Coffee Helps Boost C-Store Sales

This article is brought to you by Core-Mark.

WESTLAKE, Texas—According to the National Coffee Association, 63% of American adults drink coffee every day, and many of those coffee aficionados purchase their java from a convenience store.

Due to coffee’s popularity, it’s often the centerpiece of a convenience store’s foodservice program. If the coffee is good enough to tempt shoppers inside, they are more likely to try other offerings, such as fresh sandwiches and baked goods. 

Arcadia Bay Select, a comprehensive coffee program from Texas-based Core-Mark, helps c-store retailers drive traffic into the store and encourage foodservice trial. “Retailers that have converted from a moderately performing coffee program to Arcadia Bay Select have seen an average 63% increase in coffee sales,” said Chris Scott, corporate director food service, Core-Mark.

Millennial coffee drinkers are open to new beverages and preparation methods. They are interested in conscious consumption, which includes the origin and production of the coffee they drink, and they are aware of free trade and the Rainforest Alliance, which tells them what sustainability practices are in place. These attributes, which influence the shopping decisions of millennials, are among Arcadia Bay’s features.

The program includes everything from brewing equipment and syrups to marketing tools and 100% Arabica coffee. Arabica beans come from the “Bean Belt,” the area between the Tropic of Cancer and the Tropic of Capricorn, and are carefully roasted to maintain the flavor.

“Because the roasting process can turn a high-quality bean into something dreadful within seconds, we have technical controls that allow us to monitor the heat at precise levels,” said Scott. “Then, the roasted beans are precision ground, measured to the exact portion weight and packaged to ensure a premium product.”

Before a convenience store serves its first Arcadia Bay customer, Core-Mark consults with the retailer to conduct extensive research in and around the store, looking at the competition and consumer demographics and doing a site survey.

“Members of our Food Marketing Initiative staff go to the store and analyze its business,” Scott said. “We look at the competition within a five-mile radius around the store, and not just other convenience outlets. We look at QSRs and FSRs, so we have a holistic view of who the real competition is. We then provide management with a roadmap to success.”

Based on the store’s volume and existing factors in the market, Core-Mark will suggest the Arcadia Bay Select program best suited for the retailer, which may include from two to six airpots on a coffee bar that stretches from as concise an area as 4 feet to as large as 12 feet. Cappuccino machines, cold brew coffee, iced tea and even nitrogen-infused beverages also are available, and the company has developed a model for an in-store, barista-managed coffee service.

As consumers respond to the program, Core-Mark can recommend complementary items, such as pastries, breakfast and other foods, to enhance the coffee offering and increase sales.

“This is a partnership,” said Scott. “We’re a partner in their business as much as they are in ours. It’s a serious investment, but it’s going to be high volume, high traffic and bring in $4 rings.”

Coffee is among the highest margin items in a convenience store (with a gross margin percentage of 62.5 per store per month, according to recently released NACS State of the Industry data), and its importance cannot be ignored.

“Coffee is a big category,” said Scott. “And when customers are in the store having a great cup of coffee, it’s an opportunity to promote breakfast, bakery, pizza and fried chicken.”

This is the first installment of a two-part series on c-store coffee programs. Look for more on this coffee program in the June 11 edition of the NACS Daily.