NATIONAL REPORT — In 2014, it was GPM Investments LLC and its 120-percent store count increase, mostly driven by its acquisition of VPS Convenience Store Group's Southeast division. In 2015, it was Speedway LLC and its 86-percent growth spurt on the heels of purchasing Hess Corp.'s retail network. In 2016, it was Alimentation Couche-Tard Inc. with a 39.4-percent boost to its U.S. footprint following its takeover of The Pantry Inc., parent of the Kangaroo Express chain.
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This year, Western Refining Inc. joins the ranks atop the Convenience Store News Top 20 Growth Chains list. Between January 2016 and January 2017, the El Paso, Texas-based company saw its convenience store portfolio jump 119.4 percent, adding 295 net new stores for a total store count of 542.
This accomplishment was largely driven by the company's acquisition of Northern Tier Energy LP. The deal, which closed in June, added to Western Refining's footprint 170 Midwest c-stores — primarily carrying the SuperAmerica banner — and another 114 franchised locations supported by Northern Tier under the SuperAmerica trademark. (Note: Late last year, Tesoro Corp. finalized a definitive agreement to acquire Western Refining for $4.1 billion. The transaction is on pace to close in the first half of this year.)
While Western Refining's jump to Top Growth Chain was sealed when it more than doubled its size thanks to Northern Tier, the other convenience store chains on this year’s CSNews Top 20 Growth Chains ranking practically inched their way onto the list, when comparing this year’s numbers to the growth tracked by CSNews in prior years.
The annual ranking, now in its sixth year, is based on store count figures provided by TDLinx, a service of Nielsen. The period analyzed was January 2016 to January 2017. 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 and thus are not reflected in TDLinx’s store count figures.
Behind Western Refining, in the No. 2 spot, is GPM Investments with 177 net new stores added for a 26.3-percent increase. Sunoco LP's addition of 123 stores (a 4.3-percent increase) was good enough to snag third, while CST Brands Inc.'s 118-unit jump (an 11.2-percent increase) places it fourth. Rounding out the top five is Kwik Trip Inc., which added 66 stores to see a 13.6-percent lift.
Now, consider that Couche-Tard, 2016’s Top Growth Chain, added 1,510 stores just on its own — more than all of this year’s growth chains combined. Overall, the 2017 CSNews Top 20 Growth Chains added a net 1,396 stores to their portfolios between January 2016 and January 2017, equating to a 5.9-percent increase for the year. That’s 1,763 stores less than what last year’s Top 20 Growth Chains added (3,159 stores for a 12.3-percent increase).
This may be the new normal, according to convenience store market experts.
"There are fewer deals, fewer big companies out there," explained Dennis Ruben, executive managing director of NRC Realty & Capital Advisors LLC. "What we believe is where you are going to see more acquisitions is in the small to mid-sized companies. There is going to be increasing pressure on the guys who have 25 to 75 stores. It's going to be more difficult for them to compete with these very large players."
The full Top 20 Growth Chains list for 2017 is:
1. Western Refining Inc.
2. GPM Investments LLC
3. Sunoco LP
4. CST Brands Inc.
5. Kwik Trip Inc.
6. 7-Eleven Inc.
7. Croton Holding Co.
8. C.A.R. Enterprises Inc.
9. Pilot Flying J
10. Love’s Travel Stops & Country Stores
11. TravelCenters of America LLC
12. Casey’s General Stores Inc.
13. Nouria Energy Corp.
14. Wallis Companies
15. Exxon Mobil Corp. (tie)
15. Mirabito Energy Products (tie)
17. Sheetz Inc.
18. Holiday Companies (tie)
18. Wawa Inc. (tie)
20. QuikTrip Corp.
For our full report on this year’s Top 20 Growth Chains, look in the March issue of Convenience Store News.