerson founded Professional Datasolutions Inc. (PDI) in 1983 and has served as its president since the company’s inception. PDI, a supplier of enterprise-class retail automation software systems, provides software, hosted solutions and professional services to multi-unit retailers and wholesale petroleum marketers.

Chris Girard came to Plaid Pantry as an outside consultant tasked with guiding the chain out of Chapter 11 bankruptcy in November 1989. Creditors asked him to stay on permanently, and he was able to successfully reorganize Plaid Pantry out of Chapter 11 and revitalize cash flow. Girard currently serves as executive chairman and is still very much involved in the retailer’s day-to-day business. The enthusiasm that he injected into the chain while saving it from bankruptcy has become part of the company’s DNA.

Under Gilkerson’s direction, PDI joined forces with Luminate Capital Partners in 2015 to purchase the company from McLane Co. Inc. PDI’s management continues to lead the team and owns a significant equity in the newly independent company.

Plaid Pantry’s current president and CEO, Jonathan Polonsky, notes that the biggest lesson he’s taken away from his mentorship with Girard is the importance of “taking the time to serve shoulder to shoulder with our frontline staff.”

In its quest to grow both organically and via acquisitions, PDI has expanded retailers’ access to efficient software solutions through its recent acquisitions of The Pinnacle Corp.’s enterprise resource planning assets in 2017 and CStorePro Technologies Inc., a provider of simple, self-provisioning and cost-effective mobile software designed for single-store operators.

“One practice that Chris put in place is visiting stores on Thanksgiving, Christmas and other holidays. Senior leadership spends the day as peers in the store, thanking staff members for being away from their families to support our 24/7/365 operation,” Polonsky explained. “This is one of the practices that Chris initiated that I am most proud to continue.”

Gilkerson has served on the NACS Technology Committee, the founding board of PCATS (now Conexxus) and the NACStech Technology Council.

Girard was inducted into the CSNews Hall of Fame in 1998.

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


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COVER STORY

“Uncle Johnny” Green

Scott Hartman

The Southland Ice Co.

Rutter’s

The entrepreneurial ice-dock employee sculpted the first c-store

The chief executive has been an industry champion for technology advancement

John Jefferson “Uncle Johnny” Green worked at The Southland Ice Co. in Oak Cliff, Texas. One ice customer suggested that it would be convenient if Uncle Johnny carried a few loaves of bread to sell along with the ice, while another regular customer needed eggs after church one Sunday when grocery stores were closed.

Rutter’s President and CEO Scott Hartman represents the 10th generation of his family to lead the business, which dates back to 1747. He started working in his family’s c-stores stocking and cleaning shelves when he was just 12 years old. Today, the York, Pa.-based company operates 70-plus stores throughout central Pennsylvania, West Virginia and Maryland.

Uncle Johnny, at 55 years old and a shrewd businessman, saw an opportunity to fulfill a need that wasn’t being met. At first, he financed the sideline business out of his own pocket, selling bread, milk and eggs. Word spread and business was so good that Uncle Johnny asked a friend to build some shelves to stock enough items to meet demand.

An early advocate of technology adoption in the c-store industry, Hartman helped NACS launch the first NACStech technology conference and he chaired the inaugural NACS Technology Standards Committee. He went on the chair the NACS Technology Council, and received the CSNews Technology Leader of the Year award in 2009.

The ambitious ice-dock employee then took the idea of selling groceries to young Southland Ice executive Jodie Thompson, volunteering to run this new side business during the company’s slow season — winter. A deal was struck. The company would fund a dozen or so items to stock; Uncle Johnny would pay the power bills and keep the accounts. Thus, the “convenience store” business was born in 1927.

Hartman served as a NACS executive committee member for more than 10 years and was chairman of NACS in 2005. He was also the first chairman of PCATS (Petroleum Convenience Alliance for Technology Standards). In 2007, Hartman was inducted into the CSNews Hall of Fame, The Food Industry Hall of Fame, and was the first retailer inducted into the PCATS Hall of Fame. Although a regional chain, Rutter’s is the only U.S. company to have ever received the International Convenience Retailer of the Year Award from NACS International.

John Hervey

Fred Higgins

PCATS

Minit Mart Foods Inc.

He was a pioneer in convenience and fuel technology

He strengthened NACS’ technology and advocacy programs

John Hervey’s long career in the c-store industry began at Mobil Oil Corp., where he filled a variety of roles for 25 years. In the 1990s, he began a second career as an industry consultant. Hervey was best known for his work with NACS, which he joined in 2000 as chief technology officer. He led the NACS Technology Standards Project until 2003, when the initiative spun off into the independent Petroleum Convenience Alliance for Technology Standards (PCATS). As executive director of PCATS, Hervey guided the growth and standards adoption work of the new organization, helping to develop the commonplace industry standards that exist today, such as point-of-sale and back-office integration, electronic B2B document exchange, payment systems and device integration. Following his death in 2010, Hervey was posthumously inducted as one of the inaugural members of the PCATS/CSNews Technology Hall of Fame in 2011.

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Fred Higgins co-founded Minit Mart Foods Inc. with his father shortly after graduating college and while still attending law school. By 1969, when he graduated from law school, the new convenience store chain had already opened six stores in Lexington, Ky. Higgins grew Minit Mart to more than 200 stores in multiple states through both new-builds and acquisitions. Minit Mart was also one of the first convenience store chains to add fuel pumps. In 1972, Higgins leased operations to Clark Retail Enterprises, which later declared bankruptcy and returned 37 stores to Higgins’ control. This second act of Minit Mart emphasized a combination of convenience and grocery, with strong branded offers in both food and fuel. Higgins served as chairman of NACS in 1996, overseeing the growth of technology and standards within the industry, resulting in the launch of the industry’s first technology-focused conference, NACStech. He was also pivotal in strengthening NACS’ advocacy programs to communicate the voice of convenience retail to Congress and the media. Higgins passed away in April 2019 at the age of 75.


Bringing Goodness o 1894

2019


COVER STORY

Harry Hunter

Bob Johnson

NACS

The Pinnacle Corp.

The association’s first leader molded the early growth of the industry

He modernized the POS for the c-store industry

In 1961, 17 owners, presidents and general managers of convenience store chains were called upon by Speedee Mart founder Henry Boney to form an association to represent the needs of the convenience sector of the food industry. The National Association of Convenience Stores (NACS) was born, and Harry Hunter was chosen as the new trade group’s first executive director — a position he held for 20 years. Hunter helped mold the association and grow the industry, while overseeing its move to Washington, D.C., to focus on government and regulatory advocacy. Today, Alexandria, Va.-based NACS advances the role of c-stores as positive economic, social and philanthropic contributors to the communities they serve. NACS has 2,100 retailer and 1,750 supplier members from more than 50 countries.

A nearly 30-year veteran of the c-store and petroleum marketing industries, Bob Johnson is founder and CEO of The Pinnacle Corp., a leading supplier of e-commerce solutions and automation technology to the industry. Every day, Pinnacle’s products are used by thousands of retailers to improve the operational efficiency of their c-stores. Johnson first got involved with c-stores in the early 1980s when he was writing software for a company that created point-of-sale (POS) equipment and expanded from quick-service restaurant franchises to 7-Eleven stores. When his position ended there, he had the opportunity to move on to a different industry, but he chose to stay and founded Pinnacle. Johnson is very active outside his own company on behalf of the c-store industry. From 1991 to 1998, he served as a member of the NACS board. He was also the Supplier Board chairman for the organization from 1994 to 1996. In 2012, Johnson was inducted into the PCATS (now Conexxus) Technology Hall of Fame and in 2016, he was the supplier inductee into the CSNews Hall of Fame.

Craig Johnson

William “Bill” & Kyle Krause

Altria Group Distribution Co.

Kum & Go LC

He led the tobacco category through difficult times

The family’s hard work has paid off for the Midwest chain

Craig Johnson served as president and CEO of Altria Group Distribution Co. (AGDC) from April 2011 to March 2019. Many operators admired Johnson for his team’s focus on c-store retailers and the needs of their customers. His focus on driving share and sales influenced the actions of most of the cigarette industry and helped retailers manage through difficult times in the tobacco category. Prior to becoming CEO, Johnson served as executive vice president for Altria Group, overseeing its three tobacco operating companies: Philip Morris USA, U.S. Smokeless Tobacco Co. and John Middleton, as well as the Altria Sales & Distribution and Altria Consumer Engagement Services divisions. AGDC launched its Women in Sales Network (WSN) employee resource group (ERG) during Johnson’s tenure. Johnson cited WSN and all of the company’s ERGs for fostering better communication and problem-solving across the diverse organization.

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“Don’t look back, we’re not going that way” was one of the favorite sayings of William “Bill” Krause, co-founder of Kum & Go LC, one of the largest family-owned enterprises in America. Krause certainly didn’t look back when at the age of 15, he left his family’s failed farm and hired himself out to a Quaker family for $10 a day. The determined young man put himself through high school and college before partnering with his wife’s father, Tony Gentle to form the foundation of the convenience store chain Kum & Go (a play on the phrase “come and go” using the initials of Krause and Gentle). Krause was inducted into the CSNews Hall of Fame in 2006. Kum & Go had grown to more than 440 stores at the time of his death in 2013 at the age of 78. Under his son, Kyle Krause, the company has concentrated on modernizing its stores, divesting older locations and focusing on the retailer’s larger, higher-volumegenerating store model.


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COVER STORY

Kerley LeBoeuf NACS

He launched the NACS Show and expanded the association’s government relations efforts Kerley LeBoeuf oversaw some of the biggest growth years of the convenience store industry during his 24-year tenue as leader of NACS. Prior to that, he spent 15 years at Tampa, Fla.-based convenience store chain Little General Stores, where he rose to president and chief operating officer. He served as NACS president as a retailer. LeBoeuf’s prominent contributions to the industry include the creation of the annual NACS Show — which today is one of the largest retail industry trade exhibitions and expos in the world. The expo brings together convenience and fuel retailing industry professionals for four days of learning, buying and selling, networking and fun — all designed to help participants grow their bottom line, according to the association. He also oversaw the expansion of government relations activities by the association and the creation of the Hunter Club, a premium supplier membership category that was important in helping to fund the early advocacy efforts of NACS.

William “Willie” Laufer Anheusher-Busch

He made a point of learning c-store retailers’ business William “Willie” Laufer’s 27-year career with AnheusherBusch (AB) started in 1979. His earliest memorable learning experiences in the industry are a testament to Laufer’s character. On one of his first sales calls to a major c-store chain, he went in with a blank sheet of paper and sat down with the buyer. Instead of making a presentation, he said, “Tell me everything you’d like a beer company to do to improve your business.” He came away with 30 bullet points that served as his “roadmap for success,” Laufer recounted upon his induction as the 2006 supplier inductee into the CSNews Hall of Fame. Then, upon his first industry assignment, Laufer was asked by the retailer if he had ever worked in a c-store. When he replied that he hadn’t, the retailer asked him, “Then how can you relate to anyone in the c-store business?” With that, Laufer obtained permission from his boss and clearance from the legal department to work in all aspects of that retailer’s store for one week. The AB executive’s nominator describes Laufer as “a true category partner” and as someone who “was always looking out for what was best for the business.”

Tom & Judy Love

John MacDougall

Love’s Travel Stops & Country Stores

Nice N Easy Grocery Shoppes

The couple created the third-largest travel center chain in the nation

He was known as the gentle giant of central NY c-store retailing

Tom and Judy Love founded Love’s Travel Stops & Country Stores in 1964. With a $5,000 gift from her parents, the couple leased an abandoned gas station in Watonga, Okla. Within a few years, the company had 40 stations and began to open convenience stores alongside the gas pumps. Today, Love’s has more than 480 locations in 41 states. In the beginning, Judy handled accounting and ran the company with Tom until 1975, when she returned to college to complete her degree. Now, Tom is executive chairman of the company and their son Fred Love is CEO. Judy serves as secretary of the board and chairman of the Love Family Fund, the family’s well-regarded charitable foundation. As the third-largest travel center chain in the nation, Love’s continues to grow rapidly, ranking No. 11 on the 2019 CSNews Top 20 Growth Chains list.

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John MacDougall’s strong values defined Nice N Easy Grocery Shoppes with a mission statement that read: “Be Nice, Have Fun, Sell Stuff and Be the Best.” Just prior to his death in 2014, MacDougall negotiated terms of the sale of his 81-store central New York chain to CST Brands Inc., in the hopes that the Texas-based chain would carry on Nice N Easy’s reputation for friendly customer service, high-quality fresh food and strong community involvement. Alas, CST itself became an acquisition target two years later. MacDougall, who was inducted into the CSNews Hall of Fame in 2003, was known as a savvy, forward-thinker; a motivator, friend and father figure to many; a boss who created a loyal following among his employees; and a man who liked to have fun (he often joked about his love of beer, saying he was “built by Bud”). The gentle giant was one of three founders of the New York Association of Convenience Stores (NYACS) and a NACS board member.


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COVER STORY

Bob Martin

Brad McGuiness

Huck’s

Verifone

He brought the “milk-bread-bacon-andeggs” concept to southern Illinois

He raised the technical bar throughout his career

Bob Martin was way ahead of his time with c-stores. He and his business partner, Frank Bayley, formed Martin & Bayley Inc. in 1960 and began opening supermarkets in small southern Illinois towns, before eventually branching out to Kentucky and Tennessee. They opened the first Huck’s convenience store in Grayville, Ill., in 1974, at a time when there were very few stores of this type, especially in the southern Illinois area. Martin created the “milk-bread-bacon-and-eggs” store that competed with supermarkets, and put Huck’s on the map. It was said that in many locations, Huck’s sold as many gallons of milk as the local supermarket in that town. Martin passed away in 1998. In March 2001, the Martin and Bayley families sold the company to the employees, making the retailer a 100 percent employeeowned business.

