New Projects Gain Traction for Couche-Tard

LAVAL, Quebec — Halfway through its 2020 fiscal year, Alimentation Couche-Tard Inc. is seeing notable progress, with several of its programs turning in a strong second quarter.

"On the convenience side, we're seeing good traction from a number of different projects that we've launched," President and CEO Brian Hannasch reported during the company's second-quarter earnings call on Nov. 27.

One such program is Lift, its digital upsell platform. Couche-Tard, the parent company of Circle K, has deployed Lift in 7,000 stores in North America to date. This total includes 1,000 stores in Canada.

"We continue to see strong upsell results through the platform, and we intend to deploy it in all of our Canadian sites by the end of the current calendar year," Hannasch said.

Another program gaining traction is its home delivery service. To bring the c-store to the consumer, Couche-Tard has widened the reach of its delivery service — from an initial 160 stores in Texas to now more than 550 stores in the state. The retailer launched its delivery pilot with third-party provider Favor this summer, as Convenience Store News previously reported.

"Early results demonstrate that orders from the partnership appear to be additive to our typical traffic. In this offer, customers can order a wide variety of products including snacks and beverages, receiving them in less than 30 minutes," the chief executive explained.

"In addition to the Texas pilot, we've recently launched another pilot in Florida. We're monitoring these initiatives closely to measure customer acceptance, purchase behavior, and how we think it could play out in other markets," Hannasch added. "Early on, what's clear to us is that customers want this type of service. As a purveyor of time and convenience, we're seeking solutions that will meet those needs, while creating value for us and for our shareholders."

The Canada-based retailer also saw its traffic in North America tick up during the latest quarter, driven by national campaigns and gamification promotions.

Couche-Tard has put a focus on customer loyalty. "In the U.S., we've been working on improving the customer experience and deepening our loyalty relationship with our customer," Hannasch noted, pointing to the first-quarter introduction of Easy Pay, a loyalty and discount fuel program.

"While we're still in the early phases of the rollout, we're seeing strong attachment to the program, which is delivering increased trip frequency and growing transaction sizes," he said.

As of Oct. 13, Laval-based Couche-Tard's network comprised 9,815 convenience stores throughout North America. Its North American network consists of 19 business units, including 15 in the United States covering 48 states and four in Canada covering all 10 provinces. In Europe, Couche-Tard operates a broad retail network across Scandinavia, Ireland, Poland, the Baltics and Russia through 10 business units. Its Europe network comprised 2,708 stores. In addition, under licensing agreements, approximately 2,280 stores are operated under the Circle K banner in 16 other countries and territories, which brings the worldwide total network to more than 14,800 stores.

This total excludes CrossAmerica Partners LP's network, which Couche-Tard recently sold to investment entities controlled by Joe Topper, the founder of Allentown-based CrossAmerica, in the third quarter of 2020.