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
Oct 18, 2024 - Customer Traffic Is Up
- Monthly visits to convenience stores have been rising consistently year over year since February, according to a new 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.
- Employment by convenience stores grew 1.8% in July compared to a year ago to a new high for the industry, while average industry wages for convenience retailers and vending machine operators were essentially unchanged over the same period at $16.64 per hour, according to the latest US Bureau of Labor Statistics data. July’s average wage fell nearly 5% from January, consistent with a cooling labor market. Meanwhile, sales for food and beverage stores rose 1.9% year over year in June, supported by continued growth in consumer spending, up 2.6% YoY in June and 0.2% from the previous month, BLS data show.
- Canada's Alimentation Couche-Tard, which owns the Circle-K brand in the US, isn’t giving up on its pursuit of 7-Eleven, Reuters reports. Despite 7-Eleven’s Japanese parent company’s rejection of its $38.5 billion offer, Couche-Tard said it’s open to engaging in confidential discussions with Japan’s Seven & i Holdings to overcome its rejection of its bid. Seven & i, which says it’s open to a higher bid, rejected the $38.5 billion bid saying it wasn’t in the best interests of its shareholders and could face antitrust challenges in the US, where the combined company would be the biggest convenience store operator by far. In calling for more talks, Couche-Tard said it was highly confident that discussions would lead to increased value, adding it has sufficient capacity to finance the transaction in cash. Couche-Tard, 7-Eleven, and Circle K are the largest convenience store chains in the US based on the number of locations.
- To sell more alcoholic beverages, convenience stores should focus on younger, legal-drinking-age women, a critical demographic that c-stores have yet to fully capture, the NACS reports. The majority of drinkers in the US under the age of 25 are female, with rates of alcohol consumption among women outpacing those of men for the first time in the US in 2019, according to data from the National Survey on Drug Use and Health. Currently, women make up 43% of c-store customers, leaving room for growth among this promising demographic. Alcohol brands – particularly in the ready-to-drink segment – have seen their sales bolstered by female shoppers, and these companies are increasingly catering to their specific needs and preferences. C-stores can grow sales to women, NACS notes, by stocking more zero-sugar alcoholic beverages, malt-based drinks, and wine, which women, more than men, tend to favor.
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