Operating a convenience store in an urban setting is challenging due to intense competition, high costs, limited space, strict regulations, security concerns, traffic constraints and the need to cater to diverse consumer preferences. The urban environment’s fast pace demands operating hours, while supply
chain complexities and changing trends further complicate maintaining a well-stocked and profitable store.
I’m lucky to have four c-stores within a 5-minute walk of Winsight offices in downtown Chicago. There’s a grubby but reliable 7-Eleven, a 1-year-old Circle K that doesn’t know the meaning of the phrase “elbow room,” an Amazon Go that can’t be raking in too much revenue based on my observations, and an upscale Foxtrot that’s nice to visit, but those prices!
City Streets
For Chicago, this variety of options represents a boomtime for convenience retailing in an urban market. Not that long ago, Walgreens was the predominant corner store in the city, and while many of its stores are still here, the smaller footprints of c-stores have begun to find their own space in the ground floors of high-rises across the Windy City. Turns out, however, not every urban market is blossoming for convenience retailing.
In fact, the past five years have been crushing for retailers in some urban markets.
In Denver, retailers—and building owners—are still waiting for employees to return after the pandemic shut them out in 2020.
In Philadelphia, theft and violence have driven the cost of doing business too high to make a profit or keep employees safe.
In this month’s cover story, CSP editors check in with retailers who continue to see opportunity in urban markets, whether its relying on employees coming into the city five days a week to work in an office building or becoming an oasis in a food dessert, providing the only place area residents can find fresh produce and reasonably priced foodservice.
Innovation Beat
On a different subject, the other day I ate some grapes that tasted like caramel. Eye opening!
Another afternoon, I visited a museum that proudly proclaims “We all are artists.” The credo made for some subjective exhibits.
And also, the first paragraph of this column? It was written by artificial intelligence bot ChatGPT.
I asked it: “In 100 words or less, why is it challenging to operate a convenience store in an urban setting?” I can’t say it was wrong, but maybe a little obvious.
These experiences reminded me how, about five or six years ago, “disruption” was the word of the decade. Amazon was Go-ing. Retailers were promising delivery via drones. Third-party delivery! Electric vehicles! E-commerce vs. brick-and-mortar! And then the pandemic hit, and it came even faster!
While some of the examples mentioned above have shown legs, others have faded into niches, but we—in business and as consumers—continue to drink from a fire hose of innovation. Those who embrace it and aren’t afraid of risk will likely come out on top in the long run.
Of course, CSP and Winsight are here to help as we innovate around the innovation. This month, we hosted our inaugural RetailTEC Conference with sister publication Winsight Grocery Business, inviting c-suite, finance, operations, marketing and IT professionals to Dallas to get a better understanding of the challenges and solutions in the often-confusing world of retail technology. It was a unique sharing of the challenges and opportunities afforded by investments in technology. Watch for coverage in a future issue of CSP magazine.
By the way, those grapes I mentioned above? They’re worth checking out—if you’re OK with someone messing with the genetics of your food. They’re called Candy Heart Grapes and available at many grocery stores. Enjoy!