BETHLEHEM, Pa. — Lisa Dell'Alba, president and CEO of Square One Markets Inc., has been in the convenience store industry for 20 years and has weathered the ups and downs of the retail channel.
In a recent fireside chat with Gray Taylor, executive director of Conexxus, Dell'Alba discussed what it's like to be a small operator in today's convenience world. Bethlehem-based Square One Markets operates seven c-stores in northeast Pennsylvania.
"It goes by quickly and there have been numerous amounts of changes in the industry over the last 20 years," said Dell'Alba, a second-generation retailer. "It's been a very steep learning curve and just when I think I have mastered everything there is to master about running convenience stores, something new comes up."
The biggest challenge right now for Square One Markets, and for small- and medium-sized operators in the industry in general, is labor. "No conversation today should leave off the table labor. It is very challenging right now to fill positions," Dell'Alba explained.
Since the start of the pandemic, employees' values have shifted and they are looking for different challenges, she noted. "People are looking for things that really fulfill them. One of the things that really becomes challenging in the retail landscape — and especially in the convenience store industry — is how do we fulfill that for folks who are looking for meaningful interactions and challenges when we are trying to be efficient and we are trying to be innovative, especially on the technology front," she said.
For Dell'Alba, it raises three key questions:
How do we keep them engaged?
How do we help them grow and develop?
What does that look like in the future for retention strategy?
A second challenge is staying on top of trends. "We're moving so quickly that it is hard sometimes, as a small business, to keep up with the trends," she said.
Square One Markets is in the process of completing the last of its outdoor EMV upgrades. The project did not come without hiccups. According to Dell'Alba, the company had to wait on the supplier side as their partner was also short-staffed.
There's been some hiccups around the addition of mobile pay, too. "I thought we would be good to go for a while, but now we are upgrading POS [point-of-sale] software to enable mobile pay," she said, explaining that the chain's fuel-brand partner markets mobile pay, but the chain did not support the option.
Square One Markets also had to upgrade its internet to enable mobile pay. "We didn't realize how much space all those transactions were taking up. I spent a significant amount of time with internet providers trying to make sure we had the speed capability to handle all the transactions," she recounted.
Doing the leg work to find the right internet solution to fit Square One Markets' needs highlighted another issue Dell'Alba says small operators have when working with their major fuel-brand partners. The help eventually does come from the major oil brands, but it almost always comes too late, she lamented.
"As my naïve self coming into the industry, I saw the major oil brands as a hub for things — information, how to, best practices — and connecting us as small operators to the greater piece of the industry. Things we need to do to be successful and be business partners," she said. But that hasn't always been the case.
Some of the pain points are around technology. As she pointed out, Square One Markets outsources its IT work. "I am no longer comfortable unplugging things and plugging them back in and solving all of my own problems," she said.
However, outsourcing sometimes pairs the chain with technology companies that do not understand the industry and its needs, like PCI compliance. In that disconnect lies an opportunity for the major oil brands, she believes.
"That would be something I would love to see the major oil companies do. Where can I best outsource IT, connectivity, especially when there is a problem?" Dell'Alba said.
Connecting With Customers at the Forecourt
Square One Markets has been an early adopter of pushing content out to the forecourt.
Dell'Alba said she's always been bothered by the fact that there is a significant portion of the retailer's customers that the employees never see. "So many folks come to the forecourt, they fill up their car, they interact with the dispenser, and then they leave," she said. "That's the only representation of our organization, our business and the way we go to market."
Controlling what those customers are seeing and how they interact with the brand is key for small businesses, she noted.
"It's really important as a small business to be able to say this is what sets us apart for those customers that are just not coming in," she said, adding that Square One Markets has been fortunate to work with a great partner to push out content.
The move is bringing customers in, even if they sometimes come in for free offers. "That's OK," Dell'Alba said. "That’s probably the most active campaign we have on the dispenser is offering a free coffee. It really just gives us an opportunity to interact."
Because interacting is a key part of her view toward the convenience store business, Dell'Alba eyes the shift to self-service with some hesitancy.
"When we talk about the industry as a whole, one of the things that comes up often is that we are part of the community," she explained. "I think, right now especially, we are lacking in significant face-to-face connectivity."
Consumers have become accustomed to talking on screens and using phones, and she admits she uses third-party providers like Grubhub and Instacart. "But at the end of the day, I think we appreciate interpersonal connections," she said.
On the employee side, face-to-face interaction with customers is important for developing any career path. "At the end of the day, we are still going to be communicating with someone. We still have to know how to interact with people," Dell'Alba said.
She often tells her employees that if they know what a customer smokes, they should also know that customer's name. "I challenge all of them to introduce themselves and have that customer share with them their name. I think there is something really neat about that," she added. "The more we automate or the more we self-checkout, the less opportunity we have to do that. It becomes challenging to create those opportunities in another way."
Embracing Innovative Ideas
Just because she's not chomping at the bit to bring self-checkout to Square One Markets' c-stores, that doesn't mean Dell'Alba does not embrace innovative ideas.
One area in particular where she'd like to see innovation is fuel sales.
"One of the things we have never changed in this industry is the way people buy fuel. We may have sped up the delivery a little, but at the end of the day, you are still getting out of your car, standing there, and maybe interacting with the dispenser — which is great, but it’s not fun," she said, admitting that she pushes her fuel tank to as low as it can go because she hates the current process of filling up.
As an alternative, she would like to see the convenience channel develop a solution like Grubhub or Instacart to deliver fuel directly to customers.