This blog highlights the tools that are now available to convenience stores that were lacking during the author’s youth when her father operated a forecourt convenience store. What may have seemed unthinkable back then as devices to understand customers is now a reality – and one which simply must be embraced for convenience retailers to differentiate and compete today.
On Highway 1941, about a mile north of the Atlanta Motor Speedway, my father invested in a small market with a gas station. It was called Talmadge Farms. The name came from former Governor Herman Talmadge who owned property in that area. Though he would be embarking on the American dream of independence through hard work, my dad was unaware of many of the challenges that lay ahead.
Roadside convenience store without the roadmap to success
Like many Indian immigrants, my dad sought the ambitious path of a self-employed entrepreneur. He followed the footsteps of other friends who had been successful. My dad also had no clue how to run and operate a forecourt convenience store with a gas station in middle of the US, but he did the best he could with the tools he had. And, he had great pride of ownership. He and my mom ran their local market store by using his big-box store membership as their supply chain. He would take inventory every week and assess what he needed.
We had the usual staples of the typical corner market including: milk, eggs, colas, alcohol, and even crickets (there were several ponds and a lake not too far from the store). Saturdays would be a family event when we’d go to the big-box warehouse store to buy all of his inventory wholesale. We relied on the need for gas to drive traffic into the store, and, of course, the store had sales. Ideas for sales came from my dad thinking about what would be good to drive people in. I think it was reactive at best.
Customer insights must not be hindsights
I often think What if he had better tools? Or better insights? Really, any insights. How about a demand forecasting tool, or an understanding of planograming? Or the concept of segmentation? What if? These tools would have meant more profit, and perhaps, a path to creating more Talmadge Farm corner markets.
My dad’s lack of knowledge and understanding of the business resulted in him giving up on his dream to become a store owner. I’m proud of my dad nonetheless, but I wish I had the knowledge of my industry experience back then. Maybe I could have helped. I’ve had some fun conversations on my learnings with my father and he would say “We could have used that, betu,” a term of endearment for “child’ in Gurjarti.
The convenience store is a balancing act with many components
Owning a convenience store is a hybrid business. In my dad’s case it was an all-in-one shop that encompassed a little bit of everything: a grocery store, gas station, liquor store, tobacco store, and a bait shop. These days, a convenience store might include a fast food restaurant, fresh items and more.
The premise of now and the past is the same and universal – to provide a quick and easy shopping experience. From the suburban stay-at-home mom needing to grab milk to the construction worker who needs a bite to eat or purchase a 6-pack of beer after a long day’s work, all find value in the experience of shopping at a convenience store.
There are several keys to success of how to effectively thrive in this C-store arena. Although convenience stores have come a long way since the early 1990s when my dad was in business, there are several key data points that are key success criteria to operate a C- store, whether it’s one or 10, 000 stores.
Here are some key observations for convenience stores:
- Know your customers
In a C-store, as in any other retail space, it’s imperative to know who’s your customer base. In my dad’s case, we had a pretty steady group of loyal customers and he knew their habits and buying patterns. Understanding trends and these patterns can result in knowing when to put something on sale. It helps to understand how to pair items (affinities), or how to place the items and build a better assortment, ultimately resulting in a better shopping experience.
- You must have customer insights for supplier collaboration
Data is key to understanding buying habits and placing promotions accordingly to drive the loyal customers into stores and increase basket size. It can be leveraged for a formidable partnership with suppliers to make better recommendations for products and categories.
- Effectiveness of inventory
Purchasing, storing and selling inventory are the most significant business processes for a convenience store. A better inventory system means faster inventory turnover ratios, less spoilage and higher financial margins. Since convenience stores sell perishable items, it is essential to understand the importance of forecasting demand and purchasing inventory.
- Understanding trends in the market
The fact remains that convenience is why customers shop at convenience stores. Seems obvious, but the landscape in which these stores exist is now becoming more digital and data driven. C-stores must connect the dots, and use loyalty to gain insights. Today, AI decision engines are integral in driving growth and success.
Lacking the convenience of time travel
I wish I had superpowers to go back in time to help my dad’s journey. However, his shortcomings and challenges taught me valuable lessons which I use each day in supporting customers in my work. Back then, though he could have only imagined some of the exceptional tools available to today’s C-store owner, I often think about what could have been for him.
I’m proud of my dad. He taught me so much. And, today, I’m proud to be part of a team of experts who have made meaningful impacts in the lives of retailer owners, their families, and the customers they serve. My dad is proud that I’m helping pay it forward.
Stay tuned for part 2 in this blog series.
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