ROSEMONT, Ill. — In the hyper-competitive world of retail, businesses are fighting it out for every scrap of market share. But in the boxing ring of the convenience market, foodservice fights above its weight, according to John Oros, senior director of on-premise category management for Anheuser-Busch.
While the business model for convenience foodservice differs from restaurant operators seeking to drive on-premise consumption, c-store retailers can learn valuable lessons from best practices and challenges in the restaurant world. In his general-session presentation at the 2017 Convenience Store News Convenience Foodservice & Beverage Exchange event, which took place this week in Rosemont, Oros shared tracked shopping behavior data showing that restaurants and c-stores have the same shoppers.
The overall away-from-home eating experience is evolving, with the rise of delivered meal kits and grocerants as recent examples of change, but it is particularly important that c-stores stay competitive in the category. Recent data shows foodservice makes up 21.7 percent of sales but 35.2 percent of gross profit.
To achieve success, convenience operators have to always keep the name of their industry in mind.
"Convenience stores must always deliver on convenience," Oros said. It is their reason for being."
While it is less critical for restaurants to lean in on the attribute of convenience, they share five key issues, or "pain points," with c-stores:
- Growing traffic;
- Increasing average basket size/check size;
- Being innovative;
- Server training/labor; and
- Managing commodity costs.
Accordingly, there are numerous traffic drivers restaurants currently use that c-stores can likewise adopt to improve their foodservice sales.
While not typically associated with c-stores, chalkboards — whether they are placed on the sidewalk outside or hung up inside the store — can drive incremental visits, expand scope, increase awareness, and promote profitable items. Chalkboards can also effectively promote limited-time offerings.
Oros shared examples of multiple chalkboards with eye-catching and light-hearted text that focuses on particular desired items. He advised the retailers in attendance to "be intentional in how you use them."
Menus are also critical to increasing overall check or basket size, and retailers should make sure their menu includes all the products and flavors they offer.
"People don't know about it if it's not on the menu, Oros said. "Don't know, won't order."
He advised c-store operators to break the trend of what appears where on the menu, moving to the front items they want to push, regardless of category, and suggesting food pairings as the "fancy version" of a combo. While c-stores are less likely to have full printed menus, menuboards can accomplish similar goals.
Retailers should also be mindful of the influence their employees have. Whether they are servers waiting tables or store employees behind a counter, if properly trained, they can have a strong influence on foodservice sales. Active recommendations can steer customers toward purchasing those items retailers would most like to sell, or just establish trust and credibility with the customer by demonstrating product knowledge.
By taking active steps to stay relevant, c-stores will be able to continue growing their foodservice operations, said Oros, noting that "the foodservice world is not all equal."