There’s only one event that delivers the metrics, insights and information convenience retailers need to make data-driven decisions. Chris Rapanick stepped up to the mic on a recent Convenience Matters podcast to break down what attendees saw and heard at this year’s NACS State of the Industry Summit.
In “Industry Data You Can Use to Power Your Business,” Rapanick, who has been managing the NACS State of the Industry Enterprise for over 10 years, talked about key trends, challenges, and opportunities within the c-store industry.
One area of operations he noted was the impact of fuel prices on sales. Fuel price was down over 10% in 2023 and over 6% in 2024. Industry fuel sales were down $101 billion over the last two years. This has led to changes in the c-store sales mix, particularly among sites that do not have a robust in-store offer.
Rapanick noted that the industry is still impacted heavily by fuel performance, which historically has been based on revenue figures and their fluctuation. In recent years, the sales component has taken a back seat to the fuel margin component. As average margins have grown, retailers that were struggling have become profitable. This has had a significant impact on smaller chains, especially those that don’t have a strong inside offer. The change in fuel margins kept some retailers afloat, so it’s not a surprise that most of the sites that closed in 2024 were independents that did not sell fuel.
Inside transactions showed positive growth in 2024, reversing a decline from previous years. However, inflation continued to affect inside sales.
“For inside sales, there's still the impact of inflation. And every time we think it's going to go down, it spikes back up. For the past few years, we’ve adjusted our inside sales numbers for inflation and there's no growth—less than flat for merchandise in terms of actual dollar sales—and every [in-store] category in convenience is down in units.”
What was behind the increase in trips in 2024, yet merchandise sales were relatively flat? “It’s not more folks coming from the pump—pump transactions were down in 2024,” said Rapanick, adding that it’s due to customers buying less merchandise to stretch their dollars.
“We were seeing basket value growth post-covid where the basket went from $6 to roughly $8. That has slowed, so basket growth is now flat. People are shopping more often and spending about the same, but they're buying less merchandise,” he said.
A bright spot that is undeniable in the convenience channel is foodservice. Retailers are increasingly focusing on food as a core part of their business model, and the Summit highlighted success stories from retailers who have efficiently—and profitably—integrated foodservice offers that drive traffic to their stores.
“Foodservice is accelerating its percentage of in-store sales and in-store profits. We’re increasingly talking to retailers who say, ‘I do foodservice and, oh by the way, I have merchandise as well’ as opposed to ‘I'm experimenting with foodservice.’ Convenience is a food-forward business,” said Rapanick.
What else could keep customers coming back? How about the friendly and familiar faces of the people who work in your stores.
In 2024, there was a significant decrease in employee turnover rates within the industry. This improvement is attributed to increased salaries and bonuses aimed at retaining talent.
“People are staying around longer and they are more productive,” he said. As 2025 continues, Rapanick said it will be interesting to track whether the reduced turnover rates in the channel lead to increased trips.
“If people know who they're buying items from, even if they're buying fewer items, they’ll want to go to the place where they can have a conversation, see a smile from someone familiar … so that could play out in these somewhat uncertain times that we’re living in.”
To hear the full podcast, go to conveniencematters.com and hit the green play button.
Access All the Data
The NACS State of the Industry Report® of 2024 Data, set to be released in June, will feature complete insights on c-store industry trends and provide the benchmarks retailers need to measure their performance. Pre-ordering is available; reach out to Raei Tesfazghi at rtesfazghi@convenience.org.