2023: THE CONVENIENCE AND FORECOURT YEAR IN REVIEW

GCSF puts spotlight on the convenience retail innovators

2023 has been a standout year for innovation in convenience retail with a raft of new formats introduced to the market and a heightened focus on premium, freshly prepared foods plus local specialities.

These developments have all taken place against a challenging economic backdrop. Retailers have had to contend with a cost of living crisis brought about by high inflation and rising energy prices, as well as ongoing supply chain issues, the need to invest in new tech and address environmental issues and reduce emissions.

Nonetheless, retailers have proved resilient and forged ahead with new developments and are planning more of the same for 2024.

GCSF kicked off the year talking to High’s, the 60-strong convenience store chain servicing the Mid-Atlantic region in the US and learning about its four pronged strategy, which included driving growth and profitability in food and beverage and leveraging tech for better data and insights.

The company has been on a rebranding exercise since 2017 and had remodelled two thirds of its locations when we spoke to High’s senior vice president Brad Chivington.

The rebrand has emphasised fresh food in terms of the look and feel of stores but crucially has retained High’s dairy and ice cream heritage.

Chivington shared High’s foodservice journey, which included a strong focus on super premium ice cream plus milk shakes and sundaes and a packaged take-home offer too.

High’s has introduced local specialities including freshly hand breaded chicken but executed the High’s way with a proprietary season breading that uses fresh marinated chicken, not frozen.

There’s a pizza offer plus breakfast and lunchtime sandwiches including rockfish and pit beef sandwiches, which are signature Maryland items.

Crab cakes are another big local menu item, which have been a hit with High’s customer base.

“We have a traditional offer but try to find signature and unique items that differentiate us from the competition,” Chivington said.

“The industry has done a good job of elevating food and food quality over the years. We’ve broken the stigma of getting food from a gas station.”

One of the first Shop Talk LIVE episodes recorded in 2023 put the spotlight on Ireland’s leading convenience and roadside retail operators to discuss fresh food-focused formats.

The panel featured Insight managing director, Dan Munford; Brian Reid, CEO of food-to-go specialist manufacturer, DELI LITES;

Thomas Ennis, owner at the Thomas Ennis Group; and Brian Donaldson, CEO of Maxol Group.
Reid shared the background on the DELI LITES business, which was inspired by a trip to New York, and emphasised the need for newness and excitement.

“It’s about innovation and discovering those products that customers want to see and bringing them to life in-store to inspire customers with colour and vibrancy,” he said.

Ennis agreed and recalled the fresh food challenges he faced opening his first store on Merrion Row, Dublin, back in 2005.

“It was a bit different compared to all the other convenience stores that were out there,” he recalls.

“We didn’t want to have pre-packed sandwiches back then,” he says, “we wanted to make our own and we wanted to have our own – we didn’t want to be like everybody else.”

Like Reid, Ennis reveals the importance of travel in seeking out new ideas and inspiration.

“We all travel – we’ll be in New York quite a bit and in London and we look at what’s going on in the market and in Ireland also.

We’ve got some really, really good retailers,” he says. The STL focuses on Ennis’ latest store, Spar Waterloo Exchange, which packs a punch in limited space.

The focus is on fresh food and quality plus consistency, he maintains.

Ennis also spoke to upholding quality and standards in spite of the cost of living crisis.

The consumer is more educated on fresh food and well travelled, he said.

They know what food should look and taste like and they even know the value of it now, he added. People will pay for quality food and ingredients and they want to eat quality, healthy food, he maintained.

The STL moves on to feature Maxol’s EUROSPAR EV hub in Kinnegar, Northern Ireland. Opened in December 2022, the site represents an investment of £2.4m and is the first ultra rapid EV charging hub on the island of Ireland.

Here too, there’s a strong focus on fresh food with a locally produced pre-packed butchery, locally produced ready meals and locally produced food-to-take home plus national brands.

The store also features Delish deli, which was a first for Northern Ireland.

According to Donaldson, customers appreciate the increased choice and range of the EUROSPAR format and more than 50% of people using the EV charging hub were shopping in the EUROSPAR format shortly after the store’s opening.

In March GCSF turned its attention to one of the growing issues for convenience store operators and, in particular, their staff: harassment.

Escalated by the cost of living crisis, there’s an increasing amount of anti-social behaviour and shoplifting in stores and, all too often, it’s the front-line c-store staff who bear the brunt.

At the start of 2023, Circle K decided to take action with the launch of the Circle K Kindness Day and a wider call to action to the convenience industry to help stamp out staff harassment.

“We really thought we could do something on a European level across our network,” Preben Kristiansen, head of people at Circle K Europe said.

