Opinion: Changing and Staying the Same

Hank Armour, President and CEO, NACS

Michael Wood Jr., President and CEO, Winsight

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The business world is often a study in evolution and revolution. Darwin speaks of the necessity of adaptation, of physically evolving to successfully navigate today’s environment to ensure a more prosperous tomorrow.

And yet there are times when the environment changes in such a way that problems you may confront today can disappear outright or become opportunities tomorrow.

It was but a few years ago that we spoke with some doom about our nation’s thirst for fossil fuels and overdependence on foreign oil. We saw this as a threat to our national security and a cause for pendulum swings in prices and availability.

Today, America is exporting more than it is importing due to the rapidly changing nature of fuel. With the exception of seasonal swings and extreme weather conditions, our forecourt is seeing relative stability in terms of prices and better forecasting of per-gallon profits.

It wasn’t long ago that we feared the big box. Today, led by Walmart and Target, those big boxes are embracing the value of small, and we’re waiting to see how big of a presence those smaller boxes will have in the retail landscape.

So there are times when the best action is inaction—to observe, monitor and track but not necessarily react.

Of course, were we to perpetually wait and fail to initiate, we would not be celebrating our channel’s growth from 149,220 to 151,282 stores, or be America’s impulse store, with more than 83% of our items sold and consumed in less than one hour.

We are evolving in ways perhaps once unimaginable. We are selling healthier items and embracing a balance of indulgent and better-for-you foods. We are incorporating sustainable practices good for both the environment and the bottom line. We are even rolling out stores with a net-zero carbon footprint. We are embracing digital technology and using social media to communicate to old customers and attract new customers in cost-effective, targeted ways.

In short, we are adapting in a way that ensures that we as a retail channel will survive and thrive for decades to come.

But what about you, the individual operator? In this special issue, forged through the partnership between NACS and CSP, you will find reams of data points. Accompanying each statistic is a story or multiple stories of strategies and opportunities.

NACS State of the Industry data speaks about us as an industry and, in some cases, as regions or top-quartile or top-decile operators. So what can you plumb to enhance your company’s performance?

Here are a few ideas:

 ▶ People Productivity: The gap between top-quartile operators and the bottom quartile is glaring. NACS reports a 12% difference between these two quartiles in non-managerial turnover. More alarming is that bottom-quartile performers suffer twice as many manager turnovers as top-quartile companies. This means greater discontinuity, less loyalty from customers and greater investment in training and filling holes. What are you doing to keep your turnover low, to help your employees climb your corporate ladder?

 ▶ Today’s Consumer: Bubba certainly matters, but all of us today are making strides to attract the female shopper, the millennial and our nation’s increasingly multicultural demographic. That means we cannot be a one-size-fits-all merchant. For example, nontraditional meals are the new normal. We’re grazing. How can you take advantage of that? What can you do at 10 a.m. that is different from the 7 a.m. coffee rush?

 ▶ Tobacco: Cigarettes remain our industry’s top-selling category, easily outpacing foodservice and packaged beverages. Yet our business model can no longer be as dependent as it is on tobacco. This habit necessitates adjustment but not wholesale reconstruction, because cigarettes remain a core product and a consumer expectation. At the same time, we are interested to watch the continued growth of e-cigarettes and vapors.

Some believe that, over time, electronic smoking devices will pass cigarettes in sales. We’ll leave that to the analysts. What we do feel certain about is that with some adjustment to your backbar, your total tobacco business should remain strong for the foreseeable future.

So as you go through the magazine, assess where you rank among quartiles. If you were to make one change in your store, what would it be? Happy reading!

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