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Convenience stores’ issues could throw a big hurt restaurants’ way

Photograph: Shutterstock

Peter blog

The restaurant business got you down, bunky? You’re not alone. New research shows that depression and sleeplessness are veritable epidemics within the trade, and worsening conditions aren’t exactly easing the pressure. 

Yet future-minded members of the convenience store industry would likely swap their situations for yours in a heartbeat. And it’s only a matter of time until they’re likely to try doing exactly that. Selling more coffee, sandwiches and pizza may be the only way that business can survive the changes erasing their traditional sources of revenues. To feed their investors, they’ll need to steal your lunch. Breakfast and dinner, too.

It’s all happening in less time than Netflix needed to put video rental stores out of business. Last week, the Food and Drug Administration announced it will pursue a ban on selling menthol cigarettes, the source of roughly a third of c-stores’ tobacco revenues, according to CSP, a sister magazine that covers the gas-and-go channel. From a public health perspective, the move may be a leap forward. But in pure business terms, it’s a mortal blow to the field.

That’s not the end of new woes for convenience retailing. The FDA has also proposed that consumers’ access to e-cigarettes be tightened, throttling another major source of sales for c-stores. Here again, the health benefits may be great (vaping among high school students increased by 78% this year, and by 48% among youngsters in middle school), but the restrictions could leave c-stores gasping.  

Yet that’s not even the most significant change looming for the field. Movements are afoot to outlaw the sale of cars that run on gasoline, another core product of the 7-Elevens and Circle K’s of the world. If that sounds like something Bernie Sanders might dismiss as too outlandish, consider that Egypt and Israel just set sunset dates for the sale of gasoline-fueled automobiles, of 2040 and 2030, respectively. Bans are already set to take hold in Denmark, the United Kingdom and France. 

The United States, or at least parts of it, is moving in the same direction. A bill outlawing the sale of gas-powered passenger vehicles has just been introduced in the California legislature.

C-stores are already stocking alternative fuels, and offering charges for electronic vehicles is a no-brainer. But the latter is going to change the fundamental grab-and-go nature of convenience retailing. It’s a short jump from that reality to offering more foods and beverages for on-site consumption.

But even without that topspin, the survival option for c-stores is as obvious as an exterior neon sign. Ready-to-eat food is going to soar in importance, supercharging the effort already evident to pull more business from restaurants.

The lines may be blurring, but changes suggest they may disappear altogether.

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