Five or six years ago, the company began rebuilding stores that were 4,000 sq. ft. or less and turning them into 5,000 sq. ft. or moresometimes building right behind the store and tearing the old one down, and sometimes building the new store somewhere nearby. The move was meant to enhance [image-nocss] Sheetz's foodservice offering, a big focus for the company. "We certainly are all about food, so anything that makes us able to serve our food customers better is in our best interest," Sheetz told CSP Daily News.
"They just couldn't get the right equipment in there, and there just wasn't enough room to do what the employees needed to doso that kind of started it all," he said.
He said that the company has averaged six and eight of those rebuilds a year. He estimated the company will do six or seven in 2011, with a few more trailing after that.
Now, the company is looking at its older stores, typically around 10 to 15 years old, which are large enough but might be looking "a little tired," as he put it. "They're not very old, but they don't look much like what we build today."
Those stores would not be torn down, but will be "major, major remodels," keeping the same four walls. "Economically, it just didn't make a whole lot of sense if the building is in pretty good shape structurally and it's already big enough, why would you tear it down and build another one?"
Sheetz said he expected costs to range from $500,000 to $750,000 per site, depending on the individual needs of the stores. Some of those needs could include additional freezers, larger restrooms or the need for a small addition to be added.
The buildings will also get a refresh on the outside, removing the light block skin of the older buildings and putting the red brick found on newer stores. New canopies and gasoline pumps will also be included where needed.
"It's much more an effort to make the working conditions more pleasant and more efficient for our employees and really to give the customers the look and feel of a new storeso it's a lot about branding," he said. "It's a lot about bringing up those stores to current day, because our new stores just look so different."
Sheetz said the company has approximately 150 stores that will get the major remodeling.
The company first tested the work on the exterior of one store to see how close they could get it to looking like a new store by replacing the exterior with red brick and adding new awnings and other effort. When they were satisfied with the efforts, they also tested interiors to see how the finishes looked, the amount of effort required and what kind of business disruption it might mean.
"So right now we're actually doing the first store soup to nutsthe inside, the outside, the parking lots, the gas," Sheetz said. While he also calls that store, which is in Nanty Glo, Pa., about 30 minutes west of the Sheetz corporate office, a test, he says the test is more to determine how long the process takes and how much it will cost. "It was good to do one close by so that all the corporate people could get a look and feel for what it looks like, and go up their while they're doing the work."
If all goes well, Sheetz plans to finish that store by the end of the year, and then follow it up with 10 morespending $7 million to $8 millionnext year. From there, the goal is to do 30 a year for the next four yearsat about $20 million to $25 million. Sheetz said the order the stores will be done is based on priority set by operations.
The company has other plans for growth, as well. Although acquisitions are not part of the company's model, the plan is to continue with new builds every year. "I would say 25 brand new builds, five tear-downs and rebuilds and then phase in this major remodel schedule at the same time. So there'll be an awful lot going on," Sheetz said.
"As long as I've been around, we have always rebuilt a certain number of stores every year. We just realized that if we didn't pick up the pace, we were never going to where we wanted to."
He added, "This is really for our employees, it's for our customers, but it's really certainly to help build the brand."
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.