27 minute read
Security: Caught on Camera
Caught on Camera
Convenience retailers weigh in on loss prevention best practices — plus, one chain’s unconventional approach.
Isabelle Gustafson • Associate Editor
Loss prevention is an important consideration for all convenience stores, but every chain approaches it differently.
Marietta, Ohio-based Par Mar Oil Co., which operates 165-plus Par Mar Stores in Ohio, Kentucky, West Virginia and Pennsylvania, is currently working to streamline its strategy, said Terri Caldwell, regional director of operations for the chain.
Caldwell’s been with Par Mar for 20 years now and was recently promoted from the director of loss prevention role.
“I’ve implemented a 20-point inspection for all the supervisors to do at their location,” she said. “It’s going to pinpoint anything that could cause a loss to the company or injury to an associate. Do you have too much product over here by the door? Is your office disorganized, so you can’t count (inventory) properly?”
Marietta, Ohio-based Par Mar Oil Co. tripled its store count in three years. Now, the company operates 165-plus Par Mar Stores as well as 16 quick-service restaurants. Regional Director of Operations Terri Caldwell said the goal now is to streamline operations, including loss prevention training and strategy.
Because Par Mar tripled its store count in four years, streamlining and training are more important than ever. Before the end of the year, Caldwell said, the goal is to have all loss prevention training completed with each district.
“The lady who took my place (as the director of loss prevention), we’re starting to do some training together on our PDI system,” she said. “Her goal is to go through the whole company and just make sure our system is being used the way it’s meant to be used. … I was at a store today, and the manager was trying to find a transaction. Well, she couldn’t find it because the associate rang it under (the wrong category). With our back-office system, it was easy to pinpoint exactly what that associate did.”
As a back-up to its preventative approach, Caldwell said, Par Mar utilizes between 10 and 20 cameras per store, depending on the size and the location.
“If we couldn’t find the transaction, we could’ve looked at the camera,” she said, “which we do have on our ATMs, our money order machines, our Coinstar machines, on the associates.”
NEIGHBORHOOD STORE
Video surveillance plays an important part in Kansas City, Mo.-based Fav Trip’s loss prevention strategy, too. The two-store chain really struggled with shrink when it first opened.
“When we started the business, shoplifting was an everyday issue, even with regulars,” said Fav Trip President and CEO Babir Sultan. “We used to put up their photo on the door. And that created some buzz. And then we were putting a picture on Facebook, and that got us some attention.”
Finally, the company decided to try uploading shoplifting videos to the chain’s YouTube channel — with commentary, recorded and edited by Sultan himself. Now the Fav Trip YouTube channel has close to 50,000 subscribers — and a reach of 8 million on Facebook in July, up from 900,000 a few months prior.
Customers will visit the store — sometimes from out of state — just because they’ve seen the videos. “It’s almost like a destination for them,” Sultan said. “And they buy our shirts and hoodies.”
Kansas City, Mo.-based Fav Trip’s YouTube channel is known among customers and fans alike for its videos of shoplifters, coupled with commentary by Fav Trip President and CEO Babir Sultan himself. The channel has close to 50,000 subscribers — and has helped to signifi cantly decrease shrink.
Not only are the videos attracting customers and driving engagement (and ad revenue), but shoplifting has signifi cantly slowed, too. “We’re a neighborhood store, and people know — these guys don’t tolerate it,” Sultan said. “Even employees, when we hire them, they’ve got to sign off on, ‘if you steal, you give us the right to publish your video.’ So, rarely do we have an employee steal.”
Of course, Sultan noted, this is a strategy that Of course, Sultan noted, this is a strategy that works best for a small, neighworks best for a small, neighborhood chain, where “evborhood chain, where “everybody seems to know erybody seems to know everybody else.” In everybody else.” In fact, customers will fact, customers will often identify shopoften identify shoplifters in the videos. lifters in the videos. “What we’ve done “What we’ve done as well is, if somebody as well is, if somebody comes back and says, ‘Hey, comes back and says, ‘Hey, I made a mistake, I’m sorry I made a mistake, I’m sorry about it, I’ll go ahead and about it, I’ll go ahead and give back the money,’ we’ll give back the money,’ we’ll take down their video or take down their video or picture too,” he said. “We picture too,” he said. “We had one guy whose fi ancée said, ‘I’m going to leave you if you don’t make this right.’ So he came back.”
