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QuikTrip Eyes North Texas

TULSA, Okla. -- Convenience store chain QuikTrip sees growth in the North Texas market, and to secure its foothold there, is closing in on the purchase of a distribution building in Midlothian.

The North Texas area -- also home to the largest U.S. convenience store chain, 7-Eleven Inc. -- is one of QuikTrip's top growth markets, company spokesman Mike Thornbrugh told the Dallas Business Journal.

QuikTrip entered the Dallas-Fort Worth market roughly 10 years ago, and now owns and operates 76 stores there, with three more under construction, the report stated. It also plans to open eight to 10 stores a year in North Texas for the next 10 years, Thornbrugh added.

"The opportunity for us to have tremendous growth [in North Texas] in terms of store count and additional employees is phenomenal," Thornbrugh said in the report. "When you reach that critical mass, where people know who you are, you become a destination for those who are out of gas, those who are thirsty and those who are hungry."

One of the biggest reasons for the North Texas growth is the relaxation of laws governing the sale of beer and wine, Thornbrugh told the paper.

"You're seeing more and more of the Metroplex go wet," Thornbrugh said in the report. "That's going to open up a lot of opportunities for people to build business -- QuikTrip included."

Thornbrugh declined to discuss details of the retailer's pending purchase of a 316,000-square-foot distribution center in Midlothian, as the purchase has not yet closed.

However, he did note it may be used as a bakery/commissary for the production of food items, and the convenience chain recently began manufacturing its own doughnuts, pastries, muffins and other food items.

"Beyond store count, that's going to be the next growth area for QuikTrip," he said.

The facility previously housed a Kehe Foods distribution center, according to Trey Fricke, managing principal of Lee & Associates DFW, who is marketing the building for the previous owners, the Journal reported. Built in 2004, the building is listed at a price of $14.5 million, and QuikTrip would employ about 40 people at the center, according to the report.

Meanwhile, North Texas' other notable convenience store operator, 7-Eleven, began emphasizing fresh food sales approximately 10 years ago, and built daily distribution systems and added bakeries and commissaries to make sandwiches, bakery items and other foods for sale in its stores, the report stated. Similar to QuikTrip, 7-Eleven is in aggressive-growth mode, with plans to add 15 to 18 stores each year in the Dallas-Forth Worth area over the next three years, Dan Porter, vice president of real estate and new store development for 7-Eleven, told the Dallas Business Journal.

"While QuikTrip is an admirable competitor, our growth strategy is somewhat different and more flexible," he said in the report, adding 7-Eleven's strategy allows the company to go into smaller locations, including walk-up stores and shopping center sites, and some non-traditional venues such as college campuses and airports.

And by offering independent retailers a conversion program, the company can grow its brand without adding more fuel-and-convenience stores to the marketplace, Porter said.

7-Eleven also embraced the franchise model, which currently makes up more than 4,300 of its 5,448 U.S. stores, the report stated. The company is moving toward an all-franchise model in the U.S., spokeswoman Margaret Chabris said in the report.

This is another difference from QuikTrip, as it operates all it stores in an effort for consistency.

"In our opinion, you lose control when you start franchising," he said in the report.

And as QuikTrip expands into 7-Eleven's home base, the Tulsa brand will set itself apart from the convenience store giant just by working its plan, Thornbrugh told the paper.

"There's not much we can do about how others do their business," he said. "All we can do is search for the best locations and follow the game plan that's proven successful for us so far."

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