Dishing On Candy & Snacks

Convenience Store News/NCA 2010 Candy & Snacks Roundtable discussed trends and profit potential in the "little indulgence" categories

Thank goodness there are some little things in life that economic woes can't control. For convenience store customers, these typically include small indulgences like buying their morning coffee and treating themselves to candy, gum and snacks. As a result, these have been classified as some of the prized few recession-resistant categories.

"Candy and snacks are part of those key categories that probably do well no matter how the economy goes. They're easy things to buy, and customers are not going to cut back by forgoing them," said Convenience Store News' Editor-in-Chief Don Longo, who moderated and kicked off this year's CSNews/National Confectioners Association Confectionery & Snacks Roundtable with research data from the 2010 Convenience Store News Industry Report.

Dollar sales of chocolate bars and packs (the largest subset of candy/gum for c-stores with $16,495 average sales per store in 2009) were up 5.4 percent in the channel last year, and bagged/ pegged candy — with $656 in average sales per store in 2009 — experienced the largest dollar sales change at 9.4 percent, according to the report.

In snacks, dollar sales of potato chips (the largest snack subset for c-stores with $7,641 in average sales per store in 2009) were up 10.9 percent in the channel last year, and ready-to-eat popcorn ($970 in average sales per store in 2009) experienced the largest dollar sales change with 17.6 percent.

"To buy snacks" and "to buy candy/ gum" were among the top five reasons why consumers shop at c-stores, according to CSNews 2010 Realities of the Aisle survey. With 30.9 percent of respondents reporting they shop at c-stores to buy snacks, it was the No. 3 reason behind buying gasoline (71.2 percent) and buying beverages (48.8 percent). Shopping at c-stores to buy candy/ gum was cited by 21.4 percent of respondents, and was the fifth-largest reason behind buying lottery tickets (26.4 percent).

This year, the Candy & Snacks Roundtable was held on the eve of the Sweets & Snacks Expo in Chicago. It included top convenience store candy and snack category managers from BP/ampm, E-Z Mart Stores Inc., Kum & Go LC, Quick Chek Food Stores, Thorntons Inc. and Travel Centers of America, and was sponsored by The Hershey Co. and McLane Co.

Group discussion got underway with confectionery best practices buyers would like to see more of:

• Achieving speed-to-market with new-item releases. Retailers praised candy manufacturers that timed new-item releases with seasonal changes in planograms. "It's important that manufacturers line up new item releases with our planogram changes so we can add in the new items," said Natalie Nader, confection category manager at ampm, operating 1,250 stores

• Utilizing category captains. Choosing a leader to manage the category has proven very helpful to overall category sales, participants agreed. Kum & Go, with 430 stores, has category captains "across the board," according to Stephanie Poitry, category manager for the chain. She utilizes The Hershey Co. for confections, Wrigley on the gum side, General Mills for salty snacks and Kellogg's for cookies, crackers and nutrition bars. Poitry considers category captains a tremendous asset. "I can do planograms in a day. The speed has just been very helpful," she said.

"We've recently pushed the category management process," said Mike Santiago, senior manager grocery category at Thorntons, operating 160 stores. When asked about the allure he said: "It's teamwork as opposed to one person make the decisions — there are more heads on board the process."

As category manager at The McLane Co., Bill Walker has witnessed the success of category and brand management over the years. "By focusing on refreshes, candy tends to be very successful," he said. "Speed-to-market can be achieved when the planograms are refreshed at least every six months."

• Encouraging impulse buying/suggestive selling. Confections are such a natural impulse item — perhaps even more so in down times — it is a waste to not take advantage of it, some buyers observed.

"The only item that should be at the pay point — the only thing that's really worked for us — is candy," said Erin Slater, category manager at Travel Centers of America, with 187 sites. More than a year ago, the chain put together an informal training idea, instructing all cashiers to encourage even more impulse candy buying through suggestive selling. "We had huge sales in a tested two-week period," Slater said.

"We do suggestive selling with candy, too, especially on new items," added Bill Tencza, senior category manager at Quick Chek, with 123 stores. "It's easier for the cashier to make the suggestion."

"The power of suggestive selling is awesome," said Pat Hesselmann, c-store area sales director for The Hershey Co. "If you can coach your cashiers to do it, it's not real expensive to do. Ninety-eight percent of people who go into a c-store eat candy, but only 62 percent purchase it down the aisle, so it's important to capture others at the counter, under the counter or on a multi-vendor structure. It's something we've seen be very successful, not only to Hershey, but to the entire category."

