CHICAGO — Despite the COVID-19 pandemic taking a toll on many businesses across the country, most convenience-store retailers, about 78%, say business conditions are good to excellent.
Those numbers are close to last year’s responses, when about 80% of respondents reported the same description of business conditions.
“Our industry is just very fortunate,” Rutter’s CEO Scott Hartman said during Winsight Media’s 2020 Outlook Leadership Community Talks From the Top. “It’s a very challenging time for a lot of people out there, and I certainly appreciate the challenging times they’re having. But for our industry, we are in a good spot because we’re critical infrastructure, and critical infrastructure means that we’re required to stay open. And by being open, it gives you an opportunity to sell something.”
Still, others found intense challenges impossible to overcome. For Ray Huff, president of HJB Convenience, doing business as Russell’s Express, Lakewood, Colo., this year has been “horrible.” HJB specializes in c-stores in office buildings—which have been empty or at low capacity due to work-from-home orders.
“I don’t expect to be profitable again until 2023,” Huff says. “We’ve lost too much in this unexpected shutdown. Imagine you’re expected to do $300,000 a week; you shut it down, that inventory spoils. We’ve lost that. We’ve lost wages. We’ve lost rent. For me, I don’t see this coming back. For my contemporaries, they’re doing pretty good. Their customers aren’t going downtown, but to their local c-store instead of grocery stores.”
Even if there’s a coronavirus vaccine released in the near future, a 2021 recovery is still questionable, Huff says.
“There’s no magic bullet because it’s completely out of control,” he says.
When asked what issues could have a negative effect on their businesses in 2021, decreased foot traffic, the labor market, tobacco/vape regulatory issues and new and/or higher taxes topped retailers’ list.
However, survey respondents’ outlook for 2021 business conditions is overall positive: Nearly 80% expect there will be some or great improvement next year.
Regardless of c-store retailers’ positive outlook, they still have challenges to face.
Retailers said their biggest concerns are COVID-19 safety, the ability to hire and retain workers and employee turnover. Retailers also will be weighing whether to offer new services, such as home delivery or frictionless checkouts.
Despite some c-store chains adding or enhancing delivery services amid the pandemic, only 7% of respondents said it was something they planned to offer in 2021.
Hartman, of York, Pa.-based Rutter’s, said he’s not “running a mad race” to get into delivery.
“I’m trying to evaluate that with our team because it’s going to be all about the experience,” Hartman said. “What part of the experience do they want? Do they want socialization? Do they want to be around people? Do they want to have a great store to come to because they’re getting out, or do they want to stay inside and have everything home delivered? I would say if you had a choice, more people would rather be out than being stuck at home.”
How do you anticipate your total 2020 sales will compare to 2019 (including fuel and in-store)?
What do you expect will happen to business conditions in 2021?
What amenities do you plan to offer in 2021?
Source: CSP’s 2020 Outlook Survey | Numbers may not add to 100 due to rounding.
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CSP’s 2020 Outlook Survey conducted between Sept. 9-23 and fielded 74 responses from CSP readers. Click here to visit report landing page.