The National Association of Convenience Stores (NACS) thinks the future of convenience retailing lies outside of fuel.
Chris Rapanick, managing director of research at NACS, shared this insight at the 2025 NACS Show, held Oct. 14-17 in Chicago.
“What I want you to draw from this today is, what can you do to improve your business on the inside so as fuel demand declines… you’ll be able to diversify your revenue and profits?” he asked the audience during an education session at the show.
Foodservice drove sales at U.S. convenience stores in 2024, according to NACS State of the Industry data released earlier this year. Areas that struggled were fuel and tobacco. C-stores, which sell an estimated 80% of the fuel purchased in the United States, saw total fuels revenues decrease 5.7% to $501.9 billion in 2024. This was a result of a 6.5% decrease in the average gas price, NACS said, which was $3.31 in 2024 compared to $3.55 in 2023.
Rapanick noted several areas of focus for c-stores looking to improve their business outside of fuel.
Consider adding foodservice or a car wash
While foodservice is doing well in c-stores, it’s expensive and there is risk involved, Rapanick said. C-stores may want to try another route: Adding a car wash.
“If you have a car wash, if you have the opportunity to build a car wash, do a subscription program,” he said. “It’s very profitable.”
Focus on growing units
There are two categories outpacing the impact of inflation in 2025: Packaged beverages and other tobacco products (OTP), Rapanick said.
“So, when you're thinking about where the growth is coming from, where your profitability is building, it's probably the impact of the beverages and OTP. New nicotine delivery systems and things like that are really making an impact on the business,” he said.
Across the c-store industry, sales dollars, transaction counts and units are down, he said, citing NielsenIQ and NACS CSX data, a self-reported subscription database serving the c-store industry and its stakeholders.
When looking at national sales data from January through June, total store national sales dollars were down 0.1% and national units were down 3.1%. Packaged beverages and OTP were the only segments up in sales data—up 2.6% and 5.4%, respectively. But both were down in units. Packaged sweet snacks was the only segment that grew in units, up 2.1%, although it was down 3% in sales.
“So, this is the concern. And when you think about driving the inside business, how you can increase your basket size, and things like that, you really need to focus on units,” Rapanick said. “It’s always great to drop an extra unit in the basket, however it takes. The cashier upselling, better promotions and things like that can lead you to some impact on that unit count.”
Cut operational expenses
The way to make the most impact on profitability, though, is to cut direct store operating expenses, Rapanick said. This can be through trimming wages and benefits, card fees, repairs and maintenance, utilities and supplies.
“If you're a retailer, operating expenses have grown to the tune of like 200% over the past five or six years. They've been growing double digits year, upon year, upon year,” he said.
When looking at the first half of 2024 compared to the first half of 2025, direct store operating expenses were up 2.7%, NACS CSX data shows. Wages and benefits made up the bulk of those costs.
It’s quicker to cut an expense than to growth sales or profits in store, Rapanick said. He encouraged retailers to use NACS’ State of the Industry data as a benchmark so they can see how they’re spending compared to their peers.
“If you go and you see that your supply costs grew by 2% or 3% in 2025, and the average is only 1.4%, you should be thinking, 'Where's the extra half a point going? Why am I spending more than my peers?'” he said.
Controlling shrink and employee turnover can also help.
Merchandise shrink runs about $2,000 per store per month now, he said. One way to help with this is to improve record keeping.
“Whenever you have an issue where you realize that you’ve experience shrink, write it down. See if there’s patterns there. Look at your cameras if you have to,” Rapanick said.
A c-store's business will also benefit if employees love to work there and stay.
“At the end of the day, it allows you to spend less on turnover, which again is an ambiguous cost that no one can really put a finger on, but what it does, it helps you control your expenses,” he said.
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