The United States Of C-Stores

This year's Top 20 Growth Chains are conquering the retail landscape

There's a reason why convenience stores are often referred to as neighborhood stores, and it's because a c-store can be found in most neighborhoods across the United States. Consider that over the last 30 years, the U.S. convenience store landscape has nearly doubled, growing from 76,200 locations in 1982 to a record 149,220 locations as of the end of last year.

Today, convenience stores represent 34.8 percent of all retail outlets in the U.S. with their ranks outnumbering drugstores, supermarkets and dollar stores combined. For every one drugstore, there are 3.7 c-stores. For every one supermarket, there are 4.3 c-stores. And for every one dollar store, there are 6.2 c-stores. Some might say convenience stores are taking over.

Companies such as this year's Convenience Store News Top 20 Growth Chains are helping to accelerate this c-store domination. For the second year, CSNews partnered with TDLinx, a service of Nielsen, to identify those c-store operators (21 in all due to a tie) that added the most convenience stores between Jan. 1, 2012 and Dec. 31, 2012.

TDLinx defines a convenience store as a store that includes a broad merchandising mix, extended hours of operation and a minimum of 500 SKUs. Fueling stations with small kiosk stores do not meet the official definition of a c-store and thus are not reflected in TDLinx's store count figures.

This year's Top 20 Growth Chains, by means of acquisitions, new store construction — or in the case of the oil companies, extending their branded wholesale network — added more than 1,700 stores to their portfolios last year. Once again, convenience giant 7-Eleven Inc. led the pack, adding a net 961 locations for a 14.4-percent increase in its U.S. store base.

Impressive growth was also seen by Tesoro Corp., which had the largest percentage increase at 53.3 percent. The company went from 225 stores to 345 — an increase of 120 locations. Including Tesoro, seven of the 21 chains on this year's list posted double-digit percentage increases.

Given that continuous store count growth is ingrained into many c-store companies' DNA, it's not surprising that several of the retailers on this year's list are making a repeat appearance from last year. In fact, a total of 14 companies on this year's list are "repeat expanders."

Of those, QuikTrip Corp. has the distinction of being the company that's jumped the most spots year over year — 13 spots, to be exact. Last year, the retailer added 21 stores and landed at No. 19 on the list. This year, it added 54 stores, claiming the No. 6. ranking.

Read on as CSNews investigates what's driving the growth at these chains.

No. 1: 7-Eleven Inc.

Last year, 7-Eleven Inc. was not shy about its plans to grow. The company publicly declared that it was working to have a record growth year, adding at least 630 new U.S. and Canada stores. It ended 2012 with far more than that, adding a net 969 locations, of which 961 were U.S. additions.

"We are a strong company with a strong balance sheet, and strong companies grow," 7-Eleven spokesperson Margaret Chabris told CSNews when asked why the decision was made to set such an aggressive target. "We believed that with the real estate, mergers and acquisitions, and new store integration teams we had in place, this number was achievable."

7-Eleven's focus on maintaining a strong balance sheet before and during the recent financial crisis placed the convenience store giant on solid footing to grow, she further explained. Because of this strategy, the retailer was able to be "opportunistic" and take advantage of a soft real estate market.

Approximately 60 percent of 7-Eleven's growth in the United States last year resulted from several multi-store acquisitions. As CSNews reported throughout the year, 7-Eleven acquired:

• 143 stores in Texas from C.L. Thomas Inc.
• 12 stores in North Carolina from Fast Track Inc.
• 163 stores in Utah and Texas from TETCO Inc.
• 67 stores in Ohio and Pennsylvania from EZ Energy USA.
• 58 stores in Ohio, Pennsylvania, West Virginia and Maryland from Handee Marts.
• 74 stores in West Virginia, Ohio, Pennsylvania and Kentucky from Prima Marketing LLC.
• 51 locations in north Texas from ExxonMobil.
• 55 locations in North and South Carolina from Sam's Mart.
• 18 stores in Wisconsin from Open Pantry Food Marts of Wisconsin.
• 23 stores in north and central Texas from Strasburger Enterprises.

According to 7-Eleven, the chain's disciplined approach to growth resulted in purchases from those in the industry who decided the timing was right for them to sell their stores. The recent uncertainty and changes surrounding tax policy, health insurance costs and the capital intensity of the convenience industry led many c-store owners to consider exiting the business. 7-Eleven was in a position to seize these store development opportunities during a tough economic period when some retailers slowed or stopped growth altogether.

When it comes to acquisitions, 7-Eleven prefers stores that are in its successful, existing markets or close by since market concentration is very important to its business. It also looks for stores that can be more successful using its proprietary technology, processes and vendor relationships, as well as facilities that can support its merchandising offering (requiring at least 1,800 square feet of selling space). Quality real estate that can support the sales levels necessary to be a successful and quality franchisor are also musts, the retailer told CSNews.

The Dallas-based company focuses on having its stores in the best locations within a marketplace whether they originate from an acquisition or new construction.

Building off the momentum of its record 2012 growth year, 7-Eleven is certainly planning further expansion this year. However, the retailer said it's still too early to tell whether 2013 will be another one for the record books. At the end of last year, 7-Eleven operated and franchised a total of 8,118 stores in North America — 7,641 of those locations are in the U.S.

