SCOTTSDALE, Ariz. -- The retail business is a people business. And as the three operators on a panel at the 2014 CSP Outlook Conference explained, the people part can be a true balancing act, whether it comes to from fighting for legislation supportive to the industry to speeding up the transaction for a time-crunched consumer base.
For example, the 2014 midterm elections seem to have been decided favorably for the convenience store industry, with business-friendly Republicans winning the Senate majority. The panelists agreed that retailers need to engage and educate legislators and employees about the effect of government on the c-store industry.
"At Kwik Trip for the last six to eight years, we've been educating coworkers that elections have consequences," said Steve Loehr, vice president of operations support at Kwik Trip Inc., La Crosse, Wis. "It's incumbent on all of us to educate our coworkers so they understand the impact of legislation in Congress."
"We saw a lot of apathy in younger voters," said Sonja Hubbard, CEO of E-Z Mart Stores Inc., Texarkana, Texas. "We do have to encourage them. Their vote does make a difference."
While acknowledging that Republicans tend to be more pro-business, none of the retailers are expecting big change considering the fact that President Obama can veto anything he does not support.
On the topic of raising the minimum wage, which the public is heavily in support of, Peter Tedeschi, president and CEO of Tedeschi Food Shops, Rockland, Mass., acknowledged that the "optics are not good" for businesses who publicly voice their opposition. And indeed for the three retailers on the panel, there was general agreement on the need for a wage floor on a state level.
"If it's done at the federal level, that's just plain wrong," said Tedeschi, citing the varying costs of living across the country.
As a silver lining to a wage raise, Tedeschi also pointed out that the core convenience store consumer would also have more money to spend.
Speaking of Bubba, the c-store industry is also finding its balance on healthful food. While the overall trend points to greater demand, c-stores in some areas have not yet seen it.
"There are opportunities to keep Bubba because we need him, but also bring in new customers," said Loehr. In fact, Kwik Trip is a member of the Partnership for a Healthier America, a group of business leaders, policy makers and health professionals united in their desire to end childhood obesity.
For Kwik Trip--and the newest convenience store member of the group, Sheetz Inc.--that means offering a good selection of healthful, fresh food options. The key will be to provide enough items to attract customers looking to eat healthier while not alienating the core customer.
"Bubba has evolving taste, too," said Hubbard.
And an ongoing challenge for all convenience store retailers is interchange fees. Here, Loehr said the industry should continue to defend the Durbin Amendment, which limits interchange fees on debit-card transactions; however, it also needs to "build a better mousetrap"--an alternative payment path that can compete with Visa and MasterCard.
One option is supporting the efforts of the Merchant Customer Exchange (MCX), a consortium of retailers that is developing a mobile payment solution. Tedeschi argued that credit-card companies should also be forced to be more transparent with the fees they charge retailers, and ultimately, consumers.
"Why shouldn't customers know exactly what they're paying for an interchange fee?" he asked.
Loehr said retailers should educate their legislators about the sheer amount of taxes paid on interchange fees alone. For Kwik Trip, this can reach $10,000 per store.
And perhaps one of the biggest challenges of all--and one that was a key topic of conversation at the conference--was how to attract and win the loyalty of millennial consumers. It's a demographic whose behavior can run counter to the "norm."
"I think millennials would take speed over service," said Hubbard. The drive-thru would be one path of delivering this, although the panelists have mixed experiences with it.
Loehr noted that Kwik Trip had acquired some sites that already had drive-thrus, but after some testing, realized the feature did not mesh with its customer base. "Customers said they wanted to come into the stores," he explained.
Self-order kiosks are another way to speed up the experience, although Tedeschi said some of his older customers rejected kiosks his chain installed for its made-to-order sub program. The retailer ended up giving customers the option of ordering from an employee or the kiosk.
Regardless of the means, the retailers were cognizant of the high-wire act they must master. That is, they need to somehow maintain a connection with the customer and deliver an experience that wins their loyalty, all while maintaining convenience. As Hubbard observed, "It's hard to have an experience in under a two-minute window."
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.