Murphy USA has started its plan to retrofit its existing 2,800-square-foot stores, featuring a new layout design based on learnings from QuickChek, President and CEO Andrew Clyde said on the company’s second-quarter 2023 earnings call.
The new layout that it is piloting will allow for easier traffic flow, he said. It was designed around driving food and beverage sales at Murphy stores, enabling access to a more desirable assortment of high-quality grab-and-go food and dispensed beverages that are more accessible, visually appealing and relevant to customers, Clyde said.
Queuing lanes have been added to promote impulse sales and reduce congestion around the register.
“With the right assets and the right places, selling the right products, managed by the right people, we are in a unique position as a company to fully realize benefits and more intentionally drive food and beverage sales through targeted marketing strategies that go beyond our most effective marketing tool of everyday low prices,” Clyde said.
The chain is also looking at a new concept for a 2,800-square-foot store, called its “store of tomorrow,” which will launch in 2024, Clyde said. He didn’t provide further details.
- Murphy USA is No. 4 on CSP’s 2023 Top 202 ranking of U.S. c-store chains by total number of retail outlets.
The QuickChek team has been leading innovation efforts, and its format is the perfect test and learn environment to identify potential products that have strong overlap with Murphy customers, Clyde said.
QuickChek saw strong sales from a limited time made-to-order watermelon smoothie, which was subsequently reimagined and introduced as a limited-time-offer Sour Patch Kids branded frozen slushy at Murphy USA stores. Edible cookie dough and brownie bites cups were introduced in the QuickChek coolers, and then were added to Murphy stores. And promotional learnings from QuickChek’s two-for-$5 breakfast sandwich deal, which realized sales and margins growth of 11% in the second quarter, have led to two similar promotions for Murphy grab-and-go items.
“We also continued to innovate in our growing core categories where the made-to-order menu at [QuickChek] is being realigned with consumer insights and fresh product preferences,” he said. “This will lead to some exciting new sandwiches—signature sandwiches to be introduced in the second half of 2023.”
Murphy USA is also in the early states of leverage its digital assets to unlock significant value inside the store through machine learning tests, he said.
Second-quarter results highlights
- Murphy USA’s net income was $132.8 million in second-quarter 2023 compared to $183.3 million in second-quarter 2022.
- Total fuel contribution was 29.5 cents per gallon, down from 34.9 in the same quarter of 2022. Total retail gallons, however, increased, up 2.3% in second-quarter 2023 compared to second-quarter 2022.
- Total merchandise contribution increased $10.1 million, or 5.1%, to $206.8 million in second-quarter 2023 compared to the prior-year quarter, due primarily to higher unit sales volumes. Total tobacco and non-tobacco contribution dollars also increased, up 3% and 7.6%, respectively, compared to second-quarter 2022.
Murphy USA, El Dorado, Arkansas, completed its acquisition of QuickChek in January 2021. Murphy USA operates one of the nation’s largest convenience-store chains, with more than 1,700 stores in 27 states, located primarily in the Southwest, Southeast, Midwest and Northeast, the majority of which are next to Walmart Supercenters.