7-Eleven said it will continue to grow and be "opportunistic and diligent" about acquisition opportunities. It is too soon to say how many stores the chain expects to open this year, but the company will make sure it has an appropriate return on its investment.

The driving factors behind 7-Eleven's growth strategy will remain its desire for market concentration, leveraging its store count to lower costs per store, and driving more efficiencies from its infrastructure such as fresh foods and their delivery.

As for whether the iconic c-store brand has an optimal store count in mind, 7-Eleven said it is "a flexible growth company," capable of developing stores in urban and suburban settings, with or without fuels, on or in airports, on or near college campuses, and at endcaps of shopping centers.

7-Eleven aims to serve the convenience needs of consumers around the world, and believes there is huge potential not just in the U.S., but in other parts of the world, too. The company and its licensees are currently in only 16 countries, so many more stores are feasible.

In addition to continued growth, the other major initiatives on 7-Eleven's blueprint for this year are fourfold: fresh foods development and sales; simplifying and improving store operations; innovation of products and services; and digital guest experiences including a mobile app.

— Linda Lisanti

No. 2: Military

The military once again makes an appearance on the Top 20 Growth Chains list, shooting from the No. 9 spot last year to No. 2 this year. Pushing the armed services up the ranking are its 133 new stores added from January to December 2012. In total, there are currently 636 convenience stores in the military's portfolio, which includes the Army Air Force Exchange Service (AAFES), Coast Guard Mini Mart, Marine Corps Shoppette and NEXCOM Mini Mart (Navy).

Of the total portfolio, AAFES locations make up the majority of the stores — mainly because the AAFES network comprises two branches of the military. The Exchange, as the AAFES store base is known, has locations on military installations in the United States and abroad.

In 2012, the Exchange opened seven new Express convenience stores. The additions came through six new builds in the U.S. and one in Europe, according to the c-store operator. Aside from new construction, the Exchange also updated or renovated 18 Express locations.

Driving The Exchange's growth is an initiative known as "Grow the Express" set forth by Director/CEO Tom Shull. The initiative challenges the organization to focus on category growth within the store and increase convenience to support the active, fast-paced military lifestyle. Specifically, the Exchange is reviewing its in-store foodservice offering and how it can offer on-the-go customers more.

One example of the "Grow the Express" program is the recent update of its Fort Hood III Corps Express store. This location has eight roller grills, and the latest addition in the program is an island cooler offering everything from fresh to-go sandwiches and orange juice to sushi and chips. The island cooler is scheduled to be rolled out to an additional 48 AAFES locations throughout the U.S. and the Pacific. The Exchange is also looking to pilot fresh-baked pizza and chicken for convenient take-away food at a number of locations, an AAFES spokesman told CSNews.

In addition to expanding foodservice, the Exchange is reviewing its Express store retail assortment and store layout with an eye toward the most effective and efficient use of space. It is also putting a focus on a leaner inventory, while still providing an assortment that meets its customers' needs. With that mind, the Exchange is specifically looking at ways to improve the Merchandise Processing Area of its Express stores — the back of the house — to more efficiently support the new program offerings.

Along with these improvements, the Exchange is interested in reducing energy consumption for all of its Express locations. Its energy team is focused on gaining efficiencies for everything from lighting to ambient temperature set-backs to efficient refrigeration. In 2012, the Exchange completed energy projects in 70 buildings. These projects were finished after a successful pilot project at the Warrior Way Express store at Fort Hood that realized energy reductions of more than 40 percent with an estimated cost savings of $17,000 a year. The Exchange plans to complete another 25 buildings per quarter over the next two years in order to reduce the overall energy use at Express stores.

— Melissa Kress

No. 3: Tesoro Corp.

Tesoro Corp. began 2012 with a loss instead of a gain when it sold 32 gas stations and a refinery in Hawaii after determining the company would be better served focusing on the mid-continent and West Coast. But that didn't set the tone for the entire year, as Tesoro's convenience store division added 120 net new retail locations by the end of 2012.

In fact, the company posted the highest percentage increase of all the companies on CSNews' Top 20 Growth Chains list, expanding its retail portfolio by 53.3 percent last year.

During the first four months of the year, the San Antonio-based company closed on its late-2011 acquisition of 49 Albertsons Fuel Express c-stores with gas stations in Washington, Oregon, California, Nevada, Idaho, Utah and Wyoming. At the same time, it also began to take possession of approximately 225 southern California retail stations from Thrifty Oil Co., with another roughly 175 locations to follow during the second and third quarters.

"2012 is a heavy turnaround year for us," Tesoro CEO Greg Goff said. "We completed nearly half of our planned turnaround activity for 2012 during [our first] quarter."

Then in August, Tesoro announced a $2.5 billion deal with BP through which it purchased BP's ARCO network across the Southwest, including approximately 800 dealer-operated sites in southern California, Nevada and Arizona, along with BP's Carson, Calif., refinery.

