Convenience Store News

FEB 2017

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2013 Jesse H. Neal National Business Journalism Award Best Single Issue, October 2012 2013 Jesse H. Neal National Business Journalism Award Finalist, Best Profile, August 2012 2016 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2015 Business to Business, Retail, Single/Series of Articles, August 2015 2015 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Single Article, February 2014 2014 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2013 Business to Business, Retail, Single Article, February 2013 2013 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2012 2016 American Society of Business Press Editors, National Azbee Awards Gold, Best How-To Article, March 2015 Bronze, Best Original Research, June 2015 2016 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best How-To Article, March 2015 Silver, Best Original Research, June 2015 2015 American Society of Business Press Editors, National Azbee Awards Silver, Best Profile (long form), February 2014 2015 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best Special Supplement, November 2014 Silver, Best Profile (long form), February 2014 2013 American Society of Business Press Editors, Midwest Regional Azbee Awards Bronze, Best Editorial/Commentary, July 2012 2016 Trade Association Business Publications Intl. Tabbie Awards Silver, Front Cover Illustration, June 2015 4 Convenience Store News | FEBRUARY 2017 | WWW.CSNEWS.COM VIEW POINT By Don Longo, Editorial Director EDITORIAL ADVISORY BOARD EDITORIAL EXCELLENCE AWARDS (2013-2017) Brett Atherton Bolla Management Jon Bratta Core-Mark International Inc. Rick Crawford Green Valley Grocery Edward Davidson ER Davidson & Associates (7-Eleven Inc., retired) Jim Hachtel Eby-Brown Co. Ray Johnson Speedee Mart Kirk Leff McLane Co. Inc. Jack Lewis GPM Midwest Danielle Mattiussi Maverik Inc. Kyle McKeen Alon Brands Inc. Richard Mione GPM Southeast Jonathan Polonsky Plaid Pantries Inc. Greg Scriver Kwik Trip Inc. Roy Strasburger Convenience Management Services Inc. Jon Urbanik CST Brands Inc. B everages are the lifeblood of a convenience store, but there may be signs that plaque is building up in some of the arteries. When it comes to the top 10 in-store categories for the convenience channel, packaged beverages and alco- holic beverages take the third and fourth spots, respec- tively. These two categories alone capture roughly 22 percent of all in-store sales, according to the Convenience Store News Industry Report. Add in hot, cold and frozen dispensed beverages and that percentage rises to more than 27 percent of in-store sales. And the importance of beverages to a c-store is only getting stronger. Packaged beverages, including carbonated soft drinks, energy drinks, juice, sports drinks, bottled water, ready-to-drink iced tea and enhanced water, grew by about 3.5 percent last year, based on preliminary data we've collected. That's up from a 2.4-percent gain in the year-ago period. Meanwhile, beer sales rose by 3.1 percent, a full percentage point bet- ter than the year-ago period. Although these statistics demonstrate the impor- tance of beverages to the convenience channel and all its players — retailers, distributors and manufactur- ers — it is also true that consumer tastes continue to change rapidly. New research from The NPD Group shows that U.S. consumers are drinking fewer pur- chased beverages. This is worrisome news for conve- nience stores, as this trend affects more than a quarter of their in-store sales. Apparently, according to NPD, Americans are drinking more tap water at home, and brewing their own gourmet coffee in their kitchens due to the wide variety of coffee appliances now available. Consumption of both regular and diet soft drinks has also been on the decline, although they still repre- sent the largest revenue-generating subcategory within packaged beverages. The hot growth categories in beverages the past few years have been bottled water, enhanced water and energy drinks. In the beer category, imports, super-pre- mium brands and microbrews/craft beers are the hot subcategories. On the dispensed side, the introduction of barista-served coffee at more and more c-stores is a sign of the growth of specialty coffee drinks. One look at a c-store's cold vault today and you'll see that there are more varieties of beverages available than ever before in order to appeal to the broad range of consumer needs and wants. The same goes for the coffee bar, beer cave, and the fountain drink wall. In order to keep their beverage sales flowing, c-store retailers must constantly be alert to changes in con- sumer tastes and trends. In this issue, we highlight some of the latest evolutions in the beverage business and provide case-study examples of c-store operators who are doing it right (see page 24). Keeping the Beverage Sales Flowing C-stores must stay abreast of rapidly changing consumer tastes For comments, please contact Don Longo, Editorial Director, at (201) 855-7606 or [email protected]

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