Turning Today's Lessons Into Tomorrow's Foodservice Profits

NASHVILLE — In the rapidly evolving convenience foodservice space, operators that are just beginning their journey in the category can benefit from the wisdom of chains that can trace their knowledge back decades.

However, there's also plenty to learn from newer brands or those that are taking a new approach to staying competitive and in turn, redefining the c-store shopping experience for customers today and tomorrow.

Three retailers shared their experiences with innovating and staking out distinct competitive positions during "The New Convenience Retailer Panel" at the 2023 Convenience Store News Convenience Foodservice Exchange (CFX), which took place May 4-5 in Nashville.

[Read more: At Texas Born, Foodservice is the Focus Across the Board]

At Choice Market, one of the biggest foodservice opportunities can be found in exploring alternate store formats. In addition to its full-size stores in Denver, the retailer has seen very positive results from its fully autonomous Choice Mini-Mart, which launched at The University of Colorado Anschutz Medical Campus in October 2022 and offers high-quality prepared food and natural groceries.

"We see this as an amazing use case for technology," said Choice CEO Mike Fogarty. "Things like hospitals are frankly underserved in terms of fresh food."

The mini-mart format is set to scale alongside standard Choice locations in a hub-and-spoke growth model, expanding customers' access to fresh, convenient and healthy food by meeting them where they are.

Health is a consideration for La Plata, Md.-based Dash In Food Stores, the Prepared Foods Innovator of the Year in Convenience Store News' 2023 Foodservice Innovators Awards. But that doesn't mean choosing customers who want healthy items over customers who want more indulgent fare, according to Ben Lucky, category manager for foodservice.

He describes the company's approach as creating a "healthy halo" and offering items that fit in different points along the health spectrum. This includes options like Impossible Burgers and vegetarian flatbreads along with other menu experiments. At the same time, Dash In keeps its strengths and the things most consumers want in mind, and stays practical in what it can offer.

"You put all those things together and you give people options," Lucky said. "We're looking at trends, looking at how we can be better, using cleaner ingredients, using whatever we can to knock down artificial colors, artificial flavors — but we have our limitations."

A key component of adding new menu items is using as few extra ingredients as possible to streamline sourcing and order preparation, he added.

Curby's Express Market, a concept that launched in early 2022 in Lubbock, Texas, has also reaped the benefits of balance, said Tony Sparks, head of customer wow! The store is 50 percent focused on quick-service restaurant style food and beverages — which generate 65 percent of its sales — and the other 50 percent focused on standard c-store offerings.

Curby's offers healthier, higher-quality offerings without going fully upscale in a way that doesn't meet the desires of its customers. "We wanted to be right down the center. We didn't want to alienate any particular customer or demographic," Sparks said.

Both healthier food offerings and technology investments depend on recognizing consumer habits as they exist today.

"Ultimately, customers still shop based on taste and price," Fogarty said. He noted that it's equally as important to know what technologies currently resonate with customers before making future technology investment plans. "Develop an innovation pipeline based on them, not based on what everybody else is doing," he cautioned. 

At Choice Market, company leaders knew the target market would be younger customers who want fresh, made-to-order food and would be comfortable using digital ordering.

"So, for us to invest in these technologies, it made sense and was perfectly aligned to our customer," Fogarty said. "But everybody's customer needs are different, right?"

Looking ahead, Sparks advised retailers to explore made-to-order beverages, which can include coffee drinks, energy drink refreshers, custom tea drinks, craft sodas and more.

"I sell twice as much made-to-order beverages as I do food. We do craft sodas, we do two different types of energy drinks," he said. "It's not popping up everywhere but, in certain parts of the U.S. it's exploding."

The panelists agreed that recruiting employees with a culinary background outside the c-store channel is a smart move, and that there is much to be learned from quick-service restaurants, grocers that offer prepared food and other non-c-store competitors.

"Just be really fluid with your thinking and accept what the guests want, and then understand and look at all those different channels," Lucky said. "We hurt ourselves if we take them for granted."

The eighth-annual CFX event was an exclusive networking and experience-focused conference that gave attendees actionable knowledge and research to strengthen their foodservice business. Multiple executives from leading food-focused convenience store chains spoke at the event.

Sponsors of the 2023 Convenience Foodservice Exchange included gold sponsors Autofry/MTI Inc., BOHA! by TransAct Technologies Inc., Chain Link Services, Everest Ice and Water Systems, Finlays Americas, Hunt Brothers Pizza LLC, Southern Visions LLP, The J.M. Smucker Co., and Wasserstrom; silver sponsors Supplyit By Jera Concepts and Tyson Foods; and innovation zone sponsors 33 Degrees Convenience Connect, Kitchen Technology Innovations Integrated Control, and Smoodi.