Under the terms of the agreement, Tesoro will acquire the ARCO brand and associated registered trademarks along with a master franchise license for the ampm convenience store brand. BP will exclusively license the ARCO retail brand rights from Tesoro for northern California, Oregon and Washington, and retain retail ownership of the ampm brand.

"This transaction is a unique opportunity for Tesoro to combine the best aspects of two West Coast refining and marketing businesses, resulting in a more efficient, integrated refining, marketing and logistics system," Goff said at the time. "Given Tesoro's existing operations on the West Coast and our understanding of the complexities and challenges of operating in California, we are well positioned to generate significant operational efficiencies, increase our ability to satisfy market demand and reduce stationary source air emissions."

The acquisition price reflects $1.175 billion for BP's assets, plus the value of the inventory at the time of the transaction's close, which is expected to occur in mid-2013. The inventory was valued at approximately $1.3 billion at the time of the deal's announcement.

As for its 2013 strategic focus, Goff has publicly stated that Tesoro's goals for the year include further strengthening its West Coast business and capitalizing on an advantaged position in the mid-continent, while executing a cash strategy focused on investing for growth.

— Angela Hanson

Alimentation No. 4: Couche-Tard Inc.

Alimentation Couche-Tard, the Laval, Quebec-based convenience store chain that operates 3,659 stores in the United States mostly under its Circle K banner, is one of the fastest-growing retail companies in the world, with 12,000-plus stores in more than half a dozen countries. Its acquisition last year of Norway's Statoil Retail ASA chain, in a deal valued at $2.679 billion, added more than 2,300 stores in Scandinavia, Poland, Russia and several other eastern European countries.

In the U.S., though, the international giant has been stymied in its quest to overtake Dallas-based 7-Eleven Inc. for the most convenience stores in the nation. In 2012, Couche-Tard added a comparatively modest 74 net new stores vs. 7-Eleven's addition of more than 960, but it still retains its lead in company-operated stores, with 3,130 corporate units as of December 2012.

Couche-Tard's 2.1-percent increase in store count last year was slightly lower than the 2.9-percent gain in total U.S. units it saw in 2011, when it added 100 net new stores.

Included among its 2012 additions were acquisitions of 27 stores in eastern Washington State, 25 locations in Illinois, three in Missouri and one in Oklahoma. In addition, the retailer acquired 29 sites from Florida Oil Holdings LLC late last year to add to its Circle K Florida division. The Sunshine State has become a hotbed for c-store growth with the recent entry of Wawa Inc. and Thorntons Inc., as well as accelerated growth by existing market players RaceTrac Petroleum Inc. and 7-Eleven.

Although unsuccessful in its unfriendly takeover attempt of Casey's General Stores Inc. in 2010, Couche-Tard shows no signs of reining in its acquisition appetite. During the company's latest earnings conference call, CEO Alain Bouchard said the retailer continues to search for small- to mid-sized acquisitions in both North America and Europe.

Bouchard, who was recently named to Forbes' Billionaire's Club, has said Couche-Tard could operate 25,000 convenience stores in the near future. With that kind of aspiration, industry insiders expect the Canada-based retailer's name to come up in ongoing speculation over potential acquisition targets such as Energy Transfer Partners LP's Sunoco Inc. division, Hess Corp. and others.

— Don Longo

No. 5: Fikes Wholesale Inc.

Fikes Wholesale Inc., parent company of CEFCO Convenience Stores, is on a roll when it comes to store growth. In 2011, the Temple, Texas-based company added 72 stores. Last year, the c-store chain tacked on an additional 61 net stores, including the acquisition of 59 former Taylor Food Mart Stores from Taylor Petroleum Co.

Fikes now has 255 locations, all of which are company operated.

"We have a two-pronged [growth] approach," said Brett Giesick, chief retail officer for Fikes. "One has been acquisitions. In 2012, we really filled out our network by purchasing stores in east Texas — where we didn't have a large presence — as well as Oklahoma, New Mexico, Arkansas and Louisiana. We are now in seven contiguous states."

The second facet of Fikes' approach is organic store growth. According to Giesick, nine new or rebuilt CEFCO stores opened last year. All new stores sell gas, span 5,000 square feet and offer in-store, made-to-order foodservice items or house quick-service restaurants.

This April, a prototype CEFCO travel center will open at the intersection of Interstate 30 and Highway 37 in Mount Vernon, Texas. While this won't be CEFCO's first truck stop, it will be the first one to be co-branded with Huddle House, and the largest CEFCO location thus far.

"The total footprint for that location will be 10,000 square feet," noted Giesick. "It will have a Huddle House restaurant, as well as a 6,800-square-foot [convenience store] facility."

The new CEFCO travel center prototype is only the beginning of Fikes' 2013 expansion plans. Giesick relayed that the company is always on the lookout to extend its business beyond the seven states in which it currently operates, which also includes Alabama and Mississippi.

"Our goal is to build between 10 and 20 organic locations per year," he said. "We will [also] continue to be opportunistic in terms of acquisitions, but they need to be the right fit."

— Brian Berk

No. 6: QuikTrip Corp.

QuikTrip (QT) has been a quick grower for several years now, with 2012 continuing that streak. The Tulsa, Okla.-based convenience store chain began the year just shy of 600 stores, but by the end of the year, it had surpassed that milestone and kept growing to 641 locations.

