Chairman of Ricker Oil discusses industry, economy and new store format
Who are the authorities on the future of the convenience store industry and what can you learn from them? In this series of exclusive one-on-one interviews with c-store industry leaders, Convenience Store News Editor-in-Chief Don Longo explores the most important trends and issues facing the convenience store industry.
This month, Longo interviewed Jay Ricker, chairman of Anderson, Ind.-based Ricker Oil, a family-owned firm with 49 convenience stores in Indiana. In 2008, Ricker purchased the Indianapolis BP/ampm stores. A former chairman of NACS, Ricker's company won CSNews' Grand Spirit Award for Community Outreach in 2010.
Longo: What do you consider to be the most important trends influencing retailing today?
Ricker: One of the things I'm concerned about is the future of fuels. I think we, as an industry, need to take a leadership position in determining the predominant fuels used down the road. I personally think natural gas is a logical fuel to start blending into the supply mix. America has abundant supplies of natural gas. Cars can be converted over to natural gas relatively easily. It's cleaner burning and better for the environment.
I'm also concerned about inflation and what it's doing to all businesses. And gasoline prices are making it worse. If gas goes to $4 per gallon, it's really going to cause price increases everywhere and impact sales inside the store.
And I'm concerned about how much the Fed continues to borrow and about what we do about our nation's deficit spending.
Longo: Please comment on the most important issues relating to the convenience store industry and how these specifically impact Ricker Oil?
Ricker: A huge issue for the convenience store industry is whether customers at the pumps come into the store. Do we have the right products? A retailer has got to be on top of what customers want because everything changes so quickly. Prepaid products are a good example of how we supply the products customers want. What's going to be next? I don't know, but we must stay on top with both the right products and the right sized options for our customers. I saw a lot of new products at last year's NACS Show, but the products you haven't seen before weren't from the big suppliers, they were from the smaller guys.
Another big issue for the convenience store industry and our company is swipe fee reform. The banks are scrambling like crazy to overturn the gains we made last year (passage of the Durbin swipe fee reform amendment). We have a great story to tell and we have the moral high ground but the fight isn't over yet.
And we're all concerned about tobacco regulation and taxation. Tobacco products, whether they are cigarettes, smokeless, cigars, are very important to our industry. There's still a huge number of adult smokers out there and we're the chosen place for them to buy their tobacco products.
Longo: As a BP dealer, your company was directly affected by the negative publicity of last year's oil spill. What did you do as a company to offset the negative press? More importantly, what did you learn for the future?
Ricker: The number one thing I focused on was to make sure consumers understood the stores are owned and operated by an individual businessperson who lives and contributes to that community. My situation was somewhat unique because the stores were run by BP up until we purchased them two years ago. We had to communicate, communicate, communicate. In the final analysis, we took some hits, depending on the demographics of a specific store's trading area, but we are not suffering any long-term ill effects. One of the lasting lessons of the whole BP spill is the importance of making sure all the consumers know we are a local company. That is one of the things that gets you the business.
Longo: What other trends are impacting Ricker Oil and how are you responding to them?
Ricker: Healthy eating and buying local are two big trends. People are changing their eating habits and it's very important that we offer these products and that they are packaged properly for our class of trade. Healthy products have been tried in the past and quite frankly they haven't sold.
We're currently going through a new store design. We haven't built stores in a couple of years as we've digested our acquisitions. But now we feel it is important to have a consistent exterior look to all our stores. We also know you don't need a 4,000-square-foot store in a small town but you do need one in a metro or highway location.
We think we've come up with a simple, cost-effective building design that doesn't look cheap. It's a classic look and it stands the test of time. We're took the BP Connects and ampms we acquired in Indianapolis and we have retrofit them to look like the rest of the Ricker Oil stores. It's important to build our brand.
Longo: The challenge to build closer connections with shoppers is a mandate before all retailers today. How have you traditionally marketed Ricker's offerings to consumers and what's different about how you do it now?
Ricker: We market in all the traditional ways, but now we also have hired someone to handle all our social media. We have a large Facebook following now. But the question is: Is it driving our business? How do we use it to get more people through the door?
I was talking to Brad Call of Maverik and he said, âthere's so much technology out there it almost gives you a headache.â This is a huge area for our industry to get our arms around. We've made it a focus to utilize social media and use it to give back to the community. We recently came up with prizes for customers if they bring new people to our Facebook site. I know just enough about apps to be dangerous. We're really pushing Facebook and apps now.