Focus On Value Continues

C-stores are still offering value to customers through promotions, while budgets loosen up a bit from last year

Last October, Convenience Store News ran a cover story called “Your Recession Toolbox,” focusing on how convenience store companies adjusted their operations to accommodate the economy and recession. From offering value through price and promotions to cutting expenses, CSNews spoke with a couple of retailers who were interviewed last year to see how things are looking 12 months later. And it seems many of the same tactics are still showing positive results.

In 2010, consumers continue to look for more value for their dollar, and this trend doesn’t seem to be fading any time soon. Discounts, promotions and coupons are still a big hit in stores, and at Ricker Oil in Anderson, Ind., the company is continuing its focus on “value- added promotions.” These include many packaged beverage offers, and this year they include new line extensions or package size additions, said Keith Broviak, director of marketing at the company.

“Consumers are definitely still looking for value,” he noted. “Our promotional activity is designed to bring value to our customers while generating gross margin dollars.” The company offers value in most categories, including bakery, packaged sweet snacks, confections, salty snacks, packaged beverages and other tobacco products (OTP), he said.

Last year, Nice N Easy Grocery Shoppes, along with many other retailers, focused on promoting staple items like coffee, milk and eggs, especially through the use of coupons.

“We can redeem 100,000 coupons per week on these items,” Matt Paduano, vice president of information at the company, said at the time.

Kwik Trip Inc. based in LaCrosse, Wis., took a similar approach, and this year reported increasing its focus on promotions and value pricing, according to president and CEO, Don Zietlow. “We are promoting value in our commodities such as milk, bread, bananas, potatoes, onions, apples, oranges, butter, eggs, water and ice cream,” he noted.

Foodservice also continues to be a way for c-store retailers to offer value, and Zietlow explained Kwik Trip focuses on the fresh case, bakery items, hot foods and pizza when it comes to promotional activity, as well as the coffee bar and fountain area. Private label is another venue to offer value for many retailers, and this continues to grow for Kwik Trip as well.

The good news is while last year many retailers reported cutting budgets, in 2010 money was once again allotted for advancement and acquisitions. Zietlow increased his budget for capital expenditures in production, bakery and dairy departments, and also increased the number of stores being built.

“Our sales per transaction are less per store visit, but our customer count is up,” he said, explaining sales in general are up because of the company’s focus on customer service, value in the store and value in foodservice offerings. The chain also implemented labor scheduling, and over the past year, focused on giving employees more time to “provide better customer service, and focus more attention on our foodservice offering.”

For comments, please contact Tammy Mastroberte, Executive Editor, at [email protected].

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