Early in his career, Brad McGuinness pioneered point-ofsale integrations for Pick Kwik, PDQ Food Stores, Nice N Easy and other retailers in his role at Perdata Corp. After joining Verifone in 1992 when it acquired Perdata, he oversaw product development activities across the company’s indoor and unattended product portfolio, and architected and managed Verifone’s Linux product portfolio. McGuinness, inspired by technical challenges and always seeking to support others as a mentor and coach, also spearheaded key standards development initiatives with Conexxus, the nonprofit organization that drives standards, technology innovation and advocacy for the c-store industry. In 2012, he was inducted into the PCATS/CSNews Technology Hall of Fame and, in 2016-2017, he served as chairman of the NACS Supplier Board.

Today, the company operates more than 120 locations in Illinois, Indiana, Missouri, Kentucky and Tennessee, with 1,500-plus employees.

Maurice P. Minno

David Nelson

MPM Group

Study Groups

His breadth of knowledge helped make convenience foodservice what it is today

He’s helped businesses thrive by bringing them together to share best practices

Maurice P. Minno has some of the greatest expertise and insight into the convenience foodservice category, gained through decades of service with retailers such as Wawa, Circle K, BP and others. A graduate of the Cornell Hotel and Restaurant School, his early career was spent outside the c-store industry, but he soon made an immense difference in the channel. One of Minno’s most impressive achievements was championing the repositioning of Wawa’s foodservice and coffee business in the 1990s, basing it on a “Food Forward” concept that turned the retailer into the gold standard of convenience foodservice. Later, as a consultant, he helped many other brands make significant improvements. Minno also served as a member of the CSNews How To Crew and Foodservice Advisory Council. “It should be noted he has had his fingerprints on every aspect of the food-at-retail industry in our channel and, as a pioneer, has not only taken arrows in the back for his forward thinking, but has more often than not come out at the top of the hill with the organizations that listened to him next to him as partners in success,” said one supporter.

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As a petroleum industry veteran for more than 30 years, David Nelson has aided many companies by founding Study Groups, an organization that brings together non-competitors to share financial benchmarking, best practices, new ideas and more. The organization is frequently credited with helping c-store businesses grow and become more efficient. Nelson’s work in this area began in 1985, when he served as the financial consultant and facilitator for a group of five Northwest petroleum jobbers, forming the first financial study group in the industry. Study Groups now operates across North America. “Through his industry study groups, David has probably helped more companies get better and, in many cases, survive than any other resource available to the petroleum industry,” said one industry insider. Nelson is also a professor of economics at Western Washington University and has published multiple studies on the valuation of petroleum distributors, c-store profitability and other topics. He is a frequent speaker for industry groups.


Gus Olympidis

Greg Parker

Family Express

Parker’s

The longtime innovator is now among those spearheading frictionless commerce

His company’s success has been driven by people, technology and community service

Described by industry members as outgoing and confident, Gus Olympidis began his career in the c-store industry at the age of 21. The 2019 CSNews Hall of Famer often characterizes his journey in business as having been born out of “youthful indiscretion.” Family Express, the Valparaiso, Ind.-based chain of 74 convenience stores — still led by Olympidis, its founder — flies under the radar in most discussions of best-in-class convenience store chains, but the vertically integrated retailer is a market leader in northwest Indiana, known for its uniquely friendly employees who embrace the company’s “living brand” culture of exceptional customer service. Under Olympidis’ direction, Family Express has been at the forefront of testing and rolling out frictionless commerce technology in the c-store industry. According to the president and CEO, the goal is to reduce digital friction in its customer engagement experience, as one-click ordering, curbside delivery and no-wait checkout spread across all retail channels.

“I am the perfect person to be in the convenience store industry because I’m impatient,” Parker’s CEO Greg Parker told CSNews in 2016. The sentiment is as true today as it was a few years ago, as the Parker’s chain continues its journey from one location in Midway, Ga., in 1976 to now 57 c-stores across The Peach State and South Carolina, with no signs of slowing down. Throughout his tenure, Parker has been regarded as one of the nation’s leading business innovators, earning acclaim for his commitment to high-quality foodservice, technology, consumer rights and charitable giving. He has been recognized by CSNews as Foodservice Leader of the Year in 2018 and Tech Executive of the Year in 2013. He’s also been the recipient of the Frank Callen Boys and Girls Club Citizen of the Year award, the Savannah Morning News Entrepreneur of the Year award and the Savannah Area Chamber of Commerce Entrepreneur of the Year award. If you ask Parker what it takes to be successful, he’ll tell you it takes a “whole village.”

Joseph Petrowski

Teri Richman

The Cumberland Gulf Group

NACS

The oil industry legend is now an advisor to the Yesway c-store chain

She had a hand in major initiatives across the convenience industry

Joseph Petrowski has been called a “true legend” in the convenience and fuel retailing space. The Harvard University graduate served as CEO of The Cumberland Gulf Group from 2005 to 2013. During his time as chief executive, the company achieved record earnings and increased its store count to 700 c-store locations and 3,500 Gulfbranded sites. Petrowski is also the founder and managing partner of Mercantor Patners, an investment firm that invests in downstream energy and retail c-stores. He has frequently been featured on national news media to talk about the state of the oil business. In 2013, Petrowski stepped down from his position at The Cumberland Gulf Group and three years later, he joined Des Moines, Iowa-based Yesway as its senior advisor and a member of the company’s executive committee.

A longtime NACS employee, Teri Richman touched nearly every aspect of the convenience store industry over 20-plus years. After joining NACS as its first in-house federal lobbyist in 1982, she was involved in major initiatives such as the defeat of beer-gas bans in the mid 1980s; improving store security in the late ‘80s and early ‘90s; and introducing technology standards in the mid ‘90s. She also fought credit card fees by founding the Merchants Payments Coalition in 2005. Richman played a critical role in developing NACS’ advocacy, research and technology efforts, according to the association. Following her death in 2009, NACS established the Teri Richman Internship Program, open to deserving undergraduate and graduate students. Having a keen eye for the way technology innovations could aid business strategy, Richman spoke at the World Wide Web Consortium’s 10th anniversary event in 2004 and was instrumental in bringing the inventor of the World Wide Web, Sir Tim Berners-Lee, to the NACStech conference in 2007.

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COVER STORY

Jay Ricker

John Roscoe

Ricker Oil Co.

Big Top

He led industry change in foodservice, legislation and technology

He coined the term “convenience store” and was one of the founders of NACS

Ricker Oil Co. started in 1979 as a small jobber, with Jay Ricker driving the tank wagon and wife Nancy running the office from home. Over the course of four decades, the business acquired five oil companies and opened 58 c-stores, which were recently acquired by Pittsburgh-based Giant Eagle Inc.,

John Roscoe was one of the 13 visionary c-store chain executives who met in August 1961 to found NACS, and helped steer the name choice to the National Association of Convenience Stores, rather than some other suggestions like the national association of midget marts or bantam stores.

Throughout his tenure, Ricker contributed to a tremendous amount of change, especially with regards to foodservice, legislation and technology. In 2013, the Anderson, Ind.-based chain took a unique approach to convenience foodservice with its ¡AhhBurritos! food truck. The program was later rolled out in-store.

In 1964, Roscoe’s Colorado-based chain, Big Top, was the first to offer self-serve gasoline. Combining gas pumps with groceries “not only changed fueling, but the concept of self-serve that we know today,” said Jeff Lenard, vice president of strategic industry initiatives for NACS. “Because it was so unique, it took a good decade to truly catch on but, once it did, convenience stores quickly became the country’s dominant fueling stations and [the place for] other modern conveniences like to-go coffee, self-serve fountain soda and ATMs.”

Ricker’s in-store food offer evolution also led the company to challenge Indiana’s law regarding the sale of cold beer. Normally prohibited at c-stores, Ricker’s received alcohol sales permits typically granted to restaurants, which were later revoked by a state liquor lobby that excluded the retailer from renewing those permits. The conflict brought considerable attention to the state’s ban on cold beer sales, which does not exist in any other state.

Credited with coining the phrase “convenience store,” Roscoe was a marketing genius and innovator, according to his supporters.

For his contributions to the industry, Ricker was the retailer inductee into the CSNews Hall of Fame in 2018.

Stewart Spinks

Tom Trader R.J. Reynolds Tobacco Co.

The Spinx Co.

He’s piloted his convenience store chain to preeminence in South Carolina Stewart Spinks founded Spinx Oil Co. in 1972 with a home heating oil delivery company and one gas station in Greenville, S.C. He didn’t immediately tell his wife and family that he’d left the security of his job at Shell Oil to start Spinx. “I’d still get up each morning around 5 a.m. and put on my Shell uniform and bow tie, just like I was going to work for Shell,” he recalled. It took him about three weeks to get up the nerve to tell them. Today, The Spinx Co. operates 81 convenience stores in South Carolina and employs more than 1,400 associates. It also operates some of the largest c-stores in the state, illustrated by the 6,600-square-foot store it opened in its hometown earlier this year. The store features a new interior layout and décor that reflects the company’s local, southern roots; aroundthe-clock foodservice with a full-service kitchen; eight multi-product fuel dispenser pumps; and a walk-in beer cave featuring local craft and national beer brands. In 2012, Spinks’ son, Steve, was named CEO and Stewart moved to the role of chairman of the board. Spinks has also served the industry as a former chair and board member of NACS and a former board member and committee chairman of SIGMA. In 2011, he was inducted into the CSNews Hall of Fame. 66 Convenience Store News C S N E W S . c o m

He successfully navigated a world of changes in the tobacco category Tom Trader, a former executive with R.J. Reynolds Tobacco Co. (RJRT), earned his place in the CSNews Hall of Fame in 2007 for his high level of participation and advocacy to ensure the tobacco category remained profitable for retailers despite its many challenges. During his 33 years of service with the second-largest tobacco company in the U.S., Trader served on the boards of NACS, the National Association of Tobacco Outlets (NATO), and the American Wholesale Marketers Association (AWMA) — known today as the Convenience Distribution Association (CDA). Trader joined R.J. Reynolds in 1973 and quickly moved up the ranks. By 1988, he was promoted to national manager of the trade relations department, and then became director of the department in 1990. One of the most dramatic changes Trader navigated was the Master Settlement Agreement with the states, which impacted the price of tobacco products overnight. He also saw the change from self-service to clerk-assisted cigarette merchandising. After retiring from RJRT, Trader joined Corporate Creative Connection, a consulting firm founded in 2004 by his former RJRT colleague, Mickey Jones.


Sam Turner

Tom & Dick Wake

Favorite Markets

Eby-Brown Co. LLC

The always bow-tied industry icon advocated for technology standards

Their investment in cold chain spurred foodservice growth in the industry

With his ever-present bow-tie and Southern charm, Sam Turner was a c-store industry icon. A former NACS chairman, he fought tirelessly for the industry on many key issues, including rising credit card fees, energy policy and labor issues. After working in the banking industry for several years after college, Turner became chief financial officer and eventually CEO of Dalton, Ga.-based Calfee Co. He went on to lead the company’s Favorite Market/ComPac convenience stores as president and CEO from 1981 to 2010. The history of Calfee Co. dates back to the start of the c-store industry. In 1981, investors — including members of the Turner family — purchased 65 convenience stores from George Calfee. These stores were operated by the Calfee family under the “Calfee’s Minit-Markets” name and were prominent fixtures in Chattanooga, Tenn., and north Georgia. In 2007, Calfee Co. sold 107 Favorite Markets to Delek US Holdings Inc. with Turner remaining CEO of a handful of stores. He passed away in 2016 at the age of 71.

Gary & J. Michael Walsh Core-Mark International

Brothers Tom and Dick Wake purchased Eby-Brown Co. from their father William Wake and his partner, William Michael, in 1983. Today, Eby-Brown has grown from a small distribution company in Illinois to the largest privatelyowned convenience distributor in the country, servicing more than 8,500 retail locations across 20 states with eight distribution centers. As their nominator pointed out, the brothers were ahead of their time in identifying foodservice as a high-growth category and were among the first c-store distributors to invest in cold chain facilities and trucks. The duo also implemented SmartProcess, an integrated category management solution to improve overall efficiency. Remaining at the forefront of legislative and taxation conversations, Tom and Dick continue to advocate for fair and equitable treatment of all stakeholders in the industry, and they educate their retail partners on the ever-changing regulatory environment. Earlier this spring, Eby-Brown announced it will be acquired by Performance Food Group Co. However, the Wake brothers will continue to run the operation.

Arch “Beaver” Aplin & Don Wasek Buc-ee’s

They spearheaded multiple deliveries of fresh food per week to c-stores Brothers Gary and J. Michael Walsh built Core-Mark International into the second-largest c-store wholesale distributor in the country. Gary was the majority owner, CEO and president for many years. He was succeeded by Michael, who served as president and CEO from March 2003 to January 2013. Under the brothers’ leadership, Core-Mark became one of the first convenience distributors to develop a state-of-the-art distribution platform that included a fleet of tri-temperature trailers for delivering fresh product to c-stores. They are also credited with starting multiple deliveries per week, and consolidating vendor shipments for more efficient distribution of product to c-stores. In 2007, the company expanded into Canada with a new distribution facility in Toronto, which enabled the organization to reach further into western Canada.

The founders have built a network of c-store wonderlands Arch “Beaver” Aplin and Don Wasek, founders of Buc-ee’s, developed a convenience store/travel center concept as big as the state they hail from — Texas. This uniquely Texan chain, which recently opened its first store outside that state (in Alabama), has transformed travelers’ perception of a convenience store from a necessary pit stop to a destination experience. Buc-ee’s “convenience stores on steroids” typically feature (depending on the location) multiple spotless restrooms; upwards of 100 fuel pumps; not one, but four ICEE machines; two self-service coffee bars; shelves of Buc-ee’s brand snacks and grocery items; freshly prepared barbecue sandwiches; a large bakery counter; and every kind of grab-and-go snack imaginable. Aplin calls them “the Disney of convenience stores.”

