Cigarettes And Foodservice Remain Top Categories

Cigarettes and foodservice accounted for almost 47 percent of in-store sales at convenience stores last year, and about 41 percent of gross margin dollars.

As in past years, the top 10 product categories accounted for almost 90 percent of c-store retailers' in-store sales in 2009. Sales for the top 10 categories grew from 88.2 percent in 2008 to 89 percent last year.

The top 10 also represented 86.2 percent of in-store gross margin dollars, down slightly from 86.8 percent in 2008.

The top nine categories in sales remained in the same exact order as last year, as cigarettes gained almost 3 percentage points in sales share, and foodservice gained slightly, while other tobacco products grew to more than 4 percent of in-store sales, and candy/gum sales remained flat. All the other categories declined as a percent of in-store sales, but not enough the change the rankings.

Fig. 13

Top 10 In-store Categories

Salty snacks cracked the top 10 last year, edging out nonedible grocery for the 10th spot.

In profits, foodservice was again retailers' top category in percentage of gross margin dollars. Foodservice generated 22.2 percent of in-store gross margin dollars last year, slightly down from 22.7 percent in 2008. Cigarette gross margins rebounded, driven by higher sales volumes. This segment generated 19.2 percent of in-store gross margin dollars, an increase from 17.21 percent in 2008.

Other categories that increased in percent of in-store gross margin dollars were beer, up from 6.9 percent to 7.1 percent and candy/gum, up from 4.6 percent to 4.8 percent.

BOTTOM LINE:

• Cigarettes again top the in-store sales category, but foodservice continues to generate the most gross profit margin dollars.
• Other tobacco products (OTP) grew from 3.94 percent of in-store sales to 4.12 percent in 2009.
• Salty snacks replaced nonedible grocery in the 10th spot among the top 10 sales categories.

Fig. 14

Top 10 In-store Category Ratios