In a presentation at this year's Forecast Council, Technomic Inc. Senior Consultant Matthew Mandeltort offered an outlook on the top opportunities for convenience store foodservice. The most critical piece, he said, remains overcoming the "gas station" perception.

"Part of this is ambiance. Consumers seek a cozy, homey décor," he said, noting that McDonald's expects a 35-percent sales increase as a result of its remodeling effort. The fast-food chain's new look, which debuted in Tampa this past spring, features wooden tables, comfortable faux-leather chairs, muted oranges, yellows and subtle greens, and earth-toned and glass exteriors.

Aside from the perception issue, Mandeltort's top opportunities list also included:

• Keep heavy users happy;
• "Value" beyond price;
• Lead with beverages; and
• Attract new users.

The Value Equation

He said convenience retailers could take some cues from other foodservice segments, such as the fast-casual channel. For instance, c-stores can apply the "fast casual template" of fresh, fine ingredients, full-view preparation, a fair price and a pay-first model. Seating, too, makes a difference as Technomic research has found that a third of consumers would purchase food more often if seating were available, according to Mandeltort.

A practice c-stores could borrow from quick-service restaurants (QSRs), he said, is barbell pricing. Burger King promotes its dollar menu and five meals for $5, but also offers $8 and $9 items. Likewise, Starbucks discounts common drinks, while raising prices on specialty brews.

Mandeltort emphasized that value is not solely about the price of an item, and he offered an equation for value: value equals food plus hospitality plus ambiance divided by price.

In addition to focusing on the opportunities he laid out, c-store operators also need to be aware of several threats that are on the radar, he cautioned. These include retail meal solutions; non-traditional retailers such as Costco, which sells 99 million hot dogs a year; and QSRs, which have upped their game, meaning convenience stores have to up theirs.

He also reminded retailers that consistency in delivering the basics is key to any successful foodservice program. "Think like a restaurant, act like a restaurant," he stressed.
— Linda Lisanti