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COVER STORY

Celebrating 50 Years of Convenience Retailing A look at the happenings that have transformed the c-store industry over the past half century president of Little General Stores, is elected president of the National Association of Convenience Stores.

1969

There are 11,000 convenience stores nationwide, with approximately $2.3 billion in sales, according to the Convenience Store News Industry Report.

7-Eleven operator The Southland Corp. projects sales to exceed $950 million, with net earnings of $14 million. About one-third of Southland’s stores are franchised.

Then-governor and future President Ronald Reagan is a guest speaker at the annual NACS convention. Kerley LeBoeuf with comedian Jerry Lewis at MDA Telethon

1982

Ronald Reagan with NACS President Harry Hunter

The Sheetz family marks its first 30 years in the c-store business with a bold expansion plan that will bring the 75-unit chain up to 192 units by 1986.

1976

1972

QuikTrip of Tulsa, Okla., begins installing gas pumps at its c-stores — a decision founder Chester Cadieux thinks is “stupid” at the time.

1973

The 1973 oil crisis leads to gasoline shortages, government price controls, calls for national gas rationing and, ultimately, ridiculously long lines at the pumps.

1974

The CSNews Industry Report reveals that 79 percent of the 24,516 stores in the c-store industry are company-owned. The remaining 21 percent are franchised. Weekly sales per store are $4,313.

Wawa installs electronic banking terminals in a number of its stores.

1978

The 30,000-plus convenience stores in the U.S. account for more than 5 percent of all food purchases.

1979

The New York Association of Convenience Stores (NYACS) holds its first meeting, stating the need to pass legislation permitting food retailers to sell wine.

1981

Kerley LeBoeuf, senior vice

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

Chester Cadieux of QuikTrip is the first retailer inducted to the CSNews Convenience Store Industry Hall of Fame. McLane Co. and Philip Morris Co. are the first supplier inductees.

1988

A court rules that the word “convenient” is too generic to trademark, causing Convenient Food Mart to lose its trademark protection in a lawsuit against 6-Twelve Convenient Mart Inc.

1989

Fast Fare Inc. opens its “store of the future” in Robersonville, N.C. The store offers parking for 30 cars. Interior walls and fixtures are dark gray to promote product visibility.

1977

Oil marketers report paying six to seven times what they once paid for environmental impact liability insurance — if they can get it at all.

1987

1975

1970

1986

The industry grows by 2,500 units, with all but 500 of the new stores operated by petroleum marketers.

1990 1983

National Convenience Stores purchases Colonial Food Stores of San Angelo, Texas, giving the company a total of 1,025 units.

1984

The Circle K Corp. purchases U-Tote’M Inc. from American Financial Corp. for $225 million, bringing the retailer’s store count to 2,180 locations in 17 states.

The Circle K Corp., operator of 4,600 stores, files for Chapter 11 bankruptcy protection. Later in the year, The Southland Corp. declares bankruptcy.

1991

On Aug. 6, 1991, the World Wide Web becomes publicly available, fundamentally changing business — and the world — as we know it.

1985

Git-n-Go Inc. installs automated fuel terminals that accept cash and debit cards at select stores.

1992

QuikTrip begins to offer fast food and fountain beverages


at its stores, becoming the first convenience store to offer a self-serve soda fountain and self-service coffee bar.

1993

The five largest c-store chains in the U.S. at this time are: The Southland Corp., The Circle K Corp., Amoco Corp., Texaco Inc. and Shell Oil Co.

2002

Conoco Inc. and Phillips Petroleum Co. merge to become ConocoPhillips.

2003

Convenience Store News celebrates its 25th anniversary.

Fas Mart Convenience Stores Inc. emerges from a two-year bankruptcy through new ownership, GPM Investments LLC, which quickly invests $10 million in upgrades for the chain.

1995

2004

1994

The top 10 in-store sales items are: tobacco, beer/ wine/liquor, bottled/canned drinks, prepared foods, grocery/frozen foods, candy, milk/dairy, fountain/slush/ coffee, salted snacks, and general merchandise.

1996

The Pantry sells to investment group Freeman Spoglin & Co. Inc. for $50 million.

1997

RAI also closes on related divestiture transactions with ITG Brands, a subsidiary of Imperial Tobacco Group.

The DB Mart chain of convenience stores files for Chapter 11. Later in the year, Hess, Getty and Sam’s Food Store Corp. acquire the chain’s assets.

2016 2011

Sheetz helps hang a price tag on its hometown of Altoona, Pa., as part of a tie-in with Morgan Spurlock’s movie: “Pom Wonderful Presents: The Greatest Movie Ever Sold.”

Alimentation Couche-Tard reaches a deal to acquire CST Brands Inc. in a $4.4 billion deal. The agreement brings an end to months of speculation about the future of San Antonio-based CST.

2017

2012

An increasing number of c-stores offer mobile ordering, delivery and drive-thru to stay competitive.

2013

2018

Valero Energy Corp.’s board decides to sell off its retail business through an auction.

2006

7-Eleven acquires the Chicago-based White Hen Pantry chain, and rolls out its own brand of gasoline after the expiration of its 20-year contract with CITGO.

Fina Inc. and Southwest Convenience Stores merge and form Southwest Convenience Stores LLC.

The FBI locks down Pilot Flying J’s headquarters in Knoxville, Tenn., during execution of a search warrant. The travel center chain is accused of shorting trucking companies on earned fuel rebates.

The c-store industry sees one of, if not its most, active years in merger and acquisition activity — both in number of transactions completed and the monetary value of the transactions.

1998

7-Eleven tests in-store public internet kiosks.

1999

The Pantry issues an IPO to raise $100 million; opening price: $13.25 per share.

2000

BP Amoco and ARCO merge, despite efforts by the Federal Trade Commission to block the $30 billion deal.

2007

7-Eleven grabs headlines — and several awards — for a marketing campaign centered on transforming select stores into Kwik-E-Mart from “The Simpsons.”

2008

Gas prices hit a new record of more than $4 per gallon, while the cost of crude oil also tops the record books at more than $147 per barrel.

2009

In a CSNews exclusive, Wawa leaders discuss the company’s plan to survive a recession as global consumer confidence falls to historic lows.

2001

Dairy Mart Convenience Stores Inc., operator of 546 stores, files for Chapter 11.

2010

Alimentation Couche-Tard launches an ultimately unsuccessful, unfriendly takeover attempt of Midwest convenience store chain Casey’s.

2019

2014

The U.K.-based EG Group, which already acquired Kroger’s c-store division and TravelCenters of America’s Minit Mart chain, continues to rapidly grow its U.S. footprint with the purchases of Fastrac and Certified Oil c-stores. EG Group also announces the introduction of the EG America banner through the rebranding of Minit Mart stores.

The c-store industry mourns the death of Nice N Easy founder John MacDougall, whose leadership and values defined the New York State c-store chain.

2015

Reynolds American Inc. (RAI) acquires Lorillard Inc.

SHARE YOUR STORY

Celebrate the continued success of the convenience store industry with us! Send photos, videos and memories of your years in the convenience channel to dlongo@ensembleiq.com and we’ll add them to our timeline. If you have a fond industry memory or achievement, let us know about it. J ULY

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What Will the Next 50 Years Bring? Continuous change is the one thing that all c-store industry insiders seem to agree on A Convenience Store News Staff Report In 1969, there were 11,000 convenience stores nationwide, with approximately $2.3 billion in sales, according to the Convenience Store News Industry Report from that year. Fast forward to 2019 and there are approximately 153,237 convenience stores operating in the United States, with $661.4 billion in sales. Convenience stores account for more than one-third of the total brick-andmortar retail universe in the U.S., according to Nielsen. “Our industry has strong footholds in providing customers with convenience, whether at our stores or even in their homes. That’s a powerful combination to consider as we continue to re-invent the definition of convenience,” said Henry “Hank” Armour, president and CEO of NACS, the Association for Convenience & Fuel Retailing. So, what will the next 50 years bring for convenience retailing? To help answer this question, Convenience Store News tapped four leading c-store industry authorities. JOSEPH DEPINTO PRESIDENT & CEO, 7-ELEVEN INC.

What do you think the next 50 years will bring for U.S. convenience retailing? I think U.S. convenience retailing is positioned well within the overall retail sector for the next 50 years. Time pressures will continue to increase in the future and customers will correspondingly seek out simplicity, ease of use, in addition to seamless and frictionless shopping experiences at a greater pace. Products and services will change and come and go, but it is important for our industry to remain “top of mind” with consumers when they think of convenient, immediate-consumption products and services. What will change in the next 50 years? All retail sectors are evolving to be “more convenient” to the customer as customer needs continue to change. The evolution will continue to accelerate and traditional convenience as we’ve known it will be

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

redefined. This means people will shop differently, seeking more simple and easy ways to shop. This will include shopping at close-by and convenient physical stores, but it will also include e-commerce (delivery, order and pick up at a store or elsewhere, etc.). Payments will evolve as well as customers will seek to pay the way they want and in a fashion that is most convenient to them. Finally, I believe as retail channels overlap and merge, all retail will become increasingly competitive. For us, that means we will continue to see significant consolidation as size and scale will matter. What will stay the same? We will always have physical stores, but they will certainly be utilized in different ways, and we’ll build on our strength in immediate-consumption products. Where do you foresee the 7-Eleven brand being 50 years from now? 7-Eleven will evolve with the customer. We have the organization, scale and capacity to make the changes required to keep pace with a rapidly evolving customer. In this sense, we will remain top of mind with the customer regardless of how they define convenience in the future.

“Products and services will change and come and go, but it is important for our industry to remain ‘top of mind’ with consumers when they think of convenient, immediateconsumption products and services.” — Joseph DePinto, 7-Eleven Inc.

GREG PARKER FOUNDER & CEO, PARKER’S

What will the next 50 years hold for U.S. convenience retailing? U.S. convenience retailing is undergoing a transformation because our traditional profit silos of “gas, cokes and smokes” are all under assault. We need to evolve and expand into other silos, like foodservice, providing customers with the freshest high-quality consumables they want. Rather than being a gas-based industry, we will become an energy-based industry over the next 50 years — in whatever form that may take.


The future is going to be about delivering what the customer wants in the most seamless, frictionless, timeefficient way possible. We need to digitize operations as much as possible and have the best loyalty platform and the best technology that lets us know what the consumer wants even before they know what they want. The future of convenience is going to require that we make things even easier for the consumer, delivering items to them at their home, their office and wherever they need us. I fully expect the convenience industry to optimize delivery and pick-up service. Customers want to touch a button on their phone to place an order that will be ready when they need it. I anticipate that, in the future, convenience retailers will have fleets of autonomous vehicles that can sell items to customers wherever they are.

“The future is going to be about delivering what the customer wants in the most seamless, frictionless, time-efficient way possible.” — Greg Parker, Parker’s

nesses aren’t focused on this technology now, they probably won’t be around in the next decade. They simply won’t be able to compete against those companies that are tapping into this advanced technology. We’re working hard at Parker’s to become a foodservice company that’s focused on convenience, and a technology-based company that’s focused on meeting consumer demand. We’re always working to improve our processes and speed up transaction time. At Parker’s, we’re exhilarated by change. We see change as a major opportunity for growth. The reality is that the rate of change we’re experiencing now is the slowest we’ll ever experience it in our lifetime. It’s only going to continue to accelerate. The convenience store industry should embrace change as we look to the future in order to exceed evolving customer expectations and set the bar even higher over the next 50 years. HENRY “HANK” ARMOUR PRESIDENT & CEO, NACS

We know that consumption of prepared foods is continuing to grow. As an industry, we’ve got to have the best-quality food, prepared as close to the time of consumption as possible. We have to continue to be focused on the customer experience. We need to make sure it’s a great experience and can’t lose sight of the importance of lighting, architecture, interior design and landscaping. If we exceed the expectations of the consumer, we’re winning as retailers. As an industry, we have to change our payment systems. We cannot continue to allow the credit card companies to make more money from the convenience store industry than we make. We cannot continue to be handcuffed to the Mastercards and Visas of the world. They’re a legal monopoly. We need to figure out better payment systems that eliminate the middle man that’s extracting more profit than we are. How do you see Parker’s adapting to this changing landscape? In the convenience store industry, we sell time. We’re saving people time and that’s extremely valuable. As a nation, we’re more time-starved than ever. People want to get in and get out and get what they need as soon as possible. They want to be able to multitask and meet multiple needs in one place, from picking up prepared food to energizing their vehicle. At Parker’s, we’re using machine learning to figure out how to better serve our customers. Anything we can do to make things better, faster, higher quality or better tasting is a win. We’re very focused on business intelligence and we’re using predictive analytics, bots and machine learning — all of which are a must-have in our industry. If busi-

What is the single biggest difference between when you started your career in the convenience store industry and now? I have seen two very significant differences. One: the products have changed as brands and consumer tastes have evolved. But also because our industry has innovated its offer by adding fuel and restaurant-quality food, to name two significant developments. Two: our industry has a more positive image today, largely because NACS members are more engaged with advocacy efforts to educate members of Congress about their business and how regulations and legislation can greatly impact their

“The innovations that will stand the test of time will best combine convenience with technology, with a strong focus on the most important element: connecting with the customer.” — Henry “Hank” Armour, NACS

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COVER STORY

ability to serve their customers. The leadership of organizations like NACS and publications like Convenience Store News deserve a lot of credit for these two changes. What areas do you expect to produce the greatest innovations in the coming years? Convenience, convenience, convenience. We sell time, however the consumer defines it. But it’s important to recognize that all retailers, regardless of channel, also sell convenience and compete for the same customers.

