Haseotes, a 34-year-old Harvard Business School graduate, said the 700-store convenience store chain can't afford to stand still. "[image-nocss] This is a business of pennies where we compete against hundreds of competitors," he told the newspaper. "There's really a massive blurring of [retail] channels that intensifies the level of competition."
The grandson of the 70-year-old chain's founders, Haseotes is charting a business plan designed to insulate Cumberland Farms from potential future declines in tobacco and gasoline sales. "It's unknown where tobacco and petroleum products are going," he said. "We are planning for the long term, so we can be even more viable with the core product we sell today."
To that end, Cumberland Farms recently opened a pair of refurbished stores in Farmington and Deep River, Conn., with what Haseotes calls a more "food-centric" theme (click here for previous CSP and CSPTV coverage). Several stores in Massachusetts will get the makeover later this year.
The stores are redesigned to highlight the chain's private-label groceries, drinks-to-go and a new line of toasted sandwiches.
Last fall, Cumberland Farms introduced a new blend of coffee, Farmhouse Blend, which is designed to compete with Dunkin' Donuts coffee. Cumberland is selling all of its hot beverages for 99 cents. At the prototype stores, in the past six weeks, new equipment allows customers to make their own milkshakes. And the chain has introduced a new line of sandwiches that can be toasted by employees.
So far, the early response to the prototypes has been encouraging, Haseotes told the paper.
Privately held Cumberland Farms has annual revenues of $10 billion, and does not release breakdowns of sales by segment, said the report.
Haseotes, who previously served as the chain's vice president of marketing, has been meeting with store managers to find out more about day-to-day operations, the report added. The company has installed in-store technology to reorder merchandise automatically, a time-consuming task previously performed by managers. That should allow employees more time to serve customers, said the report.
The emphasis on store operations is one reason Haseotes avoids the use of the word "headquarters" to refer to the company's new 100,000-square-foot Framingham digs, which Cumberland Farms will share with sister company Gulf Oil. Instead, Haseotes likes to use the term "store support center." He said, "We're at the bottom of the pyramid, and our job is to support them."
For more on Cumberland Farms' new store concept and other changes within the company, watch for the May issue of CSP magazine.
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