Harsh Winter Sets the Stage for Active Summer

ALEXANDRIA, Va. -- It was a long, cold winter, but with the unofficial start of summer a week away, U.S. consumers are ready to trade their boots for flip flops.

According to a new consumer survey by NACS, the Association for Convenience & Fuel Retailing, one in four consumers say they will spend more money this summer than they would otherwise because of the harsh winter weather, as opposed to 16 percent who say they will spend less money.

Consumers in the Midwest are most likely to spend more this summer, with one in three reporting they will spend more than otherwise expected.

The survey results could spell good news for convenience store operators, who are also optimistic about summer spending. Most operators say they expect their sales to increase at both the pump and inside the store, NACS reported.

"We expect to see sales up at least 8 percent to 10 percent over last summer's numbers, and we will be back to pre-recession sales numbers before the end of 2014," said Theron Soderlund, president of TMS Enterprises, which operates the Country Corner convenience store on Orcas Island, Wash.

According to NACS, c-stores sell 80 percent of the gas purchased in the United States and will see plenty of traffic at the gas pumps this summer, especially when the weather is nice. Store owners surveyed by the association said weather conditions are the best determinant of sales, with two in three calling it important. The economy is the second-most important factor affecting sales, cited by nearly half of all retailers.

"People are tired of waiting on the economy to improve, but there are positive signs that it is improving," said Sonja Hubbard, CEO of Texarkana, Texas-based E-Z Mart Stores Inc. Sales also may be enhanced by more hours of daylight, which Hubbard said is a significant factor that drives strong summer sales.

Renewed housing starts and construction is also driving stronger sales at c-stores.

"We are seeing construction crews in the mornings and afternoons that have been almost nonexistent for three years," Sunderland added.

When it comes to travel, U.S. consumers are expected to average more than two summer vacation trips of at least two nights away from home, and the bulk of this travel will be by car. Eighty-four percent of consumers say they will drive for a summer vacation.

While gas prices are near highs for the year, consumers see driving as cost effective. A majority of consumers (54 percent) cite affordability as the reason to travel by car, followed by the freedom to choose where to stop (52 percent).

In addition, half of consumers say gas prices influence where they stop on their summer vacations, but they also are influenced by in-store offers. Four in 10 consumers seek out quality food options for stops, and 36 percent seek out stores that have clean bathrooms.

According to NACS, it's not surprising that clean bathrooms are a priority, given that consumers cite them as their top reason to stop. More than three in four consumers say they stop to use the bathroom, 74 percent say they stop to get gas, and 67 percent say they stop to get food or drinks.

Services are also important: Nearly one in five consumers expect to use an ATM at a convenience store while traveling. Younger consumers, those aged 18 to 34, are the group most likely to buy a snack (68 percent), buy a sandwich (33 percent) or use the ATM (25 percent), the NACS survey found.

To capture more summer sales, retailers are particularly focusing on new deli programs, cookouts, fresh fruits and expanded beverage options. 

"There is a continued interest in a store-prepared food, and customers are buying more freshly made sandwiches and meals," said Tom Moser, general manager of Westminster, Md.-based Tevis Oil Inc., which operates Jiffy Mart stores.

The potential for strong sales over the summer months has retailers hopeful that the weak first quarter will be followed by strong summer sales.

"Consumers are feeling a little bit better," said Leo Vercollone, president of VERC Enterprises in Duxbury, Mass., and one of many retailers who indicated they are very optimistic about the industry's economic prospects this summer. "After all, we held our own this winter when the weather couldn't have been worse."

The NACS consumer survey was conducted May 1-2 by Penn, Schoen and Berland Associates LLC and incorporates responses from 1,183 gas customers. NACS, headquartered in Alexandria, also surveyed dozens of retailer member companies, which range in size from single stores to large chains operating hundreds of stores, from May 8-14.