Top 10 Chains Tower Above in 2017 CSNews Top 100

NATIONAL REPORT — The latest numbers put the U.S. convenience channel store count at nearly 155,000. The majority of the stores are owned by single-store operators, but the chain retailers on the 2017 Convenience Store News Top 100 ranking hold a sizable amount as well: 63,368 stores to be exact — a number that has grown incrementally over the past five years.

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Things get interesting when you fine-tune the microscope and realize that the top 10 chains, led by 7-Eleven Inc., account for a whopping 40,725 of those stores. The top 10, which also includes Alimentation Couche-Tard Inc., Shell Oil Co., Marathon Petroleum Corp. and Chevron Corp., controls 64.3 percent of the Top 100 store count and 26.3 percent of the total U.S. c-store industry store count. Just five years ago, the top 10 chains accounted for 35,292 stores, equating to 58.9 percent of the Top 100 and 23.7 percent of the industry.

These staggering numbers are proof-positive of the consolidation movement that has gripped the c-store industry in recent years and seen the biggest chains get even bigger. In fact, the top 10 chains account for more of the Top 100 this year than they have in the past five years.

But these numbers also raise a question: Is the convenience channel getting too top heavy?

Industry merger and acquisition (M&A) experts say no — at least, for now.

"The convenience store industry could become more top heavy. But too top heavy now? No, I don't think so," said Ken Shriber, managing director of Petroleum Equity Group in New York.

The size of the overall convenience channel currently helps balance out the industry.

"I think what keeps the top chains honest is that there are about 155,000 convenience stores, so they cannot really control the market," said John Flippen, managing director of Petroleum Capital & Real Estate LLC. "Where the issue will come is when they start to control the market."

Major oil companies used to control certain sections of the market. Their exit has opened up avenues for growth among all the top chains. "They are basically trying to replace the major oil companies," Flippen explained.

The Convenience Store News Top 100 is the industry’s longest-running accounting of the largest convenience store chains by store count. The annual report is compiled in partnership with TDLinx, a service of Nielsen. TDLinx defines a convenience store as a small-format store of at least 800 square feet; with 500 to 1,500 SKUs; that operates at least 13 hours a day; and carries a limited selection of grocery items, including at least two of the following: toilet paper, soap, disposable diapers, pet food, breakfast cereal, tuna fish, toothpaste, ketchup and canned goods.