Preview of NACS State of the Industry Report of 2011 Data

A first look at all the important 2011 numbers.

Samantha Oller, Senior Editor/Fuels, CSP

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A wise person once said, “In theabsence of data, people tend tomake plans based on opinion.”“I’ll suggest to you that that’s a failingstrategy,” said Wendy Chronister, CEOof Chronister Oil Co., and a member ofthe NACS board of directors and researchcommittee. For her part, Chronister plansto consider what her company is doingand why, and how to adjust its strategybased on data gleaned from the NACS®State of the Industry Report of 2011 Data.In the following pages, you’ll fi nd preliminarynumbers from the report to applytoward this endeavor. Keep in mind:

Learn from the Top of the Top. Retailersin the top 10% of the NACS® State ofthe Industry total fi rm sample outperformthe other 90% by leaps and bounds (seep. 83) and have brought up the industryaverage. A main point of differentiation:They have decided to be famous for something—such as a sophisticated foodserviceoffer, expansive dispensed beverage programor stellar customer service—and letthis fuel their growth.

Focus on Reliable Growth Opportunities.With fuel gallons off (see p. 81)and cigarette volumes and gross-profi tdollars down (see p. 81), c-store retailersneed to focus even more on highmargin,stable categories with plentyof growth potential such as foodservice(see p. 90). A high point for 2011: Preparedfood began pulling its own weightin sales and gross profits, joining colddispensed beverages as the motor forthis category.

Source the Growth. Going into 2012,analyze each category and break downits contribution per square foot to determinenot only where there is growth butalso why. For example, sales for edibleand nonedible grocery fell precipitouslyin 2011 (see p. 87). Does this refl ect groceryspace being given to foodservice, ora lack of focus? Another example: Candy sales rose as units slipped (see p. 100). Is this the result of a greater emphasis on king-sized and seasonal candy, or simply customer reaction to price increases?

Control the Controllable. In a year in which credit-card fees hit a record high on the back of record-high fuel prices, retailers kept admirable control of expenses(see p. 83). Total direct store operating expenses (DSOE), without factoring in credit card fees, rose only 2.0% in 2011 for same-firm retailers. Factor in credit-card fees’ 23% jump, and DSOE grew 4.5%.

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