With all the pandemic restrictions on gatherings and movements, everyone expected the downfall of business activities and the cutback on profits. Surprisingly for c-stores, this has not been the case. Data released by the NACS State of the Industry show that convenience retailers were unshaken during the pandemic period that affected global economies.
C-stores saw a 1.5% increase in sales from 2019 to 2020, generating $255.6 billion. This rise in sales happened despite a decline in the number of customer transactions. How was that possible? According to NACS, the rise in profits resulted from an increase in basket sizes, which stood at 18.4% in comparison to 2019.
So, why did convenience store retailers generate such huge amounts of income even at a time when the number of stores reduced by 1.6% across the country?
How Are C-Store Sales Increasing Amidst the Pandemic?
The reason lies in their name – "convenience". At a time when many people were restricted to their localities, these shops proved to be an ideal option for the pandemic conditions. They offer the basic items that most households need, remain open for 24 hours, and are conveniently located.
Apart from fuel sales that dipped as a result of restricted movement, the majority of retailers have admitted a rise in their in-store sales. Among the c-store owners interviewed in a NACS Retailer Member Pulse Survey, 50 percent of respondents registered a positive income, in relation to 30 percent who reported shrinking sales.
The convenience sector benefited largely from the Americans shifting to localized shopping. Consumers flocked to the nearest stores to fill larger baskets with in-home foods and drinks. Pre-packaged meals, beer, cleaning detergents, and tobacco are some of the products whose demand still stood high.
How Are They Competing?
While c-store retailers continue to enjoy an upsurge in sales, they still face competition from conventional grocery stores. This is because both stores stock almost similar products, but the grocery retailers offer a greater variety of packaged consumer goods. To remain on top of their game, conventional store owners have:
Adapted to Local Customer Demands
The pandemic has resulted in certain shifts in consumer preferences. It might be hard to note a change in customer trends, but information such as per-basket transactions helped c-store operators meet localized demand and improve sales. For example, the latest data shows that products such as alcohol and tobacco are doing extremely well compared to food services.
Kept Customers Safe
Consumers want to feel safer and protected now more than ever while buying goods. As such, most C-stores owners have put in place proper packaging measures, and clean more frequently to maintain the trust of customers.
Engaged in Charity Actions
Everyone is still having their tough moments, and a little act of kindness could help change their situations. As a way of giving back to society and showing solidarity, some convenience shop owners are making free deliveries to vulnerable groups such as the elderly, offering free meals to health care workers, and many more. Such acts are boosting their reputations and enabling them to attract and retain more customers.
Has Changing Product Selection Helped C-Stores to Retain Customers for Long?
Changes brought about by the pandemic have pushed c-store retailers to adjust their product mix. More shops are now focusing on take-home meals, drinks, and beverages. Precisely, data by NACS shows that 49 percent of stores concentrated on pre-packaged ready-made meals, 41 percent emphasized prepared food services, with 24 percent focusing on take-home meals.
As inventory categories change to match consumer demand, so too will a c-store's refrigeration needs. Limited by space, convenience store operators need refrigeration systems that are reliable, powerful, and energy-efficient.
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