QT is no stranger to CSNews' Top 20 Growth Chains list. Last year, the retailer landed at No. 19 on the inaugural list by opening 21 stores in 2011. This year, QuikTrip moves way up the ranking to No. 6, having opened a net total of 54 stores in 2012 — more than double its 2011 growth.

Mike Thornbrugh, QuikTrip's manager of public and government affairs, told CSNews that the company actually opened 61 stores in 2012 — 54 new builds and seven "relocations." All new stores sport the chain's Generation 3 prototype design. These larger stores have multiple entrances and offer outdoor seating. Inside, customers find an expansive array of hot, cold and frozen dispensed beverages; a large selection of QT Kitchens single-serve and take-home prepared foods; and a specialty beverage and soft-serve yogurt/ice cream bar staffed by associates.

2012 also marked the first time North Carolina consumers got the chance to experience QT, as the company opened its first store there in April. QuikTrip also spent the last year accelerating its push into neighboring South Carolina, where it launched not long ago in October 2011.

Thornbrugh said the new Carolinas division is playing a major role in QuikTrip's rapid expansion. "This has been the most aggressive and quickest growth for a new division in QT history," he stated. As of this January, the chain had built and opened 24 stores in the Carolinas — 18 in South Carolina (Greenville-Spartanburg) and six in North Carolina (Charlotte).

"We're going to be focused on the Carolinas for a long time," he added.

QT's Gen 3 prototype design is the other major motivator behind the retailer's growth. "The new Gen 3 gives us a lot of growth opportunity in newer markets, as well as the more mature, existing markets we're in," Thornbrugh explained. Including the Carolinas, QuikTrip currently operates in 11 states. Its major markets include: Atlanta, Charlotte, Dallas-Fort Worth, Des Moines, Greenville-Spartanburg, Kansas City, Omaha, Phoenix, St. Louis, Tucson, Tulsa and Wichita.

Coming off such phenomenal store count growth in 2012, QuikTrip has no plans to put on the brakes. Thirty-seven new stores were already under construction as of late January.

"Growth [this year] will be very similar [to last year]," Thornbrugh told CSNews. "The Carolinas [division] is going to see the majority of new stores, but we continue to have good success and growth in the Dallas-Fort Worth and Arizona markets, too."

As in the past, new builds will make up 100 percent of QT's growth this year and onward. Acquisitions are not something the chain pursues. "It's just the way we like to do things. We like to do everything from the ground up. We always have," he said. "There's nothing wrong with acquisitions, but that's just not our model or the way we do business."

— Linda Lisanti

No. 7: Casey's General Stores Inc.

Casey's General Stores brought its brand of convenience to three more states in 2012. With its entrance into Kentucky, Tennessee and North Dakota, the chain now operates in 14 states.

Asked why these three states made sense as the retailer's next moves, Chief Financial Officer Bill Walljasper told CSNews: "Kentucky and Tennessee have similar demographics as our existing states, with many smaller rural communities. The stores are in the western portion of the state — a natural geographic expansion in relation to our distribution channels. The eastern part of North Dakota also has these characteristics."

Casey's is penetrating these new markets with ground-up stores representing its latest prototype design. The larger format spans 4,000 square feet and includes the company's new sub sandwich program and, in some cases, an in-store foodservice seating area. These stores also feature expanded coffee bars, self-serve ice cream and walk-in beer caves.

Last year, Casey's added a net total of 42 stores to its network. It started the year with 1,686 locations and ended with 1,728. Walljasper noted that Casey's actually added 51 stores — 23 new builds and 28 acquired units — but the retailer closed nine sites as well. Most of the closures were the result of an acquisition that had stores overlapping with existing Casey's locations.

In its biggest deal of the year, the Ankeny, Iowa-based chain acquired 22 stores from fellow Midwest c-store operator Kum & Go LC of West Des Moines, Iowa. The transaction, which closed in November, included locations in Iowa, Missouri and North Dakota.

According to Walljasper, Casey's saw the greatest store count growth in Iowa last year.

As for 2013, the publicly-traded company has yet to release store growth goals for its 2013-2014 fiscal year. However, the CFO did tell CSNews: "We anticipate opening more new builds next year than we did this year. Acquisitions are much harder to predict."

That doesn't mean Casey's won't pursue acquisitions. Such opportunities will continue to be part of its store growth strategy, in tandem with new builds that will be spread out throughout its 14-state marketing territory. Emphasis will be placed on its three newest states of operation.

— Linda Lisanti

No. 8: Valero Corner Store

In 2012, Valero had to follow up on what the company labeled the best year ever for its retail division. Valero grew its Corner Store network through both new builds and acquisitions, adding 34 net stores over the course of last year for a total of 1,030 company-operated sites.

A number of the added stores were refurbished or repurposed stores, while others were new builds, Bill Day, Valero's executive director of media relations, told CSNews. "These new sites were all done in the new, larger format style, which features stores up to 5,500 square feet and offerings of freshly prepared foods," he explained. "In addition, there were several sites purchased and rebranded as Valero Corner Store locations."

