America's new favorite restaurants are Wawa, Sheetz, and 7-Eleven

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But the grocery stores and gas stations that shape the American retail landscape have worked to improve their dinner and coffee. Today chains such as Sheetz, Wawa and Kwik Trip offer meal sets, salads, keto snacks, kombucha and espressos.

"It was absolutely a hidden gem," said Jeff Williams, senior vice president of retail services at Nielsen. "They are demanding that consumers view them as a food destination."

In order to keep up to date, chains are hiring managers from restaurants and expanding their selection of snacks and prepared dishes in the kitchen on site.

According to analysts, consumers, especially millennials, are not always ready to visit a fast food restaurant or snack bar, or to run around in a 400 square meter grocery store. Instead, they often go to a grocery store where the average time customers spend in the store is less than four minutes.

"People just don't have the time to eat a full meal at night," said Carl Rick, executive development specialist at Kwik Trip, who builds around 40 stores a year and is just opening his 700th. "The more places there are that people can sneak in and go out in three minutes with milk, eggs, maybe a sandwich or something to drink – these are very good places."

The growth of convenience

Quirky chains like Wawa and Sheetz in the northeast, Casey & # 39; s and Kwik Trip in the Midwest, Buc-ee & # 39; s from Texas, Maverik in Utah and others open new stores and build dedicated customer reviews. (A couple recently made a bond at Wawa, and a Sheetz superfan – Sheetz Freakz, as they are called – got the company logo tattooed.)

According to the National Association of Convenience Stores, an industry advocacy group, convenience chains have increased sales in their stores by around 30% in the past decade. The number of convenience stores in the United States has increased by 28% since 2000.

The Southland Ice Company opened the first American supermarket in Dallas in 1927. The chain, now 7-Eleven, recognized the opportunity to sell these staples on Sundays and evenings when the grocery stores were closed.

Convenience stores in the United States picked up pace in the post-war period with the growth of car ownership, the creation of the freeway system, and emigration to the suburbs.

"These new pocket-sized supermarkets, most of which are chain-operated, specialize in fast service, easy parking, and long hours," wrote a New York Times reporter in 1966, "How convenience stores started to fill "for the housewife. "

In 1965 there were 5,000 convenience stores in the United States. Today there are more than 153,000 of these mini-marts, more than all of the grocery stores, drug stores and dollar stores in this country combined. 7-Eleven is the largest US convenience store chain with more than 9,000 outposts.

Around 93% of Americans live within 10 minutes in a grocery store, a highly fragmented sector dominated by regional chains and mom and pop bars. Almost 80% of the convenience stores have a petrol station connected.

For years, convenience chains have relied on tobacco, soft drinks and fuel to attract customers, a business model often referred to as "cola, smoke and gas". But Americans smoke less these days and cut soda all the time.

An undated photo by 7-Eleven. The first grocery store in America opened in 1927. Today there are approximately 153,000 in the United States.

And tougher tobacco regulations and the decline in sugary beverages will continue to grow in areas where convenience stores have long been growing. This has forced convenience stores to adjust.

"When we look at what will make us competitive in the future, it is what is going on in the store," said Rick of Kwik Trip.

Sheetz Subs and Casey's Pizza

In the top chains there is an opening for customers who are looking for breakfast, a quick snack or a prepared meal for dinner. From 2009 to 2018, food service sales in convenience stores grew faster than in any other area of ​​business, according to the industry group.

According to the Department of Agriculture, spending on food outside of your own home for the first time in 2010 exceeded that of Americans.

"Fewer people do these big shopping trips and more and more people buy individual meals," said Rick. "We want to take advantage of that." Kwik Trip sells eggs, milk, burgers and products and has expanded its range of ready meals and roast chickens that are cooked in Wisconsin.

According to the agency, these food trends are pronounced among millennials who eat out more often and visit grocery stores less often than their parents.

Casey & # 39; s, based in Iowa, has become America's fifth largest pizza chain.

"Millennials prefer more convenience" when buying food, according to a 2017 USDA study.

"Our bullseye is kind of a younger age group – the late teens until the early 1930s for food and beverage," said Travis Sheetz, chief operating officer at Sheetz, a family-run chain with more than 600 stores on the east coast and last year sales of over $ 7 billion. "They tend to eat at a gas station."

The Sheetz offers made-to-order sandwiches and salads, as well as espresso bars. Everything happens on touchscreens that it introduced in the 1990s.

The chain is trying to separate its offering from McDonald’s, its biggest competitor, by offering more customizable sandwiches and more choice.

"We always had breakfast at night," he said. "McDonald's did that recently."

Wawa, which has over 800 shops on the east coast and is known for its junk, has added custom salads, artisanal sandwiches, and organic coffee in recent years. Casey, based in Iowa, has become the fifth largest pizza chain in the country. The website looks more like this Domino & # 39; s (DPZ) as a gas station.
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"This is not what many people would call gas station food," said Darren Rebelez, general manager of Casey’s General Stores, which has grown to become the country’s fifth largest pizza chain.

7-Eleven is also trying to change its food and drinks. Food sets for private labels were launched in 125 shops in Los Angeles and keto and paleo snacks were tested. In a 7-Eleven laboratory in Dallas there is a Growler bar with regional craft beers and a bar with frozen yoghurt and ice cream. There is also a terrace and indoor dining areas.

The chain recently made its debut at Voyager Point, a dedicated wine line that costs less than $ 12.

Competition burdened

But convenience stores are not the only areas of retail that recognize changing consumer habits and demand for small stores.

Retailers and grocery stores have introduced food copycat models, and restaurants have increasingly focused on breakfast and snacks. These strategies of competitors threaten to lure customers out of convenience stores.

At Sheetz, customers place their orders on touch screens.

For example, a better cup of coffee at McDonald’s could take morning trips to convenience stores that these companies rely on.

"Other retail channels are also trying to steal our thunder," said Steve Holtz, who covers the convenience store industry for CSP Magazine.

Dollar general (DG) builds smaller versions of its stores, called DGX, while Kroger (KR) has teamed up with Walgreens to test "Kroger Express" mini sections in some Walgreens (WBA) Locations.

"This ability to get on and off really quickly is undoubtedly something that has been well received," said Gary Millerchip, CFO of Kroger, analysts last year.

Other grocers like Hy-Vee, Giant and Whole Foods are testing new convenience formats and adding grocery stores and convenience foods to stores so customers can buy them on the go.
"In the future, large food retailers will use rather small-format, comfort-oriented concepts," says a research report by the real estate company CBRE.
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Also fast food and fast service chains like McDonald’s and Dunkin & # 39; (DNKN) have focused on improving their breakfast offerings and coffee. Customer visits for breakfast, coffee and snacks are part of "that we didn't have our fair share" MC Donalds (MCD) CFO Kevin Ozan said on a call to analysts last year. These areas are "further growth opportunities" for McDonald’s.

Meanwhile, online competitors are threatening to disrupt traditional convenience stores.

Amazon is reportedly aiming to open up to 3,000 small Go stores without a cashier by 2021. Startups like GoPuff and Cargo use the gig economy by offering snacks in ride-sharing apps like Uber. GoPuff, a convenience store delivery app that has grown rapidly in dozens of cities, offers shipping for $ 1.95 for more than 2,000 items from its own fulfillment centers.

But some convenience store managers say they're unimpressed by Amazon and online starters.

More than half of Casey's stores are located in cities with fewer than 5,000 residents. And CEO Darren Rebelez believes Amazon will struggle to reach these rural customers.

"I do not believe that [Amazon Go] is something that is likely to appear in our presence soon, "he said." It is difficult to really disrupt this industry in a meaningful way. "