By Howard Riell, Associate Editor
In the face of traditional thin fuel margins and flagging cigarette sales, foodservice has continually grown as a way for many c-stores to maintain decent profit levels.
And the stakes are high. Earlier this year, Chicago-based Technomic Inc. predicted growth of about 2% in c-store foodservice for 2015.
“Convenience stores serve as a prime destination for younger generations and people seeking fast, on-the-go options,” it noted, “and there are plenty of winning chains and opportunities for growth.”
Indeed, the research and consulting firm found that c-stores account for 28% of retail foodservice and $11.2 billion in sales.
“The newest pieces of equipment are those that allow for full-menu cooking without traditional ventilation,” said veteran foodservice consultant Arlene Spiegel, president of Arlene Spiegel & Associates of New York City. Labor-saving units are also invaluable, she added. “Considering the highest cost of doing business in a c-store is labor, any equipment that allows customers to ‘help themselves’ is a winner.”
Equipment has also come a long way in helping operators keep track of their products, Spiegel explained, decreasing waste. “Refrigerators warn the manager when temps go below 38 degrees. Fryers have quick recovery sensors and continuously filter oil.”
Lafayette, Calif.-based foodservice consultant Tucker Main, who does 20% of his consulting for retailers, said c-stores need to do some basic calculations upfront to determine whether or not a foodservice program is worth the investment in equipment. They must begin by analyzing their sales mix, and then measuring the traffic flow and direction, and reassessing the point of purchase and ‘four-walls’ merchandising scheme.
“First, I start with customer-facing interactions and do an internal, anonymous ‘pulse survey’ of cashiers and clerks to measure the recommendations of these key employees,” Main said. “That takes 10 minutes.”
Common mistakes that c-store operators make when purchasing foodservice equipment include being sold vending solutions by salespeople that rarely deliver a good return on investment, according to Main.
Main generally approves of the careful purchase of used equipment, as long as it comes along with realistic warranties and local service support. “I usually recommend, for high-traffic stores, investing valuable shelf space (and) a 90-day turn-key rental program with an option to buy, lease or walk away.”
With her husband Randy, Diane Morton owns and operates Morton’s Drive-in Grocery, a convenience store in Hallettsville, Texas that is powered partly by a state-of-the-art kitchen equipment package. The technology is juxtaposed with the nostalgic feeling patrons encounter when they enter the Texas store and dining spot.
She and her husband owned and operated another convenience store, Morton’s Drive-In Grocery, also in Hallettsville, for over 19 years. They sold it in March 2014. “We kind of outgrew our convenience store,” she said. “It was an older store, built in 1968. I think we were the fourth owners. We did really, really good business. It was more like a mom-and-pop neighborhood store, close to the school and residential area. We moved across town where we have a better location, on a busier highway.”
The new Morton’s, which is located on I-77 between Dallas and Corpus Christi, Texas, includes the 48-seat Diane’s Diner, which also supplies food for regular c-store shoppers. The retro fast-casual concept cooks to order. “I think we basically needed to spread our wings,” Morton said. “We went as far as we could with that (first) store. We basically have built our dream store, which the other one wasn’t.”
Morton’s customers can order food at the gas pumps. The 6,985-square-foot building includes a pair of order kiosks, and a POS system that sends orders to monitors in the diner’s kitchen.
“The diner is cooking all the food for itself and the convenience store,” said Morton, “so we’re not going to have the traditional choices that you get to grab-and-go at the convenience store hot box or cold case. We’re going to make all our stuff at the diner fresh every day and stock the store displays.”
The store’s menu includes sausage and bacon biscuit sandwiches, hamburgers, pork cutlet burgers, and breakfast tacos and burritos—all with self-service gravy. The outlet’s equipment package includes a pastry display case holding cookies, biscuits and muffins sourced from a nearby bakery. There is also a cold case that holds salads, cut fruit, slices of cheesecake and cheese, and puddings.
According to Andy Revella, principal of Dallas-based Vision 360 Design, which designed the operation, at its core are three pieces of equipment from which the entire foodservice operation springs.
Inside the kitchen, the centerpiece of the c-store’s foodservice flexibility is a TurboChef Dining Green Oven, which cooks with heat and convection transfer.
“It’s about 70% faster than traditional cooking,” Revella said. “The beauty is that you get the impact of an 800-degree oven without its physically being 800 degrees, so there is your cooking speed. And you don’t have to adjust for volume. You can cook one or 20 at the same time and it’s the same button, same cook time.”
Implications for employee training are obvious, he added. “You can tell your employees, ‘There’s no variation here, guys. If you’re cooking chicken you hit the chicken button, and it doesn’t matter whether you put one or 10 in there.’”
The second part of the set-up is an induction cooker, which works using magnetism. “You use it to do things you normally do on a stove top, whether you’re making soup or chili or heating sauces or boiling water. It stays clean and it costs pennies per day to operate it,” Revella said.
Finally, a cook-and-hold box helps maintain the quality of a variety of foods. “What if I make 300 hamburgers?” Revella asked rhetorically. “We use a brand of hold box which has the best technology out there. It allows very, very little shrink when you cook or hold something in there. It never tastes like leftovers.”
Savvy, hands-on operators are less interested in shiny equipment with lots of bells and whistles than with preventive maintenance to lengthen their units’ useful life and maximize return on investment (ROI).
“I think the key to any piece of equipment is keeping it maintained properly,” said Richard Little, manager of operations, foodservice and food safety for Mullins, S.C.-based Smith-Rogers Oil Co., which operates one Sunny Mart and 19 Tiger Mart convenience stores.
The Smith-Rogers’ stores that include foodservice offer branded Burger King and Hot Stuff Pizza operations at four locations and a proprietary deli operation at two. “Where we have it, (foodservice) is a major facet,” said Little. “It varies greatly, going as high as 20% of inside sales.”
The fryers continue to serve as the workhorses in the delis, Little pointed out, preparing such high-volume items as fried chicken, potato wedges, French fries, breakfast sausages, corndogs and wings.
Store personnel are trained on its upkeep. “We maintain and clean the equipment, of course, but as far as servicing it there’s not much to do to a fryer or oven.” The policy on equipment replacement is simple, Little added. “We go till it breaks.”
No new equipment purchases are anticipated, he added, although when foodservice equipment is purchased it’s always new—not used—for reliability. Executives regularly attend the two-day Southeast Petro-Food Marketing Exposition in Raleigh, N.C., looking at cooking equipment and other items.
Spiegel said she advises convenience store clients to, like Smith-Rogers, do their homework before purchasing any major pieces of foodservice equipment.
“Work with experienced foodservice consultants and not just suppliers of equipment offering to design the store for free. You get, and save, what you pay for,” Spiegel said.