The growth of convenience stores shows no sign of slowing as chains improve food offerings, add sit-down dining and turn to smaller designs that feature separate window pick-up for online/app orders, with 7-Eleven leading the way as it adopts cashless shopping, mimicking the Amazon Go model. Smaller c-stores are showing up in urban city centers and near college campuses. Expanding c-store brands Wawa and Casey’s General Stores will focus on states less affected by closures and delays, mainly the South, the Southeast and the Midwest, through the next couple of quarters. Sheetz, Royal Farms and EG Group also plan expansion, while Target plans to jump into the fray with a revamped small-store format.
Expect 7-Eleven to be on the hunt for sites in major metros suitable for its units based on its “evolution store” design. Earlier this year, 7-Eleven added two more units based on this layout: a 10,000-s.f. store in San Diego, opened last month and a store in Washington, D.C., opened during February. With 7-Eleven’s 2018 acquisition of Sunoco’s 1,030 Stripes-branded convenience stores in Texas and Louisiana, and Stripes’s in-store Laredo Taco Company brand, 7-Eleven used the Laredo Taco food offerings in the development of its evolution store concept. The chain first tested the evolution store concept during March 2019 in Dallas. This concept prominently features a restaurant menu, including Laredo Taco menu items such as carne asada and breakfast tacos, along with a salsa bar and handmade tortillas.
7-Eleven is testing a cashierless, checkout-free concept at its headquarters in Irving, Texas. The 700-s.f. test-pilot store, opened during February, is available only to corporate employees and requires customers have the 7-Eleven app installed before entering the store, with the app automatically providing a detailed receipt when a customer leaves the store. If successful, this concept could become part of 7-Eleven’s plan to compete with the Amazon Go cashierless store model that utilize overhead cameras and computer vision technology to track items purchased at 25 units spread throughout Chicago, San Francisco, Seattle and New York. The Amazon Go layout is 2,500 s.f. or less.
7-Eleven is also actively adding new non-gas convenience stores, primarily in Atlantic coastal states, especially Florida, as well as in central Texas. The 8,604-store chain generally looks for space of 1,800 to 2,500 s.f. In freestanding locations, retail strip centers and mixed-use developments. 7-Eleven has plans on the books to further develop its presence in shopping malls with seven more mall locations by the end of this year, but this could be affected by the COVID-19 pandemic. The chain opened its first mall during September 2019 in 2,293 s.f. in the Westfield Brandon mall in Brandon, Fla., followed by a 1,600-s.f. unit on the first level of the Tysons Corner Center mall in Tysons, Va., that same month.
Wawa expects to open about 55 new stores annually during the next five to eight years. The majority of these openings will be concentrated in northern Florida, including Jacksonville and Flagler County, with about 25 new stores opening in that area alone each year through 2028. Starting next year, expect the chain to add five to six new stores in central Maryland during each of the next five years. Northern Virginia will get about two to three new stores each year over the next 15 years, starting this year. Wawa seeks out space in densely populated communities for stores that average 6,000 s.f.
The retailer may bring a new mini unit to densely populated urban centers in the future if a new smaller prototype is a success. Wawa introduced this prototype during January with a 3,000-s.f. corner street-front store in the Center City business district in a former AT&T store. The non-fuel location sells express items such as coffees, breakfast foods and hoagie sandwiches made in-house for grab and go convenience and features an exterior to-go window for mobile-ordered items. The chain will open a unit in a retrofitted existing building in Vienna, Va., next month. The 6,290-s.f. building, which is without an attached gas station but features electric vehicle charging stations, formerly housed Coldwell Banker offices. The store will focus on food and beverage offerings and provide indoor seating areas in a customized vintage wood design. In February, Wawa won city approval to demolish an existing 3,000-s.f. non-fuel freestanding store in Voorhees Township, N.J., and replace the space with a fueling station, while building a new 5,000-s.f. store further down the street. The retailer hopes to have the project completed by mid- to late 2021. Wawa operates 880 convenience stores in Pennsylvania, Delaware, Maryland, New Jersey, Virginia, Florida and Washington, D.C.
EG Group – which owns the Cumberland Farms, Fastrac Markets and Certified Oil convenience store brands – plans to continue to aggressively expand in the U.S. by opening or acquiring up to 3,300 new units during the next four years. The U.K. company acquired the Cumberland Farms brand and its 566 stores in the Northeast last October and purchased the Kroger company’s 762 convenience stores, under the Kwik Shop, Loaf ‘N Jug, Quik Stop Markets, Turkey Hill and Tom Thumb banners, during early 2019.