“Then it struck us – it’s not just a Circle K issue, it’s an industry problem so we thought why not try to encourage and create this ‘call to action’ message to the rest of the industry that we need to make sure our customers are kind to our employees.”

The Circle K initiative aims to encourage customers to be kinder to employees and equips stores with a tool kit including giveaways, posters, stickers and badges featuring messaging, which asks customers to be kind to employees but also thanks and acknowledges kind behaviour.

The motivation for the kindness campaign was crystal clear from the offset, as Kristiansen explained.

“For us, our people are the main and most important asset – we are nothing without our people out in the store. When we see that we have employees that are harassed out there, and some more than others, we can’t just sit down and do some online training and that’s it.

“We are open 24/7 at most of our stores and, while we can never guarantee that we will not get a customer coming in that is not treating our employees with respect, our employees should know that we are doing whatever we can to make sure that the customer behaves well.

If he or she doesn’t, our store employees should feel comfortable that we are doing everything we can and give whatever support is needed to our store employees that have experienced harassment in the workplace,” he says.

In April, GCSF was back in the Mid-Atlantic and hearing from Wills Group president and COO, Julian B. (Blackie) Wills, about the new Dash In Kitchen brand, opened in March in Chantilly, Virginnia.

Dash In Kitchen is the latest evolution of the Dash In brand, which was launched by Wills’ father, Julian Blacklock Wills, in 1979; initially with a test site and then the building of the first full size Dash In store in 1981.

The new concept elevates Dash In’s foodservice credentials in preparing food on site using fresh and clean ingredients with the introduction of a new menu featuring signature dishes and specialities plus new beverage products.

The menu includes griddle press burgers, which are made using Angus beef patties and available as singles, doubles, triples, as well as a smokehouse version plus a collaboration with a celebrity chef, Spike Mendelshohn, on a Spike Burger.

Like High’s, Dash In Kitchen has two key signature dishes: mini donuts, which are fried in house and then sprinkled with cinnamon, chocolate and sugar; plus house made chips available with salt and pepper, salt and vinegar and Old Bay Chip seasonings.

There’s also a full line of pastries – sweet and savoury; while healthier options include salad bowls with a choice of bases like field greens or quinoa and a selection of protein toppings.

Quesadillas are also available across all day parts and are offered with a choice of grilled chicken, steak or carnitas fillings; while a standard pizza offer has evolved into a unique flatbread product, which is made in house and full customisable.

Chicken wings are another staple and always part of Dash In, Blackie said. “We wanted to really lean into food and we are really going to lean into prepared food with new stores,” he added.

The Kitchen brand has also introduced a new proprietary line of dispensed refresher drinks featuring teas, lemonades and limeades.

These have been developed with a beverage purveyor and have been well received by the community. “We are very bullish about that and will be integrating into all of Dash In stores over the summer,” Blackie told GCSF.

Loop Neighbourhood Market, the 56-strong California convenience store chain, also aims to differentiate from the competition through innovative and great tasting food and building community engagement, GCSF learned.

The retailer has also worked hard to ensure it provides an inviting and safe environment with windows that stretch the full height of the store, smart subway-style tiles plus gondolas that are sited at eye level so customers can see right across the shop.

Food and kitchens are a key focus at Loop, which has taken out product that didn’t sell and replaced it with better for you and healthier lines including a full salad bar.

The fountain machines have been enhanced and freshness cues introduced around the store to to build customer trust on product quality, Pervez Pir, president of retail explained.

Loop has also narrowed its confectionery assortment but introduced lines such as seaweed and better for you chips, that you wouldn’t expect to find a in a c-store.

“We had chickpea chips back then when they were not popular but now they are popular,” Pir says.

“We are a c-store, which is open 24/7 and needs to serve the neighbourhood so we did not shake it all up but we did say ‘how do we differentiate?’ Thirty per cent of the offer is different across the store.

We wanted to find other ways to bring people into the site,” Pir said.

The retailer also shared details of a new kitchen brand, Hello Tasty, which offers pizzas with home made dough and unusual toppings; and its Loop blend bean-to-cup coffee, which have both been well received.

Further private labels were in development too. “We just love pushing the barrier and finding new things – we don’t mind failing fast but we prefer to do it rather than be too scared to do it,” Pir said.

On the community piece, Loop is committed to supporting local organisations having been partly inspired by the Parks and Recreation TV show featuring the charity KaBOOM!, which builds playgrounds in locations all over the US.

“It’s about giving something back. It’s not fake – it’s altruistic and genuine.

We are a family company that feels blessed and we want to help our own employees and communities,” Pir says.

Loop has selected a range of local organisations and will swap ones out to give others a chance, however, two – the California Fire Foundation and the Bay Area Deputy Sheriff’s Foundation – have been retained as constant key beneficiaries.

