Healthy Food Promotions: A ‘Must’ for Retailers

By Brian Harris

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Across the food industry, healthy, better-for-you food promotions are becoming more than a “nice thought.” They’re becoming essential to attracting new customers and retaining current traffic. More retailers are launching promotions and reorganizing product assortments as they realize the opportunity to increase their bottom line.

Family Express of northwest Indiana is an example of one such retailer. Convenience Store Decisions recently reported on a new better-for-you initiative at this 68-store chain. For the next two months, children 12 and under who visit one of Family Express’ locations will be offered a free banana, pear or apple while their parents shop. The retailer is also working towards displaying its healthier food options to make it easier for customers to find and select healthy foods. Eventually each store will have a “Better for You” section.

Convenience store competitors are also making an effort to improve their healthy snack offerings. In June, CVS Pharmacy announced the expansion of its assortment of healthier foods and beverages to more than 2,900 stores nationwide. This includes the expansion of better-for-you snacks at checkout lanes and healthy trend zones. Raw snack foods are currently on display in the summer, and they’ll be followed by vegan options in the fall.

The CVS promotion adapts with the changing seasons and recognizes that healthy snacks are here to stay. Packaged Facts recently released data that should get every retailer fired up about this category. In the past half-decade, healthy-ingredient snacks have seen steady growth. In fact, the market’s compound annual growth rate of 4.7% has outpaced overall food and beverage sales growth. That rate is expected to jump to 5.7% between 2016 and 2020. That translates to $25.4 billion in sales by 2020.

According to Packaged Facts, snack bars are still the largest category of healthy-ingredient snacks, followed by sales of nuts and seeds. In terms of growth, meat snacks continue to be the fastest-growing category within the segment, particularly in supermarkets and convenience stores.

Retailers across different channels are getting the message: Healthy foods attract customers and the expansion can be profitable.

The public sector is also taking note as it considers ways to support retailers who want to expand access to fresh produce, particularly in urban areas. For example, Philadelphia launched the Philadelphia Healthy Corner Store Initiative to support neighborhood stores that are trying to expand healthier offerings. “The representative from the program showed me data that I could make as much money selling two tomatoes as I could soda,” one c-store owner told NACS Online. “I didn’t realize produce could have such a decent markup.”

A Checklist a Day Makes the Apples Stay

The success of healthy food initiatives is dependent on three factors:

  1. Getting the word out via promotions
  2. Product selection
  3. Execution of display

Remember: No promotion in an ever-changing retail environment falls under “set-it-and-forget-it.” If you’re going to test the effectiveness of a new healthy foods campaign, you have to mobilize your team and follow up in each store.

For instance:

  • Is promotional signage up and accurate?
  • Is there enough product available? Are products priced correctly? (Don’t make the Whole Foods pricing error!)
  • Are individual stores executing the marketing plan? (In the case of Family Express, is every age-appropriate child provided a piece of fruit? This observation can be recorded.)

Having regional or store managers account for a promotion’s various elements via a checklist is smart, intuitive, and enables you to react in real time. It could mean the difference between a promotion increasing your bottom line or failing to make a return. Tools like Zenput increase accountability and increase returns by providing real-time, actionable insights. To learn more about how this mobile solution works in the c-store environment, click here.

Topics: Retail, C-store

Today’s Forecourt: Opportunities to Convert Customers from the Pump

By Jennifer Hoffman

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Today’s convenience store forecourt offers one thing to retailers and customers alike—opportunity. For retailers, the forecourt represents the opportunity to convince customers to make an additional purchase beyond the gas pump. For customers, the modern forecourt should be an opportunity to quickly and safely make a fuel purchase while learning of a store’s promotions.

Gas station customers have 3 motivations when they arrive on your property:

  1. They have to fill up their tank. As we know from NACS, 80% of fuel sold in the U.S. is sold at a convenience store chain. Filling up could be their sole motivation.

  2. They need to fill up their tank and use the restroom. That’s a common scenario for customers traveling during the summer months and an ideal opportunity to upsell during their pit stop.
  3. They fill up their tank and purposely stop for beverages, snacks, cigarettes or perhaps even a lottery ticket. That’s a c-store retailer’s ideal customer—the customer who is already interested in entering the store.

But let’s not give up on the other two kinds of customers and let’s not take that third type for granted. The forecourt is an opportunity not only to upsell, but also to promote brand loyalty. It’s a positive experience with efficient and friendly service that makes these customers return.

In order to provide a positive experience, retailers need to create a forecourt environment that fits all three of these characteristics:

  1. Well-lit, clean and inviting. If it’s not a safe, inviting and sanitary environment, a customer might not go the extra distance to use your restroom, nevermind purchase a food product.

  2. Functional. Is your equipment working? Are the pumps and credit card terminals functional? Do you monitor for security? A security breach can damage your brand and lead customers to choose your competitor down the street.