EG Group also acquired 54 Fastrac Markets and 69 Certified Oil c-stores last year to give it a total of 1,700 c-stores in the U.S. EG Group will likely rebrand these acquired chains under the EG America name, as it did after acquiring the Minit Mart during 2018.
Sheetz expects to open 30 new convenience stores/gas station service centers per year during each of the next 10 years. Next year, the family-run owned store/gas station retailer will focus its expansion on central Ohio, specifically near Columbus. It is already eying space in Delaware, Ohio, across the street from a Dairy Queen and an ALDI, and is looking into locations in Obetz, Ohio. This year, Sheetz expects to open 24 new stores and complete about five tear down/rebuilds of units that are about 16 years old in Raleigh, N.C., western Pennsylvania, and northern Virginia. Sheetz uses two prototypes for its stores: a 5,000-s.f. layout and a 6,000-s.f. design. The brand targets low-crime locations along highways that are located five to 10 miles outside a major metropolitan area. Sheetz is known for its on-site quick service coffee shop found in 90% of its stores, which are located in Maryland, Pennsylvania, Ohio, Virginia, West Virginia and North Carolina. The Pennsylvania-based chain opened its 600th store during December 2019 in Shaler Township, Pa.
Casey’s General Stores plans to open up to 350 new stores by 2023, especially in midsize markets with populations of 10,000 to 100,000, including suburban and rural areas in the Southwest. The brand continues to scout for new space in outlying areas beyond its current presence close to its two existing distribution centers in Ankeny, Iowa, and Terre Haute, Ind., and a still-under-construction fulfillment center in Joplin, Mo., that’s due to be completed during spring 2021. It will also focus on buying c-store brands with 10 or fewer locations. Casey’s will introduce a new non-fuel convenience store format this year with a 2,80-s.f. unit – about 40% smaller than its typical 2,500-to 4,000-s.f. layout – that will open in West Des Moines, Iowa, during late 2020 or early 2021. The retailer currently has 2,193 stores in 16 states in the Midwest. Its stores are known for made-from-scratch pizza with up to 14 different toppings.
Target will test its smallest store ever next year with a 6,000-s.f. prototype it expects to place in urban neighborhoods and college campus areas in New York, Los Angeles, Philadelphia and Chicago. This prototype is half the size of Target’s previous small store concept that debuted five years ago, which ranges from 12,000 to 40,000 s.f. and will be used for about 18 stores that will open by the end of 2020. This is half the number originally planned but reduced due to COVID-19 delays. The remaining stores are expected to be completed by the end of 2021 in locations on the Las Vegas Strip, near Walt Disney World, and close to the campus of the University of Iowa.
Privately owned Royal Farms looks to expand further into Lehigh Valley, Pa., the Jersey Shore, northeastern Baltimore and Opal, Va. The 188-store chain generally builds stores based on two of its prototypes: a 4,166-s.f. layout and a 5,371-s.f. format. Royal Farms, with stores in Delaware, New Jersey, Virginia, Maryland and Pennsylvania, is known for its food offerings, especially its chicken, including chicken sandwiches, fried chicken and chicken tenders, as well as its breaded potato wedges and dinner rolls.
While Yesway will continue to expand within its current states of Wyoming, Nebraska, South Dakota, Texas, Oklahoma, New Mexico, Missouri, Kansas and Iowa, its recent growth has been through acquisitions. Launched during 2015 in Iowa, the brand has amassed 419 stores in nine Midwest states through acquisitions, with its latest acquisition being the Allsup chain during October 2019. The purchase allowed Yesway to offer the famed Allsup burritos in all of its stores. Operated by an affiliate of private equity investment firm Brookwood Financial Partners, BW Gas & Convenience, Yesway focuses on c-stores with or without gas pumps, with an average square footage of 1,700 s.f. in smaller rural and suburban communities with a population of 5,000 to 50,000 people.
Speedway’s growth remains a question mark after parent company Marathon Petroleum failed to spin off the chain. Both 7-Eleven and EG Group scrapped their bids for Speedway earlier this year as they couldn’t agree with Marathon on a price. Speedway moved into new western markets, including California, West Texas, New Mexico, Arizona, Oregon Washington and Alaska, last year through its acquisition of San Antonio-based Andeavor and its 1,100 convenience stores. Speedway also acquired 200 SuperAmerica units in Minnesota, which have since been rebranded as Speedways. Speedway is now focused on rebranding select California units that had been owned by Andeavor (these brands include ARCO, Superamerica, Shell, Exxon, Mobil, Tesoro, USA Gasoline and Giant). The chain typically seeks sites with a minimum of 1.5 acres, with a population of 3,000 within a one-mile radius, zoned for gas use. Speedway operates 3,900 convenience store/gas stations in 36 states.
