Convenience Store

The first chain convenience store in the United States was opened in Dallas, Texas, in 1927 by the Southland Ice
Company, which eventually became 7-Eleven, the largest convenience store chain.

A convenience store, convenience shop, or corner store is a small retail business that stocks a range of everyday items
such as coffee, groceries, snack foods, confectionery, soft drinks, tobacco products, over-the-counter drugs, toiletries,
newspapers, and magazines. In some jurisdictions, convenience stores are licensed to sell alcohol, although many such
jurisdictions limit such beverages to those with relatively low alcoholic content such as beer and wine. Such stores may
also offer money order and wire transfer services, along with the use of a fax machine or photocopier for a small per-
copy cost. They differ from general stores and village shops in that they are not in a rural location and are used as a
convenient supplement to larger stores.

A convenience store may be part of a gas/petrol station, so customers can purchase goods conveniently while filling
their vehicle with fuel. It may be located alongside a busy road, in an urban area, near a railway or railroad station, or at
another transport hub. In some countries, convenience stores have long shopping hours, and some remain open 24
hours.

Convenience stores usually charge significantly higher prices than conventional grocery stores or supermarkets, as these
stores order smaller quantities of inventory at higher per-unit prices from wholesalers. However, convenience stores
make up for this loss by having longer open hours, serving more locations, and having shorter cashier lines.

Differences from supermarkets

Personal care products at a FamilyMart convenience store

Although larger, newer convenience stores may have quite a broad range of items, the selection is still limited compared
to supermarkets, and in many stores only one or two choices are available. Prices in a convenience store are often
higher than those at a supermarket, mass merchandise store, or auto supply store, as convenience stores order smaller
quantities of inventory at higher per-unit prices from wholesalers. However, there are some exceptions like milk and fuel
which are priced similar to larger stores, as convenience stores traditionally do high volume in these goods and
sometimes use them as loss leaders.

Product containers in a convenience store are often smaller with reduced product quantity, to allow more products on
the store shelves. This also reduces the apparent cost differences between full-size packaging in supermarkets. Smaller
packaging also reduces waste when a traveller such as a hotel guest does not want or is unable to carry the leftover
product with them when they leave.

The average U.S. convenience store has a sales area of 2,768 square feet (257.2 m2). New stores average about 2,800
square feet (260 m2) of sales area and about 1,900 square feet (180 m2) of non-sales area—a nod to retailers
recognizing the importance of creating destinations within the store that require additional space—whether coffee
islands, food service areas with seating or financial services kiosks. Convenience stores also have expanded their
offerings over the last few years, with stores becoming a part supermarket, restaurant, gas station and even a bank or
drug store.

Convenience stores sell approximately 80 percent of the fuels purchased in the United States. In the US, the stores are
sometimes the only stores and services near an interstate highway exit where drivers can buy any kind of food or drink
for miles. Most of the profit margin from these stores comes from beer, liquor, and cigarettes. Although those three
categories themselves usually yield lower margins per item, the sales volume in these categories generally makes up for
it. Profits per item are much higher on deli items (bags of ice, chicken, etc.), but sales are generally lower. In some
countries, most convenience stores have longer shopping hours, some being open 24 hours.
Merchandise
Various types exist, for example, liquor stores (off-licences—offies), mini-markets (mini-marts), general stores or party
stores. Typically confectionery (sweets, ice-cream, soft drinks), lottery tickets, newspapers and magazines are sold
although merchandise varies widely from store to store. Unless the outlet is a liquor store, the range of alcohol
beverages is likely to be limited (i.e. beer and wine) or non-existent. Most stores sell cigarettes and other tobacco
products (e.g. cigarette papers, pipe tobacco, cigars and e-liquid for e-cigarettes). Varying degrees of food and grocery
supplies are usually available, from household products to prepackaged foods like sandwiches and frozen burritos.
Automobile-related items—such as motor oil, maps and car kits—may be sold. Often toiletries and other hygiene
products are stocked, as well as sanitary products and contraception. Stores may carry apparel, home furnishings, CDs
and DVDs. Some of these stores also offer money orders and wire transfer services. Convenience stores may also carry
small appliances as well as other household items such as coolers and backpacks. Convenience stores have also been
known to carry candles, stationery, artwork and crockery.

