Why the C-Store Segment Cannot Afford Food Safety Breaches

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Why the C-Store Segment Cannot Afford Food Safety Breaches

02/09/2016

Chipotle has long been the darling of Wall Street, the media and business schools. Even in the face of adversity, it has thus far withstood multiple food outbreaks dating back to the fall of 2015 without shuttering stores permanently. The theory is that a pocket of its fiercely loyal customers has outwardly expressed they are willing to “get sick” on its food as a cost of the company’s commitment to saving the earth. In effect, its patrons (sick or otherwise) are its lobbyists.

Unfortunately, the convenience store segment has no such luxury. In Q1 research, general foodservice consumers rank c-store food slightly higher in freshness than a vending machine, though the channel has lobbied extensively in the past decade to prove it provides restaurant-quality food. Still, the perception lingers of gas station food, with cashiers “pumping gas and handling food.”

Approximately 70 percent of consumers surveyed are extremely or very concerned about food safety in all venues, not just convenience stores. More applicable to c-stores, when the data is cut by two of its frequent user characteristics — males and incomes in the $35,000-$49,000 range — the level of concern increases. Perhaps the reason for the collective shrug from Chipotle’s customers could be that its user base — females and millennials — are slightly less concerned than the average.

As a segment rising in the foodservice space in both perception and traffic, c-stores must avoid any “hiccups” that could cause irreversible damage (both from the media and consumers). A relevant lesson is Jack in the Box. In 1993, the chain sickened 583 people across four states with E. coli because it cooked its meat at an unsafe temperature. Nearly 200 people were hospitalized and five people died. The company lost approximately $160 million in the 18 months following the outbreak and lawsuits totaled $50 million. There have been other examples with similar outcomes since — including Taco Bell, Blue Bell and Jeni’s Ice Cream.

Furthermore, c-stores offering and expanding foodservice must be aware of the culprits of most foodborne illnesses, particularly produce, fruits and dairy products. The good news is most of the foodborne-illness outbreaks can be avoided by simply following strict guidelines — in every store, every day. This includes proper staff food-handling techniques, cleaning equipment to avoid cross contamination, cooking foods to a safe temperature, and discarding foods after an unsafe holding time (parfaits in the cold case, for example).

Finally, and perhaps most challenging for c-stores, is to regularly monitor the supply chain. As commissaries become more important in expanding menus and delivering fresh prepared foods to units, the sources must be vetted rigorously to ensure food safety procedures are followed. This has been the cause of Chipotle’s ills and there is no excuse for multiple outbreaks from multiple suppliers. In the case of the c-store segment, prevention is really the only defense.