Newer good causes Loop has partnered include the RotaCare Bay Area volunteer alliance of medical professionals who are dedicated to providing free primary, quality healthcare.

Loop has also supported a local high school to raise funds for a new soccer field by providing a percentage of sales from a gas station pump close to the school.

And, at the end of last year, the retailer participated in a similar Shell program called the Giving Pump to raise money and support a student education initiative across California.

Pir reported the next phase of community involvement will be exploring how it can help its staff and team members by introducing internships for kids and encouraging third year students to apply for an eight to 10 week paid placement.

“They will present a project to our executive team and we will make them a job offer. If it works, it will be a very successful way to motivate people in our community,” he said.

In June GCSF visited a market undergoing huge transformational change – Saudi Arabia – and learned how Orange was giving consumers more reasons to visit its locations.

The Saudi Government’s new Vision of 2030 means that in future all fuel sites will be operated by corporates and not individual owners.

As a result, competition is currently intense as multi-nationals enter the market and local players build scale.

Orange is expanding its operations and had a target for 60 stations by the end of 2023 and 300 within the next five years, Hesham Elshafei, retail operations manager for Orange, revealed.

Orange aims to stand out from the crowd by focusing on retail excellence, Elshafei reported. “We are not selling products but selling service and convenient shopping experience.

We provide the end consumer with a safe and convenient environment and a one-stop shop for all their activities in a high and professional retail standard.”

In foodservice, the company partners with big name brands including McDonald’s, KFC and Burger King; while in coffee Orange partners with Starbucks plus Barn’s and Road Cafe, which are local reputable coffee players.

“We completely rely on tenants, we only operate the fuel business, not food and beverage, so we rely on big partners in the market,” Elshafei explained.

Readers heard how transformational change in Saudi Arabia is driving the development of c-stores over local baqalas (supermarkets), which are currently the dominant store format.

Circle K, for example, has opened four service stations in Jeddah and Orange is exploring how it can be an integral part of the c-store business and expand its offering in this sector through new partners, Elshafei revealed.

The retailer is also expanding its lubes and car wash offering.

“We are always trying to find investments and enrich the portfolio in Orange, either by ourselves or via partners and experts in those fields,” Elshafei said.

If anyone wanted a fresh take on the latest global strategic industry issues then NACS president and CEO, Henry Armour, would be your first port of call.

In May Armour presented at the NACS Convenience Summit Europe in Dublin, Ireland, revealing the results of the NACS Global Issues Lifecycle Survey.

The survey sought to understand which strategic issues were high on the agenda of senior convenience sector executives and the extent to which they rated the maturity of their own countries on these issues versus other global markets.

Top issues for global convenience leaders include supply chain, labour, technology, ESG, last-mile, O2O, electric vehicles, alternative fuels, technology, digital, finance, competition and the regulatory environment, Armour reported.

In Europe, executives are focused on own label and private label offerings and they are reengineering their supply chains following the impact of the Covid pandemic but also the war between Russia and the Ukraine.

ESG is beginning to regain momentum in Europe and especially electric vehicles but there is a broad perspective among European leaders on how fast adoption is going to be, Armour said.

In Asia, meanwhile, the big strategic issue is the complex relationship between the USA and China, which is hugely disruptive to Asian markets.

Asia is also under pressure due to a shortage of labour and there is now a strong focus on up-skilling.
In North America, the predominant theme among executives was negative growth.

The average convenience store customer was already in a recession, Armour said.

Finally, in Latin America, political instability and high inflation rates – over 100% in Argentina, for example, were key themes.

Affordability is a big concern in Latin America, where 117% of disposable income is going to 94% of the products people need to buy.

“That’s an affordability issue,” Armour told delegates.

Last month, GCSF heard from the Argentine fuel station company, FGC, all about that challenging economic landscape, which is characterised by high inflation and fluctuating exchange rates.

Claudio Reboredo, FGC co-founder, shared the company’s journey and how it has weathered the economic storm by a steadfast focus on efficiency, robust risk management practices, and a culture that fosters innovation.

The company opened its third Lion Place location in Canning, Buenos Aires, this year, which included its first standalone Mostaza burger restaurant and drive-thru.

A fourth site was due to open this month (December) and the company is eyeing the development of travel centre locations in Argentina, taking cues from a recent fact finding study tour in the UK, Germany and Ireland.

The Lion Place model offers a wide range of services including convenience stores, QSRs and other ancillary offerings.

FCG operates leading food and beverage franchises including Havanna, Argentina’s leading coffee brand and Subway, the fast-food sandwich brand; plus its own fast casual restaurant, TanGrill, which is focused on traditional Argentine food.