Many convenience shops offer food ready-to-eat, such as breakfast sandwiches and fry-ups. Throughout Europe, it is
now common for convenience stores to sell fresh French bread (or similar). A process of freezing parbaked bread allows
easy shipment (often from France) and baking in-store. Some shops have a delicatessen counter, offering custom-made
sandwiches and baguettes. Others have racks offering fresh delivered or baked doughnuts from local doughnut shops.
Some shops have a self-service microwave oven for heating purchased food.

In the United States and Canada, fast food items are often available, with stores offering such food either under its
owner banner or in partnership with a fast-food chain maintaining a counter in the store. Often, to save space, food is
not prepared in the store. Instead these counters offer a limited menu of items delivered several times a day from a
local branch of the restaurant, with items intended to be served hot either kept hot under a warming device or re-
heated as ordered.

Convenience stores may be combined with other services, such as general stores and pawn shops, a ticket counter for
purchasing railway tickets, a post office counter, or gasoline pumps. In Asian countries, like Japan or Taiwan,
convenience stores are more common because of the higher population density. They are found with gasoline and train
stations, but also can be stand-alone stores. Here, items like soft drinks or snacks are sold. Hot dogs, sausages, hard
boiled tea eggs, and fish cakes can be found in stores. Delicatessens are absent, instead, pre-made sandwiches can be
bought. Non-food products like magazines are also sold but to a lower degree. Many convenience stores also have a
fountain that offers a variety of beverages such as coffee, soft drinks and frozen beverages.

The smaller convenience stores typically have very few perishable items because it is not economically viable to rotate
perishable items frequently with such a low number of staff. Smaller convenience stores also do not generate the
business needed to sustain food spoilage rates typical of grocery stores or supermarkets. As such, products with a long
shelf life are the rule unless a product is specifically aimed at attracting customers on the chance they may buy
something profitable too.

https://en.wikipedia.org/wiki/Convenience_store
13 Convenience Store Advantages and Disadvantages
Aug 1, 2018 by Brandon Gaille

A convenience store is a small retail business which stocks everyday items which the average person uses. It may range
from snack foods to toiletries to tobacco products. In the United States, convenience stores are often associated with
fuel stations. They are often located along busy roads or at important intersections in a community.

Convenience stores also go by a number of different names. They may be referred to as corner shops, party stores,
corner stores, or c-stores. In 2011, convenience stores reached a record $195 billion in total sales. When combined with
motor fuel sales, U.S.-based convenience stores are responsible for about 5% of all dollars in the GDP.

The first chain-type convenience store opened in the United States was located in Dallas, Texas. Opened in 1927, it was
originally operated by the Southland Ice Company. In time, the company would eventually transform itself into 7-11.

Here are the advantages and disadvantages of a convenience store to consider.

List of the Advantages of Convenience Stores

1. They are a natural destination retail location.

Convenience stores are placed in locations that are convenient for local customers. They are a natural destination point
for the neighborhood in which they are located. If someone requires a couple of items that doesn’t justify a trip to the
local grocery store, then a trip to the convenience store down the street makes more sense. Although the prices at a
convenience store tend to be a little higher, customers spend less to get there, which creates a pricing balance.

2. It provides an economic boost to the community.

Convenience stores have stable revenue streams because of the nature of their business. People stop by these stores
because they are convenient, having what they need to get through their day. Many locations offer gasoline for sale as
well, along with propane or kerosene, which generates more local economic activity. Convenience stores provide
employment opportunities, business ownership opportunities, and are relatively recession-proof in most locations.

3. It doesn’t cost much to start a convenience store.

Although the cost to start a convenience store business which includes fuel at an important location in a community may
cost over $1 million, it is also possible to start a store for around $10,000 in the United States. Much of the cost variation
depends on if you’ll lease or own the property, if there is an existing business in place you can take over, and if there are
franchising fees involved.

4. Convenience stores are not bound by local pricing needs.

The benefit of a convenience store, from an ownership perspective, is that pricing is independent of recommended
systems. Most customers are willing to pay a little more for the convenience of being able to purchase a wanted item
close to home. Convenience stores can also provide an outpost for travelers, which allows for higher pricing because
providing access to needed items saves time for the traveler, which is valuable to them. Even if there are multiple stores
within a 5-mile radius, a convenience store will generate a loyal following, which creates income for the owner.

