The current challenges facing the c-store industry — from inflation to supply chain issues to high gas prices — are impacting key product categories in varied ways.

After weathering a difficult 2020 as consumers stayed home during the worst of the COVID-19 pandemic, convenience store sales began to rebound in the first half of 2021 and by the time the calendar was ready to turn the page to a new year, almost all of the industry’s key product categories were on the upswing. According to the exclusive Convenience Store News 2022 Midyear Report Card, the story for this year so far is a bit different, with some categories still seeing positive momentum, but others feeling the negative effects of inflation, supply chain issues, continued staffing challenges, and high gas prices.

THE STATE OF CIGARETTES

During the first six months of 2022, both cigarette dollar sales and unit volume were down vs. a year ago. Sales were down 3.9%, while units were down more than double that (8.6%).

In 2021, total convenience store industry sales of cigarettes were flat, rising just 0.3%, while unit volume in the category declined by 6%, the largest drop in five years.

THE STATE OF OTP

In 2021, other tobacco products (OTP) had a better year overall than cigarettes. The first half of 2022 presented a similar scene for this category, with total industry OTP sales up 4.4% vs. a year ago, while units were down 1.8% for the same period.

The smokeless tobacco and pipes segments were the first-half standouts in the OTP category, posting both sales and unit volume increases. The e-cigarettes and papers segments also posted sales increases, but saw unit volume declines.

THE STATE OF PACKAGED BEVERAGES

The packaged beverages category had a good year across the board in 2021, following mixed results the previous year. The first six months of 2022, however, brought a unit volume decline of 1.3%. Dollar sales were still on the rise, albeit at a slower pace of 6.5% growth.

Energy drinks and enhanced water were the category standouts for the first half of this year, being the only segments to post both sales and unit volume increases. Sports drinks had the biggest percentage increase in sales, but saw a slight 0.1% decline in units.

THE STATE OF BEER

Sales of beer and malt beverages contracted in 2021 following strong pandemic-related growth the previous year. The contraction seems to be continuing, but leveling off somewhat, based on the numbers for the first half of this year.

Segment-wise, imported beer, super premium beer and flavored malt beverages are faring well in the beer category, posting first-half growth in both dollar sales and unit volume.

THE STATE OF CANDY

2021 marked a high point for the candy category’s total c-store industry sales and unit growth over the last five years. The first six months of 2022 brought sustained sales growth of 10.8% vs. a year ago. However, unit volume returned to negative territory, dropping 0.1%.

All segments of the candy category posted increases in dollar sales for the January-June 2022 period. Three segments also posted unit volume increases: candy rolls/mints/drops, gum, and bagged or repackaged peg candy. The rest of the segments saw a drop in units.

THE STATE OF SALTY SNACKS

Similar to candy, the salty snacks category also posted its highest c-store industry sales and unit growth in five years in 2021. The category is performing even better so far in 2022. First-half sales jumped 14.1% vs. a year ago, with unit volume rising 3.4%.

With the exception of two subcategories, all other segments of the salty snacks category posted first-half growth in both dollar sales and unit volume. The nuts/seeds and mixed salty snacks segments grew in dollar sales, but posted unit declines.

THE STATE OF GROCERY

Edible grocery dollars and units in the convenience channel grew in 2021, but that growth slowed compared to the height of the pandemic in 2020. The first six months of 2022, however, brought a resurgence to this category, perhaps fueled by consumers seeking to make fewer shopping trips to offset record-breaking gas prices.

C-store industry sales of nonedible grocery items were also strong during the first six months of this year, with sales increasing 7.8% vs. a year ago, and unit volume increasing 5.2%.

THE STATE OF GENERAL MERCHANDISE

Looking at the first six months of 2022, general merchandise is off to a shaky start in the c-store industry this year, with both dollar sales and unit volume declining. First-half unit volume was down 6.7% vs. a year ago, and sales were down 4.3%.

Only one segment of the category saw growth across both sales and units during the first half of this year: hardware/ tools/housewares. Most other segments were down in both metrics.

THE STATE OF HEALTH & BEAUTY CARE

Last year, the health and beauty care (HBC) category experienced its largest c-store industry sales growth in five years. The first half of 2022 brought continued HBC sales growth. Unit volume, however, retreated back into negative territory.

Segment-wise, the first-half standouts in the HBC category were vitamins/supplements, cosmetics, and other internal over-the-counter medications. These segments produced growth in both dollar sales and unit volume during the first six months of this year.

The exclusive Convenience Store News 2022 Midyear Report Card, compiled in partnership with NielsenIQ, looks at dollar sales and unit volume metrics for January through June 2022 to evaluate which product categories are gaining vs. losing amidst today’s challenges.