In June, the company acquired 29 locations from The Crackerbox Stores in Arkansas and quickly got to work converting those stores to the Valero Corner Store brand.

"We were in Arkansas 20 years ago, but exited the market because the sites were older and required investment. We were not investing in retail then like we are today," a company executive said. "[Arkansas] is right next to Texas and adjacent to where we are today, and we had access to our own fuel supply. These are the type of acquisitions we want to look at in the future."

Last year also saw Valero purchase approximately 20 pieces of land for future growth. This year, the retailer intends to continue this long-term strategy by buying another 20 pieces of property and building another 15 new stores. 2013 will also see Valero separate its retail division from the rest of the company. The spinoff, first announced last year, is slated for the second quarter, and the new company will be named CST Brands Inc.

Under the leadership of Kim Bowers, former executive vice president and general counsel, who was recently named executive vice president and retail president of Valero's convenience store division in the United States and Canada, the company is keeping its eye on growth opportunities in merchandise, food-service and new-build locations as it prepares for the spinoff.

— Angela Hanson

No. 9: Murphy Oil Corp.

In early 2012, Murphy Oil pledged to continue an aggressive store growth plan as it moved forward. The El Dorado, Ark.-based company lived up to that commitment, adding 28 new convenience stores in a year of transition that ended with a total of 152 Murphy Express c-stores in operation, in addition to more than 1,000 Murphy USA gas stations.

Word of a major change came early in 2012, when then-President and CEO David M. Wood disclosed during an earnings call the possibility of spinning off Murphy Oil's downstream division, parent company to its c-stores and gas stations in 24 states. At the time, Wood described the company's retail division as "well poised for future growth."

Confirmation of the spinoff finally came in November, when Chief Financial Officer Kevin Fitzgerald announced that a new company, Murphy Oil USA Inc., would comprise its more than 1,150 c-stores and gas stations along with a few other assets, including two ethanol plants.

The Murphy Oil USA spinoff is scheduled for the second half of this year, at which time R. Andrew Clyde will take the reigns as president and CEO of the new downstream entity. The new company already has a goal of adding 65 to 70 new locations by the end of this year.

While Murphy Express locations tend to be larger, standalone, traditional convenience stores, Murphy USA stations are smaller, kiosk-format stores located near a Walmart. Just recently, Murphy Oil and Wal-Mart Stores Inc. forged a deal that paves the way for the opening of 200 new Murphy USA stations over the next three years in the Midwest and Southeast.

— Angela Hanson

No. 10: Sunoco Inc.

To say Sunoco had a busy 2012 would be quite an understatement. In April, just one month after Brian MacDonald replaced Lynn Elsenhans as CEO, the company announced that master limited partnership Energy Transfer Partners LP (ETP) would buy Sunoco for $2.6 billion.

Sunoco shareholders approved the acquisition on Oct. 4 and the company became a division of ETP one day later. Sunoco will be fully incorporated into ETP in 2014, according to Kelcy Warren, CEO of ETP's pipeline business.

Following the acquisition, what Dallas-based ETP would do with Sunoco's large network of convenience stores and gas stations quickly garnered several headlines. A plethora of analysts recommended that ETP sell the entire Sunoco c-store and gas station business, noting its unfamiliarity with retail operations and unfavorable tax implications.

However, Warren stressed that no such sale will occur. "We are a long-term holder of the retail gasoline assets," he stated during a Nov. 8 earnings call and reiterated just last month. "One of the key things we acquired with Sunoco is expertise. Admittedly, we are not knowledgeable as far as retail goes. But we acquired it [in the transaction]."

Whether ETP changes its mind remains to be seen, but one thing is certain. With 26 net locations added last year for a 1.3-percent increase, the new owner continues to grow Sunoco's retail network, hence its placement at No. 10 on this year's Top 20 Growth Chains list.

— Brian Berk

No. 11: RaceTrac Petroleum Inc.

RaceTrac Petroleum, the Atlanta-based chain of more than 650 convenience stores, added 25 net new stores last year — all of them built according to the retailer's RT6K prototype.

Company spokesperson Dayna Reed told CSNews that the pace of expansion for 2012 was about on par with previous years. However, at 6,000 square feet each, these new RT6K prototype stores added more than 150,000 square feet to RaceTrac's retail footprint last year.

"In 2012, RaceTrac built stores in Dallas-Fort Worth, Atlanta, southeast Louisiana and all major markets in Florida, including Miami, Tampa and Orlando," said Reed. "All of these markets were existing markets for RaceTrac, but we were pleased to have grown within the cities we are already well-known and have a great guest base."

The 6,000-square-foot RT6K store model features indoor and outdoor seating, free Wi-Fi and a walk-in beer cooler among many other amenities. It also has an increased emphasis on foodservice, offering expanded food and beverage options, 24 frozen drink flavors and a Swirl World self-serve frozen yogurt bar with 10 flavors and more than 40 toppings.

Based on the strength of its RT6K prototype, RaceTrac in October was named CSNews' inaugural Retailer Innovator of the Year. In an interview with CSNews, Allison Moran, who assumed the chief executive role from her father and chairman Carl Bolch Jr. on Dec. 31, vowed that RaceTrac's "ground up" expansion will continue under her leadership. Building stores from the ground up "enables consistency of execution throughout the far-flung chain," she said.