For community members in need, Fav Trip’s there to help; the c-store hosts a food drive every year.
“And, all year round, if somebody comes to us and says, ‘Hey, I need a sandwich, I’m hungry,’ we’re happy to take care of them,” Sultan said. “It’s always been our policy.” These days, Fav Trip’s video strategy works so well that it’s running low on content.
“At this point right now, we don’t have a single video of a shoplifter to post. So it’s a double-edged sword for us,” Sultan said. “It’s a good problem to have, but at the same time, people want more content. So we’re diversifying quite a bit. We have a few things up our sleeves to keep our customers entertained.” The company’s keeping busy on other fronts, too. It’s currently building its third store from the ground up in Grandview, Mo., which will be 4,000 square feet — twice the size of the other two — with an updated, modern design. Will Fav Trip fi lm shoplifters in the new store, too?
“Oh, yeah,” Sultan said. “Anywhere. Because in our store, if they shoplift, we will post them.” CSD
The Power of Energy Efficiency
Whether replacing large HVAC equipment, upgrading exterior signage and canopy lighting or replacing cooler door seals, energy e ciency pays o .
Thomas Mulloy • Senior Editor
It’s no secret to convenience retailers that saving on costs is crucial to succeeding in an increasingly competitive landscape. Energy effi ciency upgrades can turn those pennies saved into pennies earned.
The energy savings hype is defi nitely focused on LED lighting — and with good reason. As the technology evolves and those fi xtures become more effi cient, it is even more important for operators to take advantage of those improvements.
“We’ve continued to focus on changing out most of the interior lighting on our remaining sites,” said Dan Soltis, vice president of real estate for Cima Developers, the construction arm of The PRIDE Stores, which operates 15 stores in the Chicagoland area and one in Indiana. “We’ve got, maybe, two left that we’re just going to wrap up before the end of the year here.” Retrofi tting newly acquired stores is at the top of the list for Charleston, S.C.-based
The Power of Energy Efficiency
Charleston, S.C.-based Refuel Market has grown to 160 stores since 2018 through multiple acquisitions. Once Refuel buys a store, energy effi ciency is one of the fi rst priorities.
“What we do, absolutely, is any fl uorescent tube lights that are in cooler doors, we replace them with LED strips,” said Mark Jordan, president and CEO of Refuel. “And any cooler door seals that aren’t perfect — literally, perfect — we replaced those seals. Those are two things that go without saying.” But using more effi cient LEDs in the cooler does more than save on costs. It can help move product, too, Jordan explained. The updated lighting makes for a more appealing product. He recalled a side-byside cooler display at a trade show comparing fl uorescents to LED lighting. “It was like night and day,” he said.
The same result applies to a store’s exterior. Soltis said that The PRIDE Stores has begun converting its outside signage to LED. “So that’s been a pretty, fairly seamless process,” he said. “The contractors are taking care of all the ComEd rebate programs for us and then giving us the reduction in our invoicing. So that’s been easy to do.”
Energy efficiency is a top priority for Refuel Markets (top left). When the c-store chain acquires a new store, for example, fluorescent tube lights in cooler doors are replaced with LED strips.
FROM SOLAR TO HVAC
For its new builds, Refuel is all-in on LED lighting, converting “every single thing that is a light, even the parking lot lights,” to LEDs, Jordan explained. “We don’t do that deal that a lot of people do with the power company, like lease the parking lot lights from them over the years and all that. We put in the nicest, brightest LED lights we can — day one.”
To make its older convenience stores more energy efficient, Refuel has begun installing solar panels, starting with the least-efficient buildings. That’s where solar will save more in costs. To determine where to prioritize placing the solar panels, Refuel looks at the kilowatt-hours per store. “We would never install solar panels at the first (new build) store, it being the cheapest in kilowatt-hour costs.”
