SOI Summit: Back to the Future

This moment in convenience retail calls for a focus on basic execution and fast evolution.

April 08, 2024

NACS President and CEO Henry Armour wrapped the NACS State of the Industry Summit with a presentation summarizing his takeaways from the event.

According to Armour, we’re in a moment that calls for dual perspectives. On the one hand, “we’ve arrived back at a more normal time,” he said, “after huge disruptions in our country, a tremendous financial collapse, the Covid pandemic and a 13-year aberration in economic history of zero interest rates and tremendous financial liquidity.” The present business climate isn’t necessarily easy, but “it doesn’t appear to be nearly as chaotic as the last few years.”

From this perspective, it’s back to basics. “It’s about aggressively managing escalating operating expenses and once again competing with other channels for the customer.”

But in other ways, convenience retailers face “huge changes almost in the very nature of gravity,” Armour said. Among other fundamental changes: “AI will dramatically impact almost every process we have. AI is coming fast.”

Where does that leave retailers? Armour cited psychologist Daniel Kahneman’s observation that success in the future requires thinking fast … and thinking slow. Slow is the back-to-basics part, focusing on operational excellence. “But fast thinking is a bit more complicated … it’s really about articulating the problems that we really need to solve to get to the future and then finding technology and other solutions to solve those problems.”

For Armour, the two things the industry needs to solve to get to the future are:

  • Dramatically increase labor productivity
  • Reverse our thought process of using fuel as a way to get customers to our stores

Finally, Armour reminded attendees that in our industry, there are 160 million transactions every day, “eyeball to eyeball with other human beings.”

“We absolutely need to embrace new technologies to reduce friction to drive more convenience, but we have to be very careful not to reduce this unique personal relationship that we have with so many of our customers.”

Read more about the NACS SOI Summit in the June issue of NACS Magazine. The NACS State of the Industry Report® of 2023 Data will be available for purchase in mid-June.