On the forecourt, uniquely, FGC has supply agreements with all of Argentina’s top fuel brands: Shell, YPF, Puma and Axion.

Mostaza is a local Argentine business with around 200 locations and has been a logical introduction to the Lion Place model, enabling the company to add more value to the new Canning site but also provide an opportunity to learn and bring in new skills, said Reboredo.

“We knew how to operate the fuel pump but now, as a company, we are able to operate multiple foodservice offers.

That pushes us into a new era and more into mobility where people will not just stop for fuels, which will eventually expire,” he said.

Mostaza is already proving a hit with customers and is attracting incremental business to FGC’s other operations.

Despite the challenging backdrop, 2023 was a standout year for FGC and its Lion Place concept and was topped off with two international award wins – The Retailer of the Year Award with Shell at an awards ceremony in Budapest and the inaugural NACS Convenience Retailer of the Year Award Latin America, presented at the NACS Show.

In August, GCSF heard how Alltown Fresh is championing fresh food choices at roadside convenience in the Northeast and New England, USA.

Joanna Linder, vice president of marketing, shared he retailer’s founding principle, which is to elevate the everyday for everyone on the go.

“Alltown Fresh® started from the mindset that you should not have to sacrifice fresh food choices for convenience,” she said.

“We’ve all been there, when you are desperate for a snack, but the choices are not what you would want at home.

At Alltown Fresh® you can still make really good food choices when you’re on the go, even if you’re looking for something healthy, vegetarian, gluten free, etc.”

Alltown Fresh®’s belief that you should not have to sacrifice fresh food choices for convenience means there’s a firm focus on food quality and the skills with which food is prepared.

“Eggs are cracked to order – they are a work of art in each breakfast sandwich,” Linder said.

“That speaks to the level of quality and culinary innovation and it’s a cornerstone of our brand,” she said.

“We want customers to think ‘wow, that’s the best food, I had no idea that was possible’.

We are coming up with flavours on our menu that surprise and delight our guests versus the expected options found at a traditional c-store.”

Like Thomas Ennis, Linder emphasised a focus on quality versus price.

“Customers can see, taste and smell the difference – it’s really for people that want something better to put in their bodies when they are not at home,” Linder said.

“When people walk in and smell fresh baked cookies, for example, they know right away there is something different and it does resonate,” she said.

Alltown Fresh® is leveraging its culinary credentials too with an in-house catering business, a service you don’t frequently see at c-stores.

The business also hosts regular pop-ups outside its sites to feature new items like tacos or pizza.

“What happens in our four walls is not always apparent so we create a bit of theatre with a tent outside to offer dishes like tacos with fresh pico de gallo and guacamole, which creates something that captures your eye at the fuel pumps,” Linder said.

Theatre is the watchword at Kavanagh’s Belsize Park, GCSF’s last retailer port of call in 2023. According to Noel Kavanagh Jr, managing director of the Kavanagh Group, the aim for Kavanagh’s Belsize Park was to provide a premium independent store with a real focus on fresh food.

Trading for almost a year, the retailer has been blown away by the customer reaction with sales increasing month on month and smashing both initial and secondary store targets.

There’s a large focus on fresh foods and products being freshly prepared in front of customers such as sushi or ready meals from the store’s own kitchen.

The front area of the store is focused on grab and go lines, a fresh sushi bar, a fresh juice bar, patisserie and donuts plus a seating area.

The kitchen is located towards the rear and offers both ‘heat me’ and ‘cook me’ options, appealing to time-poor London shoppers.

“It’s all about theatre as you move through the store – the idea was trying to create theatre everywhere you turn,” Kavanagh said.

Ensuring the store team could deliver Kavanagh’s premium, fresh food proposition has been key.

With a core team in place from the old store, Kavanagh’s carried a full wage bill for the three months while it was closed for refurbishment in order to be ready for reopening.

“We did not want a Gatwick Airport situation, post covid, where we had a fab new store and no team to run it,” Kavanagh said.

The retailer also used that period of time to focus on customer service and hosted 12 breakout sessions getting the team ready for the new store opening.

In addition, in the specialist areas, the business flew team members over to Ireland and put them up in the Kavanagh Group hotel, putting them to work on its fish counters and in kitchens at its Irish stores. “They were making the product before the store ever opened,” Kavanagh said.

Kavanagh, for one, is happy to have completed the first year of trading but is already eyeing the next opportunity.

“We pitched Kavanagh’s Belsize Park as a truly independent, premium fresh food offering so it’s important to get a year under our belt – it takes a year for it to settle down,” he said.

“We see it as a flagship but if we can get the right locations, there’s an opportunity to roll this concept out.”

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