By Shahla Hebets, Publisher, Convenience Store Decisions
Through special arrangement, what follows is an excerpt of a current article from Convenience Store Decisions magazine, presented here for discussion.
Kwik Trip Inc. operates more than 350 stores under brands such as Kwik Trip, Kwik Star and Tobacco Outlet throughout Wisconsin, Minnesota and Iowa. Plus, it operates a 150,000 square-foot distribution center in Wisconsin with its own fleet of semis to service its stores around the clock.
Steve Loehr, vice president of operations support for Kwik Trip, spoke with Convenience Store Decisions.
CSD: What section of the store do you see as your most successful?
Loehr: Our foodservice offering has been our most successful program. We know we could have prospered for several more years by just selling "Cokes and smokes," but we knew we were going to hit a wall if we didn't have a strong foodservice offering. It takes a great deal of planning, and when you have 300+ stores it takes a lot of capital expense and trial and error. Even with the best of intentions, some things don't work, but we are smart enough to say, "let's change it." Our owner (Don Zietlow) is a visionary who rarely talks about what has happened in the past. He talks about what lies ahead because you can't change what has already happened, but you can always do better in the future.
CSD: What current industry trends are of interest to Kwik Trip?
Loehr: Every year we travel to see what other markets are doing. This year we will visit convenience stores in London because Europe is ahead of us in many ways with respect to convenience offerings, and this is particularly true in fresh and hot foods. We know companies like Tesco are coming to the U.S., and we need to be ahead of companies of this size and influence. We ask ourselves, "What can we do in our stores to mimic successful operations abroad?" As a result, we feel we're in front of these changes and ideally positioned for success.
CSD: What does Kwik Trip do to stay ahead of the competition?
Loehr: I think being hands-on and not being reluctant to change. We actually welcome change, and we never take anything for granted. We study what's happening in the marketplace and we seek out industry trends. Most importantly, we listen to our customers. A lot of credit also has to go to our many strong supplier partners that talk to us about the trends they see out in the field and offer tips on how we can improve the business. These combined efforts aid in our ability to stay ahead of the competition.
CSD: What do you see as the biggest opportunity for the c-store channel?
Loehr: I think, ironically, the big box stores trying to get into the c-store business creates an opportunity because we are confident we can do convenience better than they can. Our locations are better, our prices are the same or better, and I anticipate that we can combat the "big guy" by doing things quicker. The Wal-Marts and the Tescos are our future competition as opposed to other c-stores. It comes down to attracting consumers and competing on the level of true convenience. This type of strategy and focus doesn't happen overnight - it's an evolution, not a revolution.
CSD: What do you think the c-store business will look like 10 years from now?
Loehr: I think the industry is going to be a lot smaller. I believe that there will be fewer players in the market, but the players will be stronger. The stores that survive will be, on the whole, more powerful. We are experiencing a great deal of acquisition in the convenience market, and smaller, less competitive stores are going out of business because they can't compete with the larger players. Our industry, in general, is really positioned to grow, however, because of the demands on everyone's time and the need for convenience.
Discussion Questions: What do you see as the biggest opportunity for the convenience store channel? What do you think the convenience store business will look like in 10 years?