Convenience Store News

JUL 2015

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34 Convenience Store News | JULY 2015 | WWW.CSNEWS.COM COVER STORY Energy Transfer Partners LP/ Sunoco LP Nos.4&9 Two of the top 10 chains on this year's Top 100 list are related: Sunoco LP (at No. 9) and its parent company Energy Transfer Partners LP (at No. 4). Sunoco LP owns the former legacy Susser Petroleum Partners wholesale business. It also owns Aloha Petroleum, Mid-Atlantic Convenience Stores (MACS) and Tigermart. Sunoco LP's parent company, Energy Transfer Partners LP (ETP), is in the process of drop- ping down its entire retail division to Sunoco LP and reiterated in May that it will be done no later than mid-2017. Once this transaction takes place, Sunoco LP will become one of the biggest players in the convenience store industry, as it will take on the Sunoco Inc., Stripes and Sac-N-Pac retail assets now owned by ETP. "[Sunoco] LP is on the path to become one of the leading wholesale and retail platforms in the country," said Sunoco LP CEO Robert Owens. As for Sunoco LP's current assets, Owens noted Aloha and MACS are performing so well that the company is seeking future c-store acquisitions boasting similar assets to these two retailers. "We checked every box of what we are looking for in an acquisition [with those trans- actions]," Owens reported in May. "They have strong assets, demand growth in key markets and were acquired at attractive prices." The master limited partnership is also bullish on the future of the c-store industry thanks to the potential for growth and margin expan- sion in foodservice. "People are becoming increasingly more comfort- able purchasing prepared food at convenience stores," Owens relayed. ETP's current retail assets are also performing well, led by in-store mer- chandise sales. In 2015's first quarter ended March 31, ETP's retail division (primarily consisting of Stripes and Sac-N-Pac stores) achieved gross mar- gins of $438 million, compared to $255 million in 2014's first quarter. Motor fuel gallons sold throughout ETP's retail division were also strong, increas- ing year over year from 1.392 billion gallons sold to 1.88 billion gallons sold. No.6 BP takes the No. 6 spot in this year's Top 100 list, dropping three positions from its consecu- tive No. 3 hold in 2014, 2013, 2012 and 2011. Nielsen TDLinx puts BP's total store count at 3,945 — all of which are franchise/licensee locations. BP's retail banners include Amoco, ampm , Arco, Arco Thrifty, BP, BP Connect and BP Shop. The company's latest year-end sales amounted to approximately $14.3 billion. Following suit to its testament of "strategic refocusing," in the past year, Houston-based BP introduced a new technology solution deployed at the point-of-sale, inside PIN pads, electronic payment server, forecourt controller and network for its BP-branded retail- ers. In doing so, the company provides its BP-branded marketers the ability to accept EMV (Europay, MasterCard and Visa) credit cards and debit cards. The technology platform is also designed to allow Marathon Petroleum Corp. No.5 Moving up two spots to No. 5, Marathon Petroleum Corp. boasts an overall store count of 4,086 locations, 2,646 that are corporate-owned and 1,400 that are franchise/licensee. The Findlay, Ohio-based company's biggest boost came when it added Hess Corp.'s 1,200- store retail network to its Enon, Ohio-based Speedway LLC retail division in September. The $2.82-billion transaction also included Hess' transport operations and shipper history on various pipelines. As a result of this deal, Marathon is in the process of introducing the Speedway brand to a new region (the Northeast) and reintroducing it to another region (the Southeast). Rebranding efforts began in Florida before switching to the Northeast — mainly the New York and New Jersey area — in the spring. The company will turn its rebranding focus to the Carolinas later this year and finish all conversions by early 2016. In addition to growing its footprint, Marathon is expanding upon the Speedway brand with its new Speedy Rewards MasterCard. The one-swipe technology allows customers to pay for their purchases and manage their rewards points with one card, eliminating the need for a separate Speedy Rewards membership card. Cardholders earn 50 points per dollar by using the card for purchases at Speedway and 10 points per dollar on all other purchases. Speedway is not drawing all of Marathon's time and atten- tion, though, as the parent company rolled out Cents Off Marathon, an instant cents-off-per-gallon discount program on fuel purchases throughout its Marathon-branded marketing network. As of late 2014, nearly 80 percent of Marathon's independent job- bers and dealers had enrolled in the program, which uses technology developed by Drop Tank. The program will be made available through deployment and installation, occurring during this year. branded marketers to accept mobile payments and more effectively implement loyalty programs. On the consumer side, British-based parent com- pany BP plc teamed up with Synchrony Financial to provide new private-label and co-branded credit card programs for customers. The new BP credit card pro- grams, launched in the second quarter of this year, are accepted for purchases at more than 7,000 BP gas sta- tions, as well as other retail sites. Additionally, on the consumer side, BP simplified its Driver Rewards program, whereby motorists can choose from three different loyalty cards: BP Visa with Driver Rewards, BP Credit Card with Driver Rewards and BP Driver Rewards Loyalty Card. BP-branded retailers now have an easier and more cost-effective program to manage as well. BP North America

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