“The key to success for this new business format will be a design that is innovatively ever-changing.” — Maurice Minno, MPM Group

Frictionless checkout, the growth of e-commerce, mobile payments, one-stop shopping and delivery are certainly dominating the conversation and changing the business model of many brick-andmortar retailers. The innovations that will stand the test of time will best combine convenience with technology, with a strong focus on the most important element: connecting with the customer, whether online, at the point of sale or in the community. What are some ways you expect the c-store industry to be different 50 years from now? Our industry has been defined by serving people where they are, whether at convenient locations on street corners or off highways. Our industry will continue to serve customers even as advances in new fuels, vehicle powertrains and evolving consumer trends in transportation and mobility change what it means to be a “convenient” store. And there could be new definitions of convenience that go well beyond the technologies we see today, which I believe will radically redefine where the point of sale between the convenience store and the customer ultimately resides. MAURICE MINNO FOUNDER, MPM GROUP

What are your thoughts on the future of the convenience store industry? I see massive change driven by who our customers are and what they seek. The preponderance of driverless vehicles (commercial delivery, as well as passenger vehicles) will result in new technology-enabled, full-service refueling forecourts with dedicated alternative fuel vehicle lanes for speedy and unencumbered access and return to the highway. Alternative fuel vehicle popularity will result in the reinvention of the traditional c-store forecourt to the forecourt-of-the-future. The forecourt will evolve to a newly created design that enables the speedy access and refueling/recharging of customers’ alternative fuel vehicles. The change will be dramatic not only in the reduction of the number of traditional fuel pump islands in favor of new recharging islands for electric and other alternative fuel vehicles, but also in the new forecourt technol72 Convenience Store News C S N E W S . c o m

ogies that will be deployed for efficiently monitoring forecourt traffic, as well as electronic virtual charging for customer use. New data reporting and analysis systems will be developed in full support of the reinvented forecourt. A new generation store-of-the-future will also emerge. It will develop from customer behavior shopping patterns that focus on meeting customers’ human daily convenience needs. This store will be an updated definition of convenience shopping. It will provide multifaceted customer solutions via a diverse product, experience and services offer. It will be restaurant-patterned in terms of image, services and format, yet with exciting, freshdominated food and beverage offers that engage customers with immersive and dynamic in-store experiences. Binding the store and its various elements together will be the branded c-store retailer’s unique approach and capability to customer experiential services, customer marketing reach to loyal customers, and in-store merchandising — of not only the product offers, but also of the various new customer services and interactive experiences showcased. The key to success for this new business format will be a design that is innovatively ever-changing. The store will be anchored by the c-store retailer’s proven branded concepts, while being enhanced with individual pop-up showcase stores, such as financial, dining, grocery, social and entertainment, and new retailer product and service showcases. Who will the c-store industry leaders be in the next 50 years? The iconic c-store retail brands — Wawa, Sheetz, QuikTrip and others like them — will continue to grow, prosper financially, outperform the industry, innovate their retail business models and freshen their offers, while remaining top-rated by customers and industry peers. CSN


Attract the CBD Consumer Millennials, baby boomers and women are the biggest customers today By Tammy Mastroberte

DESPITE THE AGRICULTURE IMPROVEMENT ACT of 2018 legalizing CBD, or cannabidiol, derived from hemp, the Food and Drug Administration (FDA) has yet to rule on the regulation of CBD used in food and beverage products. As a result, many retailers and manufacturers are hesitant to jump into the space until regulations are set.

However, in states where both cannabis and CBD are legal, there is a rapidly growing demand for these products. And if the FDA rules CBD as safe, experts believe the market will explode among both current and new users. “After the FDA rules, I think the landscape of consumers using CBD will change because it’s not readily available right now,” Jessica Lukas, vice president of consumer insights at BDS Analytics, told Convenience Store News. “They are not seeing it while shopping at Target or the grocery store. But as product availability increases, you will see a lot more people trying and accepting these products.” There is already a growing segment of the U.S. population using CBD products, and others who are just starting to hear about them and showing interest.

Current CBD Users For many consumers, CBD is new to their lives. For more than half of current CBD users (54%), their tenure with the product is less than one year, with 86% of current consumers having used for less than five years.

32%

14%

In the past six months, 15 percent of adults aged 21 and older have consumed CBD products, according to BDS Analytics. Of those, 40 percent have a college degree or higher. And in following the trend of consumers looking for healthier and local products — which the convenience store industry has been responding to recently — the CBD consumer also falls into this category, Lukas said. “CBD consumers are trying to live a natural and healthy lifestyle, so it’s not surprising that hempderived products would appeal to them,” she noted. “Also, more than others, they are interested in buying products local, natural and organic.” Consumers view products with CBD as a more natural alternative to pharmaceutical options for stress, anxiety and pain, according to Jamie Schau, CBD research manager at Brightfield Group, based in Chicago. Viewed as a natural product, CBD is said to be effective and affordable. “Many natural food stores carry CBD products, and it’s even being used as a tobacco substitute in some cases,” Schau explained.

Conditions New Users Treat With CBD 44%

29%

27%

23%

Anxiety

Depression

6+ Years

1-5 Years

Chronic joint pain/ arthritis

Chronic muscle pain

54% < 1 Year

21%

Source: High Yield Insights

Insomnia

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Popular CBD Product Types, All Current Users Baked goods 40% Gummies 29% Vape cartridge 23% Beauty care 23% Concentrated oil 23% Candy 22% Topicals 21% Chocolate 20% Vape oil 20% Vape pen 18% Pill 18% Tincture 17% Beverage 17%

What is the most popular form by age range? Ages 21-34 Vape pens (disposable)

Ages 35-44 Chocolate

Ages 45-54 Topicals

Age 55+ Tinctures

Concentrates 16% Honey 8%

Some independent c-stores already carrying CBD products have them behind the counter along with tobacco, and even ask people for ID before purchasing, Lukas said, noting that there are currently two paths being taken when introducing these products into the store. “One is temporary displays of the products to catch consumer attention and get them to try the products, and you will likely see some people with a shelf dedicated to CBD products — maybe starting with five,” she said. “The second is shelving the products along with the non-infused counterparts. For example, sparkling water infused with CBD would be next to non-infused sparkling water. That will really drive awareness and purchasing as well.”

The Current Landscape Most research shows both men and women utilize CBD products, with females slightly more than men — although this does vary by product. For example, topicals are used more by women, especially since CBD is being featured in beauty products already on the market today.

Source: High Yield Insights

“Right now, it’s slightly more women than men as CBD consumers, but we see this as being such a huge growth industry and used by people across the spectrum.” — Jamie Schau, Brightfield Group The two biggest consumer segments that stood out from the survey are “stressed out millennials,” ranging in age from 21 to 35, who are using CBD products for anxiety, depression and insomnia; and baby boomers, aged 56 and older, who are looking to address chronic conditions for pain management and inflammation, Schau shared.

“Right now, it’s slightly more women than men as CBD consumers, but we see this as being such a huge growth industry and used by people across the spectrum,” said Schau.

Additionally, because CBD is a newer and emerging category, a little more than half of the current users (54 percent) are fairly new to CBD, meaning they have been using it for less than a year, according to The CBD Consumer Experience Study by High Yield Insights. This study surveyed current, potential, former and non-users. The results also showed that 85 percent of current users have been using CBD for less than five years.

Brightfield Group conducted a CBD consumer insights poll, collecting thousands of surveys from those who use CBD, as well as utilizing artificial intelligence technology to scan social media profiles. The results included 5,000 responses that the company turned into one million data points.

“This was separate from consumers using the THC form of cannabis, and it’s really a new market, even for those who have been using the product for some period of time,” explained Mike Luce, co-founder of High Yield Insights, a market research firm covering the cannabis industry, based in Chicago.

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


The CBD Consumer Experience Study also showed the conditions new users are treating, which include anxiety (44 percent), depression (29 percent), chronic joint pain/arthritis (27 percent), chronic muscle pain (23 percent) and insomnia (21 percent). In terms of current users, the study breaks consumers into segments, with the top users (31 percent) falling into what High Yield Insights calls “Goop-y Gwyneth.” These are females aged 21 to 34. The second-largest group is millennials, predominately white, single men, who represent 26 percent of current users. “One of the most public supporters of CBD is actress Gwyneth Paltrow, and almost without exception, this [Goop-y Gwyneth] group is white, married women who have children at home and span all income ranges,” Luce said. “Baby boomers will also be a big area of growth. They are using it for chronic joint pain, arthritis, muscle pain and insomnia. But there is a degree of education needed on hemp-derived products and what they deliver for this group.” Management Science Associates Inc., an analytics company based in Pittsburgh, Pa., also did a survey called Consumer Research Around Cannabis, which included 70,000 legal adults in 69 different markets. The goal was to uncover who is most likely to purchase CBD and/or cannabis products. The research discovered that those interested in cannabis are also “highly interested” in CBD, according to Don Burke, senior vice president of the company. “We found males ages 18 to 39 and females from 18 to 34 as the consumers most interested, and their incomes tend to be higher,” Burke noted. “We also found it far more likely for the tobacco consumer to also have an interest in CBD amongst the general population.”

Purchase Behavior Today’s consumers of CBD are buying products based on their needs and availability. Topical, tincture and sublingual products are currently driving the marketplace, although gummies, chocolates and beverages are expected to grow once the FDA comes out with regulations. What is true today may not necessarily be the case six to 12 months from now as the availability of products changes, according to Lukas. “If you look at beverages, which is still a small market, people are buying them to help them relax, manage stress and have fun, so that is less medically related and more wellness,” she explained. “Infused foods and candies are often to sleep better, relieve pain and manage stress. There are also people buying products for their pets to treat or manage a health problem, avoid prescriptions, and manage stress or pain.” 76 Convenience Store News C S N E W S . c o m

The prediction for the CBD marketplace is that it will grow much more in the next six to 12 months when product availability increases, with CVS, Walgreens, Sephora and other major retailers currently offering topical creams, bath bombs and beauty treatments, as these don’t fall under the category of ingestible, which the FDA has yet to rule on, Lukas said. “As soon as the FDA comes out and communicates how it will be regulated, ingestible will be a bigger growth driver than topical application and will drive a big percentage of the growth we expect to happen over the next five years,” she added. Both current and potential users are looking for easier access to the products (43 percent), according to High Yield Insights, citing this as one of the drivers that would make them consume CBD products more often. Right now, the primary way CBD products are purchased is through a CBD brand’s website (31 percent) or a cannabis dispensary (31 percent). Additionally, 24 percent purchase from an online retailer and 21 percent buy at a natural or health food store. When asked their current preferred product type, 40 percent of current CBD users cite baked goods, 29 percent buy gummies, 22 percent purchase candy, 20 percent prefer chocolate and 17 percent cite beverages, the High Yield Insights survey showed. All of these categories fit into the c-store product assortment, along with vape cartridges (cited by 23 percent of the study participants) and vape pens (cited by 18 percent). “Topicals will remain very important for pain management, and the ingestible products need to be delivered to the consumer in a vessel that makes sense from a functional perspective,” Lukas pointed out. This is echoed by the High Yield Insights research that shows 52 percent of consumers consider the product form before purchase. “Every product in the grocery store will be infused at some point, but what will survive is the most functional formats, and here beverages make sense,” said Lukas. “People are already interacting with beverage in a functional manner, with coffee or energy drinks to wake up, sports drinks to recover and tea to calm them.” Also, while gummies have been a huge category in cannabis dispensaries to date, retailers must realize consumers are not looking to them as candy, but more as a vitamin or supplement in terms of behavior. CSN THREE-PART SERIES

This is the second in a three-part series exploring the CBD opportunity for convenience stores. Look in the August issue for part three.


FEATURE

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The New Trifecta Marathon Petroleum joins stalwarts 7-Eleven and Couche-Tard at the helm of the Convenience Store News Top 100 ranking By Melissa Kress

If you were a betting man, picking the top three chains on the 2019 Convenience Store News Top 100 ranking would seem like a pretty sure thing: 7-Eleven Inc., Alimentation Couche-Tard Inc. and Marathon Petroleum Corp. (MPC). These three players now control a significant portion of the U.S. convenience store market. In all, they operate 14 percent of the industry’s total stores and account for 35 percent of the stores operated by the Top 100 chains. The new trifecta has been created as Findlay, Ohio-based MPC moved up one spot on the Top 100 following its strategic merger with San Antonio-based Andeavor on Oct. 1, 2018. The $23.3-billion transaction created a retail powerhouse that stretches from coast to coast. According to the latest figures compiled in partnership with TDLinx, a service of Nielsen, MPC has a total store count of 5,875 locations, with 3,319 corporate stores and 2,556 franchise/licensee stores. This count was enough to push it past last year’s No. 3, Houston-based Shell Oil/Motiva Enterprises LLC, with a total store count of 4,202 locations. However, MPC has its work cut out for it if the company wants to catch the long-time Top 100 leaders: No. 1 Irving, Texas-based 7-Eleven with 9,280 total U.S. stores and No. 2. Laval, Quebec-based Couche-Tard with 7,021 U.S. stores. (Both have global operations as well.)

Odds on Favorites Finding these three companies at the top is not unexpected, according to industry insiders. “With Couche-Tard and 7-Eleven, it is not a surprise. They have always been aggressive, looking for opportunities,” said Dennis Ruben, executive managing director of NRC Realty & Capital Advisors LLC, based in Chicago. As Ruben pointed out, 7-Eleven’s parent company Seven & i Holdings Co. has publicly stated it is looking for acquisition opportunities to expand across North America. True to that goal, 7-Eleven secured its spot atop

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the U.S. c-store industry with its January 2018 acquisition of roughly 1,030 Sunoco convenience stores in 17 states.

