Transformative Technologies That Can Bring C-stores to the Next Level

NATIONAL REPORT — Convenience store retailers need to know two things to be successful: what they sell and whom they sell it to. Sounds simple, right? But not so fast; it may be a case of "easier said than done."

Technology that taps into this information can transform the way a retailer does business.

With numerous SKUs, plus the countless number of consumers moving through a convenience store on any given day, retailers run the risk of missing sales opportunities and overlooking small inefficiencies.

This can really add up, according to Matthew McAlister, vice president of marketing and business development at CB4. The New York-based machine learning and artificial intelligence (AI) company has its roots in the AI Lab at Tel Aviv University. When it first made the jump from research project to business, CB4 started in the convenience channel.

One of the major influences in that decision was the fact that CB4 technology does not require any in-store hardware. It uses simple point-of-sale data that every retailer already has on hand. But it's more than that, McAlister pointed out.

"An in-demand item left in the stockroom or an inventory discrepancy that lasts even a few days has a surprisingly large impact on a store's bottom revenue and on the customer experience," he said. "We started in the demanding convenience store space because we had very high confidence that we could move the needle for convenience retailers significantly with clear gains to revenue. That proved to be true, which is why we keep growing in the c-store space, even as we expand to other retail verticals."

Since entering the channel, CB4 has formed partnerships with many leading industry players, including Kum & Go, QuickChek, Circle K, Quick Mart, Wilson's, Dash In, Plaid Pantry, and Wallis Cos.

According to McAlister, the use of AI is growing. As competition has increased and the bar for implementation has decreased, many c-store chains are moving to AI-based solutions to better serve their customers and to find that crucial measure of differentiation.

They're using AI, he added, to answer questions like: Does my store offer a selection of merchandise that's attuned to current customer preferences? Are we creating a better customer experience through best-in-class product availability? Are our store associates spending time in the places that offer the highest ROI and customer impact?

AI Adopters

With pandemic-driven changes like working from home, less committing and evolving preferences, convenience retailers know they need to stay on top of emerging trends and fluctuating demand. They are looking to AI solutions for help.

Among those retailers is Klamath Falls, Ore.-based FastBreak Convenience Stores.

"Our convenience stores seemed liked they were far behind when it comes to technology. Around 2015, I saw everything that was out there and knew we had to get onboard to keep up with the future," recalled Jeff Chase, director of convenience store operations for the chain of approximately 30 stores.

FastBreak first came across CB4 at the NACS Show about four years ago, but as a small chain — roughly 20 stores at the time — the retailer wasn't ready for the platform. Fast forward to mid-2020 and Chase was ready to find a solution to measure what was happening within FastBreak's stores. The retailer began rolling out CB4 to its network in April 2021.

While Chase acknowledges there are some wrinkles that still need to be smoothed out, he said the platform offers an easy task-based solution for FastBreak's store managers.

"It helps the managers look at their product sets all the time. Once a week, they are doing the tasks, but hopefully their eyes are open to things like stockouts. It will take it beyond recommendations and create a mindset. That's what I am really hoping for," Chase said.

"In the Pacific Northwest, there are not a lot of chains. There are some big ones — GPM [Investments LLC], Plaid Pantry — but there are a lot of mom-and-pop stores and no one really took advantage of the technology that is out there. We are trying to," he continued. "We are trying to get ahead of the game. I feel like the customer service the tech companies provide is going to take us to a better level and make us more competitive with some of the major chains."

Road Ranger LLC, a Schaumburg, Ill.-based chain of travel centers, truck stops and convenience stores primarily in the Midwest, also signed on with CB4, a move driven by the company's desire to improve both its employee and customer experiences, according to Jeremie Myhren, chief information officer.

"The people that make up the Road Ranger workforce are our most valuable asset. It sounds cliché, but that doesn't make it any less true. Providing a positive customer experience centered around convenience is our most important deliverable. Naturally, one of our top priorities then is to enable the fantastic people of Road Ranger to spend as much time ensuring we deliver on our customer promise of convenience," he said.

Employing technologies and tools like AI, and specifically CB4, supplements Road Ranger's team members and frees them up to spend more time with the customers.

"As well, AI doesn't rest and has no cognitive biases,” Myhren said. “We're very open to employing AI, MI [machine learning] and other such technologies to free up our people and give them additional powers and abilities, and we're constantly on the hunt for other areas in which such technologies can help."

McAlister sees AI as having nearly limitless use cases in convenience stores, from inventory management and replenishment, to enhanced loyalty programs, to pricing. As the bar for implementation lowers, he predicts more retailers will adopt AI.

"In that way, I think it will be less 'revolutionary' and more of a democratized resource. We will see AI ubiquitously across all store chains of all sizes, in everything that they do to serve their customers," he explained. "I am sure that over the next five or 10 years, we'll all be shocked at the multitude of ways the technology is applied to stores.”

Road Ranger stands ready to use new technologies to transform its operations.

"AI, ML, IoT, frictionless are the buzzwords of the past few years and I think with good reason. These technologies and paradigms are true advances in the world of computing and customer experience, and we should leverage them where it makes sense," Myhren said.

Studying and understanding how the c-store industry at large is leveraging such things, and applying that in the stores and in operations wherever it makes sense, is key to rethinking IT needs, according to the Road Ranger executive.