Don’t overlook replacing a store’s big power users, either. Older air conditioning rooftop units or other HVAC equipment can be big power consumers, which has been especially true at the older stores Refuel has acquired. Jordan explained that previous owners don’t always maintain them well, especially if they anticipate selling the store.
Soltis echoed that. “A lot of our sites are 20 years old,” he said. “Especially the ones that we purchased from BP years ago. So, as we change out the HVAC units, we’re obviously finding the most efficient HVAC units that we can change out.” The new units are also high-efficiency, he said. “So just by default, we’re getting the (savings) bumps in the efficiency.”
Affording those big-ticket items is easier for larger chains, but what can smaller operators and independents do to start tackling efficiency? Start small. The little things matter.
“When I was a smaller operator, starting with one store and all that, I didn’t really think about (energy efficiency) because cash was always a concern,” Jordan said. “But if you’ve got the ability to do it, you have to do it.”
Soltis noted that The PRIDE Stores continues with smaller savings efforts, like installing hand dryers and motion detectors in the bathrooms.
“I would start with the cooler,” Jordan advised. “If your cooler isn’t LED lit, and if your seals are not literally perfect, you’re just throwing away money.” CSD
fast facts:
• Replacing aging HVAC equipment returns big savings. • Start with the small items like cooler lights and door seals. • LED product lighting saves money and increases sales.
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Retailers are rushing to finalize real estate acquisitions and divestments before the end of 2021, given the threat of increased taxes on the horizon.
Mark Radosevich • PetroActive Services
As the second half of the year winds down, my mission with this article is to formulate and share a learned opinion as to what the mergers and acquisitions (M&A) picture will look like in 2022 for the c-store and wholesale petroleum industry.
Will buyers, sellers and lenders still be plentiful? Will interest rates remain low, while purchase multiples remain high? Will outside investors continue to view the retail petroleum sector as an attractive investment? What real effect will planned liberal policies have on real estate considerations?
I took the opportunity to interview various pieces of the M&A puzzle at a recent branded marketer conference, hoping that some of the key players would crystallize the picture and make my job easier. No such luck. As such, following is my best attempt to make some sense out of a very confused situation.
At the moment, there is a mad dash to finalize deals before the end of the year, when a period of feared uncertainty will set in. Buyers are inundated with acquisition opportunities to the point that they have to apply the brakes and pass on choice deals in order to digest what they are buying.
Traditional marketers that may have planned to exit in the next few years suddenly advanced their plans in a desire to complete a sale before a threatened host of higher taxes devour what they created over generations.
Buyers and sellers involved in active deals that originated in time to actually close this year seem to be racing toward a cliff — get it done by New Year’s Eve or plummet over the edge into a period of uncertainty. For future deals or those that won’t make the New Year’s Eve deadline, the question is to what degree will M&A activity be dampened by higher capital gains and estate taxes, as well as electric vehicle rhetoric that clouds reality on the importance of petroleum for the wellbeing of our country.
When queried about their plans for next year, buyers, lenders and equity investors all expressed continued commitment and engagement with no plan to moderate their appetite for deals.
When various limiting factors were mentioned, there seemed to be a general acknowledgement of risk, but that had not yet factored into growth plans. For the moment on the buy side of a transaction, it is business as usual, which will still foster elevated deal valuations.
BUYER & SELLER CONSIDERATIONS
On the seller side of the equation, a clear dichotomy exists that, despite these high business valuations, has the real potential of slowing the M&A train. The deliberate and misguided actions of liberal politicians in Washington have the potential to disrupt America’s economic equilibrium and result in many marketers putting off a decision to sell until things hopefully revert to normalcy.
For c-store owner operators, leasing may be the only alternative left to help ensure retention of ingrained business equity, versus giving a large chunk to the government. The potential for significant and costly limitations on 1031 Exchanges necessitates a long-term hold position on the leases for as long as those in government that want to harm our industry continue to run things in Washington, D.C.
For family businesses where cash proceeds were slated to be divided between family members, pragmatic discussions need to take place so all parties understand the rationale for leasing and how rental income will be allocated.
