The Industry Impact | Q4 Convenience Store Update

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As we finish out the year and reflect on the first 10 months of 2020, to say those months have challenged what we all thought we knew, is an understatement. COVID-19 has impacted consumer behaviors, forcing convenience stores around the world to adapt quickly or face going out of business. For those convenience stores that offer foodservices and grocery items, the pandemic has forced them to establish new operating procedures that may be here to stay.

The Initial Impact of COVID

When the pandemic first began and more and more workers started working remotely from their homes, in-store traffic decreased for most convenience stores as fewer people were commuting. That meant fewer grab-n-go breakfasts and other meals that were easy to consume in the car, were not being purchased at the same rate as more people were eating at home. According to the CS News Foodservice Study 2020, foodservice sales decreased across the board for convenience stores in the first half of this year due to coronavirus restrictions.

These restrictions required operational changes as consumers and retailers alike were concerned with safety and cleanliness. Many stores changed their approach to foodservice. Retailers with dining areas and public seating closed those sections to reduce risks, and retailers also removed access to self-serve food and beverage items to minimize additional exposure for customers and staff.

The Future of Fresh Convenience

What C-stores experienced in the early days of the pandemic has evolved as economies have begun to reopen. Though many workers remain remote and will be for the foreseeable future, some commuters have hit the roads again. Many consumers still try to consolidate their trips but new reports indicate that dollars per transaction are up compared to 2019, particularly in categories like alcohol, packaged beverages, and groceries.

To help combat the decrease in items often bought by commuters and to jump onboard the eating at home trend, convenience stores have expanded their offerings or for the first time added the option of take-home, ready-to-heat meals or meal kits. Stores are revamping menus to offer expanded selections for customized and made to order options from chicken sandwiches to salads, and many stores have also decided to add fresh produce for the first time or diversify their fresh selection. According to CS News, companies such as Couche-Tard have seen great success with their “Fresh Food Fast” program where sales for stores with the program are outpacing sales at comparable stores without the program.

And technology-focused retailers have positioned themselves to compete by meeting the demand for online order fulfillment with offering expanded delivery and curbside pick-up. The CS News Foodservice Study 2020 report states that close to 25% of convenience stores will add ordering ahead via an app within the year.

Interested in taking a deeper dive into the numbers and hear more about the trends impacting the industry?

Request time to speak with me to take a more in-depth look at fresh food and the convenience store industry over the last several months. 

About the Author

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Jesus Mathus is the Global Head of Retail Solutions at ADC where he is responsible for bringing the point of view of our retail customers on everything we do. Prior to joining the ADC team, Mathus was the Chief Information and Supply Chain Officer for Cardenas Markets, a grocery chain based in Southern California. At Cardenas, Mathus was responsible for setting the IT strategy to transform its technology platform as well as the supply chain growth plan to support the business as the company expanded its national footprint. Before his time at Cardenas, Mathus was the Chief Information Officer for Bodega Latina Corp (dba El Super) where he led the transformation of the company's technological platform to improve overall profitability and market share.