  3. Promotional. You can have the best merchandise mix in your store and the most thorough attention to detail. But if you’re not advertising new products at your forecourt, that’s going to be a problem for moving customers into your store. The forecourt has numerous surfaces and vantage points that can be used to advertise to customers, whether on the actual gas pumps or standing signs. There is an opportunity to integrate small screens and digital signage technology into the modern forecourt as well.

Keeping Up With Trends

The convenience and fuel retailing industry has never been one that stands still, so expect more changes to the forecourt in the near future. As discussed in a recent Convenience Store Decisions article, the future of the convenience forecourt will be better lighting, more touchscreens for ordering, more drive-thrus, and more outdoor seating. We already see retailers across the nation implementing these changes.

Now is the time to start finding out what works for your brand. Implement a change—perhaps an upgrade to promotional signage—and measure the outcome. Define a set of core criteria for converting customers from the forecourt and audit your stores to make sure they’re implementing these best practices. By optimizing conversion of sales now, you’ll be better positioned to implement the design of the future when the time comes.

SEE ALSO
Converting Your Forecourt into a Moneymaker
Auditing Branded Gas Station Forecourts Can Increase Supplier Payments
How to Conduct a Property Inspection

Topics: C-store

Wanna ‘Pizza’ Your Restaurant Competition? Customization and Technology Are Key

By Brian Harris

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BDO USA’s Restaurant Practice recently released its Benchmarking Update for FY 2015. This report is based on quarterly compilations of operating results. The good news is that restaurant sales were solid throughout 2015 largely due to an improving economy. Many brands increased menu prices, which worked well for those with higher traffic.

The pizza segment experienced the most significant growth with an increase of 6.4%. Domino’s was the leader of the pack and saw a 12.2% increase in same-store sales in 2015. The company sustained that growth throughout the year by emphasizing online ordering and capitalizing on convenience and food delivery.

Pizza has long been center stage in the evolution of food convenience. In fact, it could be argued that pizza chains like Domino’s and Pizza Hut helped pave the way for ethnic food customization. Chains like Chipotle, Qdoba and Moe’s Southwestern Grill then took burritos to a whole new level. Today, I went to the Chipotle of Greek food where my salad was prepared in a completely customizable format with optional meats and vegetables.

New-age pizza chains are now using the build-your-own model to their advantage. Following take-and-bake, delivery efficiency and online ordering, build-your-own/customizable pizza is the next frontier. Blaze Fast-Fire’d Pizza is set to open its 150th restaurant this year as it expands its national footprint. MOD Pizza is now expanding to the U.K. and is expected to reach 200 restaurants in the U.S. by the end of this year. Investors are feeling confident in this space, as evidenced by the $106 million MOD raised thus far.

Considering these trends, it’s no surprise that BDO’s Benchmarking Update shows that fast casual (4.9%) and quick serve (3.8%) followed pizza in same-store sales increases. Notably, these segments had a commanding lead over upscale casual (1.7%) and casual (1.6%).

Where the ‘Dough’ Could Rise More

The fast-casual and pizza segments both saw increases in labor costs, whereas casual/upscale casual remained flat and quick serve labor costs decreased by -0.1%. Pizza lead the way with a 0.7% increase. BDO points to the fact that Domino’s is providing larger bonuses and seeking out the proper labor mix to keep up with steadily increasing sales. With cost of sales and prime costs both decreasing across all segments in 2015, the way to drive higher profit margins is now more focused: Control costs through strategic inventory and labor management.

There are two opportunities here.

1. Offer customization 

So maybe your restaurant or foodservice operation isn’t set up for Chipotle-style service. Don’t let that deter you. Play into customization on your menu by offering different toppings, breads, cheeses and condiments. Give customers the option to build their own, whether it’s a burger/sandwich or salad.

2. Tap into technology

BDO expects more restaurants to leverage technology in “new and innovative ways” to keep inventory and labor in check. Zenput is a solution that offers digital checklists, task assignment, and real-time analysis all on one mobile platform. These tools improve communication between your team and vendors, and provide a process of accountability in your organization. Better yet, this technology is applicable to any segment of the restaurant industry.

To learn more about how Zenput helps companies in the restaurant industry, click here.

Related
Managing by Checklist: NASA Does It and So Can You!
Zenput Moment: Optimize Operations to Increase Sales, Save a Sandwich
Pizza Hut’s $5 Flavor Menu Raises Stakes in QSR Competition
How to Perform a Pizza Franchise Inspection

Topics: Restaurants

Managing by Checklist: NASA Does It and So Can You!

By Jennifer Hoffman

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If you know about space shuttle launches, you know the importance of the checklist.

In what seems like a lifetime ago (1999 to be exact), a friend of mine was vacationing in Florida and witnessed a space shuttle launch. It was one of the most incredible experiences of her life, especially after the launch was scrapped twice—once for a hydrogen level issue and the other for weather. This particular launch was scheduled at night, which was stunning to view. But what stood out to her—and which she later shared when learning about Zenput—was the massive pre-flight checklist. As detailed by Wired, there are several components of the checklist with sub-components. Part 8 is its own step to confirm that the checklist has been completed. Seriously, can you imagine having the responsibility of checking off the fuel tanks of a space shuttle?

