The National Advisory Group (NAG) and Young Executives Organization (YEO) Spring Leadership Series continued on June 9, with “How to Create a Next-Generation Store,” the fourth of five virtual sessions, which tackled the need for retailers to innovate and future-proof their stores to protect and maximize revenue streams.
CStore Decisions Editor-in-Chief and NAG Executive Director John Lofstock welcomed the session’s guests: Jeff Carpenter, director of education and training, Cliff’s Local Market; Kurtis Hutchinson, director of wholesale operations for Hutch’s Convenience Stores; and Frank Beard, director of Safe Shop Assured and veteran retail industry analyst.
Carpenter also acted as track leader for the session, relating experiences at Cliff’s with how enhancing the company’s store security also led to big savings. Cliff’s updated all of its firewall security to be more consistent across all of its stores.
“Over time you can find yourself with a number of components that are mismatched,” Carpenter observed, underscoring the importance that security be consistent across all of a chain’s stores.
Tight security, he stressed, is paramount in this digital information era, citing recent cyber attacks on the Colonial Pipeline and the beef industry as examples most would believe would be highly secure.
Today’s technology solutions, though, are highly customizable and help make adjusting to situations easier. “We found that it has enhanced our customer experience,” he said.
Beard provided insights into the long-term outlook for convenience stores in anticipation of market shifts in the fuel and clean energy arenas. He cited a study he took part in, the “Global Roadside Retail Report,” which explored the future of roadside retail for the next decade.
Beard recommended c-store operators ask themselves a key strategic question: Why will the customer of 2030 visit my roadside outlet or interact with it online?
He likened the retailing of fuel to a moat around convenience retail business: Fuel is a highly regulated, essential commodity. He posed the question: “If that advantage erodes, what does that mean for retailers?” Electric vehicles aside, Beard observed that the internal combustion engine is “losing its appetite for fuel.”
Beard outlined what he called “structural headwinds” whereby c-stores won’t be able to rely on fuel to draw customers, not even with electric chargers. The trends show that most charging in the future will be done at home.
The future for c-store retailers, he said, will be in “winning small baskets.” Cross-channel competition is already becoming a problem. “You’ve got tech companies that are trying to take your customers,” he said, citing Gopuff and DoorDash.
While DoorDash has partnered with c-stores on delivery, it has also begun competing with them via its DashMart delivered convenience items. C-stores need to think about the risks involved in relying on third parties in the marketplace of the future.
Hutch’s Hutchinson stressed operational innovation while sticking to what your stores do best. The pandemic, he said, accelerated convenience retailing trends that were already brewing.
“When the pandemic hit we knew we wanted to enter online ordering and delivery,” Hutchinson said.
So Hutch’s partnered with Vroom and instituted curbside pickup at all locations and began delivering in two markets and looking to expand to more, applying to all items in the store except lottery and tobacco. Now, Hutch’s does not partner with any third party delivery companies.
Instead, it partnered with more community-connected businesses like local restaurants, offering family meals designed for take home heat and serve.
Hutchinson said that the chain has also turned to drive-through and app-based ordering simply because it works for its stores. In fact, he said that any new development – even remodels – will have a drive-through window.
“It allows us to be more convenient for our consumer,” Hutchinson said. And that philosophy extends to current efforts to at touch-free restroom facilities and self-checkout.
The fifth and final session of the NAG/YEO Spring Leadership Series takes place on Wednesday, June 16, at 2:00 p.m. “Fuel Disruption: How a new administration will impact the fuel market by mandating electric vehicles and flex fuels” will feature panelists John Eichberger, executive director of The Fuels Institute, and Jeremie Myhren, chief information officer with Road Ranger. NAG Executive Director John Lofstock will serve as moderator. Register for the free webcast and view previous sessions on demand at the NAG Website Spring Leadership Series page.