In the past 15 years, RaceTrac has only bought one store for its Raceway division of contractor-operated stores. The retailer owns the vast majority of the real estate for its stores as well.

— Don Longo

No. 12: Pilot Flying J (tie)

It could be said 2012 was a banner year for Pilot Flying J as the Knoxville, Tenn.-based company hit a milestone number of travel centers and plazas, cracked the top 10 on Forbes' America's Largest Private Companies list and made its first appearance as one of CSNews' Top 20 Growth Chains.

According to the data provided to CSNews by Nielsen TDLinx, Pilot Flying J added 23 convenience stores to its footprint between January and December 2012, bringing its total convenience store count to 536. Of that number, 526 are corporate-owned locations.

Factoring in sites without convenience stores, though, Pilot Flying J reached the notable 650 mark for travel centers and travel plazas last year and has since passed that with more new locations.

Strategic advisor John Compton said Pilot Flying J is always on the lookout for new store locations that will add to its North American network in order to better serve customers and more consistently provide them with convenience; fast, friendly service; and quality amenities.

"The convenience of our customers is always a top priority, and their needs largely drive the business decisions of the company," Compton added. "We're committed to making life better for America's drivers, and we look for new travel center and travel plaza locations that will complement our complete network of more than 650 stores and will continue to provide customers with a great experience."

Pilot Flying J is the largest operator of travel centers and travel plazas in North America. Its network provides access to more than 60,000 parking spaces for trucks, over 4,400 showers and 4,000-plus diesel lanes, of which more than 2,500 offer diesel exhaust fluid at the pump.

— Melissa Kress

No. 12: Sheetz Inc. (tie)

Sheetz Freakz had 23 new reasons to celebrate last year, as the convenience restaurant chain they go crazy for added a net 23 stores to its steadily growing network across Pennsylvania, West Virginia, Virginia, Ohio, Maryland and North Carolina.

At the end of 2012, Sheetz operated a total of 434 locations where fans could go for their "Sheetz Runs." Even though the company's 23-unit increase was just one higher than its prior-year addition of 22, the retailer jumped several spots on our Top 20 Growth Chains list. This year, Sheetz landed at No. 12 in a tie with Pilot Flying J. Last March, it was ranked No. 17.

Some of the store opening milestones Sheetz achieved in 2012 included its:

• Third Erie, Pa., location, opened in December;
• 227th Pennsylvania store, also opened in December in North Huntingdon;
• 42nd West Virginia location, opened in December in Clarksburg; and
• First ever dual-lane drive-thru, opened in October in Blairsville, Pa.

It is not uncommon for hundreds to flock to Sheetz' grand openings, lining up before daybreak to be among the first 50 who receive $100 Sheetz gift cards. The festivities also include activities, games and samples of Sheetz food and beverages, along with a donation to a local charity.

Sheetz Freakz will surely get more reasons to cheer this year, as the chain continues its measured growth. Already announced are four more stores in Erie County, Pa., and two more locations in West Virginia's Putnam County — one in Rock Branch and the other in Teays Valley.

This year will also see Sheetz begin construction on its second distribution and food manufacturing center. The company is slated to break ground this June on the $32.8-million facility in Burlington, N.C., with an opening scheduled for December 2014. The new center, which will be similar to the retailer's existing facility in Claysburg, Pa., represents a key element in Sheetz' plans to rapidly expand its convenience restaurants, particularly in North Carolina and Virginia.

— Linda Lisanti

No. 14: Susser Holdings Corp.

Citing a robust economy in Texas, where the majority of its Stripes convenience stores reside, Susser Holdings Corp.'s executive management has on several occasions expressed a desire to continuously open new stores.

In 2012, Corpus Christi, Texas-based Susser Holdings added 18 net locations for a 3.3-percent increase in its overall store base, which now consists of 559 Stripes convenience stores, all of which are company operated.

Steve DeSutter, president and CEO of Stripes, told CSNews that the c-store chain has even loftier goals for this year, with plans to "further increase its growth rate in new store builds with 29 to 35 new Stripes stores in 2013."

The centerpiece in these new stores — and an increasing number of existing sites — is the Laredo Taco Co., Susser Holding's proprietary foodservice brand. It is built into every new store and now housed in 60 percent of all Stripes locations.

"Fresh, in-store prepared food has certainly fueled our growth, and these [new] larger format stores provide for the necessary space to prepare and serve customers a truly delicious offering," DeSutter explained. "We are delighted with our large-format stores. They give us great merchandising options, and they provide customers with a bright, clean and comfortable shopping and eating experience."

Strong store count growth also bodes well for Susser Petroleum Partners LP, which was spun off from the parent company on Sept. 26. Susser Holdings still retains a 50.1-percent ownership of the wholesale fuels business that distributes more than 1.4 billion gallons of motor fuel annually to all Stripes stores and an additional 579 branded dealers.