For buyers insistent on owning the real estate, purchase arrangements could be made related to lease terminations and the properties purchased at a predesignated time or under certain circumstances related to future tax law changes.
After all of these considerations, my M&A prognostication for next year is that buyers, lenders and investors will remain bullish, multiples and valuations will remain high, but deal flow will be moderated due to seller hesitancy caused by uncertainty and fear. Deals that do get done will have a higher level of leasing as a primary component of value.
Our next important hurdle is the mid-term elections, when I hope we’re able to vote enough of the liberal politicians out of Washington, D.C., for business normalcy to return. In the meantime, if you are not a member, join your local petroleum marketers association and get involved to help protect our industry. Don’t let someone else do all of the heavy lifting.
Mark Radosevich is a strong industry advocate, recognized petroleum veteran and president of PetroActive Services (www.petroactive.net). He can be reached by email at mark@ petroactive.net and by phone at (423) 442-1327. The opinions in this column are the author’s alone.
Snoop Dogg and Martha Stewart Lighter Series
BIC teamed up with entertainment legend Snoop Dogg and lifestyle innovator Martha Stewart and Marquee Brands for the new BIC EZ Reach Offi cially Licensed Snoop Dogg and Martha Stewart Lighter Series. Offered in six unique designs each, Snoop’s lighters feature photos of him and illustrations of his albums, and Martha’s lighters are a refl ection of her homes and inspired by the country, farm and beach. The lighters have a suggested retail price of $4 each. Equipped with a 1.45-inch extended wand, the BIC EZ Reach Lighter is designed for lighting hard-to-reach places while helping to keep fi ngers away from the fl ame.
BIC USA Inc.
www.shopbic.com/newinquiry
Limited-Edition Lemon-Mango Cigarillos
Swisher Sweets announced the limited release of its seasonal blend, Summer Twist. Back by popular demand, this limited-edition taste combines the refreshing tartness of lemon with sweet mango for the perfect summer blend. Swisher Sweets Summer Twist pouches are available in a variety of market-driven price points and ship nationwide.
Swisher Sweets Cigar Co.
(800)874-9720 www.swisher.com
Flexible Coffee Equipment
Franke Coffee Systems America is expanding its successful A-Line series of Super Automatic Equipment with the new A1000 FLEX. A1000 FLEX delivers traditionally brewed coffee and espresso beverages, hot or iced, in one machine with maximum fl exibility. Integrated ages, hot or iced, in one machine with maximum fl exibility. Integrated features include Cold-Water Bypass for iced features include Cold-Water Bypass for iced beverages and a Patented Brew Unit specifi cally beverages and a Patented Brew Unit specifi cally designed for coffee and espresso. Plus, designed for coffee and espresso. Plus, customization has never been easier thanks to the A1000 FLEX’s powder hopper for chocolate plus an optional Flavor Station for up to six varieties of syrups.
Franke Co ee Systems
www.franke.com
Buttermilk Ranch Chicken RollerBites
Home Market Foods has introduced new Buttermilk Ranch Chicken RollerBites. It’s a seriously seasoned, bold bite, packed with zesty buttermilk ranch fl avor and juicy 100% all-white-meat chicken — featuring a unique blend of herbs and spices and a light, fl avorful coating. Great for on-premise dining or on the go, no matter the meal.
Home Market Foods Inc.
www.homemarketfoods. com/contact
Emergency Spill Kit Station
MasonWays Emergency Spill Kit Stations are designed for rapid response and safe cleanups at the fuel island. Securely locked cabinet has everything required for dangerous gas and oil spills — store employee safety equipment, absorbent materials and cleanup tools conveniently in a locked cabinet outdoors or right at the pump island where they are needed. Store orange cones, disposable safety gloves, glasses, dust masks along with caution tape safely inside. The unit has ample room and shelves to store equipment in an organized manner to make responding to an emergency more effi cient.