TOP 100 2019 Rank

2018 Rank

1

1

“They look at pretty much every deal that comes along,” Ruben noted. Company, City, State

7-Eleven Inc.

Meanwhile, Couche-Tard, the parent company of Circle K, boosted its portfolio over the past 12 months — and solidified its grip on the No. 2 spot — with the acquisition of Holiday Stationstores Inc. The assets purchased included 522 c-stores in 10 states.

Annual ACV* ($000)

Total U.S. Store Count

CompanyOperated Stores

Franchise/ Licensee Stores

$34,654,152

9,280

1,765

7,515

$26,559,728

7,021

6,136

885

$23,559,692

5,875

3,319

2,556

Marathon, Rich Oil, Speedway, ampm/Andeavor, Flyers, Giant, Giant Service, Howdy's Foodmart, Mustang, SuperAmerica, Tesoro, USA Fuel Center, USA Gas, USA Mini Mart, USA Petroleum

$11,648,988

4,202

12

4,190

Shell

$29,708,432

3,766

0

3,766

Chevron, Chevron ExtraMile, Texaco

$9,379,188

3,323

0

3,323

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

$11,632,608

3,047

0

3,047

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

$8,077,680

2,138

2,138

0

$10,512,580

1,769

64

1,705

APlus, Aloha Island Mart, Coastal, Menehune Food Mart, Sunoco

$3,515,980

1,383

0

1,383

CITGO

$3,075,280

1,198

1,198

0

$3,216,044

1,106

0

1,106

$6,477,640

989

989

0

$6,305,260

939

563

376

$9,801,740

842

842

0

Wawa

$4,478,188

832

0

832

Valero

$9,863,360

798

798

0

$5,904,860

766

519

247

$2,869,100

696

670

26

$4,230,980

646

646

0

Kwik Star, Kwik Trip, Tobacco Outlet Plus Grocery

$3,764,956

623

623

0

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

$6,888,700

588

588

0

Sheetz

$1,360,320

480

480

0

Love’s Country Store, Love’s Travel Stop

$2,303,860

399

399

0

Kum & Go

$791,960

394

44

350

Irving, Texas 2

2

Alimentation Couche-Tard Inc. Laval, Quebec, Canada

3

4

Marathon Petroleum Corp. Findlay, Ohio

4

3

5

5

Shell Oil Co./ Motiva Enterprises LLC

Primary Store Names

7-Eleven, Tedeschi Food Shop, White Hen Pantry Circle K, Corner Store, Dairy Mart, Diamond, Canada Shamrock, Flash Foods, Gas Express, Holiday, Kangaroo Express, Nice N Easy Grocery Shoppe, On the Run, Petro Express, Quick Stop

Houston

Chevron Corp. San Ramon, Calif.

6

6

Exxon Mobil Corp. Irving, Texas

7

7

BP North America Houston

8

8

Casey's General Stores Inc.

Casey's General Store

Ankeny, Iowa 9

9

Sunoco LP Dallas

10

11

CITGO Petroleum Corp. Houston

11

12

GPM Investments LLC Richmond, Va.

12

13

ConocoPhillips/Phillips 66

Admiral Petroleum, Apple Market, BreadBox, Crenco Food Store, Fas Mart, Jiffi Stop, Jiffy Stop Food Marts, Li’l Cricket, Next Door Food Store, Roadrunner Markets, Scotchman, Shore Stop, Village Pantry, Young’s 76, Conoco, Phillips 66

Houston 13

16

EG Group (U.S. HQ) Cincinnati

14

14

Cumberland Farms Inc.

Fresh Eats MKT, Kroger Express, Kroger Fuel Center, Kwik Shop, Loaf ‘N Jug, Quik Stop, Tom Thumb, Turkey Hill Minit Market, EG America Cumberland Farms, Gulf

Westborough, Mass. 15

17

Wawa Inc. Media, Pa.

16

15

Valero Energy Corp. San Antonio

17

18

QuikTrip Corp.

QuikTrip

Tulsa, Okla. 18

19

RaceTrac Petroleum Inc.

RaceTrac, RaceWay

Atlanta 19

20

Pilot Flying J

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

Knoxville, Tenn. 20

22

Kwik Trip Inc. La Crosse, Wis.

21

21

Military Arlington, Va.

22

23

Sheetz Inc. Altoona, Pa.

23

25

Love's Country Stores Inc. Oklahoma City

24

27

Kum & Go LC Des Moines, Iowa

25

26

CHS Inc.

Ampride, Cenex, CHS, Zip Trip

Inver Grove Heights, Minn.

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Steve Montgomery, president of Lake Forest, Ill.-based consulting firm b2b Solutions LLC, does not find the rankings surprising, but he does take pause with the large percentage of stores that the top three control.

“Our industry has always been regarded as highly fragmented. This has made it a popular target for consolidation investment. This type of investment will likely decrease as the consolidation continues,” Montgomery explained.

Taking the Field Pointing to the rise of MPC, Ruben said it is also worth

TOP 100 2019 Rank

2018 Rank

26

28

Company, City, State

COPEC Inc.

Annual ACV* ($000)

Total U.S. Store Count

CompanyOperated Stores

Franchise/ Licensee Stores

$1,661,660

346

346

0

Delta Express, Discount Food Mart, Favorite Market, MAPCO, MAPCO Express, MAPCO Mart

$1,493,180

337

337

0

Stewart's Shops

$676,260

333

333

0

Maverik

$534,040

315

315

0

Murphy Express, Murphy USA

$236,392

315

315

0

Allsup's

$1,460,420

298

295

3

C Stop, My Goods Market, United Oil, We Got It Food Mart

Franklin, Tenn. 27

29

Stewart's Shops Corp.

Primary Store Names

Ballston Spa, N.Y. 28

31

Maverik Inc. Salt Lake City

29

32

Murphy USA Inc. El Dorado, Ark.

29

30

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

31

33

United Pacific Long Beach, Calif.

32

34

Global Partners LP/Alliance Energy Corp. Waltham, Mass.

$636,480

275

275

0

Alltown, Convenience Plus, Fast Freddie’s, Honey Farms, Jiffy Mart, Mr. Mike's, T-Bird Mini Marts, Xtra Mart

33

24

TravelCenters of America LLC

$2,911,480

252

230

22

Petro Stopping Center, TravelCenters of America, TA Express

$490,620

242

242

0

Jacksons Food Store

$206,544

220

220

0

Timewise

$1,995,240

219

218

1

GetGo, Ricker's

$240,500

211

211

0

CEFCO Food Store, Food Fast

$448,760

209

209

0

Royal Farms

$1,554,280

207

207

0

Stripes

Westlake, Ohio 34

35

Jacksons Food Stores Inc. Meridian, Idaho

35

n/a

Texas Petroleum Group LLC Houston

36

45

Giant Eagle Inc. Pittsburgh

37

39

Fikes Wholesale Inc. Temple, Texas

38

41

Two Farms Inc. Baltimore

39

37

Cal's Convenience Inc. Frisco, Texas

40

40

United Refining Co. of Pennsylvania Warren, Pa.

$952,380

206

202

4

Country Fair, Kwik Fill, Kwik Fill & Smokers Outlet

41

42

Thorntons LLC

$706,160

191

191

0

Thorntons

$1,659,060

185

185

0

Meijer Gas Station

$575,900

174

105

69

$614,640

172

172

0

United Dairy Farmers

$1,123,980

158

158

0

QuickChek

$363,012

153

0

153

$360,620

146

146

0

Hy-Vee Gas Station

$374,400

138

138

0

Yesway

$521,560

132

132

0

E Z Mart

$247,988

129

62

67

Convenient Food Mart

Louisville, Ky. 42

43

Meijer Grand Rapids, Mich.

43

36

Dunne Manning Inc. Allentown, Pa.

44

44

United Dairy Farmers

Choice, Express Lane, Hy-Miler, Joe’s Kwik Mart, Rocky Top Market, Uni Mart, Zoomerz

Cincinnati 45

46

QuickChek Inc. Whitehouse Station, N.J.

46

47

Sinclair Oil Corp.

Sinclair

Salt Lake City 47

48

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

48

73

BW Gas & Convenience LLC Beverly, Mass.

49

51

Blarney Castle Oil Co. Bear Lake, Mich.

50

50

Convenient Food Mart Inc. Mentor, Ohio

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


taking note of who is making noise again in the c-store industry: oil companies. Oil companies like MPC and its retail arm, Enon, Ohio-based Speedway LLC, appear to be “doubling down on retail,” he said.

MPC made a similar move with its 2014 acquisition of Hess Corp.’s retail network.

“Marathon has been doing it more and

2019 Rank

2018 Rank

51

49

Company, City, State

Krauszer's Food Store

longer than some others,” said Ruben, adding that MPC’s recent deals include the pending NOCO Express acquisition in upstate New York. “They realize they are looking for an outlet for their production, and that makes sense for them.”

Annual ACV* ($000)

Total U.S. Store Count

CompanyOperated Stores

Franchise/ Licensee Stores

Primary Store Names

$261,300

128

0

128

$583,180

122

122

0

Go Mart

$409,760

122

122

0

Huck's

$188,760

121

121

0

Terrible Herbst

$328,120

119

0

119

Clark

$263,900

118

0

118

Kwik Stop

$555,100

117

117

0

Duchess Shoppe

$392,340

113

110

3

Alta Convenience, Kwik Stop, Smitty's

$415,220

111

111

0

Par Mar Stores

$620,620

111

111

0

E-Z Shop, Enmarket

$225,940

109

109

0

7-Eleven

$165,360

108

108

0

Plaid Pantry

$244,920

108

108

0

Mirabito

$514,280

107

107

0

Little General

$222,040

107

107

0

Freedom Valu Center, Jet Pep

$441,220

105

105

0

Stinker Stores

$243,100

104

104

0

True North

$307,580

100

100

0

Town Pump

$251,940

95

95

0

Family Fare

$195,000

92

92

0

Star Stop

$414,180

90

90

0

2 Go Mart, Rebel

$221,520

89

89

0

Han-dee Hugo's

$201,760

87

87

0

Applegreen, Pitt Stop, S-Mart

$282,100

87

87

0

Daily's, T Fuel, Tri Star Energy, Twice Daily

$361,660

86

86

0

Bucky's

Krauszer’s Food Store

Edison, N.J. 52

53

Go Mart Inc. Gassaway, W. Va.

52

56

Martin & Bayley Inc. Carmi, Ill.

54

59

Terrible Herbst Inc. Las Vegas

55

57

Clark Brands LLC Naperville, Ill.

56

54

Kwik Stop Inc. Plantation, Fla.

57

57

Englefield Oil Co. Heath, Ohio

58

61

Pester Marketing Co. Denver

59

71

Croton Holding Co. Pittsburgh

59

54

Enmarket Inc. Savannah, Ga.

61

60

7-Eleven Stores of Oklahoma Oklahoma City

62

61

Plaid Pantries Inc. Beaverton, Ore.

62

63

Mirabito Energy Products Binghamton, N.Y.

64

64

Little General Stores Inc. Beckley, W. Va.

64

51

CrossAmerica Partners LP Allentown, Pa.

66

64

Stinker Stations Boise, Idaho

67

66

True North Energy Brecksville, Ohio

68

67

Town Pump Inc. Butte, Mont.

69

69

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

70

68

Panjwani Energy LLC Houston

71

69

C.A.R. Enterprises Inc. Upland, Calif.

72

73

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

73

167

73

77

Petrogas Group of South Carolina Lexington, S.C.

Tri Star Energy LLC Nashville, Tenn.

75

85

Buchanan Oil Co. Omaha, Neb.

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“What we are seeing is almost a reemergence of the oil companies in the retail space. BP teamed up with ArcLight Capital Partners to acquire Thorntons. That was a huge deal: 191 stores,” Ruben

said. “They announced publicly they are looking to get back into retail in a big way. A few years ago, they got out of retail. My company worked with them on it. They are moving back into the retail space.”

TOP 100 2019 Rank

2018 Rank

75

77

Company, City, State

Victory Marketing LLC

Annual ACV* ($000)

Total U.S. Store Count

CompanyOperated Stores

Franchise/ Licensee Stores

Primary Store Names

$132,860

86

86

0

Sprint Mart

$531,440

85

85

0

Fast Market, Fiesta Mart, Quik Way Food Mart

$275,600

84

84

0

Five Star Food Mart

$307,320

84

84

0

White Oak Station

$133,900

84

84

0

Crosby's

$260,780

81

81

0

Spinx Store

$156,520

81

81

0

Chucky's Food Store, Hess/Aldin Associates, Sam's Food Store

$159,900

80

80

0

Express Lane

$202,540

80

80

0

Toot N Totum

$322,660

79

79

0

Moto Mart

$211,120

78

78

0

Inland Sun Stop, S&S Food Store, Sun Valley Market & Deli

$133,380

77

77

0

Break Time, MFA Oil, Petro Card 24

$156,000

76

76

0

Big Apple

$186,420

75

49

26

$124,280

74

74

0

$267,020

74

38

36

$167,440

73

73

0

Family Express

$171,600

71

71

0

Gate

$273,260

70

62

8

CoGo's, Ruff Creek Markets

$127,400

67

42

25

Handi Plus, Handi Stop

$177,060

67

67

0

Weigel's, Jug O Milk Store

$41,496

67

67

0

Certified

$186,160

66

66

0

Clark's Pump-N-Shop

$134,420

65

65

0

BFS Foods

$147,160

65

65

0

Dandy Mini Mart

Ridgeland, Miss. 77

71

Empire Petroleum Partners LLC Dallas

78

84

Newcomb Oil Co. Bardstown, Ky.