— Brian Berk

No. 15: Maverik Inc. (tie)

"Adventure's First Stop" makes its debut on CSNews' Top 20 Growth Chains list this year. Maverik Inc., whose adventure-theme model permeates every aspect of the company's corporate culture, opened 15 new stores in 2012, securing it the No. 15 spot on the list along with Shell Oil Co., which also opened 15 locations last year.

While Maverik's 2012 growth rate was on par with the two prior years, it did fall behind the company's internal target due to permitting delays, said Dan Murray, vice president of Growth Tsunami, the retailer's real estate and construction department.

Indicative of the chain's aggressive growth aspirations, Maverik had 32 sites under development as of the summer — eight under construction and 24 in the time-consuming building or zoning permit phases. The company's hope is that all 32 of those sites can be open for business by this summer. "You grow or you die," Murray said when CSNews visited the retailer's Salt Lake City headquarters for its August 2012 "A Day in the Life of Maverik Inc." cover story.

Most of the new stores that did open during the last calendar year were in Maverik's core trade areas within 10 western states. Last year, the chain did expand into eastern Washington State with stores in Spokane and the Tri-Cities markets.

Maverik's store growth, like that of several other regional chains, was completely organic. All 15 stores were new builds. Each year, the company tweaks its store design, but no new prototype or concept stores were introduced last year, according to Murray. The retailer, already in the Reno, Nev., market, debuted its first store in Las Vegas in December as well.

In addition to this growth, Maverik won the Gold Medal for Best New Foodservice Program in CSNews' inaugural Foodservice Innovators Awards. Judges in the program, which was sponsored by Tyson Foods, praised Maverik's Bonfire proprietary hot and cold fresh food program and "The Bundle," a proprietary hot product line in which each Bundle is handmade in the store and comes in a variety of breakfast, lunch and snack options.

— Don Longo

No. 15: Shell Oil Co. (tie)

Coming off its second-place ranking on last year's CSNews Top 20 Growth Chains list, Shell saw another year of unit growth for its convenience stores and gas stations in 2012, albeit far less in scale. Shell ended 2012 with a net gain of 15 stores, for a total of 4,948 locations.

By comparison, the Houston-based company added 167 net stores in 2011 — many of which were new build Shell-branded sites — capping off three straight years of unprecedented growth.

At the start of last year, Shell vowed to continue creating value and growth for its branded wholesalers by driving more traffic to their sites and delivering new, innovative products and programs that generate brand-loyal consumers. The company delivered in several ways.

Most notably, Shell launched the Fuel Rewards Network (FRN), a free loyalty program that allows consumers to earn stackable discounts by making purchases at partner grocery stores, restaurants and merchants from the Online Mall at www.fuelrewards.com, as well as specialty offers at participating Shell gas stations. The program, developed and operated by Excentus, debuted in more than 40 markets with the expectation of reaching 200 markets across the nation by the end of the year. Shell has quickly expanded upon that target by bringing FRN to even more major markets, including Nashville, Chicago and Portland.

Shell also stepped into the arena of technological advancements in 2012 by joining with 7-Eleven, Alon Brands, Sunoco and other retailers to create the Merchant Customer Exchange (MCX) in August. The new mobile wallet platform is intended to offer customers additional payment options and compete with platforms such as PayPal, the Isis Mobile Wallet and others.

— Angela Hanson

No. 17: Hy-Vee Inc. (tie)

Hy-Vee expanded its convenience store presence last year with a flair for innovation. The Iowa-based grocery/drug/convenience store operator opened 13 c-stores from January through December 2012 — a 13.4-percent jump that landed it in a three-way tie for the No. 17 ranking.

In October, Hy-Vee announced the opening of two new convenience stores in Liberty, Mo., and Waukee, Iowa, along with its purchase of a c-store and gas station in Cedar Rapids, Iowa, which it will revamp and open this year. Hy-Vee currently owns and operates 233 retail locations in eight Midwestern states, with convenience stores accounting for 110 of those locations.

While brand expansion was a major theme for Hy-Vee in the past year, so was conservation. The retailer in August opened its first environmentally friendly, gold-level LEED certified c-store in West Lawrence, Kan. This store had the distinction of being the first c-store in town, and in the Hy-Vee chain itself, to earn LEED status. The 3,200-square-foot store features solar panels atop the gas station canopy; a rooftop rain collection system; concrete floors that can be cleaned without wax or other chemicals; LED lighting and skylights; landscaping beds planted with native plants that require little watering; and a buffalo grass lawn that doesn't require an irrigation system. The location also boasts 16 fueling stations that are open 24 hours.

2012 also saw Hy-Vee launch a new Fuel Saver program, allowing customers to earn discounts on gasoline when they buy grocery items featured in its weekly Fuel Saver ad.

"The typical household today spends nearly $350 per month on gasoline," stated Randy Edeker, chairman and CEO of Hy-Vee Inc. "Anything we can do to help families save at the pump means more money for them to spend on other items they need."

— Samantha Negraval

No. 17: Victory Marketing LLC (tie)

Victory Marketing, which primarily operates under the Sprint Mart banner, invites its customers to "Run With the Best." Now, after seeing its store count increase by 18.6 percent during the period of January through December 2012, the Ridgefield, Miss.-based company can say it is running with the convenience industry's top growers. The c-store operator added 13 stores last year, placing it in a three-way tie for the No. 17 ranking.