MasonWays Indestructible Plastics
(800) 837-2881 info@masonways.com www.masonways.com
Watermelon Hard Seltzer Variety Pack
Vizzy is launching its fourth variety pack with Vizzy Watermelon. The new watermelon hard seltzer, available in Passion Fruit, Mango, Blueberry and Kiwi, is launching nationwide in a variety 12-pack as well as single 24-ounce cans of Passion Fruit. Each 12-ounce can contains 100 calories, one gram of sugar and checks in at 5% alcohol by volume.
Molson Coors Beverage Co.
www.molsoncoors.com
New and Improved Zero-Sugar Cola
The Coca-Cola Co.
www.coca-colacompany.com
Coca-Cola is releasing a new and improved Coca-Cola Zero Sugar recipe with a new look. This recipe was achieved by further optimizing the blend of fl avors using the same ingredients to deliver a great Coke taste. The new design will be featured on all Coca-Cola Zero Sugar products, including 7.5- and 12-ounce cans; fridge packs; and 13.2-ounce, 16.9-ounce, 20-ounce, 1.25-liter and two-liter bottles — with zero calories and zero sugar. The new packaging is simplifi ed and celebrates the iconic logo, beginning with the brand’s original and universally recognized red, with black Spencerian script, signaling the Zero Sugar variety.
Seasonal Flavored Whiskeys
Two Trees Beverage Co. Inc. introduces Pumpkin Spice and Peppermint woodcrafted fl avored whiskeys. Both are available in 750-milliliter bottles, are 70 proof and 35% ABV — with a suggested retail price of $21.99 per bottle. Two Trees wood-crafted fl avored whiskeys are created by pairing specifi c grains with wood varieties that are toasted to perfect charlevels to deliver rich fl avor profi les that carry a hint of smokiness. The whiskeys are also sustainably matured; the Two Trees process leads to conservation in forestry, reduced emissions and reduced environmental footprint overall.
Two Trees Beverage Co. Inc.
(803) 767-1322 info@twotreesdistilling.com www.twotreesbeverage.com
Halloween Lighter Series
Calico Brands Inc. introduces a new Halloween series to its Scripto Hybrid Designer lighter line, featuring fi ve Halloween designs. The Scripto Hybrid Lighter is the perfect crossover of a multi-purpose lighter and pocket lighter now available with a variety of stylish designer wraps. It features a refi llable tank, extended nozzle for safer lighting, adultfriendly pushbutton ignition and adjustable fl ame. The Scripto Hybrid Lighter Designer series are available in a 50-count display-a-tray and one-pack open stock. The lighters have a suggested retail price of $1.20 per lighter in a display-a-tray and $1.25 per one-pack.
Calico Brands Inc. www.calicobrands.com
Chocolate Cookie and Icing Combo
General Mills Convenience announced that Dunkaroos, the beloved cookie and icing combo from the ‘90s, are now available in chocolate. The new fl avor has been a top request by consumers since the successful comeback of Dunkaroos with vanilla frosting in 2020. Both varieties of the dunk-able cookies come with frosting and are individually packaged in a 1.5-ounce single-serve tray that are perfect to eat on the go. The suggested retail price is $1.99.
General Mills Convenience & Foodservice
www.generalmillscf.com
Pickup Experience With Integrated Loyalty
Punchh Pickup creates a frictionless, end-to-end pickup experience for both customers and employees. It allows operators to view and manage all pickup orders from a customizable web-based console, providing real-time location and arrival estimates that enable clear, automated communication with customers through a personalized mobile and web experience. Built to seamlessly integrate loyalty with curbside, drive-through and in-store pickup orders, Punchh Pickup offers a fully synchronized employee and customer experience that reduces customer wait times and simplifi es both back-of-house and front-of-house operations.
Punchh
www.punchh.com
Banana Taffy Bites
Laffy Taffy’s new Laff Bites “Gone Bananas!” combine the classic banana taffy fans know and love in the center with a candy-coated, crunchy shell. Laff Bites “Gone Bananas!” are available nationwide in three sizes: two-ounce single pegs, suggested retail price (SRP) $1.29; 4.2-ounce pegs, SRP $1.49; and six-ounce pegs, SRP $1.69. Laff Bites are also available in assorted bags with four fl avors including cherry, strawberry, green apple and blue raspberry.
