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    The Next Big Leap

    What will be the next transforming development in the convenience store industry?

    By Don Longo

    This 40th anniversary year of Convenience Store News has given me and our editorial staff ample opportunity to flip through the old, yellowed back issues of the publication, looking for milestones and the key consumer, business and technology trends that have driven the industry to where it is today -- a $634 billion business that accounts for 4 percent of the nation's gross domestic product!

    After we got through laughing at the antiquated newspaper layouts of those early issues (as well as the early 70s hairstyles), it became obvious that without certain developments and innovations, the convenience store industry would look very different today.

    For example, how would retailers be able to apply modern category management techniques, not to mention automated inventory and ordering, if not for the introduction of the bar code 35 years ago?

    Indeed, technology has enabled much of the growth of the industry these past 40 years. One of the most astute participants in the c-store industry, Green Oil's Jim Callahan, noted the industry "has gone from a very much seat-of-the-pants-style management to a very analytical and absolutely professional-type management."

    Asked about the biggest change he'd seen in the industry since he started, Callahan said, "There's so much more sophistication than I ever dreamed possible -- stores with chandeliers, real cappuccino machines, Internet cafes."

    Speaking of sophistication, the next generation of bar codes are two dimensional and have the ability to encrypt manufacturer information, product name, what factory the product was made in, what day it was made, ingredients and more, according to Zebra Technologies, a bar code provider. Think about how crucial this is for food safety and the ability to provide transparency and traceability in a cost-effective manner.

    Our journey through the back issues of CSNews also uncovered product developments that were key to the industry's success. Products such as Gatorade, fountain drinks, Reese's Peanut Butter Cups, 7-Eleven's Slurpee and Big Gulp, coffee and beer have all withstood the test of time.

    But the one development that most agree had the biggest influence on transforming -- and growing -- the convenience store industry was the introduction of gasoline to the traditional convenience/neighborhood store in the late '60s. While the fuel business has become increasingly volatile, it remains key to the industry's ability to serve the mobile and fast-paced American lifestyle.

    So, what will be the next transforming development? Made-to-order food preparation is not particularly new (Wawa introduced built-to-order deli sandwiches in 1977), but the acceleration in adoption of more robust, high quality, fresh foodservice programs by more c-stores than ever promises to transform the way consumers view purchasing food in a convenience store.

    How about the increased use by retailers of social networking sites such as Facebook and Twitter to engage customers? According to a CSNews Online poll, 23 percent of the industry already has profiles on all the major social networking sites and updates them regularly. Another 54 percent are exploring the use of such sites.

    The next transforming development could come out of advances in smartphone technology. Smartphone sales have grown remarkably despite the recession, and a whole cottage industry of applications for smartphones has sprung up overnight. These apps allow the user to access recipes, online coupons, create shopping lists, buy books and movie tickets, find the closest gas station, make restaurant reservations and more.

    It won't be long before consumers will regularly be using smartphones instead of credit cards to pay for their purchases in your stores -- maybe even reducing those dreaded transaction fees.

    Whatever the future brings, CSNews will be there to tell you about it.

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