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It’s no secret that the restaurant and foodservice industry has been profoundly impacted by the ongoing pandemic. While the restrictions to stop the spread of the virus have been necessary for public health, the economic effect has been devastating for those employed within the industry, alongside all the other challenges business owners have had to face.
For the franchisor looking to expand operations, understanding the changing dynamics of the foodservice industry is essential in order to effectively identify key growth opportunities and create an agile and adaptive business model. This article takes a look at the current c-store store trends that are emerging in the wake of the pandemic and explores the pros and cons associated with this growing market.
Understanding the Current State of the Foodservice and Restaurant Industry
In 2020, total sales revenue in the restaurant and foodservice industry decreased by 11.4%. This was an unprecedented decline that surpassed the effect of past crises such as the Great Recession of 2007-2009, when food-away-from-home sales decreased by 4.4%. This severe fall in sales can be attributed largely to the temporary and prolonged closures of restaurants due to safety and health regulations.
While the industry has had to significantly adapt and restructure, there is hope that certain segments of the foodservice market will not only recover, but may be approaching exciting new heights. One such segment is that of c-store stores.
Exploring C-Store Store Trends
C-store stores are convenience stores that predominately offer ready-to-eat items, such as hot food, premade sandwiches, bakery items, ready-to-drink beverages, and snacks. They’re often located convenient locations such as gas stations, college campuses, or strip malls. Historically, c-store often tripled in size in new markets and steadily increased their offerings.
However, the pandemic shook up the c-store market, encouraging the development and adoption of more niche, specialized c-store store formats. Many of these stores now offer ready-to-eat, meal replacement-style items that capitalize on our newly created “grab-and-go” lifestyles. These trendier convenience stores tend to differentiate themselves from traditional stores with interesting design features, partnered delivery services, and health-focused offerings with healthier options. As a result, c-store stores have seen an increase in sales and now account for 7% of total restaurant sales.
Exploring the Pros and Cons of C-Store Store Trends
As the foodservice industry continues to face uncertainty, looking into the pros and cons of c-store store trends can be a great way to help in understanding the opportunities offered for growth and finding new locations to expand successfully.
Pros of C-Store Store Trends During COVID
The first major “pro” has to do with how quickly c-stores were able to adjust their data.com/en/platform/’ target=’_blank’>menus to fit with the new trend. A huge advantage of c-stores is that most of the items presented are already prepared and marketed online. This made it incredibly easy for c-stores to capitalize on the demand for convenience, time saving, and health-conscious meal options.
Another pro of c-stores is that they provide a feeling of safety due to their secure, closed-off nature. Customers tend to feel more secure when shopping in these stores to prevent the spread of the virus and any other illnesses. Additionally, c-stores are incredibly accessible, so customers can quickly run to grab just what they need and not have to spend a long time waiting in the store.
Finally, a major advantage of c-store stores is that they tend to have a customer loyalty program, allowing customers to benefit from discounts, rewards, and other promotions when returning to the store.
Cons of C-Store Store Trends During COVID
The first major “con” has to do with the increased competition in the convenience store space. With the new trend comes an influx of c-stores appearing around the area and this can spell disaster for established c-stores that have not been able to keep up with the times.
As with any business, c-stores face challenges in terms of labor costs. The rise of automation and app-based ordering sites have caused an increase in labor costs, making it harder to keep costs low and maintain profits.
Finally, c-stores tend to have more narrow menus with limited customization compared to traditional restaurants, meaning there will be limited customer satisfaction compared to what they’d find at a sit-down eatery.
Final considerations
C-stores have emerged as a bright spot in the restaurant and foodservice industry during these turbulent times, offering a safe and convenient option for customers. Understanding the pros and cons of this rapidly expanding market is essential in order to make the right decisions for the franchisor looking to expand their operations. With market intelligence and data-driven insights, a franchisor is well-positioned to make the right decisions for growth and even capitalize on the new opportunities presented by the rise of c-store stores.
