By: Bill Nolan–partner with the Business Accelerator Team | December 2022
With just a few days until the end of 2022, it’s doubtful we will look back with any remorse, but rather, hopeful for the new year. Yes, the pandemic of the last three years is, for the most part, in our rearview mirror. But inflation, expense increases and labor issues will continue to hammer the convenience-store industry for some time, regardless of changes in the political landscape.
Like the seasoned operators we are, having an optimistic outlook for the future is what drives our business and is a vital component that the c-store industry has and will continue to embrace.
With this in mind, here are the three proven approaches to help you improve business as we head into 2023.
There’s been no question that coffee has been a key profit producer and customer-count influencer for years. I would even say, many chains have overcome the gas-station stigma and are respected for their hot beverage offerings. But even with an influx of new and upgraded equipment, specifically bean-to-cup drip, espresso and the numerous gourmet coffeehouse options, one has to ask: Why aren’t we exponentially growing our coffee business?
I’ve come to understand one reason why: The average coffee consumer seems to believe that coffeehouses have a much higher quality bean than a c-store. In reality, many c-store chains have roasters providing the highest quality bean that would match any $4-$5 beverage at Starbucks.
Rather than just relying on advertising our hot and fresh offer, more concentration should be placed on the quality and origin of the bean and that it’s as good or better than any coffeehouse. This is especially important to reach younger coffee consumers, who may not understand your neighborhood c-store may just be your most convenient (and more affordable) coffeehouse.
A very real and persistent concern is the issue of having enough employees to staff the store and the numerous corporate positions needed to operate successfully. Offering a higher hourly wage, paying hiring bonuses, and demonstrating and implementing the value of diversity and company culture have had an impact. But still, retaining those employees, especially the best ones, present a unique situation.
We all as employees want to feel valued and that we contribute to the team. But feeling appreciated and regarded as a reliable member of the operation can mean several different things. An important one: Will management see me as someone it wants to train and develop, and am I considered a valuable asset to this operation?
Most employees are looking for self-satisfaction, in addition to recognition of their efforts.
Providing additional responsibilities and the necessary training to be successful will demonstrate the value you have in them. That may just be the solution to energize the average employee and the key to keeping them much longer.
‘Quiet Profit Maker’
Managing the cost of inventory continues to be the “quiet profit maker.” This has always been necessary for efficiently run retailers. But when sales, margin and consumer packaged goods returns are adequate, new item introductions (or the steady flow of deliveries) can take priority over removing slow-moving items.
Category managers typically review and upgrade their plan-o-grams once or twice a year. But whether it’s cigarettes or the cold vault, removing slow-selling products in a more timely manner can save significant dollars over a year’s time.
Managing the cost of inventory continues to be the "Quiet Profit Maker."
For many operators, this has become evident over the past two years. As we head into 2023, customer counts may remain flat, or for many, continue to decrease due to socioeconomic factors. Maintaining the top and core sellers, adding high-potential new items and constantly deleting unnecessary slow sellers will undeniably improve margins and profits.
Retailers must remain vigilant in this area of business to achieve the greatest results.