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C-Store Foodservice Shows Growth

Overall convenience store industry profits rose 54 percent in 2008 to reach $5.2 billion, reversing a two-year decline where profits dropped 42 percent over that period. Industry sales jumped 8.1 percent to reach $624.1 billion, with both motor fuels sales (up 10.1 percent to $450.2 billion) and in-store sales (up 3.2 percent to $173.9 billion) showing growth.

The growth of in-store sales defied the overall trend in U.S. retail sales, which fell 0.6 percent based on U.S. Department of Commerce data. It also came despite a rare decline in the number of convenience stores. For only the third time in the past 15 years, the industry store count dropped - 1.0 percent to 144,875 - as many stores closed because of the punishing economic conditions and record-low motor fuels margins the industry faced during the first three quarters of 2008.

While cigarettes continue to dominate in-store sales, accounting for nearly one in every three dollars spent, margins on cigarettes fell to 15.3 percent. Foodservice, meanwhile – which includes dispensed beverages and food prepared on-site – showed strong growth. The category now accounts for nearly 14 percent of sales and nearly a quarter of in-store profit dollars, according to NACS.

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