Once again,
another food industry news and research firm edifies the findings of the work
that Steven Johnson Grocerant
Guru® at Tacoma, WA based Foodservice Solutions® and his team have been
doing since 1991.
So,
here we go, almost all of the retailers surveyed in the 2023
Convenience Store News Foodservice Study said
they sell prepared food and hot dispensed beverages, with prepared food
generating the bulk of revenue in the foodservice category — an impressive 54
percent of total foodservice sales.
“Having
foodservice options and differentiating them in ways that drive consumers to
your location are different parts of the foodservice puzzle, though, and the
only way to complete the picture is to create a program that distinguishes your
offerings from your competitors'.
"Foodservice
has really become the key differentiator for c-stores. Good food is what
compels people to seek out and talk about a particular brand — and even drive
farther to visit one," said Peter Losee, vice president of marketing for
Bowling Green, Ky.-based Bluegrass Ingredients, which partners with its
customers to craft tailored flavors and formulations.
"These
days, most consumers have multiple stores to choose from on their drive home
from work or when they're out running errands. The right food can compel a
consumer to pull into one store over another, whether that's a busy mom or dad
looking to get gas and a healthy take-and-heat dinner for the family or a
working millennial who may be making multiple stops in a single day," he
added.
And
increasing foot traffic isn't the only benefit differentiation delivers. It
also is key to "building loyalty in short order" and ultimately
boosting the bottom line, according to Losee. "Foodservice
offerings," he said, "can serve as an important revenue opportunity
for c-stores often constrained by tightly controlled and competitive
prices."
Recent
numbers show just how significant a revenue opportunity those offerings can be.
Foodservice sales industrywide were up 19.5 percent in 2022, marking the second
consecutive year of stellar convenience foodservice sales, according to
the 2023
CSNews Industry Report, while
the average gain in foodservice sales per store was $54,956, driven by an
additional $44,845 per store from prepared foods.
Tracking
Trends
Continually
monitoring trends can help c-store operators plan foodservice programs that
will be ready when a burgeoning trend becomes a mainstream one.
"For
c-stores, it's really all about staying one step ahead of that target
consumer," explained Losee, who noted that Bluegrass Ingredients' culinary
and R&D experts perform that kind of monitoring "to keep our customers
one step ahead of what's coming."
It
is an approach Pilot Co. takes, according to Jamie King, senior director of
food and beverage for the Knoxville, Tenn.-based travel center chain with more
than 870 locations serving an average of 1.3 million guests per day.
"Pilot
takes pride in our constant curiosity to learn guests' preferences and find new
ways to meet their needs. That's why our chef and culinary team conduct sample
testing in our stores, directly interacting with guests and collecting
in-the-moment feedback," King said. "Not only does this provide
priceless interactions with our guests, but it also allows us to deliver what
they desire."
What
foodservice trends are tracking currently?
"On
the flavor front, the dominant trend is all about fueling enhanced experiences.
Consumers — especially the increasingly influential Gen Z cohort — want bold
new flavor combinations they can share with friends in person and on social
media," Losee reported. "That's a real opportunity for c-stores,
which already have a head start in the snacking space where these new flavor
innovations fit naturally."
Paying
attention to daypart trends is another way retailers can ensure their
foodservice menu includes not only items customers crave, but also some that
stand out from what they can find a few miles down the road.
Purchase
incidence of breakfast sandwiches, for example, jumped over the last year,
putting them ahead of c-store standards like pizza and hot dogs, according to
the 2023
CSNews Realities of the Aisle Study,
an annual look at c-store shopper behavior.
King
confirmed that Pilot has been tracking this trend over the past few years and,
as a result, the retailer "curated breakfast offerings that are perfect
for the morning commute — think of burritos, which are easy to eat while on the
road, as well as our recent Sausage Waffler, a syrupy waffle sandwich with
sausage, egg and cheese."
Value
is also an integral component to consider when transforming trends into
standout foodservice offerings. The percentage of shoppers who said they didn't
buy prepared food at a c-store in the last month because it was too expensive
jumped 15 points year over year, according to the Realities of the
Aisle Study. Price/value is now the No. 1 factor shoppers list as being
important to them when purchasing prepared food at a c-store.
The
value trend is something Bluegrass' experts are seeing, too. "One trend
that we're particularly focused on as an ingredients provider is around
reengineering value. Reformulations in ingredients and recipes can help enhance
flavors to match evolving consumer demands, while better navigating challenges
like supply chain shortages or surging costs," Losee said.
Ideas
That Differentiate
So,
what are some specific ways c-store operators can differentiate their
foodservice offerings to stand out in what has become a crowded and competitive
category?
Upgrading
menus in ways that move past old-school convenience store fare is a good place
to start.
"The
industry is quickly leaving hot dog rollers and microwaves behind in favor of
much more appetizing options. Prepared food and commissary kitchens have really
taken things to the next level in recent years," Losee said. "It
starts with food that looks and tastes good — food that's healthy and easy to
serve and eat. There are competitive advantages to be found in healthier
options, higher-quality options, more variety, and more."
Healthier
options, in fact, offer a big opportunity for retailers willing and able to
commit to quality offerings, data shows. Among health-conscious and
health-neutral shoppers, only 41 percent said they are somewhat satisfied with
the selection of healthy/better-for-you foods at c-stores, leaving room for
improvement, according to CSNews shopper research.
Pilot
is one operator answering the call for healthier fare. "We continue to
expand our healthy, grab-and-go options," King said. "Our fresh-cut
fruit is a simple yet delicious choice. We offer protein-packed snack boxes,
with variations based on what our guests are craving."
The
bottom line, according to King, is to combine quality, consistency and
innovation when planning foodservice offerings that differentiate you from your
competitors — always keeping in mind the kind of store you want to be.
"First,
determine who you want to be as a brand and decide what you're trying to
accomplish. At Pilot, we strive to be the preferred choice for all interstate
drivers," he said. "For decades, our desire has been to offer
high-quality and consistent items that create the best guest experience
possible. This applies to foodservice, from innovation in creating our
offerings to maintaining health and safety standards in our kitchen and
displays. Something as classic as our hand-roped pizza crust or center-of-the-plate
entrée is the perfect example of innovation, quality and consistency." Do you want more customers? Think grocerant niche Ready-2-Eat and
Heat-N-Eat fresh prepared food.
Foodservice Solutions®
specializes in outsourced business development. We can help you identify,
quantify and qualify additional food retail segment opportunities or a new menu
product segment and brand and menu integration strategy. Foodservice Solutions®
of Tacoma WA is the global leader in the Grocerant niche visit us on our social
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