Convenience store sector the stage is set for consolidation in 2010.

Grocerant prepared ready-to-eat and ready-to-heat food soled the stage in 2009. Companies with a solid footing in the niche clearly lead the sector. Foodservice sales rose 7.7 percent on a per store basis in 2008, and prepared foods led the way with a 9.1 percent sales gain per store, according to a Convenience Store News 2009 Foodservice Study. What we must take note of is that the margins within the prepared food niche were much higher than other parts of the C-store sector and impressively higher in the Grocery sector. The restaurant sector gained ground via the drive-thru and strong competitive price points with ready-to-eat prepared food.

Most exciting to watch is the Convenience sector where those in the grocerant niche or those conducting multiple fresh prepared food product tests are growing in both per store volume and new units. Prepared food has provided new life for companies like Kum & Go the 50 year old convenience chain that added 21 new stores this year to bring it total to more than 430 units by the end of 2009. Growing units at more than 4% a year Casey’s General Stores selling prepared food including pizza, now has in excess of 1,488 units according to CFO Bill Walljasper. Watch for Casey’s to continue to enter new markets gobbling up marketshare.

7 Eleven with 38,000 stores worldwide is repositioning US stores to become more like Grocerants. They are testing new coffee formats, fresh prepared breakfast and lunch options and rolling out pizza. In fact they are planning 750 new units in the US in the next year or so. More interesting 7 Eleven is driving growth via consolidation. From coast to coast they are soliciting locations, operators and regional players. This will be a success for them as they role out new grocerant prepared food offerings. Momentum for this recruitment is garnering new franchisee partners and will continue grow.

QuikTrip is growing in both units and geography from Tulsa, Kansas City, Atlanta, Phoenix, Dallas, Wichita, St. Louis, Des Moines and Omaha markets utilizing commissaries to serve all 534 units sales of the fresh deli-sandwiches, salads, fruit cups and muffins are all exceeding company expectations. This company is one to watch organic growth is in play here.

Two companies that are conservative in growth Sheetz and Wawa both are high volume regional players with outstanding grocerant style prepared food. These are my takeover or take-out targets for 2010; each seems stifled in there ability to grow outside there current operating borders. Each would be a plum for companies searching for volume, highly skilled management teams and premade template for success. If they don’t begin a strong push for growth they may be inadvertently and unintentionally marginalized by an industry on the move.

Foodservice Solutions of Tacoma, WA is the global leader in the Grocerant niche. More about us: http://www.linkedin.com/in/grocerant or leave a comment or question below. If you would like to read the latest interview of Steve Johnson on Grocerants here is the link: an interview of Steven Johnson at: www.goodfoodsales.blogspot.com/2009/12/grocerants-steven-johnson-shares-his.html