"We continue to be encouraged by the results of our Fresh Initiative," CEO Terry Marks said during a second-quarter earnings conference call yesterday. "Led by the company's highest rates of foodservice growth in the quarter, our Raleigh and Charlotte markets both posted [image-nocss] inside comparable sales growth rates well in excess of double the rate of the company as a whole."
For The Pantry's complete earnings report, see related story elsewhere in this issue of CSP Daily News.
Marks said the company's "post-Fresh consumer research has shown meaningful improvement across an array of important measures, from visit frequency to increases in female shoppers. We see this bearing out in Raleigh, our most mature Fresh market, where we experienced a year-over-year second-quarter inside traffic growth rate in the high single digits."
Program Fresh provides stores with The Pantry's new Bean Street Coffee offering and a broader assortment of on-the-go meal and snack items, such as fresh pastries, breakfast and lunch sandwiches, salads and fruits. An associated store redesign includes fewer gondolas, wider aisles and fewer signs in store windows to open the stores to consumers. Stores with the Bean Street Coffee offer also include a fulltime coffee host.
"Our experience with Program Fresh in the North Carolina market has taught us a great deal that we're now able to apply as we move forward," Marks said. "We continue to target having 400 stores completed by the end of the calendar year."
Pantry executives would not which other markets may get the Program Fresh makeover this year; however, Mark Bierley, senior vice president and CFO, said the chain has determined that about 75% of its 1,659 stores are in line for the program.
"That's what we've targeted over the next few years," he said. "As we go into each market, we look at the profitability, the lease expiration.... We have a pretty rigorous process to make sure the investments made on any individual store are scrutinized for those profitability factors."
Based in Cary, N.C., The Pantry Inc. is the leading independently operated convenience-store chain in the southeastern United States and one of the largest independently operated convenience-store chains in the country. As of May 9, the company operated 1,659 stores in 13 states under select banners, including Kangaroo Express, its primary operating banner.
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