Do you have a convenience
store that needs to break out of the past and jump into the present? Are you looking a Customer Ahead? If so, Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® believes
you just might want to reach out too Howland Blackiston, and his team at King-Casey. Below is an article by Blackiston that the team at Foodservice Solutions® believes
hits many of the right notes and that you will be able to garner valuable
insights. Here is his article:
The Eatery at American Natural
For some time now, the convenience store
industry has been transitioning toward a foodservice focused business model.
The reasons are clear. Foodservice is currently the second largest revenue
category after tobacco. In addition, the average profit margins are higher on
foodservice items than general merchandise.
Clearly, foodservice is a serious
business growth area.
Some convenience brands have improved and
expanded their foodservice menu offerings. Some have created signature food and
beverage offerings. Some have added “kitchen,” “eatery” or similar terminology
to their name to signal their shift to a foodservice focus.
A few have upgraded their store designs
to better support their foodservice offerings. And some have experimented with
off-premise offerings, such as delivery, curbside pickup, and even drive-thru.
These are all positive things to do. But
for convenience brands, these changes have been evolutionary (beneficial,
useful, but gradual). In contrast, major competitors in the foodservice arena,
including quick-service restaurants and fast-casual brands, have been
making revolutionary changes in foodservice (innovative,
dramatic and fast).
What’s Holding Up Revolutionary Changes?
The reality is there are roadblocks
preventing convenience brands from truly equaling and surpassing what the QSRs
and fast casuals are doing.
Consider the following barriers to making
revolutionary changes:
Cultural Resistance to Change—Deep-seated ideas about how to run a c-store business can clash
with what’s needed to successfully run and grow a foodservice business. Stop
thinking like a c-store and start thinking like a restaurant. That’s who you’re
competing with.
Perceptions of Disadvantages— Some in the convenience channel are put off by a belief that
there may be more drawbacks associated with building a foodservice business
than there are advantages to making the effort. Perceived disadvantages can be
lost sales of add-on items and impulse sales; increased labor costs; the need
for more space for foodservice; and the impact on store operations.
Lack of a Crisis — For many convenience brands, there has been no stunning
crisis to drive revolutionary improvements in foodservice. Even during the
COVID years, c-stores did well while many QSRs lost 50 percent of their
business. That’s the kind of crisis that has stimulated dramatic and
revolutionary changes in that segment of foodservice. So, for those frustrated
c-store managers who don’t see top management moving fast enough, pray for
things to get worse.
How to Get Serious About Foodservice
There are six absolutes to follow if you
want to get serious about growing your foodservice business. Embrace as many of
these as possible. Your key foodservice competitors (the leading QSRs and
fast-casual brands) have already done so.
1. Brand Your Foodservice Business
Let there be no question in the
consumer’s mind that a critical part of your business is the food and beverages
you offer.
One way to go about this is to create a
foodservice identity. One of the fastest and easiest ways to communicate
your foodservice focus is to create nomenclature for your brand that lets
consumers know that you are more than gas, snacks, groceries and smokes. For
example, Enmarket has its Eatery, there’s Parker’s Kitchen, and so on.
Another method is to design a foodservice
environment. From the moment a customer approaches and enters the store,
the space itself should reinforce that “this is a great place to get great
food.” American Natural, a Pennsylvania based c-store operator, developed a new
foodservice-centric store design inspired by a vision to “be the Panera Bread
of convenience.”
The food and beverage aspect of the brand
dominates the 2,800-square-foot interior. Branded as “The Eatery at American
Natural,” the store features an open kitchen design; counter, table, lounge and
outdoor seating; made-to-order gourmet sandwiches; and barista prepared
beverages.
2. Develop a Proprietary/Signature Menu
You will need more than new roller grill
recipes to stand out from the “sea of sameness” that is typically associated
with c-store food. A key distinguishing element is to develop something
craveable that your brand can be known for.
Some examples of convenience brands that
have nailed this strategy are: Parker’s, where the star of the show is the
chain’s “always fresh, never frozen” chicken tenders; Wawa, where the
centerpiece of its foodservice offer is built-to-order hot and cold hoagies;
Texas Born (TXB), where customers line up for the freshly made, locally sourced
tacos, quesadillas and tenders; and Buc-ee’s, the destination those
who crave beef jerky and freshy smoked Beef Brisket BBQ.
Outside Eyes Can Help you Growth
A
Larger Share of Stomach
3. Create a Menu Strategy
Do you have a documented menu strategy?
There’s no menu strategy if you can’t
score 100 percent on this simple test:
·
Each menu item has been prioritized based
on its importance to the brand.
·
There is a specific action plan for how
each key menu item and/or category will contribute to the brand’s business
performance.
·
The tactics needed to execute the plan
are clearly in place.
·
There are specific goals and measures in
place to evaluate results.
·
The menu strategy has been shared
throughout the organization.
·
The menu strategy is understood throughout
the company.
The leading QSR and fast-casual brands
develop a well-documented menu strategy linked to high-level business
objectives. This is a document that sets forth how the products on the menu are
prioritized and how they help the brand realize its business objectives.
The menu strategy is used to guide all
in-store foodservice merchandising — posters, banners, window clings
and, of course, the menu board itself. A menu strategy also can help identify
what new menu items should be developed, and which current items can be
eliminated.
The menu strategy establishes product and
category priorities, and helps the brand decide how communications should be
developed to get the desired business results. Creating and agreeing on a menu
strategy is how world-class foodservice communications are developed.
MENU STRATEGY PYRAMID
4. Offer Off-Premise Solutions
QSR consumers have made it clear that
they find the greatest convenience when using off-premise solutions, such as
drive-thru, curbside pickup, digital ordering, and delivery.
QSR and fast-casual brands derive more
than half of their food and beverage sales via off-premise options. These
brands are continually finding ways to optimize their off-premise strategies.
And yet, many convenience brands seem on the fence as to whether they should
fully embrace off-premise foodservice strategies.
5. Develop a Foodservice Culture
Convenience brands need to start thinking
more like a restaurant than a traditional c-store. That takes a shift in
culture. There are things you can do to make cultural change a reality, such as
establishing a commitment at all levels, starting at the top.
Nothing happens in any organization
without the demonstrated support and commitment of senior management. If top
management is not yet convinced, prototype ideas at select locations and
communicate successes and opportunities using the language of top management
(the language of money).
Additionally, identify and prioritize
foodservice objectives in the annual business plan. Linking your foodservice
business objectives to the business plan — with clear measurable
objectives, responsibilities and rewards — is a dependable way to
shift the company culture to foodservice.
6. Embrace Continuous Improvement
QSR and fast-casual brands are not
standing still. They are continuously making improvements to their menu, menu
communications, and foodservice operations. They are finding ways to leverage
technology to make the customer experience easier, faster and more enjoyable.
Starbucks, for instance, has assigned
improvement teams to each of the customer touchpoints along its entire
foodservice path to purchase. The teams are continually making improvements to
all of these touchpoints.
How many of these six absolutes has your
brand implemented? Now that you have read it kinds makes you want to jump
in with both feet. Grocerant niche
Ready-2-Eat and Heat-N-Eat fresh prepared food will drive consumer adoption for
years to come. It’s ok to jump in with
the team at King-Casey or the team at Foodservice Solutions®.
Success does
leave clues. One clue that time and time again continues to resurface is “the
consumer is dynamic not static”. Regular
readers of this blog know that is the common refrain of Steven Johnson, Grocerant Guru® at Tacoma, WA
based Foodservice Solutions®. Our Grocerant Guru® can help your
company edify your brand with relevance.
Call 253-759-7869 for more information.