78

n/a

White Oak Station Harrison, Ark.

78

79

Reid Stores Inc. Lockport, N.Y.

81

83

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

81

73

Sam's Food Store Rocky Hill, Conn.

83

81

Johnson Oil Co. Rock Falls, Ill.

83

81

Toot N Totum Food Store Inc. Amarillo, Texas

85

85

FKG Oil Co. Belleville, Ill.

86

89

Southwest Georgia Oil Co. Bainbridge, Ga.

87

90

MFA Oil Co. Columbia, Mo.

88

87

C.N. Brown Co. South Paris, Maine

89

94

Southeast Petro Distribution

Sunshine Express, Sunshine Food Mart

Cocoa, Fla. 90

92

CHR Corp.

Rutter's

York, Pa. 90

87

Turn Outz Inc.

One Stop WV, Stop In

Roanoke, Va. 92

92

Family Express Corp. Valparaiso, Ind.

93

91

Gate Petroleum Co. Jacksonville, Fla.

94

232

Coen Oil Co. Canonsburg, Pa.

95

80

Gulshan Enterprises Sugar Land, Texas

95

95

Weigel's Stores Inc. Powell, Tenn.

95

100

Certified Oil Co. Columbus, Ohio

98

97

Clark's Pump-N-Shop Inc. Ashland, Ky.

99

102

BFS Foods Inc. Morgantown, W. Va.

99

97

Dandy Mini Marts Inc. Sayre, Pa.

Source: Nielsen TDLinx, April 2019 Only U.S. stores are included in this ranking. *All Commodity Volume (ACV) is provided by Nielsen TDLinx. ACV is an annualized range of the estimated retail sales volume of all items sold in a store that pass through the retailer’s cash registers. Lottery sales are not included; gas sales are included where applicable. The Nielsen TDLinx ACV is an estimate — a directional measure to be used as an indicator of company size.

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In addition, Shell recently made headlines when it opened its first Shell Select convenience store in September, and in the second half of 2017, Chevron Corp. formed a joint venture with Jacksons Food Stores to rebrand locations to Chevron ExtraMile. According to Ruben, there are currently three groups that are big into acquisitions: • Traditional companies like 7-Eleven, Couche-Tard and GPM Investments Inc.; • Oil companies like BP, MPC and Shell; and • Foreign companies like EG Group. “EG Group did or announced four deals in the past year. They seem to have an unlimited source of capital and an unlimited interest in acquiring assets in the U.S.,” he said. But is there room for other companies to break into the top ranks? Montgomery believes 7-Eleven, CoucheTard and MPC are likely to continue growing and retain their top rankings for the foreseeable future, although their positions might change from year to year. “The industry continues to attract more and more investment from both foreign and domestic companies,” he acknowledged. “Companies such as EG and COPEC have made significant initial investment in the U.S. convenience/retail petroleum industry.” Montgomery also echoed Ruben’s assessment of Big Oil. “The major oil companies are reconsidering their divestment of retail locations as shown by BP/ArcLight’s purchase of Thorntons,” he added. EG Group, and its Cincinnati-based U.S. division EG America, is likely to move up

the ladder. The company gained three spots this year, going from No. 16 on last year’s Top 100 ranking to No. 13 this year. The U.K.-based retailer is even looking at smaller deals. “For a lot of these guys, there is no deal too small to look at; maybe too big for some people,” Ruben explained. Other emerging players he thinks the industry needs to keep an eye on include Pittsburgh-based Giant Eagle Inc., which took ownership of Anderson, Ind.-based Ricker’s in late 2018, and Ankeny, Iowa-based Casey’s General Stores Inc. “I think Casey’s is under a lot of pressure to move the needle in terms of stock price. They are certainly growing mostly organically, but I think they’ve been much more aggressive in looking at deals than they have before,” Ruben said. Notably, the Midwest retailer acquired the Fantasy’s Convenience chain in Omaha, Neb., in March. In all, Casey’s opened 56 new stores and acquired 24 stores in its 2019 fiscal year, according to its June 11 earnings call. The company also replaced eight stores and has eight acquisition stores under agreement to purchase. When looking at the current landscape, there are not that many big players left. Aside from Casey’s, other sizable companies are Des Moines-based Kum & Go LC and Atlanta-based RaceTrac Petroleum Inc. — but neither appears to be in the market to sell, Ruben pointed out.

By the Numbers The number of stores operated by this year’s Top 100 comes in at 63,258, accounting for 41 percent of the overall industry. Drilling down further, the number of stores operated by the top 10 comes in at 41,804, accounting for 27 percent of the industry. With several active-growth companies on the watch list, those figures are likely to change. “I think the percentage is only going to increase,” said Ruben. “I think it is really different than the restaurant

BIGGEST MOVERS COMPANY

2018 RANK

2019 RANK

SPOTS GAINED

GROWTH SNAPSHOT

Coen Oil Co.

232

94

138

The operator of Ruff Creek Markets grew its footprint with the acquisition of CoGo's stores.

Petrogas Group of South Carolina

167

73

94

The U.S. affiliate of Dublin, Ireland-based Applegreen plc acquired Carolina Convenience Corp.'s S-Mart stores.

BW Gas & Convenience LLC

73

48

25

Its Yesway banner hit the 150-store milestone in June 2018 with the acquisition of 26 Fresh Start stores in three states.

Croton Holding Co.

71

59

12

The company's operating division, Par Mar Stores, celebrated 51 years in the industry in September with the opening of its 99th and 100th stores.

Buchanan Oil Co.

85

75

10

The operator of Bucky's stores received a judge's approval to bring its banner to Texas when it won a legal battle against the Buc-ee's chain.

Giant Eagle Inc.

45

36

9

The company boosted its c-store count with the acquisition of Ricker's 56 stores in Indiana.

Source: Nielsen TDLinx; Convenience Store News Market Research, 2019

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industry, for example, that has a lot of brands that are unique. They have different menus, different strategies. You also have different sectors like fine dining, casual dining and quick service. Someone operating an Applebee’s, for the most part, isn’t going to operate a McDonald’s franchise. In the convenience store space, there doesn’t seem to be a perceived impediment for someone buying a different [store] brand or fuel brand.” Where companies want to set up shop also plays a key role. “For years, certain chains would not go past a certain geography. Now, a lot of these chains are spreading out and there are not as many geographic limits as there used to be,” he continued. For example, Casey’s recently opened a second distribution center in Terre Haute, Ind., which allows the retailer to move out farther from its Iowa home base. “People are going into new markets they weren’t in before, so I can absolutely see the Top 100 control of the industry stores continue to go up every year over the next five years,” Ruben said. “It wouldn’t surprise me to see it reach 50 or 60 percent.” Looking five years out, Montgomery anticipates further consolidation driven

35% 14% The percentage of the industry’s stores operated by the top three chains

by: economies of scale, as the relative general and administrative costs per site decrease as a chain’s store count increases; a lack of a successor in family-owned businesses; and the low cost of capital.

A Shorter List With all the buying, selling and moving of portfolios, one wonders if the Top 100 will one day become a much shorter list as a result of continuing consolidation. Not necessarily, according to Montgomery. However, he does foresee that “as the larger firms increase in size, the range between the top- and bottom-ranked companies will likely increase.” Small operators will need to find a way to compete — which will not be an easy task. “It’s going to be tougher. Not only do the big guys have more money and their cost of capital is cheaper and they can pay more than the small guys, but they also have economies of scale, efficiencies and more buying power,” Ruben explained. It becomes difficult for a 25-store chain to compete when a chain like Tulsa, Okla.-based QuikTrip Corp. comes to town, the NRC executive added. “There certainly are exceptions to the rule and they have been very successful, but I think as consolidation continues in different markets, there will continue to be pressure on the smaller guys to figure out if they can survive and be competitive,” he said. CSN

The percentage of the Top 100 operated by the top three chains

63,258 Number of stores operated by the Top 100

Drop-Offs From Last Year Andeavor

Became part of Marathon Petroleum Corp. through a strategic merger

Express Mart Franchising Corp. Sold its nearly 80 stores to Speedway LLC

41%

Percentage of industry’s stores operated by the Top 100

41,804 27% Number of stores operated by the top 10

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

Percentage of industry’s stores operated by the top 10


FOODSERVICE

What’s Hot on C-store Menus? The latest LTOs are all about staying cool in the summertime

The weather is heating up, and the latest limitedtime offers (LTOs) at convenience stores are all about staying cool. Moving through the summer months, be on the lookout for cool treats with a tropical twist to help consumers cool off. This month’s hot-for-thesummer item, Stewart’s Shops’ Mango Dragon Fruit Sherbet, embraces safe experimentation with a sherbet that has a colorDESCRIPTION: We’re heading to the tropics with Mango ful, tropical twist. Mango Dragon Fruit Sherbet. It’s the Dragon Fruit Sherbet perfect blend of Mango Sherbet nearly reached a perfect with a swirl of Dragon Fruit score for Uniqueness Sherbet. (a score of 99) with the addition of dragon fruit to mango sherbet. A high score of 87 in Unbranded Purchase Intent (PI) sets the stage for this tropical-forward treat to be a summer favorite with many consumers. And a high Unbranded PI means this flavor combo has potential in plenty of other regions. OPERATOR: Stewart’s Shops ITEM TYPE: Limited-Time Offer DATE: May 2019 PRICE: $2.49

popular with younger populations like millennials, who love it with a PI of 95, and Gen Z, who is warming up with a PI of 84.

Safe Experimentation Scores According to Datassential’s Menu Adoption Cycle, dragon fruit is still at the point of Inception and is largely unfamiliar to consumers, but is perfect for Foodies who scored it an 89 for PI. For non-foodies, pairing familiar flavors like mango with trend-forward flavors in traditional formats like sherbet makes it easy to explore new tastes within the comfort of familiar moments. When you look for your next batch of ideas, don’t forget that safe experimentation is an opportunity to inject variety without chasing customers out the door. CSN

INTEREST BY CONSUMER TYPE UNBRANDED PURCHASE INTENT norms reflect comparison to all items

Without kids

Unique Flavors Win With Younger Consumers This visually striking sherbet scores well across most consumer groups, although Asian consumers are less than hot (PI of 63) for this creative take on a summertime staple. By embracing unique fruits, this LTO is

PRODUCT STORES (Among: Total)

87

norms reflect comparison to all items 100 = max possible score

82

unbranded PI

99

branded PI

83

uniqueness

72

frequency

definitely or probably would buy

definitely or probably would buy

extremely or very unique

would order the item all the time

54%

63%

59%

22%

94

82

92

benchmark norms

--

--

82

99

versus other c-stores items

97

98

85

82

88

draw

value

would visit somewhere just for this item

excellent or good value for the dollar

44% 87

versus other dessert

85

70

59% 87

68

87

67

versus other items from Stewart’s Shops

Datassential, a Chicago-based food and beverage industry research and consulting firm, brings clients real-world insights on flavor trends, foodservice and consumer packaged goods, globally.

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


FOODSERVICE

Four Steps to Grab-and-Go Success C-store retailers without made-to-order foodservice programs can still be competitive — if they know how to make the most of their grab-and-go programs By Angela Hanson

CUSTOMIZATION, FRESHNESS and bold flavors — these are qualities that an increasing number of consumers, particularly younger ones who have growing buying power, say they most want in the food they buy from convenience stores and other foodservice operators.

This makes a strong case for offering made-to-order foodservice programs, but some existing c-stores don’t have the in-store space to fit a full made-to-order program, while other c-stores might not be able to support or staff one based on the local market. C-store retailers without made-to-order foodservice programs are not doomed to fail; they can still be competitive — if they invest in and execute high-quality graband-go programs. Even chains that do lean in hard on madeto-order are leaving money on the table if they do not maintain a grab-and-go offering and put effort into keeping it strong. Here are four ways to make a grab-and-go foodservice program shine: 1. Highlight Speed & Quality Customization gives customers the opportunity to get “what I want, how I want it” — but what many want is simply to get in and out as quickly as possible.

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

“I think that speed trumps customization,” said Paul Servais, retail foodservice director at Kwik Trip Inc. He noted that while the La Crosse, Wis.-based chain still offers some self-serve customization options, such as its sandwich toppings bar, the lack of full-service customization has never been a deal-breaker for its customers. “That’s really what we’re seeing.” Being able to make a quick food purchase is a big part of “convenience” for busy consumers who are eating more meals and snacks on the go than ever before. Daypart plays a part, too. At certain times of the day, customers are more willing to wait as their customized order is prepared. At other times, customers may not have a choice if they have somewhere to be or a limited break from work. Servais recalled visiting a competitor that offered both grab-and-go and made-to-order during the lunch rush. “No one was customizing anything,” he said. The catch is that consumers must feel confident they can get what they what from the grab-and-go case; that they don’t consider a lack of customization to mean lesser quality. “First and foremost, we want to make sure that the quality is good from the beginning, whether it is quality ingredients [or] strong partners,” said Jeff Keune, senior vice president of foodservice and innovation at West Des Moines, Iowa-based Yesway. “We want to reinforce Yesway as a food destination and it starts with the basics. Speaking of the basics, execution is the foundation of a strong offering. We have invested in training for our team members and quality controls to ensure the food is safe, appetizing and looks great.”


Rutter’s gives its stores choices and allows each one to customize its grab-and-go food offering based on the consumer base.

