General Merchandise

Where Do Retailers Expect Growth in 2018?

Survey shows optimism for healthy food and gas sales to rise, while recruiting employees will remain a challenge

ALEXANDRIA, Va. -- Demand for healthy foods and beverages sparked positive overall convenience-store sales in 2017, and retailers expect the momentum to continue this year, according to the newest NACS retailer survey.

About 69% of retailers surveyed said foodservice sales increased last year, and 61% said sales of healthy items such as fruits, vegetables, yogurt, nuts and health bars grew. Contrarily, 7% said foodservice sales dipped, and only 3% said sales of better-for-you items were down.

Last year was strong for gas sales too, according to the survey. More than half (52%) of retailers said fuel sales increased in 2017, while merely 20% said they decreased. Strong sales at the pump are necessary for industry growth, NACS said, as convenience stores sell an estimated 80% of the fuel purchased in the United States.

The survey also revealed retailers’ emerging-trend predictions for 2018. Some are expecting a spike in kombucha drinks, home-delivery programs, new payment methods and healthier meal replacements on c-store menus. Moreover, 67% of retailers pinpointed lunch time as the daypart with the most potential to boom in 2018, while others foresaw growth in midday snack sales.

Products aside, retailers attributed last year’s sales bump to high consumer optimism regarding the U.S. economy. This translated into strong retailer optimism, as 77% of retailers feel optimistic about their business prospects through March. In addition, the same percentage of retailers feel good about the overall economy for 2018’s first quarter.

Despite the positive outlook, there’s still some concern as the new year settles in. Competition is top of mind for retailers, as nearly half (46%) said they expect to continue competing with other channels and other convenience and fuel retailers (45%). The same percentage is also concerned with finding and recruiting top talent to represent their stores. As a result, retailers say they are recruiting employees from outside-the-box groups, including retirees, disabled workers and military veterans. Lastly, more than two-fifths (42%) of retailers—especially those in California—are concerned that regulation and legislation could potentially harm their operations.

The quarterly NACS Retailer Sentiment Survey tracks retailer sentiment related to their businesses, the industry and the economy. A total of 103 member companies participated in the December 2017 survey.

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