Convenience Stores
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 87,300 convenience store companies in the US sell a limited selection of merchandise in high-traffic locations. The majority of convenience stores in the US sell gasoline. Most convenience stores are independent operators – 92% of c-stores have a single location.
Reliance on Fuel Sales
Managing fuel sales is a critical yet risky part of c-store operations.
Rising Credit Card Fees
The cost of credit/debit fees continues to grow and can exceed the pre-tax profits for a c-store.
Industry size & Structure
A typical convenience store sells gas, operates out of 1-2 locations, employs 14-15 workers, and generates almost $7.5 million annually. A typical c-store that does not sell gas employs about 5-6 workers and generates about $1 million annually.
- The convenience store industry consists of 87,300 companies with over 130,000 stores, which generate about $457 billion annually and employ 991,000 workers, according to the Census Bureau.
- The average convenience store had 45,312 transactions (at the pump and in-store) per month in 2023, or 1,491 per day.
- Most convenience stores are independent operators - 92% of c-stores have a single location, and 88% employ fewer than 10 workers.
- The average c-store chain has about 50 individual stores.
- Large companies include 7-Eleven, Couche-Tard, Casey's General Stores, and Murphy USA.
Industry Forecast
Convenience Stores Industry Growth
Recent Developments
Dec 18, 2024 - Gas Prices and Wages Fall
- Employment by convenience stores grew 1.7% in October compared to a year ago, although it eased from its summer peak, while average industry wages for convenience retailers dipped 1% over the same period to $16.83 per hour, according to the latest US Bureau of Labor Statistics data. The national average retail price of a gallon of regular gasoline, a major revenue stream for c-stores, was about $3 per gallon in December, down from about $3.60 in the spring, according to AAA.
- The Food and Drug Administration has submitted a rule that would set a maximum nicotine level for tobacco products, Convenience Store News (CSN) reports.The proposed rule was submitted to the Office of Management and Budget in December and proposes a product standard to establish a maximum nicotine level to reduce the addictiveness of cigarettes and certain combusted tobacco products that would be among the most impactful population-level actions in the history of US tobacco product regulation, per the FDA. The agency first discussed lowering nicotine in cigarettes in 2018. In 2022, Commissioner Robert Califf announced the agency was developing a rule requiring tobacco companies to lower nicotine levels to no higher than a designated maximum level. The National Association of Convenience Stores is paying close attention to the proposed rule, as cigarette sales, while declining, accounted for about 21.5% of in-store c-store sales in 2023, per Statista.
- Fueling options are evolving and convenience store forecourts are following suit, Convenience Store News reports. Growing demand for biofuels and electric vehicle charging stations requires changes to fueling islands. CSN notes that ethanol adoption has seen its greatest growth in the past five years, mostly in the Midwest where C-store operators in Iowa, Missouri, Kansas, Illinois and Minnesota must adapt or risk losing customers to competitors. Fortunately, according to the Renewable Fuels Assn’s. Cassie Mullen, ethanol “is an easy fuel for the retailer to incorporate because of existing compatibility of infrastructure and because many major oil companies embraced the blend and are encouraging the offering." While still small, EVs are the fastest-growing car sales category in 2024, with a 7.6% share of the total US vehicle market. Larger chains have already installed EV chargers, with many taking advantage of the funding offered by the National Electric Vehicle Infrastructure program.
- Monthly visits to convenience stores have been rising consistently year over year since February, according to a recent report from foot traffic analytics firm Placer.ai. Except for January when visits declined 3.3% year over year, traffic has risen each month, with February, May, and August each seeing customer visits increase by more than 2% versus the same month a year ago. According to the Placer.ai’s C-Stores: More Than a Pit Stop report, “Convenience stores are increasingly viewed not only as places to fuel up but as affordable destinations for quick meals, snacks and other necessities.” In August, Texas-based Buc-ee’s saw the biggest jump in traffic (up 11.7%), followed by Circle K (up 9%), Sheetz (7.6%), Casey’s (3.4%), and Wawa (3.2%), per the report. The rise in visits is driving expansion in the industry. Visits to c-stores typically peak in summer months and slow in winter.
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