Two Stores Are Better Than One

Gasoline-convenience store pairings help stations turn a profit.

August 05, 2014

FLORENCE, N.J. – A recent article in the New Jersey Times took a look at the increasingly common pairing of gas stations with convenience stores, particularly as the high cost of oil has made it hard to turn a profit selling gas alone.

According to several of the retailers interviewed for the article, to be successful, they cannot rely on a single profit center — for some, adding a convenience store is the only way to be successful in the industry.

According to Jeff Lenard, NACS vice president of strategic industry initiatives, the transition began, in part, when gas station service stations found themselves competing with dealerships who could afford the expensive computer diagnostic equipment and eventually began replacing their service bays with convenience stores.

Many owners take a loss on gas sales because of the low-profit-margin and reduced demand for gasoline and hope to make up the difference with the stores, according to Lenard. The items sold at the convenience stores have much higher profit margins than gasoline and can generate more traffic, Lenard said.

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