Murphy USA is using loyalty data to learn more about its customers, piloting new technologies in its QuickChek convenience stores and focusing on new store growth and raze-and-rebuilds, President and CEO Andrew Clyde said Thursday in the company’s fourth-quarter 2023 earnings call.
The El Dorado, Arkansas-based convenience-store chain released its fourth-quarter and year-end 2023 earnings, reporting that it had reached its highest fourth-quarter net income and adjusted EBITDA in company history.
In the call, Clyde said Murphy USA and QuickChek customers value affordability above all else.
- Murphy USA is No. 4 on CSP’s 2023 Top 202 ranking of U.S. c-store chains by total number of retail outlets.
Murphy and QuickChek customers value affordability above all else, Clyde said. The company examined a large panel of customers who have been shopping with the company every month since 2019.
“We see that they are spending 50% more at Murphy USA in 2023 than they were in 2019—about $177 per month,” he said. Second, we're getting the same for more customers. New loyalty members that visited us for the first time in 2023 are making the same frequency of trips as the 2019 most loyal cohort—about five transactions per month. But they're spending at higher levels and they're shopping more of the store with 28% of them having bought fuel, tobacco and non-tobacco each month.”
Digital Transformation
He also touched on the success of part of the company’s digital transformation program. A pilot program at QuickChek focused on upsell suggestions at QuickChek touchscreens.
“Early pilots show uptake of suggested sell items and more than doubled,” Clyde said.
Last year, the company also piloted a more sophisticated demand forecast and production planning tool at QuickChek stores.
“This initiative has resulted in driving a larger basket with better availability of items, while also improving labor scheduling accuracy,” Clyde said. “In other words, doing more with less staff hours. The pilot stores have demonstrated a 20% uplift in hot grab-and-go products, leading to an increase in contribution of 6% no spoilage, due to stronger in stock positions during periods of peak demand, increasing our speed of service and giving customers more of what they want.”
New Stores
Murphy USA opened 28 new stores in 2023 and plans to open 30 to 35 new stores in 2024. It also completed 31 raze-and-rebuilds in 2023 and plans for 35 to 40 more this year.
“And while supply chain and permitting issues have deferred some of the financial impact of our new store program, most importantly, performance of these new stores has not been compromised,” Clyde said.
The 74 new Murphy-banner stores added over the last three years averaged about 290,000 gallons per store month in 2023, nearly 20% higher than the network average in 2023, delivering more gallons to more customers, Clyde said. Total merchandise sales per store month are about 15% higher than the Murphy network average at $205,000, he said.
“We've also put 13 new QuickChek stores into service over the same three-year period, helping quick check generate record results and beverage sales and margins in the fourth quarter,” Clyde said.
Murphy USA 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 under the Murphy Express and QuickChek brands in 27 states, located primarily in the Southwest, Southeast, Midwest and Northeast, the majority of which are next to Walmart Supercenters.
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