5. Franchises are often available.

About 40% of the convenience stores operating in the United States are connected to a franchise opportunity. That
equates to almost 60,000 convenience store locations. Although the cost of purchasing a franchise is similar to the cost
of purchasing an established store, the actual costs are much lower than if you were creating your own brand. Most
franchise owners become profitable faster than independent owners, and there is internal training and support offered
by the franchising company.
United States Convenience Store Statistics Total Sales In-Store vs. Motor Fuel

List of the Disadvantages of Convenience Stores

1. Long operational hours are often required.
Most convenience stores open early in the morning, then close late at night. Several stores are open around the clock to
meet the needs of their local customers. That creates a staffing challenge for a store that is independently owned and
operated. Trying to find employees to work specific shift hours that are early in the morning, or during the overnight,
can be expensive. Trying to fill those hours personally can lead to higher levels of stress.

2. They are often targeted by the local criminal element.

Any retail location faces a risk of theft in multiple ways. Shoplifters may come into the store to steal food items they
want. Criminals have targeted ATMs in convenience stores, causing damage to the building. There is always the threat of
an armed robbery for cash in the register as well. Outside of the store, these locations may be used as a site for illicit
drug transactions and other criminal actions. Even with a strong security system in place, up to 6% of the budget for a
convenience store should be dedicated to cover losses which may occur.

3. Cleaning and maintenance are frequent requirements.

Convenience stores see a lot of traffic every day. That means people are coming in and out of the store, tracking in dirt
and debris, which must be removed for health concerns. You’ll have product vendors coming in and out of your store as
well, along with equipment maintenance needs which require multiple inspections. A lot of time goes into preventative
maintenance when operating a convenience store, which can eat into the tight profit margins that some stores have.

4. Convenience stores experience inventory losses.

Expired foods have become an increasing component of the diet for many Americans. Forbes reports that food banks
are seeing requests for emergency food assistance rise by up to 40% in just 12 months. Although stores can make some
money back by selling expired products to salvage food centers, or donate items to a food bank, it is inevitable that
some of the food products will end up in a landfill. If inventory losses are not managed appropriately, the cost can be
steep enough that it may affect the profitability of the business.

5. These stores sell what people want more than what they need.
To be fair, people don’t really need candy, beer, energy drinks, or cigarettes. These are items that they want. If someone
is trying to break a bad habit which is affecting their health, a recommendation to avoid the local convenience store is
not uncommon. Except for the fuel that some stations provide, the rest of what can be found for sale at these stores is
more about wants instead of needs.

6. Prices at a convenience store can be triple the going rate in the community.
Visiting a convenience store on a frequent basis can create a budgetary crunch for some consumers. Almost everything
is priced higher at a convenience store because of its convenient location. You might pay the same price for a handful of
ibuprofen tablets at the convenience store as you would for a whole bottle over-the-counter at the local pharmacy.
Some items may be priced triple of what they are at the local store. Add in the fact that many food items are filled with
strong preservatives and the shopping experience may not be very healthy for some individuals.

7. Some convenience stores charge to use debit or credit cards.

Convenience stores often charge a premium for using a debit or credit card. These fees may be posted on the counter by
the register, then are posted nowhere else in the store. Once a customer grabs what they want, it doesn’t make sense to
put it all away for a $0.35 surcharge. Taking money out at the ATM could cost up to $5 at the convenience store. Many
of the fees may seem small, but if you visit once per week and pay with credit, you’ll be paying over $18 in fees.

8. Franchising with a convenience store involves long-term fees.

Franchises require more than an initial investment to use the branding. There are ongoing royalties which must be paid
to the franchise as well. Owners must all use established practices by the franchise to operate their business, which
limits their personal influence on the store. The equity of the business, along with its reputation, are tied to the
franchise brand as well. If the parent company receives a lot of bad press, that will affect the revenues generated at the
local level.

US Convenience Store Statistics Profit Margin By Product

These convenience store advantages and disadvantages show that a properly placed store can be financially beneficial to
owners and customers alike. At the same time, there must be smart inventory controls and an effort to build client
relationships for a convenience store to be successful over a long-term basis. People visit these retail locations because
they are convenient. If you can provide that experience for your community, then you have the potential for a profitable
business venture.

https://brandongaille.com/13-convenience-store-advantages-and-disadvantages/

A brief history of convenience stores

1913: A Gulf location in Pittsburgh becomes the first gas station to sell food.

