2015 Shaping Up as Very Good Year: Part 1
NATIONAL REPORT – The convenience store industry is poised for a strong financial performance in 2015 with improved in-store sales, based on Convenience Store News’ second-annual Mid-Year Report Card.
Based on mid-year data from Nielsen, government sources and CSNews’ own research analysis, total merchandise and foodservice sales were up 3.5 percent for the first six months of this year vs. the first six months of 2014.
Overall industry revenue was down 18.7 percent in the first half due to lower fuel prices that have resulted in a 28.1-percent dollar decline in motor fuel sales during the first half of 2015. However, it is important to note that motor fuel volume is up 2.8 percent as the lower gas prices (averaging $2.48 per gallon) have encouraged Americans to drive more this year.
AAA’s Monthly Gas Price Report noted that the national average price of gas on Labor Day was 99 cents less than a year ago – estimating that U.S. consumers would save more than $1 billion on gasoline during the holiday weekend compared to 2014. The Federal Highway Administration estimated that Americans drove more than 1.54 trillion miles during the first half of 2015.
Foodservice sales, meanwhile, were up 5.2 percent for the first half of the year. Many of the c-store industry’s leading chains are focused on increasing sales in this important, profitable category. Ankeny, Iowa-based Casey’s General Stores, for example, reported its foodservice sales (prepared foods and fountain) were up 14.8 percent in its first quarter ended July 31. Gross profit dollars in the category were up 19.9 percent for the large Midwest chain.
The CSNews Mid-Year Report Card also breaks down convenience store industry sales on a regional basis. The South and West regions of the U.S. generated the largest increases in in-store sales, both up 3.6 percent. Correspondingly, those regions also experienced the lowest decline in total sales: a 17.4-percent drop for the West; a 17.7-percent decline in the South.
A year ago, the South led all regions in in-store sales growth over the first six months of 2014.
In terms of motor fuel gallons sold, the South, with the lowest average price per gallon of $2.27, had the largest increase in volume, up 3.2 percent. Fuel volume was up 2.9 percent in the West, where the average price per gallon was the highest in the nation at $2.85. Motor fuel gallons sold were up only 3.2 percent in the Northeast, where the average price was $2.46 per gallon.
The South also had the largest percentage increase in foodservice sales over the first half of this year, up 5.5 percent. Foodservice sales in Midwest convenience stores were up 5 percent, while the Northeast and West both chalked up 4.9-percent gains during the first half of 2015.
Check back on CSNews.com for Part 2 of our Mid-Year Report Card, covering the biggest category movers and losers.