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    Supermarket Operators Turn Tables on C-stores by Offering Gas

    Retailers, including Sheetz, look to promotional campaigns to survive gas crunch.

    NEW YORK -- As rising gas prices continue to hit record levels, c-stores are faced with new competition from supermarkets that are capitalizing on consumer convenience by offering the ability to fill up their tanks after grocery shopping.

    The Altoona, Pa.-based Sheetz will roll out a promotion later this year at 350 stores in six states in which food and beverage buyers will get discounts at the pump, reported Citizen Voice. Spokesperson Monica Jones said this initiative is in response to regional supermarkets looking to gain market share. "It's made us step up our game to do what we can to remain competitive," Jones told the paper.

    Among new competition is Giant Food Stores, a Carlisle-based chain of 148 supermarkets that recently began construction of a gas kiosk near its grocery store at Scranton's Green Ridge Plaza.

    "We just saw it as a natural fit that our customers could buy groceries and fill up their tank at the same time," Giant spokesman Denny Hopkins told Citizen Voice.

    "More and more companies are using gasoline as a promotion," Harry Balzer, vice president of the NPD Group, a Long Island, N.Y., market research firm, told the paper.

    In March, Price Chopper, a Schenectady, N.Y.-based 116-store chain, introduced a gas reward program for shoppers at seven of its regional supermarkets.

    "Just in the last four years, the number of supermarkets with gas pumps has increased from 26 percent to 32 percent," Bill Greer, spokesman for the Arlington, Va.-based Food Marketing Institute, told the paper.

    According to Portalatin, grocery stores and mass merchandisers such as Sam's Club captured 13 percent of U.S. retail gas sales in 2007, which is up from 8 percent in 2003.

    "We find that across the spectrum of grocery-oriented (gas) retailers, as many as 20 to 30 percent of consumers say that is the reason they chose to shop there," Portalatin told the paper.

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