LAVAL, Quebec -- In what may be the coining of a new industry term, Circle K officials recently described an emerging tobacco customer—a “poly user”—who dabbles in cigarettes, moist smokeless and even vaping depending on the occasion.
During the chain’s July 12 earnings call, officials with Circle K’s parent company, Alimentation Couche-Tard, described its current tobacco numbers as following those of the major manufacturers, which have been experiencing slow but expected declines in volume while maintaining a strong position on price. Beyond that, Brian Hannasch, CEO for Couche-Tard, said the stores “continue to expand our back bars and allow adequate presentation of the newer innovations, whether that be electronic or [other] products that continue to grow.”
Noting growth in moist smokeless and cigarettes, Hannasch said, “We are seeing more and more consumers become poly users, so they are multiple users. They may use cigarettes for an occasion; they may use more smokeless for a certain occasion or an electronic cigarette or vaping unit as another occasion.”
The chain continues to grow its tobacco volume on a same-store basis, Hannasch said, with convenience stores in general appearing to hold an advantage over other tobacco-retail outlets.
Cigarettes have a lot in common with fuel, he said. While a declining business overall, successful c-store chains continue to thrive with both. “[There’s] a lot of low-volume sites in the industry both in Canada and in the U.S., and those sites are pressured over time from a lot of different fronts,” Hannasch said. “Demand will be redistributed and the higher quartile, high-quality assets and those players with a strong backcourt are going to be the ones that win in that environment.”
Laval, Quebec-based Couche-Tard operates more than 7,200 c-stores in the United States. It ranked No. 2 in CSP's 2017 Top 202 ranking of the largest chains in the country.
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