The Tech Event Makes Its Debut

NACStech and the PCATS Winter Meeting combine to form this all-new conference

An earlier May date and a new location — Dallas' Hilton Anatole hotel — were just two of many changes attendees encountered at last month's inaugural THE Tech EVENT. For the first time, this all-new show combined the former NACStech conference and the PCATS (Petroleum Convenience Alliance for Technology Standards) Winter Meeting into one.

"It was hard to commit to two events each year," Hank Armour, president and CEO of NACS, the Association for Convenience & Fuel Retailing, said during a speech introducing attendees to the new show on its first day. "We wanted one event that covered everything important to you. A comprehensive show that delivers new ideas and networking ideas."

Living up to its promise to introduce the convenience store industry's information technology leaders and professionals to materials that would stretch their minds, the May 6-10 conference tackled such topics as big data; the future of fuels; EMV (Europay, MasterCard and Visa); and emerging technologies such as mobile payments.

THE FUTURE OF INNOVATION

Opening presenter J. Walker Smith, chairman of The Futures Co., noted that the "low hanging fruit" of technological innovation is gone. "We need to approach technology in a different way," he said. "It's tough. But if it's so tough, why do we do it? Because it's the only thing that changes our businesses."

He recommended retailers innovate by giving consumers "head space."

"Consumers are looking for ways to solve [the] complexities of life," Smith relayed. "You need to create an experience. That's the future of innovation. Give consumers something better, not just more. Make your store more enjoyable. Fun is always on people's minds."

EMV TAKES CENTER STAGE

Arguments can be made on both sides regarding whether c-store operators should upgrade their point-of-sale (POS) systems to meet EMV guidelines, panelists noted in "411 on EMV," a hot-button educational session presented during the second day of THE Tech EVENT.

Several speakers in the standing-room-only session stressed that EMV is a set of guidelines, not standards. However, c-store retailers must convert to the chip-and-PIN system by October 2015 for in-store transactions, and by October 2017 for pump transactions in order to avoid responsibility for fraudulent credit and debit card transactions.

The first thing retailers should consider when deciding whether to upgrade to EMV-compatible POS systems is the card fraud losses they currently sustain and projected losses for the future, advised Robin Trickel, executive director of product compliance for Heartland Payment Systems.

Not only is EMV implementation expensive, but it also requires plenty of preliminary work, added Bruce Murray, president of B2 Payment Solutions Inc., who strongly advised retailers conduct several tests even if they believe they fully understand EMV.

"They say real estate is about location, location, location. EMV is all about testing, testing, testing," Murray stressed.

Even if a retailer decides to upgrade to EMV, credit and debit card fraud will still be possible, panelists said.

THE FUTURE OF FUELS

Technological innovation and fuels are clearly intertwined, which made the "Future of Fuels" an apt choice for the keynote session closing out the fourth day of THE Tech Event.

Twenty years in the future, convenience store retailers will be selling less fuel than today, said John Eichberger, vice president of government relations for NACS and director of the trade group's recently formed The Fuels Institute.

In fact, since reaching a peak in 2007, fuel gallons sold and consumed declined by 7.5 percent, according to U.S. Energy Information Administration (EIA) data. "And I don't see fuel consumption improving any time soon," Eichberger stated. "Consumers will make fewer visits to gas stations in the future and retailers will need to find a way to make up for that loss."

Corporate Average Fuel Economy (CAFE) standards and the Renewable Fuel Standard are the two reasons why gas station visits will decrease, he explained. CAFE standards require that U.S. vehicles achieve 54.5 miles per gallon in fuel economy by 2025. The Renewable Fuel Standard requires refiners to use 13.8 billion gallons of ethanol this year and 15 billion by 2015. Ethanol is typically combined with gasoline in a formula of up to 10 percent.

Perhaps the biggest question looming over the fuels industry — and its future — is how both of these standards will ultimately be achieved, especially because EIA data suggests only 0.5 percent of all fuel sold by 2040 will come from alternative fuels. Eichberger believes that figure will actually be higher than 0.5 percent, but he stopped short of saying alternative fuels will take the industry by storm in the next 27 years.

Some alternative fuels do show promise. Retailers looking for a growth opportunity should take a long look at diesel, he noted. "Gasoline demand is expected to drop by 18.4 percent in the next 27 years. But diesel demand will go up by 26 percent. You have to be thinking about selling diesel. It's only in about 40 [percent] to 45 percent of stores."

PCATS TECHNOLOGY HALL OF FAME

As part of THE Tech EVENT, Scott Hartman, president and CEO of Rutter's Farm Stores, and Gene Gerke, president of Gerke & Associates Inc., were inducted as the third class of the PCATS Technology Hall of Fame. They joined prior inductees Teri Richman, John Hervey, Greg Gilkerson, Bob Johnson and Brad McGuinness.

"It's quite an honor to be inducted in the Hall of Fame. I started in this industry at the age of 12 and have been here for 42 years," Hartman said upon accepting his award during an evening banquet at the show. "I always thought you needed to have dreams and chase those dreams. I have had so much fun chasing my dreams with my wife Cathy, who is here tonight, and my son who is also in the convenience store industry chasing his dreams."

Hartman's ties to technology run deep. The head of York, Pa.-based Rutter's has been active in the tech segment of the c-store industry since 1995, when he got involved with the NACS Technology Standards Project, which ultimately led to the creation of PCATS in 2004. Hartman was also the 2005-2006 NACS chairman and served two terms as PCATS chairman.

Like Hartman, Gerke was also an original member of the Technology Standards Project team. He co-founded CSX LLC, the largest, purpose-built, online database of financial and operating data in the c-store industry. NACS acquired CSX in 2007. Today, Gerke is president of his own Columbia, Mo.-based advisory firm.

"This is a tremendous honor," Gerke said. "To be recognized for this is awesome."