Forecast 2018: Which Categories Will Be This Year's Winners & Losers?
NATIONAL REPORT — The convenience store industry’s forecast for 2018 could be described as mostly sunny with a slight chance of clouds and rain. The channel’s retailers, suppliers and distributors are largely optimistic about the current state of the U.S. economy and their own business prospects in this new year, but there are some areas of concern dampening their confidence.
Case in point: Last year, about 89 percent of the retailers surveyed in the annual Convenience Store News Forecast Study expected their total store sales to increase in 2017. None expected a decrease, while 11 percent expected their sales to stay the same year over year. This year, only 75 percent of retailers expect a sales increase in 2018, and there are some (5 percent) who are bracing for a decrease; the other 20 percent expect their sales to hold the line.
Even among those who expect higher sales, they don’t predict as much of a rise this year as they did last year. Heading into 2017, retailers projected a 4.6-percent increase in sales across the store. Heading into 2018, they project an overall 3.9-percent increase.
As in years past, the 16th annual CSNews Forecast Study includes a Retailer Forecast and Supplier Forecast, both based on the results of a survey fielded in November 2017. Participants were asked to predict 2018 sales per store for a variety of product categories, as well as to share their opinions on overall business, economic and consumer trends.
They were also asked to rate issues that are expected to have a major impact on their business, and share initiatives they are planning to increase sales and profitability. Retailers rank motor fuel prices, healthy eating trends, and tobacco regulation as the top three factors that will impact their success in 2018. Among suppliers and distributors, the top three factors are new product development, consumer spending growth, and retailer unit consolidation.
The CSNews Forecast Study also provides dollar and unit volume projections in key c-store product categories based on data from various sources, including Nielsen for category sales history; TDLinx for store counts; and government sources for motor fuel volume and pricing data.
This year’s category standouts are predicted to be foodservice and alternative snacks. Conversely, 2018’s category strugglers are expected to be cigarettes and edible grocery, both of which were also ranked as the bottom two in last year’s Forecast Study.
Come back tomorrow to CSNews.com for the 2018 Motor Fuels forecast.