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U.S. Convenience Store Count Dips Slightly

ALEXANDRIA, Va., and NEW YORK -- The number of U.S. convenience stores fell 0.2 percent over the past year and stands at 144,541 as of Dec. 31, 2009, according to the NACS/Nielsen TDLinx 2010 Convenience Industry Store Count, released today. The store count numbers are key for industry metrics, including NACS State of the Industry and Convenience Store News annual Industry Report. (CSNews is a Nielsen company.)

This is the second consecutive year the count has declined and only the fourth time in the last 15 years that the industry's store count has fallen. The count also declined in 1994, 2003 and 2008.

The industry count reached a high of 146,294 stores two years ago.

"The decline is driven by fluctuating gas prices and many retailers, especially single convenience store owners, not being able to keep up with the expense and operating at a profit," said Todd Hale, senior vice president of Consumer & Shopper Insights, Nielsen. "Consumer purchases with payments by credit cards -- and the associated interchange fees paid to the card companies by retailers -- have been a real problem for the industry and for single-store owners."

Despite their difficulties, single-store operators continue to dominate the convenience retailing industry, accounting for 62.3 percent of the industry's total stores. While the overall industry store count declined 334 stores, one-store operators increased by 452 stores last year, after a drop of almost 1,000 stores the previous year.

And despite the two-year decline in total stores, the convenience retailing industry has shown remarkable growth over the last three decades, said NACS. In 1979 there were only 57,700 convenience stores in the United States.

"That our numbers largely held firm in a miserable economic climate and the dismal lending environment is a testament to our overall industry's strength and offer," said NACS Vice Chairman of Research Greg Parker, CEO of The Parker Cos. in Savannah, Ga.

Despite extreme price and profit volatility for motor fuels, convenience store retailers still consider motor fuels operations to be important. A total of 115,340 convenience stores sell motor fuels, a 0.6-percent increase over last year. Overall, 78.8 percent of all convenience stores sell motor fuels.

Texas once again led in terms of overall stores, with 14,226 stores, nearly one of every 10 in the country.

Convenience stores also outnumber the cumulative total stores count from competing channels in the United States. According to Nielsen TDLinx, as of Dec. 31, 2009, there were 35,612 supermarkets, 37,654 drug stores and 27,247 mass merchandiser/dollar stores.

TDLinx and NACS define convenience stores as stores that include a broad merchandise mix, extended hours of operation and a minimum of 500 stock-keeping units (SKUs).

U.S. Convenience Stores (as of 12/31/09 for the previous year)
2010 -- 144,541 (-0.2 percent over previous year)
2009 -- 144,875 (-1.0 percent over previous year)
2008 -- 146,294 (+0.8 percent over previous year)
2007 -- 145,119 (+3.2 percent over previous year)
2006 -- 140,655 (+1.8 percent over previous year)

Top States for Convenience Stores (as of 12/31/09)
1. Texas 14,226 stores
2. California 10,312
3. Florida 9,223
4. New York 7,552
5. Georgia 6,363
6. North Carolina 6,146
7. Ohio 5,182
8. Michigan 4,814
9. Illinois 4,496
10. Virginia 4,461

Bottom three states are Alaska (194 stores), Delaware (328) and Wyoming (348).

U.S. Channel Count Comparison (as of 12/31/09)
Convenience Stores -- 144,541
Supermarkets -- 35,612
Drug Stores -- 37,654
Mass Merchandiser/Dollar Stores -- 27,247
Wholesale Clubs -- 1,207

Additional Highlights:
-- Convenience stores especially serve as the one-stop shop for food and fuel in states that are dominated by small towns. At least 95 percent of convenience stores sell motor fuel in: North Dakota (97 percent), Nebraska (97 percent), Iowa (96 percent), South Dakota (95 percent) and Kansas (95 percent).
-- The states with the lowest percentage of stores selling fuel either have full-service fueling mandates (New Jersey and Oregon) or are in the Northeast where many stores were built before the early 1970s when motor fuels sales at convenience stores began to flourish. The five states with the lowest percentage of convenience stores that sell motor fuels are New Jersey (44 percent), Massachusetts (50 percent), New York (60 percent), Rhode Island (60 percent) and Oregon (62 percent). Only 37 percent of stores in Washington D.C., sell motor fuels.
-- The percentage of one-store operators, true "mom-and-pop" stores, continues to climb. The percentage of one-store operators topped 50 percent for the first time in 2001. Today, that percentage is 62.3 percent. The states with highest percentage of one-store operations are Washington (78 percent), Georgia (74 percent), Louisiana (71 percent), Mississippi (71 percent) and New Jersey (71 percent). In Washington D.C., 78 percent of convenience stores are one-store operations.
-- The convenience retailing industry has seen remarkable growth over the last three decades. In 1979 there were only 57,700 convenience stores in the United States.

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