Drive-Thrus Are Driving Sales

By Pat Pape

A year ago, leaders at SavOn Convenience Stores saw an opportunity to enhance customer service, and hopefully boost sales, by opening a long-ignored drive-thru window on the side of one SavOn store that had formerly housed a Taco Bell.

“We thought, ‘The window’s there. Why don’t we use it?’” said Sean Brown, director of operations for the Oneida, New York-based chain owned by the Oneida Indian Nation.

Soon, SavOn was selling coffee, soft drinks, tobacco and Blimpie’s sub sandwiches through the window and customers loved it. In fact, the response was so positive that management wanted to add new drive-thrus to other existing locations.

“We looked at three of our larger locations, and that’s when our creative team said, ‘Let’s think outside the box,’” said Brown. Instead of adding actual windows to existing stores, the chain constructed 8-foot by 12-foot drive-thru kiosks just adjacent to the gas pumps on the store parking lots. The result was a 54% jump in sales.

Currently, the kiosks offer basic items, such as Green Mountain coffee in K-Cups brewed by a single-serve Keurig machine, donuts and tobacco products. “About 80% of what we sell out of those kiosks is tobacco-related,” he said. “In the future, we will expand the offerings to include some breakfast sandwiches and barista-style coffees.”

Remain Seated
Drive-thru windows were serving customers at banks and food stands as early as 1930, and today drive-thrus are a staple at most QSRs. While they have been the exception in the convenience store industry, some operators offering window service report impressive sales results.

The 20-store Pak-A-Sak chain headquartered in Amarillo, Texas, got its first drive-thru in 2008. Because the handy window was a big hit with customers, “We went back and remodeled a couple of the stores to add drive-thrus, and that really improved sales for us,” said Brian McKee, vice president of merchandising and co-owner of the company along with his two brothers. “It showed that a drive-thru doesn’t cannibalize the sales that you already have. It increases sales.”

Today, the company has nine drive-thru stores. Pak-A-Sak employees will provide drive-thru customers with any products they request, but most calls are for fountain drinks, beer and tobacco, a combination of categories that experienced a “roughly 25%” sales increase with the addition of the windows.

“People just want to use a drive-thru,” said McKee. “They want to stay in their car, get their stuff and go.”

Two of the nine Square One Markets in northeast Pennsylvania have drive-thrus, and customers can buy “anything that fits through the window,” said Lisa Dell Alba, president and CEO. However, most purchases are tobacco, items from the cooler and lottery tickets.

“If somebody has a major lottery order, we’ll ask them to pull aside, and we’ll get their order together so we don’t tie up the drive-thru,” she said. However, if a shopper is disabled or otherwise can’t leave the car, “We do everything we can to accommodate that customer.” Kocolene Marketing operates 11 convenience and 18 tobacco stores in Kentucky and Indiana, and more than half of those locations have drive-thru windows. “It’s becoming more common,” said Andrea Myers, executive vice president at Kocolene.

There are a couple of reasons drive-thrus have been a success. First, customers don’t want to be outside in bad weather, Myers noted, and second, laws prohibit people younger than age 18 from entering tobacco stores, and many parents prefer not to leave youngsters alone in the car. “A drive-thru window offers them an easier way to make purchases,” she said.

Drive-Thru Planning
Obviously, it is much easier to build a drive-thru window during the store-construction phase than to retrofit an existing building. But there are other issues to consider when planning for a drive-thru.

“You have to look at traffic flow,” said Dell Alba. “You have to look at your lot size and your neighborhood in terms of what kind of business you’re doing. Are you in an area where a lot of people are driving by?”

To ensure quality drive-thru service, each window requires a dedicated store employee. “It does add a little bit to your labor cost,” said McGee. “But we believe the extra sales you get more than offset that.”

SavOn assigns an extra store employee to each kiosk from 6 am until 9 pm in summer and from 6 am until 7 pm in winter. The kiosks close around the time it gets dark. “We’re in the convenience industry, and we’re offering that higher level of convenience,” said Brown.

“You’ve got to be dedicated to it,” said McGee of the drive-thru sales system. “If someone pulls up, we want to be ready to serve them. We get so many compliments from customers who say that Betty or whoever [is working the drive-thru] knows exactly what they want before they even get up there. And dogs get a dog treat every time [their owner] comes through the window. Those dogs know too. They’ll start barking at the cars in front of them because they want to get up there and get a treat.”

Consumers take drive-thru service for granted. They are used to driving up to any fast-food restaurant and getting what they want quickly and easily, so special emphasis should be placed on training c-store team members to handle drive-thru customers.

“I want the customer to be acknowledged and the transaction under way in 30 seconds,” said Dell Alba. “We actually stand there with a stop watch and time our transactions. We want that service to be fast, quick and efficient. It gives you more of a challenge in terms of customer service.”

SavOn’s Brown agrees. “We’re all about speed of service,” he said. “The whole idea behind drive-thrus is offering a level of convenience that our competitors do not, allowing our guests to get their fuel, some staple items and hurry on their way.”

But Not For Everyone
More than a decade ago, 7-Eleven built a store north of Dallas that included a drive-thru window. The window still exists, but it is now closed to business and all customers must come inside the store to make a purchase.

In 2008, La Crosse, Wisconsin-based Kwik Trip opened its first drive-thru at a c-store in Onalaska, Wisconsin. But the window was eventually closed. “Our customers said they valued the personal interaction in the store, and they didn’t get that through the drive-up window,” said John McHugh, manager of corporate communications. “It proved to us something we have always believed at Kwik Trip: Customer service is all about that personal connection.”

Dell Alba admits that not everyone is immediately sold on the concept. “I’ve been challenged a few times with vendors saying, ‘Hey is this really a worthwhile endeavor?’ We’ve had one drive-thru for almost 30 years, and we have a reputation for being the place to go for tobacco. Ancillary sales are almost a given. Customers very seldom just get a pack of cigarettes,” she said.

Dell Alba has no doubt that a drive-thru attracts more customers to Square One Markets. “That person coming through your drive-thru comes for a reason,” she said. “They don’t want to get out of the car. They have choices, other places they can go. They tell us they love [the drive-thru]. It makes us unique and gives us a reputation for convenience and good service.”

Pat Pape spent 20 years in the corporate communications and IT departments at 7-Eleven. Currently, she is a writer and communications consultant for retailing clients and trade associations as managing partner of Brookview Advisors, Inc.