By Sara Counihan
ALEXANDRIA, Va.—A strong foodservice program should be a focus for any convenience retailer looking to make it in today’s fast-paced world. This week’s episode of the Convenience Matter podcast talks to three experts who are not only making the case for having great foodservice but making it convenient for both the customer and the employees creating it.
According to Jayme Gough, NACS research manager, foodservice categories represented nearly 23% of in-store sales and nearly 35% of gross margin last year.
“What we’re really talking about is almost a third of in-store profitability coming from those foodservice categories,” said Gough.
Foodservice took a hit in 2020 due to the pandemic. Many convenience retailers had to scale back or completely stop their foodservice programs.
“Foodservice in total was down in sales 9.6% from 2019 to 2020. And a lot of that was in the categories of prepared food, hot dispensed beverages, cold dispense beverages and frozen dispensed beverages,” said Gough, who added that there was a bright spot in foodservice categories—commissary.
Commissary includes items that are prepackaged, preprepared and grab-and-go, so consumers considered them a safer food option last year. According to CSX data from January to July of this year, commissary is up 6.8% year over year, which Gough says is “really great, especially because we had so much growth last year.”
“It means retailers are continuing that growth. Customers came into stores last year, looking for commissary products, and what they found is that convenience has a really great offer for them,” she said.
For Greg Watson, regional foodservice manager at Tri Star Energy who operates the Twice Daily convenience stores in the Southeast, foodservice is a big traffic and profit driver for the convenience store, which encourages its customers to come in “twice daily” for food. Along with a foodservice program that is fresh and well executed, Watson says customers service is what keeps customers coming back.
“The team members really go out of their way to make sure that the guests are happy. We have a lot of guests that come in that have special requests, and we can do any of those for them,” said Watson.
The majority of Twice Daily foods are made in store, and all staff is cross trained. The food recipes and processes are well-documented, and these attributes are consistent across every single location.
Watson also uses a food waste program that has helped his company realize a 10% increase in food sales by a company called Supplyit. Be sure to listen to this week’s episode to learn about why Watson can’t stop talking about this program and hear from Supplyit partner Thomasin LaMacia on exactly how the program works and how you can implement it in your own store.
Each week a new Convenience Matters episode is released. With more than 300 episodes to choose from, the podcast can be heard on Apple Podcasts, Spotify, Google Play and other podcast apps and YouTube and at www.conveniencematters.com. Episodes have been downloaded more than a quarter million times by listeners around the world.
Sara Counihan is contributing editor of NACS Daily and NACS Magazine. Contact her at scounihan@convenience.org.