Sunoco Expanding Foodservice, and It’s Not Just Laredo Taco

Retailer taking tacos beyond Texas and rolling out doughnuts, coffee to new state

HOUSTON – Along with increased merchandise convenience-store sales and merchandise margins, Sunoco LP is continuing the expansion of its Laredo Taco Company proprietary foodservice offering, said Bob Owens, president and CEO, during the company’s first-quarter 2016 earnings call May 5. He also offered details on Sunoco’s launching of the Dunkin’ Donut brand in Hawaii.

As of March 31, Laredo Taco had approximately 450 locations opened and operating, most in Texas. The first non-Texas location opened Jan. 9 outside of Pittsburgh. Since then, the company has opened another five locations, primarily around the Nashville, Tenn., area and in Pennsylvania.

“So far, the customer response to the new offering in these new markets has been very enthusiastic,” Owens said.

“Our plans are to continue to add additional stores throughout 2016,” he continued. “And by the end of the year, we expect to have 20 Laredo Taco Company locations outside of the Southwest and give the concept a real test. … Every new-to-industry site we build has a Laredo Taco restaurant inside.”

Meanwhile, Sunoco subsidiary Aloha Petroleum Ltd. has signed a multiunit store development agreement with Dunkin’ Donuts to develop 15 new quick-service restaurants (QSRs) on the islands of Oahu, Maui, Kauai and Hawaii, with the first restaurant planned to open in 2017.

The deal marks the doughnut and coffee chain’s entry into its 42nd state, said Grant Benson, vice president of global franchising and business development for Canton, Mass.-based Dunkin’ Brands.

“This new business venture will complement our existing retail offerings throughout the islands and help us diversify our portfolio,” said Richard Parry, president and CEO of Aloha Petroleum.

One of the largest gasoline marketers and convenience-store operators in the state of Hawaii, Aloha Petroleum has a history that dates back to the early 1900s. It employs more than 630 Hawaii residents and markets through approximately 100 Shell, Aloha and Mahalo branded fueling stations and 46 Aloha Island Marts, four Menehune Food Marts and two Subways throughout the state.

Aloha Petroleum will be the exclusive developer of Dunkin' Donuts restaurants in the Hawaii for an initial term of eight years, Owens said on the call.

Of the 15 units, “we expect approximately half of the restaurants will be built on existing Aloha Island Mart c-store properties and about half will be stand-alone restaurants developed on properties that we will acquire in the future,” he said.

Houston-based Sunoco LP is a master limited partnership (MLP) that operates approximately 1,300 retail fuel sites and convenience stores (including APlus, Stripes, Aloha Island Mart and Tigermarket brands) and distributes motor fuel to convenience stores, independent dealers, commercial customers and distributors located in 30 states at about 6,800 sites. Its parent, Energy Transfer Equity LP, owns Sunoco's general partner and incentive distribution rights.

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