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Trend Watch: Convenience stores add seafood to take-away menu
Savvy operators are building sales beyond the gas-and-coffee format
July 17, 2012
The next time you stop at a gas station with an empty, rumbling stomach, you might want to check out the attached convenience store. Many convenience stores have migrated from meager offerings like tepid coffee and wilting sandwiches to gourmet fare like brick-oven pizza and smoked salmon.
The trend toward upscale food at gas-station convenience stores was born of necessity, says Jeff Lenard, director of communications at the National Association of Convenience Stores.
“Typically, a convenience store gets two-thirds of its revenue and less than 30 percent of its profits from gas,” he says.
“Everyone shops at a convenience store — for gas. But not everyone shops in a convenience store. The goal is to take those people at the pump and get them inside the store, and food is one of the ways retailers are trying to do that.”
Lenard was stunned when he visited Next Store Market in Boca Raton, Fla., recently and found a brick oven for pizza, a sushi chef and a pastry chef.
“Every Friday they have a barbecue or clam bake next to the parking lot, and I was there for a barbecue,” he says. “It was noon, and they had 100 people sitting outside in chairs and up to 70 people in the store. It was pretty busy.”
The larger convenience store chains are taking notice.
Tiger Fuel built the first prototype of its food market in 1993 and has four locations offering a market to date, all in Virginia.
“When we were looking toward the future, the quick-serve-restaurant model looked good to us,” says Stuart Lowry, marketing director for the company.
“Convenience stores have always filled the niche for time-starved people, so why not try to meet the needs of time-starved and hunger-starved customers in a fast-food style that goes way beyond their expectations?”
The markets have a full restaurant-style kitchen in the back, with a small seating area in the front of the convenience store. Most still have a traditional convenience-store presentation, but there’s a larger area dedicated to seating, much like in a delicatessen.
Charlottesville, Va., is home to Tiger Fuel’s Mill Creek Market, where the menu changes daily. Shoppers are typically dual-income families with parents aged 25 through 50 — often working moms — looking for convenient home-meal replacement items.
“We’re trying to offer a food presentation that’s relatively healthy, so you don’t feel guilty about giving your kids pizza again,” says Lowry. “For example, our rotisserie chicken is a big hit.
“But what we’re best known for is our sandwiches, delivered in a traditional deli-style presentation, with each one named for a regional place, such as the Farmington, or the Monticello.”
Seafood features prominently on the menu at the Mill Creek Market, says Manager Dave Nespeco.
“We make smoked salmon, poached salmon, salmon with crab stuffing, halibut, trout and we make our own crab cakes every Friday,” he says.
A lot of the entrées are a la carte, so you order your main dish and any sides you want with it. But some of the markets offer meal packages that rotate on a daily basis.
“We don’t want to be buttonholed into the McDonald’s Happy Meal-type package. We’re a local area chain and to retain some of that local flavor, you’ve got to be a lot more flexible,” says Lowry. “It took a little while for people to associate our gas station with good seafood, but once we got our customer base to trust our food, they just kept coming back.”
The sale of gourmet seafood at a gas station convenience store represents just how far such stores have come in a short time, says Lenard.
“Ten years ago, they were questioning whether they could sell coffee. Today, 7-Eleven is selling sushi. I think when convenience stores are selling seafood, it shows they’re coming all the way in terms of what they offer.”
At the same time, given the inherent challenges in terms of seafood spoilage, those convenience stores that do sell it had better be doing it well.
“If fish is done anything less than superbly at a convenience store, it’s like selling brown bananas; it sends customers the wrong message,” Lenard says.
“Going from being a retailer to high-end foodservice demands a change in mindset. For example, the retailer’s mindset is to keep it on the shelf until it sells. You can’t do that with gourmet food, especially with fish.”
That’s not hard to remember if you’re a GetGo convenience store. GetGo, owned by Giant Eagle, benefits from its association with Giant Eagle supermarkets.
“The ability to leverage the Giant Eagle food sourcing and preparation expertise is a great resource for GetGo,” says Liza Salaria, director of foodservice.
There are 94 GetGo convenience stores, 79 with Fresh to-Go cases, 32 of which operate in-store kitchens. They sell items like premium salads, veggie cups, wraps, chicken tenders, desserts and bakery items.
Seafood items include crispy fish sandwiches and wraps, Maryland-style fully cooked crab cakes, tuna salad sandwiches, a garden salad topped with shrimp and crab and a recently introduced New England clam chowder.
“Besides some of the lingering customer perceptions in the industry regarding the quality of food offered by convenience stores, the major challenges for us are similar to those on the supermarket side: providing a consistent level of food quality,” says Salaria.
“In today’s highly competitive environment, it’s vital that retailers differentiate the shopping experience [they offer] from that of competitors. At GetGo, we achieve this by offering high-quality, fresh food and unique, customer-oriented promotions and services in a convenient, family-friendly setting.”
Lowry agrees that differentiation is a pivotal factor if convenience stores want to remain competitive.
“Gasoline margins are eroding in this country,” he says. “If gasoline is the only product you have going for you, I think you need to start looking for other profit centers.”
Lenard couldn’t agree more. “Ultimately, we sell speed. Gourmet take-home offerings or dine-in meal offers are all methods convenience stores are using to help customers solve their problems with respect to time.”