Single Store Owner

OCT 2016

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FOODSERVICE 36 / Convenience Store News for the Single Store Owner / OCTOBER 2016 Prepared Food / Hot, Cold, Frozen Dispensed Beverages single stores anticipate another year of foodservice sales improvement. This compares to just 7.1 per- cent of single-store owners who anticipate a decline in their 2016 foodservice sales. Profits generated by the foodservice category, which encompasses prepared food and hot, cold and frozen dispensed beverages, are similarly outpacing retailers' projections. While single stores do not traditionally fare as well as chain-owned stores when it comes to food- service profits, 57.1 percent of the single-store oper- ators surveyed this year reported an increase in their 2015 foodservice profits. Those whose foodservice profits fell were again in the minority at 7.2 percent, while 35.7 percent said 2015 profits held steady. As for the current year, single stores are not as bullish profit-wise as they are sales-wise. Still, the ma- jority (59.3 percent) of single-store operators polled expect their foodservice profits to rise in 2016. Only 7.4 percent are bracing for decreased profits. The Key Ingredients What's driving this better-than-expected foodser- vice category growth? Research participants cite a variety of primary sales drivers. One repeated by numer- ous retailers is the increased quality of foodservice items that convenience stores are offering these days, along with new menu choices, expanded fresh food of- ferings, and overall value. "Customer service and presentation drives our sales," one retailer remarked. "Profit changes depend entirely on the fluctuating market." Fired Up Over Foodservice Single-store owners are bullish on this category as more of them report sales increases BY ANGELA HANSON T he question of whether convenience stores can become known for their foodservice offerings as much as the packaged snacks and beverages they sell has been answered. The past year has proven that both chain and inde- pendent c-stores are solidly foodservice destinations. Among the findings to come out of the 2016 Convenience Store News for the Single Store Owner Foodservice Study is that 75.9 percent of the single-store operators who took part in the research reported an increase in their foodservice sales for 2015. This is a sharp jump up from the 50 percent who reported increased foodservice sales for 2014. The actual number of single stores who saw a sales increase in 2015 is also considerably higher than the 51.7 percent who predicted their sales would rise in last year's Foodservice Study. The number of single-store retailers who reported no change for 2015 was a minority at 24.1 percent, but more notably, zero participants reported a decrease in foodservice sales. Looking ahead to their expected results for full-year 2016, optimism prevails as 71.5 percent of TOTAL SINGLE STORES CHAINS 2015 Increased 84.2% 75.9% 92.9% Decreased 0.0 0.0 0.0 Stayed the same 15.8 24.1 7.1 2016 (expected) Increase 80.4% 71.5% 89.3% Decrease 3.5 7.1 0.0 Stay the same 16.1 21.4 10.7 Source: Convenience Store News for the Single Store Owner Market Research, 2016 Foodservice Sales AVERAGE SALES PER STORE SINGLE STORES TOTAL INDUSTRY 2015 % CHANGE 2015 % CHANGE Prepared food (prepared on- or off-site) $133,173 6.4% $149,900 6.5% Hot dispensed beverages 39,868 2.5% 45,867 4.7% Cold dispensed beverages 15,549 10.2% 17,293 7.9% Frozen dispensed beverages 7,401 3.6% 8,019 0.0% TOTAL $195,991 5.7% $221,079 6.0% Source: Convenience Store News for the Single Store Owner Market Research, 2016 Category Analysis: Total Foodservice

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