• Taking advantage of promotions and perceived value. Turnkey promotions were a big hit on Tencza's best-practice candy list. "We did one with Hershey a few months ago. It took a half-hour to put together and was turnkey — everything was done by the manufacturer," he praised. "I think a lot of manufacturers overcomplicate the process — the customer has to walk around several places to get the deal. Ours was in one location and was very simple."

The promotion included a display of Reese's, fountain cups and a sign depicting sub sandwiches, promoting a Reese's candy bar, 32-ounce fountain drink and a sandwich for less than $5. "It was an opportunity to tie in candy to the foodservice area," he explained. "It was self-contained and very easy for the customer."

Perceived value is what Danna Huskey, category manager with E-Z Mart, operating 300 stores, considers for her candy customers. "We take advantage of manufacturer coupons, and when running a promotion, cents-off works especially well for us," she said. "We found two-fers are not good for us at this time due to the economics of many of our customers." She utilizes the preferred pump-topper candy promotions as a way to get more customers into the store.

• Putting more faith in seasonal candy. Easter was the panel favorite for seasonal candy trials. Nader said she capitalized on Cadbury Creme Eggs this year.

• Having a markdown plan on older/ non-selling items to make room for new. With constant influx of new candy items, it's imperative candy buyers have an exit strategy. While panelists had strategies that were "all over the board" from designated shelves for discontinued items (particularly in kid's candy) and dump bins to graduated mark downs, they agreed there needs to be more consistency with it and that it is "the biggest challenge we have."

Salty Snacks Tracks

Participants kicked off discussions in the salty snack subset with positive comments regarding Frito-Lay's return to 99-cent bags (vs. $1.29). Even with lesser weight/product, the price point is a hit with c-stores. Tied in with that success were limited-edition snack shippers, according to buyers.

Other positive trends cited by the panel include:

• Bundled promotions. The "Power of One" Pepsi/Frito-Lay promotion is anticipated to be "huge this year" by some buyers now that the company reorganized and is presenting synergistic/bundling opportunities for c-stores, such as buy a 20-ounce drink, get a free bag of chips. Best combinations vary by chain/region; Mountain Dew and Doritos were declared best-sellers by Tencza, while Pepsi and Cheetos were the favored duo for Huskey.

However, other buyers noted margin negatives outweighed the positives with Power of One. "The bundling was going to drive margins so low, we couldn't do it. The math didn't work out," noted Poitry. Tencza determined just the opposite. "We looked at the blended margin and figured we're making more than before overall," he said.

• Latino influence. Hispanic lines from Frito-Lay, as well as actual Hispanic brands, such as Barcel Takis, are selling well with Latino c-store customers as well as with those customers just looking for hotter, spicier flavors, according to the panel. Jim Hachtel, senior category manager at ampm, said items with a Latino influence are "really catching on well with the general market."

For Kum & Go stores in Colorado and even some in Iowa, Latino products are "integrated right into the planogram now," according to Poitry. Bob Greenwood, retail client associate director for The Nielsen Co., and a special guest at the roundtable, confirmed: "We're seeing growing demand for these items." Tencza added they're so popular, "it's sometimes tough to stay in stock."

As a side note, Huskey mentioned honey barbecue flavors were doing well in her market with African-American customers.

• Smaller meat snack bags. Smaller is better in meat snacks, some panel members recently discovered. With manufacturers including Jack Link's shrinking their bags, "it's allowed us the space to bring in new items into the category, such as Stubbs and Wild Ride," said Santiago.

The smaller bags also help with freshness because they sell and are replenished faster, agreed other buyers.

Bulk meat products from Tillamook continue to do well for stores such as ampm. "In our ampm stores, Tillamook bulk meat snacks are huge," said Hachtel. "It's always in the top five snacks for us. They fly out of the stores."

Other buyers mentioned in states like Louisiana, Texas and Oklahoma, bulk meat snacks wouldn't do well because of the "health department issue."

Growth in the overall category was realized for ampm when "we brought meat snacks forward" in a two-tiered, 3-foot set towards the front of the store, as well as positioning a set on the front counter, vs. their old spot back by the beer cooler, said Cindy Badish, category manager at ampm. Hachtel added the chain segregates the sets with more traditional large bags featured inline and the grab-and-go bags and bulk meats featured at the checkout.

Last year's peanut recall fiasco, which left many c-stores with holes in their planograms, was a non-issue this year. Peanut product sales are back to normal, buyers concluded.

Packaged Sweet Snacks Unwrapped

One of the biggest challenges in the packaged snack subset is "just making sure we have room for the products," Hachtel said.

