ASHEVILLE, N.C. — Growth and opportunity are the most exciting qualities of today’s convenience-store landscape, according to four major retailers on the executive panel at Winsight and CSP’s2019 Outlook Leadership conference in Asheville, N.C.
The panel, which featured executives from QuickChek,EG America, Delek U.S. Holdings and GetGo Cafe & Markets, aimed to explore how c-stores are reshaping their business models to adapt to the changing customer and the changing retail landscape. The discussion included acquisition strategies, store design plans and foodservice innovation.
Here’s a peek into what each of these four chains has in store for the future …
Pictured: Samantha Oller (from left), Polly Flinn, Rob Easley, Jay Erickson and Tony Miller
QuickChek Corp., Whitehouse Station, N.J., models its business on four core pillars: value, fresh food, ease and speed, and community. And while the chain is focused on profit and cash flow to fuel growth, consumer engagement and foodservice are its top priorities, said Rob Easley, senior vice president of merchandising and marketing for the chain.
“We want to be a great place to work, a great place to shop and a great place to invest,” he said. “But connecting with the community and building a brand around fresh food and grab and go comes first.”
QuickChek’s idea of “fresh” means offering food that’s on par with restaurants and supermarkets, Easley said. The company looks at grocery and QSR chains such as Wegmans and McDonald’s, respectively, as its top competition, as well as Wawa when it comes to other c-store operators. To stand out from these competitors, QuickChek is relaunching its mobile app, which will feature a customer engagement component and mobile ordering capabilities.
“[The mobile app] will help us better understand each customer, who they are, how they shop in our stores and how we can effectively serve them,” Easley said.
Since acquiring the Kroger Co.’s convenience division in February 2018—its first foray into the U.S. market—EG Group has prioritized growth in the United States, said Jay Erickson, president of EG America, the U.S. arm of Blackburn, U.K.-based EG Group.
The company has added 350 U.S. stores since 2018 and is looking to remodel all acquired Mini Mart locations within the next 10 months, he said. EG’s recent acquisition of Cumberland Farms, Westborough, Mass., catapulted the brand’s store associates from 15,000 to 24,000 and its state count from 25 to 30. EG is looking to acquire 5,000 U.S. stores within the next two to three years and develop 50 to 100 new-to-industry stores per year starting in 2020, Erickson said.
“When we look to acquire stores, we look at what people are doing that we can use,” he said. “We look at everyone—whether they have five or 50 or 500 stores—at what they do well and how we can apply that to our organization. If we’re doing something today but find that they do it better, we’ll apply that across our organization quickly.”
Delek U.S. Holdings
In August 2016, Delek U.S. Holdings, Brentwood, Tenn., sold its network of approximately 350 convenience stores under the MAPCO Express, MAPCO Mart, East Coast, Fast Food and Fuel, Favorite Markets, Delta Express and Discount Food Mart names to clear space for what ended up being its acquisition of Alon USA—the largest 7-Eleven licensee in the United States—a year later. This also cleared space for Delek to launch its own convenience-store brand, DK.
“You have to align your strategy with each business model,” said Tony Miller, executive vice president of Delek U.S. Holdings. “We’re taking the proceeds [from MAPCO] to reinvest in our other assets, and now we can create a brand.”
All DK stores will be 4,000 to 5,000 square feet and offer diesel fuel, Miller said. Delek is looking to build 10 to 12 DK stores per year starting in 2020, most of which will be at industrial and interstate locations compared to corner blocks, he said.
“Everything we do from the design to the process to the products is run through a filter: How is it impacting the experience and making things easier for the customer?” he said.
In late 2018, Pittsburgh-based supermarket chain Giant Eagle acquired Ricker Oil Co. Inc., a c-store retailer with 56 locations particularly known for innovation in foodservice. Thirty-four Ricker's locations had full-service kitchens at the time of the acquisition, and those stores were rebranded into Giant Eagle’s convenience division, GetGo Cafe & Market, said Polly Flinn, executive vice president and general manager of GetGo.
This was only the beginning for Giant Eagle, which plans to double its new store count in 2020, according to a video presentation the brand released at Outlook.
“We want to leverage what we know in grocery to make 5,000-square-foot to 15,000-square-foot stores to best serve the industry,” Flinn said.
Giant Eagle’s acquisition strategy focuses on stores that show potential to boost its fresh food program, Flinn said. But beyond foodservice, the company also looks at the parking lot size and types of loyalty programs various chains offer. These are all part of the “connective tissue” that completes GetGo Cafe & Market, she said.