According to Sprint Mart's website, the brand strives to serve customers with four key qualities: honesty, integrity, service and quality. It boasts that its 83 stores, located throughout Mississippi and Alabama, are convenient, cheery and clean, with friendly staff and great merchandise.

This past year, Sprint Mart's focus also turned to efficiency, particularly in the foodservice category. In October, Victory Marketing implemented Gilbarco Veeder-Root's Passport POS with Xpedient and Express Ordering throughout its retail network. The software solution provides Sprint Mart locations with a complete foodservice option, including touchscreen ordering, a kitchen monitor system and price book integration.

"The Express Ordering solution is a perfect balance of productivity and customer service, with a modern edge," said Michael Sebree, company director of foodservice at Sprint Mart. "It has made the menu selection process fun, fast and easy for the customer to place an order."

Sprint Mart promotes its foodservice offerings, especially its Best Bean Coffee, through an active social media presence on both Facebook and Twitter.

— Samantha Negraval

No. 17: Wawa Inc. (tie)

2012 will go down in Wawa's history as the year it stepped out of its regional comfort zone. For the first time, the Pennsylvania-based convenience retailer spread it wings past the Mid-Atlantic states and established itself as a force to be reckoned with in the South.

Wawa welcomed its first customers in the state of Florida in mid-July when its first Orlando convenience store opened on Central Florida Parkway, across from SeaWorld. By year's end, the retailer had six stores up and running in the Sunshine State.

New store openings last year, however, were not confined to the home of the Gators. According to a company spokeswoman, Wawa had several new ground-up locations open in its core states of Pennsylvania, Delaware, Maryland, New Jersey and Virginia as well.

In addition to new store growth, Wawa revitalized all of its existing stores with new foodservice infrastructure to support the launch of a new product line — specialty beverages, and hot, iced and frozen espresso-based beverages. The chain also completed three major remodels in 2012, which ran the spectrum from significant store improvements to the addition of fuel.

This year, Wawa continues on its growth path. It is opening stores in the Tampa, Fla., area and just recently began its push into northern New Jersey with its first store in Hudson County.

— Melissa Kress

Love's Travel Stops No. 20: & Country Stores (tie)

Making a second consecutive appearance in the No. 20 spot on CSNews' Top 20 Growth Chains list is Love's Travel Stops & Country Stores, which added 12 net new locations last year — all new builds.

Love's ended the year with 299 stores and it's only a matter of time before the chain breaks the 300-store milestone as it maintains a goal of opening 15 to 20 new locations each year.

"Love's Travel Stops are built to be modern, spacious, well-lit and well-staffed," Kyla Turner, communications manager for Love's, told CSNews. "Our main focuses include keeping all facilities exceptionally clean and offering a variety of amenities and products [that] motorists and professional truck drivers want most."

When scouting out where to build new locations, Love's keeps one thought top of mind. "We look for locations along the nation's major highways and interstates that will offer our customers a hassle-free way to get to our travel stops, get what they need and get back on the road to reach their destinations," Turner added.

— Brian Berk

No. 20: Western Refining Inc. (tie)

Thanks to growth on par with previous years, Western Refining shares the No. 20 spot on this year's list with Love's Travel Stops & Country Stores. During 2012, Western Refining's retail division, which operates under the brands of Giant, Mustang, Sundial and Howdy's, added 12 convenience stores in northern New Mexico for a 5.7-percent increase in unit count.

This is slightly less than in 2011, when it tied for No. 17 with the addition of 21 stores.

All but one of the stores added last year were acquisitions; the other was a new build. The 11 acquired stores were obtained in late June through the execution of a long-term lease agreement with Polk Oil. All these sites were subsequently converted to the Giant c-store brand.

Western Refining now operates 222 convenience stores and gas stations in Arizona, Colorado, Texas and New Mexico. While no specific expansion plans are on the drawing board for this year, the company is keeping its eyes open.

"We continue to evaluate opportunities for growth through both acquisitions and new builds," said Gary W. Hanson, Western Refining's vice president of corporate communications.

— Angela Hanson

METHODOLOGY

Convenience Store News partnered with TDLinx, a service of Nielsen, to identify the Top 20 Growth Chains in the convenience store industry based on 2012 store count growth.

To compile this year's list, CSNews analyzed TDLinx's store count calculations for Jan. 1, 2012 through Dec. 31, 2012. The ranking is based on the total number of net stores added during that timeframe. Where possible, the figures were confirmed by the individual companies.

TDLinx is the leader in location information management. The company collects and maintains store information across all retail trade channels, including supermarket/supercenter, superette, drug, wholesale club, mass merchandiser, dollar, convenience store, gas station/kiosk, liquor store and cigarette outlet. Its database is updated daily and encompasses more than 400,000 stores.

TDLinx defines a convenience store as a store that includes a broad merchandising mix, extended hours of operation and a minimum of 500 SKUs. Fueling stations with small kiosk stores do not meet the official definition of a c-store and thus are not reflected in TDLinx's store count figures.