NATIONAL REPORT — As the convenience store industry’s largest chains get bigger and bigger through acquisitions and organic growth, the industry’s independents and small operators are finding themselves under more and more pressure to survive.
But all hope is not lost if these operators can find a way to differentiate and stand out.
A farm stand-style market, a Native American menu, gumbo served by the gallon and a growler bar with live music — these are just some of the unique approaches being employed by the convenience store industry’s independents and small operators to set themselves apart from the large convenience store chains in the market.
A major asset of small operators is knowing the pulse of their community and how to support it, according to Marcos Castelán, co-founder of The Navio Group, a retail business consulting firm in Minneapolis.
“The best way for small convenience retailers to stand out is to double-down on the in-store experience,” said Castelán. “Large chains will rely on spreadsheets and reports to find out the trends of the area, but if a small store can actively keep a lookout for opportunities and engage with customers, there is little doubt an advantage can be built.”
Coupling that with friendly, personalized service is a recipe for small-operator success.
“While large chains will be relying on a huge, corporate HR and hiring structure, smaller chains can focus on finding talented and service-oriented individuals who are trained through shadowing the owner and witnessing their values, rather than clicking through a training video,” Castelán explained. “There is no substitute for a caring, intelligent and empowered workforce — all things that are harder to screen for when you are hiring hundreds rather than a handful.”
One-of-a-kind foodservice can also be a focal point for small operators seeking to stand out.
Clinton Mini Mart in Salamanca, N.Y., features unique Native American foods on its menu the last Thursday of every month as a way of differentiation. Traditional Indian fare, such as fry bread with bean and salt pork, Indian tacos, corn soup and corn wheels with beans, are available for purchase in an otherwise traditional convenience store. Owner Marcelene Nephew’s inspiration is her mother, a “cook her whole life,” from the Cattaraugus Reservation, according to the Salamanca Press.
Tran Huonggian, the owner of Green Acres c-store in Pensacola, Fla., crafted a deli menu centered on her homemade gumbo recipe, which has now grown to a 100-gallon-per-week operation, thanks to word of mouth, according to the Pensacola News Journal. The single store’s hit gumbo recipe may result in expansion this year — in the form of a food truck.
Offering regional specialties and locally sourced menu items is an effective way for small convenience retailers to stand out vs. chains, according to Meaghan Brophy, senior retail analyst for Fit Small Business, a digital resource for small-business owners.
“Anytime an independent store can source food ingredients or products locally, it’s a win,” she said. “Customers like supporting local businesses and knowing where their food comes from. Sourcing locally also cuts down on shipping costs and delivery times, which means fresher and faster food.”
Mistakes to Avoid
There are some ways small operators should not try to compete with the big players.
Independent retailers can almost never compete on price, according to Brophy. “Instead, embrace a higher price point, but support it using local goods and ingredients, and by providing top-notch service,” she said.
Casting a wide net also is not wise. “Rather than trying to cater to every consumer in the market as larger operators do, small retailers should identify and focus on their niche market to provide their core audience with an optimal experience,” advised Ryan Riggs, senior vice president of operations for Alltown Fresh, a new store concept from convenience store chain Global Partners LP. Currently, there are just two Alltown Fresh stores in operation.
“Leveraging service and one-on-one interactions with their local community allows smaller retailers to gain loyalty from the neighbors they serve and create their own authentic identity — instead of a chain copy,” Riggs continued.
Ultimately, local partnerships of all kinds are a great avenue for small operators and could lead to additional product opportunities as the business grows.
“Seeking out relationships with other small retailers is also a great way to learn best practices from operators that face the same challenges as you,” Riggs said.