2. Listen to the Data Gaining customers’ trust in your graband-go food quality is important, but just as important is making sure product is always available to buy. That means retailers must know what customers will want, and how much of it they will want, hour by hour. At Kwik Trip, homegrown data analytics and production plans have been developed and perfected over a period of years. By calculating what is likely to sell on a particular day and at a particular time, store employees can stock the hot and cold holding cases accordingly and avoid running out or having too much of something. “It better be good and ready to go, not dried out and having sat there all day,” said Servais. Hiring smart and skilled employees can make a difference, as their in-store experience will allow them to gauge what their store’s specific customers will want and when.

that a certain amount of waste is an unavoidable cost of offering grab-and-go food. “You’re going to have that cost on the backside, but you get good at managing that after a while,” Servais said. 3. Focus on Promotions It’s not enough to just have a quality grab-and-go program at your stores. Retailers must get the word out and get customers to try it if they haven’t already done so. In addition to marketing via billboards, social media, radio or TV, there’s a lot that can be done through in-store promotions and loyalty program deals. “The largest opportunity is to take advantage of the opportunities once the guest is already on-site — inside or outside,” said Keune of Yesway. “We take a lot of time to develop the engagement points in the shopper cycle.” Rutter’s frequently runs what it calls “pairing promotions,” which take the form of pairing foodservice-associated retail items, such as a breakfast sandwich with a bottle of water. These types of promotions build the basket and lead to higher rings. “Customers like buying in two, and they like a discount,” Krebs said.

“We found that creating as many options as you can on the hot grab-and-go and allowing stores to decide which sellers are best for them [yields good results],” said Ryan Krebs, director of foodservice at York, Pa.-based Rutter’s, which has more than 85 items that could be stocked in the hot hold. “Stores can customize their offering for their consumer base.”

At the same time, loyalty program deals and regular discount days on specific foodservice items can encourage customers to return and make repeat grab-and-go purchases.

While analytics and expertise can minimize food waste, industry experts agree

4. Experiment With LTOs, But Stay Consistent Limited-time offerings (LTOs) can be used to create

“Loyalty is a fantastic and impactful tool to drive frequent users to visit even more often (for the food), as well as encourage new behaviors through cross-selling and innovation,” Keune said.

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buzz and encourage trial, but a schedule is important. Retailers should know in advance how long a LTO will run, and have a long-term plan in mind for its rate of new ones. For example, Kwik Trip does LTOs quarterly. By offering regular LTOs — particularly those based on seasons, events or holidays — c-store operators can prompt their customers to look forward to something new, and capitalize on the sense that they need to get it before it’s gone. LTOs can work against a program, though, if they detract from the consistency that consumers demand, industry experts caution. Rutter’s has more than 85 items that could be stocked in its hot hold cases.

“We believe a stronger base is more important than a wide variety. We want to make sure the core options are available plus innovative LTOs and other new news, but we have to make sure we are setting our teams up to execute well and create a great experience for our guests,” Keune said.

Ultimately, the success of grab-and-go rests on reliability over flash. “If we were breaking into [the grab-and-go] market today, maybe we would struggle,” Servais said. “Since we’re so established, people can grab it and know it’s darn good.” CSN

FORECOURT AMENITIES

W A S T E / W I N D S H I E L D S TAT I O N S TwoFold

tm

Sidekick

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FOODSERVICE

A Taste of the Future of Foodservice Leading convenience foodservice execs gathered in Austin to share good food and good practices at the 2019 Convenience Store News Foodservice Summit By Angela Hanson NEW IDEAS, advice on getting ahead in the foodservice category and, of course, delicious food and drink flowed freely at the 2019 Convenience Store News Foodservice Summit.

Ten executives from leading food-forward convenience store chains participated in the eighth-annual event, held April 16-18 in Austin. The Summit, hosted in partnership with Tyson Convenience, is designed to foster innovation and the growth of fresh foodservice in the convenience store industry. This year’s program included information-filled presentations, roundtable discussions and visits to some of Austin’s top culinary destinations. Bold flavors, freshness and authenticity were front and center as day one of the event split attendees into multiple groups to dine at different full-service restaurants. While there, they spoke with the staff about how they approach food and do unique things with ingredients. The following day, a guided tour hosted by Austin Eats visited four sites where attendees got to sample local specialty items for lunch. Later on, dinner was held at Vista Brewing, which grows its own produce, brews its own beer and maintains its own bee apiary. On the third and final day of the event, lunch was held at the Fairgrounds Food

Attendees sampled cuisine ranging from Texas barbecue to Israeli street food.

Hall, which features six different counter-service restaurants in one space. While the items sampled throughout the Foodservice Summit ranged from Texas barbecue to Israeli street food to wildly creative dessert doughnuts, one thing that all the venues have in common is knowing what they want to be and striving to be the best version of that — rather than attempting to be everything to everybody and diluting their distinctiveness. Many of the tour stops also make eating on-site an experience. Comfortable seating areas, with designs that often incorporate local Texan flora, invite customers to truly enjoy their time there instead of feeling pressure to eat and leave quickly.

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FOODSERVICE

Expert Insights The Foodservice Summit also featured multiple presentations from industry experts, designed to help the retailer attendees rethink their approach to the category. “The food business world is evolving rapidly,” Brad Barnes, director of CIA Consulting & Industry Programs at The Culinary Institute of America, said during his presentation entitled “The Evolution of the Food Transaction.” Evolving a foodservice program, though, can be particularly tricky for larger chains; members of larger organizations tend to protect what already exists, and less than 1 percent of internally generated new business ideas ever affect the bottom line, according to Barnes. If leadership prioritizes the right initiatives and cultivates the right capabilities, however, successful innovation is more likely, he said. “It’s not going to look like what you’re doing today or last year,” Barnes advised. Key priorities include: • Building great teams, without which retailers are “lost”; • Selling food the way customers need, expect and want; • Creating experiences; • Anticipating future direction; and • Expanding one’s own view. C-store operators who are ready to start making changes are in a good position to do so because a certain percentage of c-store visitors are aware of all the work the convenience store industry has put in to become a foodservice destination, noted Chris Wolf, senior vice president of insights at the Marlin Group. A percentage of visitors even call c-stores better than quick-service restaurants, he said during his presentation titled “Growth Strategies for Transforming Convenience.” “I think that’s a great base to work off of,” Wolf said. He identified a series of levers that retailers can use to transform their foodservice programs: • Technology and “effortless” convenience transformers, including cashierless shopping and digital ordering; • Touchpoints, such as loyalty programs and people connections; Foodservice executives from leading food-forward convenience store chains participated in the eighth-annual event.

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• Environment and experiential cues that indicate freshness, atmosphere and more; • Menus and “really good food”; • Dayparts and a program designed to maximize the potential of each time period; and • Assortment and relevance to location, generations, multiculturals and price/value.

Steps to Success During the roundtable discussions at the event, the retailer executives discussed what they learned since the previous year’s Summit and shared best practices, challenges and achievements. In terms of challenges, streamlining madeto-order offerings in order for the kitchen to be efficient and effective is a continual effort, one retailer told the group. Labor and employee retention is also a concern, with another retailer sharing that their company is focusing on training and making the stores a place people want to work. Today, the path to foodservice success means doing more listening to customers and store managers, for starters, according to one attendee, who noted that while their company used to think it was good to have the same offering at every store, the chain actually started seeing better results by paying closer attention to individual markets. Several of the retailers also touted the effectiveness of limited-time offers (LTOs). Multiple attendees agreed they are beneficial, but c-store operators must be able to answer important questions during the planning process: How long should it run for? How can you avoid cannibalizing existing products? What is the exit strategy? LTOs also should have a goal. One retailer described how their company utilized a coffee LTO to revitalize the breakfast segment, which continued to perform better even outside the promotional period. Given how fast the realm of foodservice is changing, it can be difficult for c-store chains to move fast enough to keep up. One retailer compared it to “trying to turn an aircraft carrier in a really small pond.” In this environment, c-store operators who do things quicker will definitely make mistakes — but they will also learn. CSN The Foodservice Summit featured multiple presentations from industry experts, as well as visits to some of Austin’s top culinary destinations.

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CANDY & SNACKS

It’s an Exciting Time in Candy & Snacks The 2019 Sweets & Snacks Expo showcased scores of new trends and innovative products By Danielle Romano IF THERE WAS ONE RESOUNDING message echoed through the exhibition halls of the 2019 Sweets & Snacks Expo, it was that there has never been a more exciting time in candy and snacks.

Hosted by the National Confectioners Association (NCA), the annual expo covers the chocolate, non-chocolate, gum, mints, sweet snacks and savory snacks categories. This year, the confectioners and snack manufacturers on the show floor showcased scores of innovative, new products for varied snacking occasions — from in-between meal fillers, to on-the-go portability, to any-timeof-the-day indulgence. These new products boasted bold, savory and sweet flavors, new formats, and overall new experiences. “With hundreds of innovations, insights and ideas to transform the world of chocolate,

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candy and snacks, the Sweets & Snacks Expo is the most important annual event in the industry,” said Carly Schildhaus, NCA spokesperson. “Sweets and snacks manufacturers have always been at the forefront of defining outstanding consumer experiences, setting trends, and delivering a wide variety of options and choices. That excitement and the vibrancy of the category come to life on the floor of the show each year.” Convenience Store News editors dubbed these as the biggest takeaways for the c-store industry from the 2019 Sweets & Snacks Expo show floor and education sessions:

The State of Snacks The candy and snack industry is in the middle of a revolution — one that won’t be short-lived, as today’s consumers snack multiple times a day without limitations as to what they constitute as a snack and with high regard as to where they purchase that snack, according to two IRI experts.


Sally Lyons Wyatt, executive vice president and practice leader, client insights for IRI, noted that today’s snackers are multidimensional and have different intentions for snacking. While the traditional paths to purchase — planned and impulse — maintain their prominence, retailers should be focused on consumers’ desire for on-demand and experiential purchase opportunities. “The average consumer still snacks 2.7 times per day, and snacking three-plus times a day has increased in the last four years. … This is good news for people in this room,” Lyons Wyatt pointed out during the “State of the Industry: Snacks Rule Center Store” session. While trends such as holistic health progression and availability of plant-based options are driving consumers to buy, today’s snackers remain committed to three key attributes when it comes to what snack(s) they’ll purchase: 1. Flavor: A whopping 89 percent of consumers want a snack with a flavor they prefer, while 92 percent seek out products with a taste they enjoy. 2. Packaging: A products’ packaging not only says a lot about the brand that manufactured it, but about the retailer who carries it. Product packaging communicates to consumers what they’re looking for in snacks, such as transparency and sustainability, as well as a brand story. 3. In-store influencers: More than a quarter of consumers (37 percent) are influenced at checkout by product assortment, signage, price and available offers through a retailer’s loyalty or rewards program.

The State of Candy Taking a look at the confectionery side of the equation, even though units are down slightly due to an increase in share-pack purchases, the category overall is thriving. “Confectionery is a powerhouse,” Larry Levin, executive vice president, consumer and shopper marketing, IRI, emphasized during the “State of the Market: Confectionery” session. According to the executive, three key confectionery themes emerged in 2018 that drove the industry’s growth: experiential (think indulgent, sensorial and exciting), expectation (think flavor, texture and familiarity) and simplicity (think healthy, convenient and natural). The category’s growth in 2018 could also be attributed to products boasting these attributes: • Non-GMO Project verified — Still a trendy consumer claim, Non-GMO Project verified jumped up 20 percent in sales to $149 million, including $111 million in chocolate products and $38 million in non-chocolate.

• Organic — Maintaining its stability as a core driver in confections, organic candy was up 12.8 percent in sales to $79 million last year. • Gluten free — The most prolific consumer demand attribute in confections, gluten free products accounted for $469 million in chocolate sales and $317 million in non-chocolate sales. • Fair trade — The fastest-growing attribute among confectionery consumers, fair trade products grew 11 percent in year-over-year sales to $192 million, and has experienced nearly 70 percent growth since 2015.

How the Convenience Channel Measures Up As convenience stores evolve to become shopper destinations, snacks and candy play a vital role in driving customers inside the store and increasing basket sales. C-stores are unlocking growth by making candy and snacks a focal point. It’s an exciting time to be in sweets and snacks in the convenience channel, The Hershey Co.’s Alan Tobin expressed. The director of category management, convenience channel, pointed to a few driving forces in the channel: consumers snacking multiple times a day; the immediate consumption of candy or snacks within the hour of being purchased; and trip frequency. “Think of a c-store snack purchase being made in the morning. Chances are that shopper is going to consume that snack and will probably come back later that day to make another purchase,” Tobin noted. “That’s a huge opportunity.” Another opportunity lies within the mantra, “Location, location, location.” The most optimal places to display candy and snack merchandise is both on the path to and from trip-driving categories (think foodservice and packaged beverages) and at the front counter. “The front counter is the last key touchpoint to provide memorable experiences,” Tobin expressed. “Sweets and

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SNACKS

“Juggling ‘good’ and ‘bad’ snacking is all about portion control. Mix indulgence with better-for-you.” — Marcia Mogelonsky, Mintel

snacks are expander categories. An optimized checkout is key to maximizing sales.” The ability to cross-merchandise seamlessly can mean bigger basket sizes and therefore bigger sales. Citing data from NACS, the Association for Convenience & Fuel Retailing, Tobin revealed that prepared food on-site is growing at a rate of 10.5 percent a year. And, because candy and snacks are rarely purchased alone, bundling and meal-deal combos of foodservice with candy and snacks can be a winner for c-store operators, he advised. Ultimately, because candy and snacks carry with them inherent characteristics that make them valuable to c-store retailers — like relevance, value and experience — operators need to make the appropriate investments now and in the future. Tobin left Sweets & Snacks Expo attendees with these pointers: • Make the right offer at the right time. • Capitalize on in-market concepts, like eye-catching endcaps, digital signage and experiential occasions. • Tap into future potential with in-aisle personalization and mobile integration.

