CHICAGO -- U.S. convenience stores experienced record in-store sales of $233.0 billion in 2016 and the third straight year of more than $10 billion in pretax profits, according to newly released NACS State of the Industry data, the convenience- and fuel-retailing industry’s premier benchmarks and key performance category insights.
|Industry measure||2015||2016||% change|
|U.S. store count||154,195||154,535||flat|
|Inside sales||$225.8 billion||$233.0 billion||3.2%|
|Fuel sales||$349.0 billion||$316.8 billion||(9.2%)|
|Total sales||$574.8 billion||$549.9 billion||(4.3%)|
|Pretax profit||$10.6 billion||$10.2 billion||(3.8%)|
Sources: Nielsen/TDLinx; NACS; U.S. Energy Information Administration
Convenience stores, which sell more than 80% of the fuel purchased in the country, reported a 9.2% decline in fuel sales. This was driven by another year of low gas prices, which averaged $2.17 for the year compared with $2.44 in 2015.
Fuel sales volume was up 2.6%, riding the wave of continued economic recovery. Meanwhile, fuel margins in 2016 dropped to 23.1 cents compared with 23.4 cents in 2015, but due to increased sales volume, overall fuel gross profit increased 1.6% per store per month.
Despite record in-store sales, direct-store operating expenses (DSOE) outpaced inside gross-profit dollars for the second consecutive year. This includes wages, payroll taxes, healthcare insurance, card fees, utilities, repairs/maintenance and supplies, as well as several other categories, including franchise fees and property taxes. This trend is creating challenges for convenience retailers as they look to grow their businesses.
Beyond sales, convenience stores are an important part of the economy. The convenience and fuel retailing industry employed 2.5 million people in 2016, wages were up 8.1% and the average wage for a store associate is $9.99 per hour. Turnover for store associates was 133%, up from 95% in 2015, according to the recently released NACS Compensation Report of 2016 Data. The rise is primarily due to tighter labor markets resulting from being in the seventh year of economic recovery.
The industry’s 2016 metrics are based on the NACS State of the Industry survey powered by its wholly owned subsidiary CSX LLC, the industry’s largest online database of financial and operating data. Complete data and analysis will be released in June in the NACS State of the Industry Report of 2016 Data.
Watch for details on CSP Daily News.