By Pat Pape
ALEXANDRIA, Va.—Prepared food is the heavy hitter of convenience store foodservice. Of the five foodservice categories (prepared food, commissary, hot dispensed, cold dispensed and frozen dispensed), prepared food enjoys the most sales, accounting for 69.5% of all foodservice sales.
“In 2021, prepared food brought in $32,081 in sales per store, per month, which was an increase of 21.1% from the previous year,” said Jayme Gough, research manager at NACS.
Gross profits of prepared food also increased, “despite a margin decrease of 1.36 points to 57.68% in 2021,” she added. “Gross profit totaled $18,505 per store, per month. That’s a double-digit increase of 18.3% from 2020.”
In 2022, average monthly prepared food sales started off at $30,324 in January and hit a peak of $42,038 in August. “It’s important to take that with a grain of salt considering inflation,” Gough said. “Last year, prices for food at home jumped 11.8%, and food away from home increased 8.3% according to the Bureau of Labor Statistics.”
“Our motto is ‘sell them what they want,’ so we look at the data,” said Jimmy Crowder, director of food innovation at Texas-based TXB. “Our TXB Kitchen focuses on core items, and on quality versus quantity. Data will tell you what customers are buying. If we add something, we try to take something away, and our data tells us what needs to go. At the end of the day, we want to be great at a few things rather than mediocre at a lot. We don’t try to be everything to everybody.”
That attitude is echoed by Neon Marketplace, based in Massachusetts. When the store first opened during the pandemic, it “had a Cheesecake Factory-like menu, where we offered tons of things,” said Elise Babey, senior manager of product development and supply chain. “We’re still learning to find a balance. Making sure we’re consistently providing an elevated, quality experience is more important than offering 10 types of global cuisines and a cherry on top.”
Today, the chain concentrates on “great quality pizza, grinders, burgers, chicken sandwiches and coffee,” she said. “I like to say we’re a C-QSR. We’re a convenience store, but we operate our kitchen in a QSR model.”
Curby’s Express Market opened its first store, in Lubbock, Texas, a year ago and soon will have four locations. Tony Sparks, head of customer wow, said the 4,000-square-foot stores “can do anything Panera can do. Half of the store is traditional c-store items, and the other half is foodservice. About 67% of sales are on the QSR side.”
Curby’s menu ranges from toasted burritos and flat-bread pizzas to wraps, salads and four different kolaches, but the showcase offering is melts. “No one does melts in a meaningful way, so that’s our primary line of food,” said Sparks. “With melts, you’re only limited by your imagination.”
“The biggest gap between the haves and have-nots in foodservice is how dedicated they are from top to bottom to treating the business like a QSR, dedicating themselves to everything necessary for foodservice,” he added.
LTOS AND UPGRADED OFFERINGS
In today’s strained environment, some retailers are putting less emphasis on LTOs or making them available for longer periods. Others are focusing on unique offerings but simultaneously testing products that could become permanent fixtures on the menu.
Read the rest of this NACS Magazine article “What’s Cooking at the C-Store” in the May issue.
Pat Pape worked in the convenience store industry for more than 20 years before becoming a full-time writer. See more of her articles at patpape.wordpress.com.