By now, many in the convenience-store industry have seen reports about the resilience of the industry, but by comparing store performance from Spring 2020 to now, it’s easy to see exactly how resilient. Despite tough circumstances, the industry has made (and sustained) some big gains.
Market basket size spiked, and stayed larger
With the onset of the pandemic in March 2020, the average market basket size jumped nearly 10% as c-store shopping behavior transitioned from quick, immediate consumption purchases to bulk purchasing for future consumption in order to minimize trip frequency. This behavior has largely remained unchanged throughout the pandemic. In fact, when looking at the two weeks prior to the National Health Emergency announcement on March 13th, 2020, compared to that same time period this year, market baskets are on average 5% larger.
In-store revenue higher than 2020; fuel visits inching back to normal
While there were slight disruptions in in-store revenue as the pandemic began, consumers continued to rely heavily on convenience stores. Despite a challenging economy, and taking normal seasonal revenue fluctuations into account, overall average monthly in-store revenue consistently outperformed the previous year. And things continue to look up! Zeroing in on March, there was a 20% increase in average in-store revenue from 2020 to 2021.
In-store revenue jumped 24% from February 2021 to March 2021, compared to a 10% jump between February and March 2020. With economic stimulus, a speedy vaccine rollout and states easing restrictions, consumer spending surged in most retail channels. Grocery stores posted almost 10% growth between February and March of this year, and general merchandise stores increased revenue by 24% MOM!
March and April monthly in-store sales more closely resembled sales numbers usually only seen in the summertime. While in-store sales are expected to level out, independent c-stores are shaping up to have an exceptional 2021.
As retailers know, here was a huge dropoff in gasoline demand as the pandemic began. During the month prior to the National Health Emergency announcement on March 13th, 2020, weekly fuel visits per store averaged around 1,675 transactions, and during the same time period in 2021, the average was 1,575 transactions, representing a 6% decrease. However, since the pandemic began, demand has slowly been crawling back, with the average number of weekly fuel visits surpassing 2020 levels in mid-March.
Conclusion
To sum it up, this is all good news for convenience retailers. As vaccine distribution continues, more of the workforce returns to their offices, and consumers feel more confident in the economy, retailers can expect these upward trends to continue throughout 2021.
This post is sponsored by Skupos