Forecast 2019: Which Categories Will Bring This Year's Highs & Lows?

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Forecast 2019: Which Categories Will Bring This Year's Highs & Lows?

By Convenience Store News Staff Report - 01/11/2019

NATIONAL REPORT — While the convenience store industry faces challenges in the form of competition from other retail channels and e-commerce, changing consumer tastes and innovation that could be the next big thing or the next big bust, c-store operators express overall optimism for 2019.

Across most product categories, operators expect both dollar sales and unit volume to rise or remain the same year over year, according to the 2019 Convenience Store News Forecast Study.

On average, c-store retailers predict their total in-store sales will grow by 3.4 percent in 2019. They were slightly more optimistic a year ago, when they predicted 2018 in-store sales would rise by 3.9 percent — after a relatively soft year in 2017 when actual in-store sales rose only 2.1 percent. Preliminary 2018 results indicate in-store sales will likely grow 2-3 percent.

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The convenience store industry’s constituents have a largely positive view on the year ahead.

As in years past, this year’s CSNews Forecast Study includes a Retailer Forecast and a Supplier Forecast, both based on the results of a survey fielded in November 2018. Participants were asked to predict 2019 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 identify and rate the issues that are expected to have the most impact on their business in the year ahead, and share initiatives they are planning to increase sales and profitability.

Motor fuel prices (cited by 61.9 percent), healthy eating trends (41.2 percent), labor issues/regulations (34.7 percent), tobacco and electronic cigarette regulations (34 percent) and emerging technologies (30 percent) are the top five factors that will have the biggest impact on convenience store sales in 2019, according to the retailers surveyed.

Not surprisingly, c-store operators expect foodservice to lead the way in in-store sales growth in 2019. They predict a 6-percent gain in sales of prepared food and hot, cold and frozen dispensed beverages. Retailers are looking to menu variety, healthier food options and increased convenience via third-party delivery services to drive foodservice sales.

Retailers are also bullish on alternative snacks (projecting a 3.6 percent sales gain), salty snacks (3.4 percent gain) and packaged beverages (3.3 percent gain).

In terms of volume, retailers are less sanguine about edible grocery units (1.8 percent gain projected), motor fuel gallons (1.5 percent gain) and cigarette units (0.4 percent decline).