Having solidly staked their claim on the breakfast and lunch dayparts, many convenience store operators are looking to round out their dining experience by tackling dinner service.
They do so knowing that they’ve got convenience and speed of service working for them, but also that they are competing against not just c-stores but restaurants of every description as well as supermarkets—many of which are staking a claim for convenience through one-stop shopping and delivery.
“The biggest advantage a convenience store (can offer) is, of course, the convenience of ordering ahead, picking up—often through a drive-through window—and getting home quickly,” said consultant Arlene Spiegel, president of Arlene Spiegel & Associates in New York.
Another form of convenience is the ability to get an entire meal in one basket. According to market research firm NPD Group, consumers continue to grow more concerned with the ability to purchase entire meals, rather than having to assemble them piecemeal. They also value authenticity in the form of real, natural, minimally-altered food.
“In order to be considered a meal solution, especially for the family, the menu needs to address the complete meal experience,” said Spiegel. “For example: protein or grain entrée plus two sides and side salad, plus fresh bread/rolls, dessert and beverage are a compelling offering for the busy homemaker.”
The biggest mistake c-stores make in trying to build dinner sales, she added, is offering individual items instead of complete meal solutions. Another is discounting items, which she said implies that the operator is trying to get rid of an item. “This is the antithesis of the freshness messaging.”
Anne Boysen, principal of Austin, Texas-based After the Millennials, a consulting firm specializing in next-generation issues and trends, believes grabbing market share at dinner must include appealing to Millennials. “7-Eleven attracts its customers with the aromas of freshly-baked pastry and ready-to-serve dinners with Millennial appeal. It would be natural to offer more of these deli-type stores by gas stations.”
Millennials and post-Millennials also care about health and wholesomeness, Boysen added. “Fast-casual chains such as Chipotle are responding; convenience stores can, too.”
Broomall, Pa.-based Swiss Farms offers a top-notch dinner program in all of its 13 stores. The company, in business for 50 years, brands itself as “America’s Drive Thru Convenience Store.” As Scott Simon, president and CEO, notes, c-stores nationwide appear to be reinventing themselves when it comes to the dinner daypart.
“If you look at Wawa and Royal Farms, for example, they are all about it,” said Simon. “7-Eleven invested a billion dollars last year in what they are going to do with fresh food and delivery, and ordering ahead and paying ahead. I would say that the whole industry is beginning to emerge into a 24-hour business, and making dinner part of that program.”
Indeed, to take advantage of the growth of at-home recipe kits and restaurants’ prepared foods to go, 7-Eleven has expanded its prepared-food program with several new locally-made, chef-inspired, heat-and-eat, restaurant-quality Italian, home-style, Asian and Mexican meal solutions targeting dinner business. Meals like Chicken Parmesan, Creamy Chicken Alfredo, Spaghetti Bolognese and others can be heated at the store for immediate consumption or taken to go, and carry a suggested retail price of $3.99 to $4.99.
Swiss Farms is focusing not on its numerous competitors, but on its customers’ needs.
“Our focus is on Millennial customers who say, ‘Look, I want high-quality food but I don’t want to have to pay the tip. I want quality food but I want to eat it at home, and I want to be able to eat it on my terms,’” said Simon. “That is the itch that we are scratching. I don’t really worry about my competition.”
Fresh food program: Swiss Farms launched its fresh-food program in January 2017, and is enjoying what Simon termed great success. The menu features about a dozen entrees, including lasagna and pizza, made from scratch in the chain’s commissary kitchen. Other menu favorites are French fries, mashed potatoes, mac and cheese, fresh green beans and more, all delivered daily.
“We are geared towards go home and reheat it yourself,” Simon said.
Swiss Farms’ management has not had to work hard at building dinner business, since most foodservice sales come between 4 p.m. and 7 p.m.
“That’s our big time,” said Simon. “As a percentage, sales are probably skewed a little heavier at night. It really solves the need on the way home when you have to pick food up and get some dinner. People are stopping for essentials, so why not grab a fresh entree and side dishes?”
Most dinner decisions are made between 4 p.m. and 6 p.m., Spiegel pointed out, so radio, television and ‘push’ social media messaging should take place during these times of day. “Bounce-back coupons given out at breakfast and lunch with a dinner-time offer are also a good incentive.”
Consumers can go through the drive-through lane to collect a meal to bring home, or use the chain’s app to order ahead. In addition, a delivery service should be in place by the end of August, serving all of Delaware County.
“The average sale is low, so no one is going to want us to drive to New Jersey,” Simon said. The average check is under $10, and online rings are about a $22. Walk-in customers spend an average of $9.80. “The percentage of sales through delivery will depend on radius and zip code. We have not gotten that granular yet, but it will be something competitive.”
Dinner offerings are trumpeted via social media and store fliers. “We will tweet out something that says, ‘Hey we have hot chicken—come on by and get it.’ Or, we might have a coupon that we are running in a magazine that says, ‘Buy one, get one,’ and that is usually a dinner entree. It could be the same item at lunch, but the portion sizes are usually fixed for dinner sales. I think people eat differently for lunch than they do for dinner.”
Juan Martinez, principal of Profitality, a foodservice consultancy in Miami, Fla., said online ordering offers tremendous opportunities for c-stores.
“The store could make the food as the guest is coming in,” said Martinez. “One specific product they could do is take-and-bake pizzas, for example, as well as other products that could be delivered as ready to heat.”
Simon advises c-store operators who want to build a dinner program to begin by finding out if there is a need. “Talk to your customers. What do they say?”