1927: Southland Ice Co. opens first convenience store in Dallas after an operator realizes customers sometimes need
bread, milk and other things after grocery stores close. Eventually, concept spreads to other company locations and
becomes known as 7-Eleven.

1929: Drive-in markets allow motorists to remain in their cars. Vending machine stores sell milk, eggs, produce and fresh
meat. Dairy cooperatives operate jug stores as outlets for their products.

1930: The first supermarkets appear. They open small outlets in rural areas so people don't have to travel to a city for
eggs, milk and other food.

1940s: The convenience store concept begins to emerge. Most are located in warmer climates and have open fronts.

1957: First cold weather convenience store opens in Denver.

1963: First 24-hour convenience store opens in Las Vegas.

1964: Self-serve fueling is introduced.

1966: Industry hits $1 billion in sales for first time. Total rises to $3.5 billion by end of the decade.

Late 1960s: Number of 24-hour convenience stores increases steadily to meet needs of younger population and people
who work late or early shifts.

1984: Number of stores reaches 85,300.

1994: Number of stores rises to 98,200.

2004: Stores number 138,205.

Today: Sales by 152,794 stores total more than $204 billion annually. Four out of five sell motor fuels. Single-store
operators, including franchises, dominate the industry, account for 63 percent of the total. Texas has the most with
15,434. Pennsylvania is ninth with 4,604.

https://www.readingeagle.com/business-weekly/article/a-brief-history-of-convenience-stores
MONDAY, OCTOBER 8, 2007

The Origin of the Convenience Store

While doing a little research for some reviews, I stumbled upon the National Association of Convenience Stores (NACS)
website. Yeah, something like that really exists. They've got a lengthy section describing the rich history of the
convenience store in America, which goes something like this.

On the corner of 12th and Edgefield Streets in Dallas, Texas, circa May 1927, The Southland Ice Company's "Uncle
Johnny" Jefferson Green, owner of the Southland Ice Dock, realized people needed to buy basic necessities like bread,
eggs and milk after the grocery stores were closed. He stocked the items at his ice shop and stayed open late, making
the world a more convenient place.

The convenience store grew rapidly after the second World War alongside the idea of the "American dream." More
families had more cars and lived in more suburbs, further away from shopping centers and large grocery stores. So,
more convenience stores came into existence. As for the Southland Ice Company? They changed their name to 7-Eleven,
Inc.

Since the 1950s, the convenience store has grown into the gas stations and corner stores we see today. Nearly
everywhere across the country you can find a place to feed your nicotine habit, spoil your diet, gamble away your hard-
earned dollar, and buy the beer you need to forget about all of that. Ah, the convenience store. Thanks, Uncle Johnny.

http://conveniencereview.blogspot.com/2007/10/origin-of-convenience-store.html

Retail Customer Experience did an excellent article on 4 different kinds of

convenience stores shoppers. Here are the types they found:
1. Mr. Jones
Mr. Jones is your regular. These people come to satisfy their daily habits. This could be anything from a morning donut
or cup of joe to kick off their day, to a daily soda and a candy bar. They are brand loyal and are likely to get the same
thing every time they come in, looking for immediate satisfaction and a means to an end.

2. The Neighbor
These customers are regulars like Mr. Jones, but their reasons for coming are more of a tradition than a means to an
end. They treat the convenience store they visit frequently like a community center. They know the associates on a first
name basis and are there for the experience and social interaction. Familiarity and a good experience is what they're
most interested in.

3. The Last Minute Shopper

This is the customer that has a need and wants a quick fix. They're likely on their way home, searching for something
very specific that they'll need that night. They don't spend time looking around or striking a conversation at the register.
Their goal is to get in and out as soon as possible, and the longer their visit takes the more uncomfortable they are.

4. The Thrillseeker
This is the least predictable group of customers. They look to be entertained, always wanting something new. They drift
from brand to brand looking for a change; something unique, personal, and exciting and they'll try just about anything
once. Keeping them engaged is a worthy challenge and every marketer's opportunity.

https://www.loyaltymarketing.com/simpliblog/the-4-kinds-of-convenience-store-shoppers
CONVENIENCE STORE INDUSTRY, INTERESTING FACTS AND TRENDS

Posted on May 28, 2015 By Compliant IA

Through our business and research, we have come across a number of high-level facts and statistics about the c-store
industry, its magnitude, direction, and emerging trends. We thought they would be of interest to our customers and
readers.

