Offering More than Convenience: The Benefits of Adding Food Service to Your C-Store

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Convenience stores are built around the idea that consumers want a fast and easy method for purchasing items throughout the day. For years, c-stores have relied on gas and tobacco sales to keep their business profitable. But with cigarette smoking at an all-time low and gas prices maintaining a reasonable cost per gallon, operators are now looking at other cost-effective options for increasing revenue. Internal store sales are helpful, but products often have low profit margins, resulting in minimal profitability. Instead, c-store owners and operators are turning to a low cost, lucrative method for increased revenue: c-store food service.

Food service is the perfect fit for convenience stores of any size. From large chain units to mom and pop shops, most can benefit from adding some hot and ready food items to their menu. In fact, according to a report from NACS, in 2011 convenience stores saw a 13 percent increase in the sale of prepared foods. After cigarettes, food service accounts for the largest percent of in-store sales and surpasses cigarettes in overall gross margin dollars. And, CSP reports that from 2011 forward, food service has continued to grow anywhere from 1-3% each year.

Many c-store operators recognize that an effective food service program can increase revenue and also increase new customers as well as customer return rates. But new research suggests that these programs are vital for creating competitive points of differentiation in today’s hyper-competitive world.

Today we plan to highlight the benefits and challenges to implementing a food service program to an existing convenience store operation. From there we will give you some strategies to make the program a success and ideas for promotion of your new program. We hope by the end of this guide you will be well informed on your options and equipped to make the leap into the food service arena.