Ferrara
www.ferrarausa.com
Crunchy Cookie Meets Classic Candy
M&M’S unveiled its latest product innovation, M&M’S Crunchy Cookie, which features a crunchy center covered in milk chocolate, all wrapped in the M&M’S candy shell. A great balance between cookie and chocolate, M&M’S Crunchy Cookie taps into America’s favorite cookie, chocolate chip, and offers a nostalgically satisfying treat with the taste and texture of M&M’S. M&M’S Crunchy Cookie will be available nationwide beginning March 2022 in single (1.35 ounces), share (2.83 ounces) and sharing stand-up pouch (7.4 ounces) sizes.
Mars Inc.
www.mars.com
Fudge-Filled Cookies
Chips Ahoy! continues to look for ways to provide consumers with exciting twists on the classic chocolate chip cookie through new fl avors and ingredients. Chewy Chips Ahoy! Fudge Filled Cookies bring the taste of Chips Ahoy! combined with Hershey’s-inspired fudge fl avor with a rich fudge-fi lled center. The new cookies combined with ice cream makes for the ultimate summer sundae.
Watermelon CBD Gummies
Pure Craft CBD is launching its new watermelon-fl avored vegan CBD gummies. Pure Craft CBD’s gummies are vegan and come with a third-party lab Certifi cates of Analysis (COA). The Nano CBDInfused Broad-Spectrum Gummies utilize nanotechnology so they can be absorbed by the body at the fastest rate possible. Each gummy is infused with 25 milligrams of NanoOptimized Broad-Spectrum CBD, with no bitter, leafy aftertaste. Pure Craft CBD Watermelon Gummies are available in 30-count jars with a suggested retail price of $55.
Pure Craft CBD
www.purecraftcbd.com
Zero-Sugar, Lactose-Free Yogurt
To create Chobani Zero Sugar, Chobani starts with a milk that’s been fi ltered to reduce naturally occurring sugar. From there, Chobani uses cutting-edge natural fermentation methods that allow yogurt cultures to consume the remaining sugar. Chobani then adds natural, non-GMO sweeteners like monk fruit and allulose. Chobani Zero Sugar has only natural ingredients, 60 calories and zero sugar. It is lactose-free, an excellent source of protein and contains six live and active cultures including probiotics. Chobani Zero Sugar is available in Vanilla, Mixed Berry, Strawberry and Blueberry fl avors.
Chobani
www.chobani.com
5-Hour Energy 53
www.5hourEnergyRetailer.com
Abbott 17
linnea.solbrook@abbott.com
Altria Group Distribution Company 2
877.968.5323
Black Buffalo 41
www.blackbuffalo.com
Calico Brands, LLC 46
800.544.4837 / www.calicobrands.com
CB Distributors 6-7
888.824.3256 www.cbprices.com / www.hempbombs.com www.naturesscript.com
Click It Inc. 83
www.clickitinc.com
E-Alternative Solutions 33
EalternativeSolutions.com/Forth
GSK C-Store 67
Scott.F.Breisinger@gsk.com
Gulfcoast 3
727.449.2296 / www.gulfcoast.com
The Hershey Company 5
www.HersheySolutions.com
Hunt Brothers Pizza 71
www.huntbrotherspizza.com/csd
Hussmann 77
800.592.2060 insidesales@hussmann.com / Hussmann.com
Invenco Cover, 45
877.515.0939 / www.invenco.com/s/csd
J&J Snackfoods Corp. 61
www.jjsnackfoodservice.com
Jet Brands 31
877.822.2214 / JetBrands.net
Kraft Heinz 39
www.kraftheinz-foodservice.com
Krispy Krunchy Chicken 69
800.290.6097 / www.krispykrunchy.com
Lancer Worldwide 51
www.lancerworldwide.com/CSD
Liggett Vector Brands 23
877.415.4100
March Networks 87
searchlight.marchnetworks.com
Mars Wrigley 35
www.mars.com/made-by-mars/mars-wrigley
MasonWays Indestructible Plastics, LLC 101
800.837.2881 / www.masonways.com
Modern Store Equipment 25
877.532.8433 / sales@modernstoreequipment.com modernstoreonline.com/cstore
North American Bancard 100
866.481.4604 / www.nynab.com
Prairie City Bakery 19
www.pcbakery.com
Premier Manufacturing, Inc. 37
www.gopremier.com
Reynolods American Inc. 29 Ruiz Foods 9
www.RuizFoodservice.com
Safe Shop Assured 92-93
www.safeshopassured.com
The Seagram Beverage Company 57
www.seagramsescapes.com/spiked
Success Systems 79
800.653.3345 / www.success-systems.com