There are lots of convenience stores!

There are 152,794 convenience stores in the United States alone, one for every 2,095 people (Nielsen, 2014).

Convenience stores lead in retail outlets.

Convenience stores make up 33.9% of all retail outlets in the U.S. (Nielsen, 2014).

A convenient and growing destination for prepared food.

Food-service is approximately a $41 billion industry contributing 19.4% of in-store sales for convenience stores in 2014
(NACS State of the Industry Report of 2014 Data).

Consumers are choosing quick, fresh, healthy options.

Sales of fresh fruits and vegetables (including prepared salads and packaged produce) increased from 10.3% to $362
million in 2014 (Nielsen).

Wine and spirits sales are rising.

Table wine sales rose 7.1% (case sales growth), sparkling wine rose 13.4%, and spirits realized 15.9% growth in 2014 for
convenience stores (IRI).

Wine, a profitable alternative to car washes?

A convenience store in El Carajo (Miami, FL) replaced its car wash with a wine store. Wine sales now account for 28% of
their 11 Million dollar sales (NACS).

Convenience stores are a worldwide phenomenon

Taiwan has the highest concentration of convenience stores of any country. There are more than 9,800 stores over
36,000 square kilometers. A study from 2014 found that there were 2.878 billion visits to convenience stores in Taiwan
in 2013, which translates into an average of 122.73 trips for every man, woman, and child in the country. More than
40% of people in Taiwan visit a convenience store at least once per day. Over 70% pay their bills there and more than
20% eat meals in the stores (China Times)

Sales of e-cigarettes are growing!

Electronic nicotine devices (ENDs/e-cigarettes) are leading the way in the other tobacco products category in the U.S.
Their first-quarter unit volume jumped to 49.6% in 2015 from 26.1% in 2014. Tobacco (cigarettes and other tobacco
products) equaled 35.9% of in-store sales in 2014 (Nielsen, Jan-April 2015, 2014).

Super Bowl = super sales in the snack aisle!

The two weeks around the Super Bowl generate $1.5 billion in snack sales and $767 million in candy sales (Larry Levin –
2015 Sweets & Snacks Expo).

Convenience store sales are increasing year over year.

Convenience store sales in the USA increased by 4.4% in 2014 to $214.9 billion (NACS).

Millennials are purchasing food and drinks at Convenience stores.

Convenience stores accounted for more than 11% of millennials’ food and beverage stops in 2014 (CSnews).
Promotional compliance is staggeringly low!
At c-store level, promotional compliance can be as low as 50%. This can be dramatically improved by implementing retail
audit software (eXPD8).

https://blog.compliantia.com/2015/05/28/convenience-store-industry-interesting-facts-and-trends/

What is the top seller of convenience stores?

A study reveals Filipinos' top food purchases from convenience stores, and who the biggest spenders are

Rappler.com
Published 7:05 PM, April 11, 2015
Updated 7:29 PM, April 11, 2015

ICE CREAM. Food, particularly ice cream, comprise the bulk of convenience stores’ fast-moving consumer goods top
sales, a Kantar Worldpanel study shows.

MANILA, Philippines – Food, particularly ice cream, comprise the bulk of convenience stores’ fast-moving consumer
goods (FMCG) top sales, a Kantar Worldpanel study showed.

The study revealed Friday, April 10, that food items are the most bought from convenience store FMCG items at 59.3%
as of January 2015, from 58.8% in the same period last year.

This was followed by beverages at 23.8% from 25.6% in January 2014 and personal care products at 13.5% from 11.3% in
the same period last year.

“While Filipinos spend the most amount of money for food purchases, the personal care category experienced the
biggest growth at 2.2% compared to 2014’s figures,” Kantar Worldpanel study cited.

Household care sales, meanwhile, grew slightly to 4.3% in January 2015 from 3.5% in the same period in 2014.

Top bought items

Eight of top 10 selling FMCG categories in convenience stores are food, the Kantar study show.

Filipinos’ top 4 food purchases remain the same – ice cream, total milk, snacks, and alcoholic beverages.

New items have emerged in the list such as diapers, water, and fabric cleaners.

Respondents in this year’s study dropped coffee and hair care products from their convenience store shopping basket,
Kantar said.

https://www.rappler.com/business/industries/176-food-and-beverage/89588-top-products-filipinos-buy-convenience-
stores