Five Need-to-Know Trends Is your snack assortment on trend? This was the question Mintel Director of Insights Marcia Mogelonsky, PhD, posed to retailers and suppliers in attendance at the “Consumer Insights: The 5 Snack Trends You Need to Know About Right Now” session. Five undeniable macro-snacking trends will help retailers determine what products to buy, feature and merchandise to meet the needs of today’s candy and snack consumers, according to Mogelonsky. The trends are: 94 Convenience Store News C S N E W S . c o m

It’s not all about taste. Although 64 percent of salty snackers consider taste an important attribute, snackers are captivated by products that offer innovation in texture, format, color, feel and smell. “On trend now is new sensation,” Mogelonsky noted. “Taste comes first, then comes color. Texture is catching up.” Snacks should tell stories. Consumers want to know that snacks have authenticity — where they came from, how they were made and the brand’s heritage. Snackers want to make the experience theirs. Candy and snack buyers want input into the products they’re buying. With this “make it mine” mentality, consumers want snacks to tell their stories through customization. An example is Lay’s “Do Us a Flavor Contest,” where fans submitted their ideas for the next great potato chip flavor. Balance is key. There’s always room for indulgence, but there’s also room for healthy snacking. Although less than one-third of Americans agree that the majority of snacks they consume are healthy, they do agree that there’s a lot of room for balance. “Juggling ‘good’ and ‘bad’ snacking is all about portion control,” Mogelonsky said. “Mix indulgence with better-for-you.” Anytime is snack time, and anything is a snack. Nearly seven out of every 10 consumers agree that anything can be a snack. This means competition is coming from more categories than ever before, so retailers must know when their shoppers are snacking. According to Mogelonsky, 17 percent of consumers snack five times a day and of these consumers, 93 percent snack in the afternoon, 84 percent snack in the evening, 76 percent snack in the morning, and 67 percent will choose a snack over a meal. The 2019 Sweets & Snacks Expo took place May 21-23 at Chicago’s McCormick Place. CSN


STORE SPOTLIGHT

Hungry for Opportunity Applegreen brings its foodservice and fuel offers stateside by way of acquisitions By Danielle Romano AS MANY CONVENIENCE STORE RETAILERS’

At a Glance Applegreen Location: 121 stores across eight U.S. states Unique features: A three-pronged brand promise of low fuel prices always, better value always, and a high-quality foodto-go offering; free Wi-Fi; indoor and outdoor children’s play areas

stories go, Applegreen plc came from humble beginnings. In 1992, CEO Bob Etchingham and Chief Operating Officer Joe Barrett opened the first Applegreen service station in Ballyfermot, West Dublin, paving the way for the brand to effectively stronghold the Emerald Isle and United Kingdom. It was multiple visits to the United States over several years and becoming members of NACS, the Association for Convenience & Fuel Retailing, which inspired Etchingham and Barrett to look at the U.S. for potential innovation. Then, an opportunity arose to lease a couple of sites in Long Island, N.Y., in 2014. With no language barriers and a great history of friendship between Ireland and America, all signs were a go for Applegreen to enter the U.S. market. “For the first few years, our focus was to learn the market and to build our supporting infrastructure stateside. Now, with that, we are much more established. We are in a mode of seeking opportunities for partnerships and growth,” Barrett explained.

Coming to America Growing through a combination of new builds and predominantly

acquisitions, Applegreen has expanded its U.S. presence to approximately 121 stores across Connecticut, Florida, Massachusetts, New Hampshire, New York, Rhode Island, South Carolina and Vermont — a significant and strategic jump from the five sites in had in 2015. “Applegreen is a food retailer that sells fuel, so we look at customer traffic volumes and opportunities in the foodto-go market. Therefore, we aim to locate ourselves in busy urban or interstate locations,” Barrett told Convenience Store News. While Applegreen offers a private label brand of food through its Bakewell Café name at its Ireland convenience stores, it chose to set its U.S. and U.K. stores apart by partnering with popular local quick-service restaurant providers such as Subway, Pizza Hut, Burger King, Mama De Luca and Hunt Brothers Pizza. “We are open to working with other U.S. food brands and welcome growing our businesses together,” said Barrett. Currently, Applegreen operates under three store models: smaller petrol filling stations, which range in size from 2,000 square feet to 3,000 square feet; and truck road service areas and motorway

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STORE SPOTLIGHT

Applegreen’s U.S. convenience stores are designed to be simple yet striking.

service areas that range from 6,000 square feet to as large as 20,000 square feet. In the U.S., Applegreen c-stores average up to roughly 6,000 square feet.

Applegreen executive explained, adding that in the U.K., the motorway service area model takes on more of a branded retail approach.

The architecture of Applegreen buildings are designed to be simple yet striking, and to purposefully communicate the food and retail offerings. The retailer creates light, warm, inviting and comfortable areas that allow customers to relax while surrounded by natural materials, according to Barrett. A motorway service area location will typically offer:

Despite Applegreen already being established as a premium retail offering with its Irish customers, the retailer is only now building its brand in the U.S. market, and therefore sees continued expansion here to be slow and steady.

• • • • • •

A variety of hot and cold food options; Fresh coffee; Comfortable seating with free Wi-Fi; Indoor and outdoor children’s play areas; Fuel and a car wash; and Clean restrooms and often shower amenities.

“We tailor our offerings to the varying needs of the local market; however, the offering is dependent on the size of the store, as this determines to a large extent what is possible in that particular location,” the 96 Convenience Store News C S N E W S . c o m

Slow & Steady

“The process of being granted permits for new builds in the U.S is slower relative to the timing for planning permission in the U.K. and Ireland, which has held back the speed of development for our new locations and new-to-industry stores,” Barrett told CSNews. In the meantime, Applegreen will continue its strategic partnerships with well-established brands in the U.S. and leverage its brand reputation to deliver on three core promises: 1. Low fuel prices always. 2. Better value always. 3. A high-quality food-to-go

offering.

Dublin-based Applegreen is an Enterprise Ireland supported company. CSN


NEW HORIZONS

Turning Plodding Progress Into a Quantum Leap Female CEOs and board members continue to rise, but not fast enough IN MY TRAVELS LATELY, there’s a lot of discussion around the latest Fortune 500 report. The headline: 33 female CEOs now sit in Fortune 500 ranks. I applaud progress — that’s more women than ever — but without taking a breath, the next words out of my mouth are: “That’s 6.6 percent. About 43.4 percent too low, if we are striving for 50 percent.”

By Sarah Alter, President & CEO, Network of Executive Women

When I was a young girl, I didn’t dream of becoming a nurse or a teacher. Both are honorable professions, but they weren’t in my wheelhouse. I wanted to be in business. And not just in the rank and file. I wanted to be a CEO. I didn’t have female CEO role models, though, because there were so few. There still are far too few. Even as our societal demographics continue to shift, the seats of power within global companies have remained stuck decades in the past. Now that I am a CEO, I can look back on the road traveled, and I’m determined to be one of the executives who smooths the road for the women who come after me.

If progress in the CEO ranks has been slower than desired, progress for women at the board level has also been sketchy. This year’s board representation numbers for the Fortune 500 show a trend — the same small group of women are being tapped for multiple boards. We’re not expanding in number; more so, in number of board positions held by the same women. Seven women serve on four Fortune 500 boards. Thirty-four women serve on three. Boards want experience. They want C-suite experience. Yet women only comprise 6.6 percent of Fortune 500 CEOs. And my organization’s research shows a female leadership crisis: senior women are heading for the exits at a far higher rate than men. Female higherlevel managers, executives and C-suite members leave their jobs nearly four times as often as men (26.9 percent vs. 7.3 percent, respectively). So, it becomes a chicken-and-egg conundrum. California took the lead to legislate greater equality on boards, which should help get more qualified women into C-suite positions. Board equality legislation is also moving through the legislature in my home state of Illinois, and being considered in New Jersey as well as a few other states. But I have to be honest, I’m always disappointed when it takes a law to force companies to do what is good, right and just plain smart. The future could be so bright. It turns out I was far from being a unicorn in my 12-year-old aspirations. Almost three out of four women (74 percent), early in their career, want to become executives, according to the Leaders & Daughters Global Survey of 7,000 women in seven countries on five continents. My question is: What happens to change that? From my own experience, it’s potholes in the road to the executive suite. NEW research shows a few issues

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NEW HORIZONS

across the board cause women to leave companies in droves. Just a few key actions could help them stay: • Confronting bias. Combine a lack of female role models in executive management with the sense of isolation that can come from being the only woman in the room — add in a lack of sponsorship — and you have a recipe for female leaders heading to the exits. Only 36 percent of women surveyed agree there is minimal favoritism within their company. The similar-to-me bias, unless addressed head-on within corporate culture, means many executives will hire and promote candidates with similar interests, backgrounds and experience to them. • Offering transition support/career pathing. When females report on the support they receive from those above them in the corporate hierarchy, only half say they receive support when they accept a new challenge or job. Men’s perception of support from peers and their managers ranks higher, at 63 percent. And while six out of 10 women say their supervisor entrusts them with a range of assignments that help prepare them for their next role, the remaining 40 percent are not receiving the corporate stretch roles and breadth of experience necessary to place them in contention for positions of higher responsibility and authority. This leaves women either stagnating in their current role, feeling passed over, or promoted without sufficient development or support through the transition. None of these situations bodes well for women reaching the C-suite successfully. • Modernizing work schedules. While the world has changed dramatically from the years when men worked and women stayed at home to take care of children and domestic duties, work schedules have not, to the detriment of women with children especially. As Melinda Gates wrote, “We’re sending our daughters into a workplace designed for our dads.” As institutional investors push for greater diversity on boards and C-suites because of the business case for it, I think we’ll see more progress. And I do think we’ll reach the tipping point sooner than later, where plodding progress becomes a quantum leap.

Convenience Store News is pleased to continue this series of educational columns by the Network of Executive Women (NEW), coinciding with the annual CSNews Top Women in Convenience awards given out each fall. Forty-two female managers, executives and directors who work in the convenience store industry will be honored in our 2019 program. In addition to being a presentation sponsor for the Top Women in Convenience program, NEW and CSNews have partnered to develop this series of columns directed at helping corporate leaders drive more inclusive company cultures. 2019 SPONSORS Founding & Presenting Sponsor:

Platinum Sponsors:

Gold Sponsors:

My 12-year-old self certainly hopes so. And my present self is committed to playing a key role in making it happen as rapidly as possible. To join me in the effort, visit NEW online or in person July 30 for our NEW Executive Forum, focused on reframing the gender equality conversation. A quantum leap forward is an eventual certainty, but its speed depends on executives like us furthering the cause. Join me. CSN Sarah Alter is president and CEO of the Network of Executive Women, a learning and leadership community representing 12,400 members in 22 regional groups in the United States and Canada. Learn more at newonline.org. Editor’s note: The opinions expressed in this column are the author’s and do not necessarily reflect the views of Convenience Store News. 98 Convenience Store News C S N E W S . c o m

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ADINDEX 7-Eleven ....................................................................43 Altria Group Distribution ....................................3 Bake’n Joy Foods ..................................................23 Boston Beer.............................................................17 Calico Brands ..........................................................16 Campbell Soup Company ..................................41 Casey’s General Stores........................................39 Cookies United .......................................................49 Danone North America .......................................53 Dawn Food Products Inc....................................45 Del Monte Fresh Produce NA Inc....................21 E-Alternative Solutions .......................................13 Forte Products .......................................................88 GlaxoSmithKline Consumer Health Care......29 Goya Foods Inc. .....................................................25 John Middleton Company..................................27 JUUL Labs ................................................................Back Cover Krispy Krunchy Chicken......................................15 Kwik Trip ...................................................................35 Liggett Vector Brands .........................................55 Miracle Nutritional Products .............................75 Pladis..........................................................................51 Premier Manufacturing .......................................Cover, 57 Procter & Gamble Distributing Co. .................37 Promotion In Motion ............................................11 Reynolds American Trade Marketing Services ...................................33, 61 Sheetz........................................................................47 Swedish Match North America LLC ...............9, 63 Swisher International ...........................................19 The Hershey Company ........................................5, 59 Tyson ..........................................................................7 Universal Merchants Outsert ...........................Outsert

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INSIDE THE CONSUMER MIND

Getting to Know the C-store Tobacco Buyer Seven in 10 cigarette purchasers have tried e-cigarettes or vaping products Despite the many challenges of the tobacco business — declining volume, new regulations, legislative scrutiny, and more — it remains a crucial business for convenience store operators. Cigarettes accounted for 28.5 percent of all in-store sales in the convenience channel last year, while other tobacco products (OTP) accounted for 6.84 percent of in-store sales. The c-store tobacco consumer, however, is evolving as new nicotine products continue to hit the market. Here’s a look at some of the latest consumer insights around tobacco purchasing.

72% of U.S. convenience store shoppers who purchase cigarettes have tried electronic cigarettes or vaping products.

79% Millennials (79%) are more likely to have tried e-cigarettes or vaping products than Generation X (67%) and baby boomers (62%).

Only 1 in 5 c-store cigarette buyers who have tried e-cigarettes or vaping products (21%) say they are currently using them.

Source: Convenience Store News Realities of the Aisle Study, 2019

Convenient location (57%), price/value (46%) and brand (38%) hold the most influence for cigarette purchases at convenience stores.

16

%

A special promotion is only influential for 16% of shoppers.

Source: Convenience Store News Realities of the Aisle Study, 2019

49

%

Administration’s (FDA) proposal

57

to remove flavored e-cigarette

X (50%) shoppers are more likely

and vaping products from

to be aware of the FDA proposal

convenience stores.

than baby boomers (37%).

Just under half of c-store tobacco buyers (49%) are not aware of the Food and Drug

Millennials (57%) and Generation

Source: Convenience Store News Realities of the Aisle Study, 2019

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%


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Profile for ensembleiq

CSN - July 2019  

CSN - July 2019