Swedish Match
800.367.3677 www.zyn.com 21, 103 www.gamecigars.com 43
Swisher International 11, 104
800.874.9720 / www.swisher.com
Texas Pete 15
TexasPeteFoodservice.com/FlavorsForTheRoad
Transact 73
877.748.4222 / www.transact-tech.com/cd
Trion Industries, Inc. 63
800.444.4665 info@triononline.com / TrionOnline.com
Tyson Convenience 75
www.Tysonconvenience.com
USA CBD Expo 47
www.usacbdexpo.com/tickets
Vitamin Energy 12-13
800.420.3106 / Sales@VitaminEnergyLLC.com
www.masonways.com | 800-837-2881
C-Store Opportunity: Pet CBD
Brightfi eld Group data shows signifi cant growth in the pet CBD market, driven by factors like rising awareness of its benefi ts and ongoing pet humanization; c-stores would be wise to capitalize on this trend.
Connor Skelly • Brightfield Group
The pet CBD products market is set to achieve $561 million in sales in 2021, up 30% from 2020, and is expected to reach $1.1 billion in 2026, representing a 15% compound annual growth rate.
This was one of the best-performing product types in 2020, aided by national pet chains Petco and PetSmart starting to sell CBD products in select stores in 2020. Pet CBD consumers are becoming increasingly educated on brands and products as the industry grows, discussing CBD brands with their veterinarians and using CBD for ailments that mirror those of human conditions for their pets.
Across the industry, the shuttering of many physical retail locations stunted discovery of CBD in 2020. In addition to convenience stores, consumers could previously come upon CBD when browsing a beauty retailer, vitamin shop, pet store or medical practitioner’s offi ce. Even with these channels reopened, consumers are not spending time in stores like they once were.
But many customers are still visiting convenience stores, which offers c-stores an added opportunity to capitalize on a demand for CBD pet products. It is also imperative for brands to understand consumer behavior at the channel level and position their products appropriately.
Consumers still report buying CBD at brick-and-mortar channels, even with 50% saying they purchase online. Notable increases are in pharmacies and specialized CBD retailers — as was highlighted in Brightfi eld Group’s July 2020 CBD report.
IDENTIFYING GROWTH DRIVERS
Here are Brightfi eld Group’s 2021 growth drivers of the pet CBD market:
Rising awareness of CBD’s benefi ts for pets with the anticipated development of more clinical data and clear and explicit policy allowing veterinarians to both discuss and recommend CBD products as appropriate (70% of pet CBD buyers discussed pet CBD brands with their veterinarians).
The ongoing pet humanization trend encouraging “pet parents” to spend lavishly on their pets, including on premium pet foods and treats. While the majority of CBD-infused pet products are designed with dogs in mind, with time there has been an increase number of products for the broader pet kingdom, such as cats, birds and horses — expanding the market even further.
Mass pet retail chains are expanding the number of stores selling pet CBD products and the entry of mass merchandisers (e.g., Target, Walmart) into the market, as well as the potential medium-term participation of pet product manufacturers like Mars and Nestlé.
As the pet CBD market grows, so too will the product types available in retail chains. While tinctures hold the top spot, edibles will see the fastest growth over the forecast period. As more mainstream consumers come into the market, many will look to the more budget-friendly and familiar format of treats to administer CBD to their pets.
Connor Skelly is the marketing director for Brightfi eld Group, a consumer insights and market intelligence fi rm for the CBD and cannabis industries. Brightfi eld works with well-known brands, manufacturers and agencies across the world, providing strategic data, insights and guidance for these dynamic markets.
