TEMPLE, Texas — The convenience channel is both lauded for being a disruptor when it comes to innovation and viewed by some retail experts as a laggard.
Eva Strasburger, president of StrasGlobal, a privately held retail consulting, operations and management provider serving the small-format retail industry, believes it's a fair assessment as there have been years of time in between the introduction of new products and services.
Since the onset of COVID-19, c-stores have been getting more credit for their embrace of innovation. However, Strasburger questions whether it's really the convenience store industry that is innovating, or rather is it that convenience retailing itself is changing?
For example, she points to c-store retailers being lauded for installing drive-thrus. "We had drive-thru c-stores back in the 1980s, so is that innovation, or just bringing back an old way of doing business as a reaction to the need for social distancing during COVID?" she posed.
Strasburger's definition of innovation is any novel creation that adds value and saves time, stress or money. "Convenience retailing is now, more than ever before, about convenience and the value proposition for the customer," she told Convenience Store News. "With online delivery offerings, the physical location is less important than what the c-store's unique offering is to its customers. The nimbler you are to react to what's going on and how you're interpreting 'convenient' retailing is what will define your success."
Overall, she views the c-store industry as not aligning well with innovation up to now because the business is based on small margins and high volumes, and is focused on the details of retailing. Innovation is difficult and requires one to step back and look at the bigger picture to recognize the needs and tackle the problems, she explained.
"The innovators in our industry now were already operating differently from the norm, or are disruptors who have joined our industry. They have been able to identify the gaps, create the solutions, and figure out what resources they require to put them in place. It's a process that is fuzzy, messy and hard," Strasburger said.
Accelerated Innovation, Added Value
Reacting to the intricacies of the coronavirus, StrasGlobal introduced a COVID-19 Response Plan last spring, a blueprint of actionable items that the convenience store industry's small operators could implement.
"We found that our COVID-19 Response Plan was particularly informative and valuable for small operators who did not have the resources available to many large regional chains. It motivated us to expand our reach and value in the marketplace," Strasburger said.
The company's COVID-19 Response Plan evolved into Resources for Retailers (RfR), a content and services hub that offers solutions for the challenges that are common to single-store owners and small operators. RfR provides a collection of reference materials, how-to best practices, templates and guidelines, all available at no charge. Additionally, monthly RfR Dispatch content provides real-world, actionable takeaways from subject matter experts, written conversationally with a slant toward independent-minded retailers.
"Resources for Retailers was a logical extension of our COVID-19 Response Plan," the executive explained. "It's been extensively researched and provides timely, relevant and needed resources for single stores and small-chain retailers to be competitive in today's rapidly changing marketplace."
Thinking Outside the Box
The coronavirus forced convenience retailers to step outside their comfort zones and explore new avenues of innovation, products and services that could best serve customers.
One area that industry experts anticipate will help convenience stores defend and expand their market share is ghost kitchens. These kitchens are dedicated to making food specifically designed for delivery by third parties.
Conceptualizing how it could move beyond physical locations, StrasGlobal partnered with Kitchen United, a Pasadena, Calif.-based ghost kitchen company, to operate a unit of its Quix General Store c-store concept within Kitchen United’s Scottsdale, Ariz., facility.
The company followed that up by opening a second Quix location within Kitchen United's facility in Chicago's Loop neighborhood. The Quix Café offers breakfast fare, such as bagels and breakfast burritos, Peet's Coffee On The Go, and bakery and pastry items.
In the coming months, StrasGlobal plans to open two additional Quix concepts within the ghost kitchen platform: Quix Pantry, which will offer more traditional c-store items that can be added to food orders for delivery or pickup; and Quix Gourmet, which will offer fine foods and large-order family meals made with high-quality ingredients.
"This is a new departure for us and sprang from COVID introducing new disruptors to the convenience store industry," Strasburger said. "Instead of seeing ghost kitchens as a separate industry, we aligned with it and that has led to opening more Quix concepts in downtown Chicago to do convenience retailing in an area where customers work and spend most of their day."
Although StrasGlobal doesn't have the time necessary to implement all of the innovations it wants to, the company is excited to expand its Quix concept, and intends to explore more ways to be the store of choice when consumers don't want to shop a physical store.
Action items currently on StrasGlobal's agenda are:
Looking into partnerships with CPG companies to serve as distributors in ghost kitchens;
Implementing robotic systems such as Blendid, an autonomous food platform that creates customized fresh and healthy food, served from a contactless food robotics kiosk; and
Strasburger would also like to dive into conceptualizing the store of the future.
"COVID jumpstarted many of our recent changes. Out of necessity comes innovation. However, it very much feels as if there has been a culture shift within StrasGlobal," she told CSNews. "What we saw in terms of making changes in response to challenges, headaches and opportunities during that period is still with our team, and no one wants to wait for another worldwide disaster to keep fulfilling our mission statement: 'To make life better for our team, our customers and our clients.'"