As it enters the U.S. convenience-store market, OXXO’s strategy is to tailor each location to the residents of that neighborhood, according to Hal Adams (pictured), managing director for OXXO USA, a unit of Monterrey, Mexico-based FEMSA.
For example, at OXXO's Lubbock, Texas, location, blocks from Texas Tech University, there is a freezer with frozen goods that appeal to both college students and the nearby residential community. Items include pizzas, chicken wings and breakfast bowls.
Adams calls OXXO USA “a startup, but it's part of a huge company that has lots of retailing capabilities and expertise,” he told CSP on an exclusive store tour Oct. 1 in Lubbock. That date marked the one-year anniversary of OXXO acquiring the DK chain of convenience stores and establishing itself in the United States.
FEMSA purchased 249 stores from Brentwood, Tennessee-based Delek US Holdings in October 2024, marking its entrance into the United States. It started rebranding c-stores in February, focusing on the Midland-Odessa and Lubbock metro areas in West Texas.
“One of the advantages that we have of being part of this big company is that we can go pick those capabilities out of Mexico or Colombia or Brazil and bring them to the U.S. and implement them according to what our market needs,” he said.
- FEMSA is No. 33 on CSP’s 2025 Top 202 ranking of U.S. c-store chains by store count.
One of the “great things” that OXXO does well is “store segmentation,” Adams said, explaining that OXXO has different segments of stores in a town. Depending on the neighborhood or street that that store is located affects what the store stocks.
“The store might have an assortment for households, like a grocery fill-in, like a small supermarket,” carrying items such as milk, bread, eggs, rice and beans, he said.
Meanwhile, another store might be all immediate consumables and impulse purchases because the residents “might be people on the run to work or school,” Adams said.
“One of the capabilities that OXXO has is this segmentation they do with assortment,” Adams said. “It takes a lot of data, and it takes a lot of expertise and process. But we’re [OXXO USA] in the beginning stages of taking advantage of those capabilities because of being part of OXXO. We’re not quite there yet, but we will get there over time.”
OXXO stores outside the United States “have five or six segmentations where their product assortment is completely different based on where the store is located,” he added. “That’s one of the things that we’re adopting here in the U.S., and I find that most U.S. retailers are not really great at that thing, but that’s how it’s done in Mexico and other countries.”
Part of the reason for this strategy is that as supermarkets get bigger and bigger, “they become less and less convenient for our customers, and we have stores that are in neighborhoods that may be further than 2 miles away from a grocery store,” Adams said. “So, it might be very convenient to buy milk, bread and eggs at one of our stores versus going 2 miles away.”
In addition, once a consumer reaches a supermarket, there could be a long walk “deep into the store to grab those things,” Adams said. “So, in stores where that's necessary, if we can create that niche of milk, bread, eggs, cereal, coffee, rice, beans, maybe a small selection of produce, maybe some frozen hamburgers, steaks, chicken breast, we can create maybe 20% of our item mix being a little bit different. We can create a niche, not in all stores, but in stores where that calls for.”
Conversely, an OXXO store in a neighborhood with more young adults—those less likely to prepare meals at home—would have a different product mix, he said.
“This store is surrounded by Texas Tech students,” Adams said. “There’s probably 1,000 units of living. And so here: ramen, cereal, coffee, frozen food, things that they can take back to their dorm or into their apartment and heat up, lots of energy drinks; more energy drinks than normal. So, this store can be adapted to that population so that we’re there to serve them for what they need.”
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