"For a long time, the philosophy was to segregate packaged bakery items in the store from the fresh baked items in the coffee area, but that changed last year. We've brought the packaged bakery back over to create good adjacencies with the coffee offer," he said.

In support of bringing it back in, he also pointed out "research clearly shows that it's two separate customers — those who buy fresh bakery and those who buy packaged bakery" items. So ideally, if c-stores position it right, one should not cannibalize sales of the other.

With Hostess out of bankruptcy last year, roundtable buyers mentioned partnering with them on successful promotions, and it was good for business that they were "back in the game."

Other packaged sweet snack names mentioned were Little Debbie, Bimbo and Entenmann's.

Price increases over the last 18 months were a challenge for the category as a whole, agreed roundtable attendees. Because of this challenge, Poitry said she was looking for more opportunity in the category with Kum & Go's private label Hiland brand. Ultimately, her goal was to take only "the best of the best" from top brand names.

Distribution/inventory management issues were also a challenge for some. Apparently, because route drivers don't like to take back items that don't sell at the end of the week, they skimp on delivery, leaving convenience stores short of product, sometimes for a whole day or two. Overcompensating for freshness by under-stocking on product is not a viable category solution, buyers concluded. They agreed there was more category potential with better-managed inventory, as well as by utilizing logical cross-promoting, such as with coffee.

For comments, please contact Renée M. Covino, Contributing Editor, at [email protected].

2010 Candy & Snacks Roundtable

In late May, Convenience Store News and the National Confectioners Association assembled the 2010 Confectionery & Snacks Roundtable on the eve of the Sweets & Snacks Expo in Chicago. Market research was first analyzed on the convenience industry as a whole and on the individual candy/snack categories, utilizing CSNews 2010 Market Research and CSNews 2010 Realities of the Aisle survey. Attendees then dove in to dishing on the ins and outs of maximizing category potential.


  • Cindy Badish BP/ampm
  • Jim Hachtel BP/ampm
  • Natalie Nader BP/ampm
  • Danna Huskey E-Z Mart Stores Inc.
  • Stephanie Poitry Kum & Go LC
  • Bill Tencza Quick Chek Food Stores
  • Mike Santiago Thorntons Inc.
  • Erin Slater Travel Centers of America


  • Bob Greenwood The Nielsen Co.


  • Pat Hesselmenn The Hershey Co.
  • Brent Cotten The Hershey Co.
  • Bill Walker The McLane Co.
  • Lance Smith The McLane Co.

Salty Targets

Where did roundtable participants anticipate putting their new-item salty snack dollars in the year ahead? Here are a few snack targets mentioned:

  • New nut lines ampm's Cindy Badish is looking for "something other than everyday peanuts."
  • Hispanic brands/lines
  • Meat snacks
  • Seeds with more flavor innovation "Anything else that comes along like Spitz cracked pepper would be great," said ampm's Jim Hachtel. "Once in awhile, they hit on a flavor that does really well — and that's one of them."
  • Spicy flavor innovation across the board "The hotter they are, the better," stated Quick Chek's Bill Tencza.
  • Private label trail mixes Tencza is looking for "unique gourmet product lines we can mix with."
  • Bigger packs (specifically mentioned by Travel Centers of America's Erin Slater.)

"We take advantage of manufacturer coupons, and when running a promotion, cents-off works especially well for us."


Confectionery Greats

Core confectionery items are tantamount to success in the category for c-stores, but new-item innovation is always the strong driver. Here are a few of the past year's branded new-item highlights, as identified by the panel:

  • Trident Layers Gum Hands down, this was most mentioned as the panel favorite. "This is the first time we heard the field ask if they could get more of something new," ampm's Nader stated.
  • Reese's Dark Peanut Butter Cups
  • Milky Way Simply Caramel
  • M&M's Pretzel Chocolate Candies
  • Breathsavers Cinnamon

In more general terms, other candy greats mentioned by c-store participants included:

  • Sour candy It's still a hot subsegment, according to several buyers.
  • Kid's novelty candy Tenza mentioned "pushing happy hour with the fountain" between 3 and 7 p.m. through the summer, fountain drinks are promoted at half-price at Quick Chek, so any new novelty candy would be a natural fit with pushing profit in this after-school sweet time. "Novelty candy is always good — anything that's a little bit different," added Hachtel. "We have the means to introduce new items quickly."
  • Pegged candy Sather's two-for-$2 promotion was mentioned as being hot currently, as was major manufacturers' pegged items. ampm is hot on the trail of new items for its private-label pegged line, "Too Much Good Stuff," according to Nader.
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