As the U.S. Hispanic and Latino populations continue to grow, the demand for Hispanic items in c-stores is expected to increase as well.
The Hispanic population in the U.S. has grown 43% in the past decade, reported IBISWorld, a Los Angeles market research firm. There has never been a larger or more influential minority than today’s Hispanic Americans. According to the U.S. Census Bureau, the U.S. Hispanic population numbered 57 million in 2016—more than 17% of the total population.
As this number grows, cultural lines blur within the convenience store channel. This concept is on full display in changing foodservice programs that increasingly offer Hispanic food—driven by demand from everyday customers.
“Second- and third-generation Hispanics aren’t becoming completely assimilated/acculturated,” said Maria Steingoltz, managing director at Chicago-based L.E.K. Consulting. “Rather, they are expected to continue to engage with food and see Hispanic dishes as a way to connect to their heritage.”
GROWING ROLE
Mad Max Convenience Stores, a 12-store Wisconsin chain based in Saukville, sells breakfast burritos, including sausage, bacon and chorizo, along with burritos with chicken and cheese, or chicken, cheese, black beans and rice.
The chain has seen sales of these products dip slightly in the last year in its two locations that sell breakfast and chicken burritos, according to Katie Kissinger, Mad Max’s price book manager. The stores sold 3,568 breakfast burritos and 1,137 chicken burritos, respectively, in 2015 versus 3,206 breakfast burritos and 938 chicken burritos in 2016.
“We’re seeing ethnic food at retail growing at approximately 3% per year, but this doesn’t tell the whole story,” said Steingoltz. “Staples like burritos and tacos have become fully mainstream with slower growth, but there is a greater push towards more unique, ethnic offerings.”
The evolution of Hispanic offerings has spurred big business for some U.S. c-store chains. A shining example is Laredo Taco Co., which has more than 450 locations in seven states and is part of the Stripes’ retail operation.
In October 2016, Stripes unveiled a new store design showcasing Laredo Taco Co.’s authentic food offering as a restaurant destination, complete with indoor and outdoor restaurant seating.
Hispanic and Latino populations in the U.S. are no longer associated with just Mexican communities. C-store clientele today include Puerto Ricans, Guatemalans, Salvadorans, Colombians, Ecuadorians, Peruvians, Cubans and Dominicans.
In c-stores, it appears the authentic offerings are just as valued. Mad Max Convenience Stores have added Hispanic items to its menu over the years, but breakfast and chicken burritos remain the top sellers.
“Our sales will hopefully skyrocket with the opening of a new business and the remodel of another,” said Jamie Harycki, Mad Max’s foodservice operations manager. “We are putting much more focus on foodservice.”
The opportunity is there as the Latino driver of growth in the U.S., with spending power increasing faster than that of non-Latino consumers, while these households are growing exponentially.
“In convenience stores, authentic Hispanic alternatives that also deliver on the core c-store food value proposition (convenient and ready to eat), will be a growing area,” said Steingoltz. “We’ll see more unique offerings like tamales or tortas, which are great for c-stores, as these are hand- held and easy to eat on the go.”