Now consider this: If a checklist is good enough for NASA, why can’t it be good enough for your retail operation? The best and the brightest minds, arguably in the U.S. and maybe even the world, use a checklist to get the job done. Checklists keep the mission on track. Checklists account for deficiencies. Checklists are smart!

However…

Not All Checklists are Created Equal

When NASA uncovers a problem during its pre-flight checklist, what follows is a predetermined sequence of events. The outcome is determined by the type of issue and its severity. The team knows how to respond accordingly. So must it be for the checklists you use in your restaurant or retail operation. Don’t send the results into outer space—follow up to keep your team accountable!

Go paperless with a process. Gone are the days of pencil and paper. The world moves at a digital pace, and no one has time to transcribe written survey responses. That time is better spent addressing the inefficiencies you and your team have uncovered.

All Systems Go

Check everything, but don’t make it overwhelming for any one manager. NASA scientists have specialties. Consider making your managers specialized. For instance, if you were to conduct a weekly retail audit of specific locations with a checklist, you could assign specific tasks to managers in the field. Have one manager check property, another check retail promotions, and a third check kitchen sanitation. Next month, switch responsibilities among managers to gain fresh perspectives and to compare previous results. This could also help with employee engagement. Managers will gain a more well-rounded view of your operation, and it will hopefully keep them engaged in the team’s efforts to identify and resolve problems.

The most effective checklists go beyond simple yes, no, or maybe answers. Take on the role of a survey, they garner actionable insights. You can optimize the fields of your checklist by using a sliding rating scale or requiring a photo. Senior management can also be alerted to exceptions, all on the same platform. For instance: “Rate the cleanliness of the floor from 1 (very poor) to 10 (very clean).” Anything falling under a 5 could alert senior management that there’s a cleanliness issue at that particular store. The visiting manager could use their smartphone to take a photo of what they see. Resolving this problem could drastically improve sales.

Blast Off!

Above all, let your imagination soar when brainstorming how to develop your checklist. A nimble platform like Zenput allows your management team to edit surveys and respond in real time from their preferred device. Zenput also provides a way to measure industry best practices and develop your own over time, all while improving operations and building your team’s confidence to respond to real-time challenges.  

Topics: Retail, Restaurants

Zenput Moment: Optimize Operations to Increase Sales, Save a Sandwich

By Brian Harris

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Yesterday, I attempted to eat a tuna sandwich that appeared as if it had been prepared by a blindfolded Kindergartener. Lettuce, tomato and onion were slapped together carelessly while the tuna was applied to everything but the bread. I had the misfortune of learning this as I unwrapped the sandwich at my computer and was rendered immobile with tuna salad hands. Through this experience, I’ve learned that when eating a tuna sandwich, it’s unnatural to feel like you’re consuming a Sloppy Joe worthy of five napkins. Overall, it was a gross experience, and it makes me want to take a break from that restaurant. I paid a good price for that half sandwich and side salad, so they’ve temporarily lost me as a customer.

To make matters worse, I had paid at an in-store kiosk intended for faster service and watched as everyone around me received their order before me. “Can we hurry up on order #30?” a manager asked. It was her job to check the contents of the plates and take-out bags to ensure that the kitchen was filling orders accurately. Perhaps the comment rushed the employee preparing the “tuna Picasso” because my order was a disaster. I was having a full-fledged “Zenput moment.”

Lesson Learned: Operations Come Down to the Basics

Here’s a quick way to lose a customer: Make them wait long only and deliver their food poorly. Without a solid grasp of basic operations, you’re at the risk of losing sales and damaging customer loyalty.

If a regional manager had walked into the restaurant (part of a major national chain) that day, I believe they would have been displeased with what I saw. One employee was frantically filling orders by herself and then had to pause because a side dish needed replenishment. She clearly didn’t have enough support. On multiple occasions, this restaurant has been low on iced tea in the beverage dispenser. I now always check before I order an iced tea and sometimes I don’t when it hasn’t been replenished—another lost sale.

Who’s preparing my order? Have they received training on how to esthetically prepare food?  The kitchen staff seemed overwhelmed, yet I overheard a manager asking customers seated at a table if she could remove plates for them. There are no waiters or waitresses at this establishment, so you have to wonder if this employee’s time would have been better spent elsewhere. So who’s running the ship and how do we steer it back on the right course?

Documentation Increases Accountability & Sales

What if a store or regional manager, on their next visit, was charged with the task of filling out an operational checklist that could document inefficiencies? Imagine if that checklist existed on a digital, mobile platform that provided real-time feedback. The manager would report a critical shortage, maintenance problem, or another serious condition that is impacting sales. They could also have a checklist that accounts for best practices like organization and cleanliness. Through a digital platform, they could share these findings with senior management and discuss ways to improve various challenges that arise store to store.

At the end of the day, that’s what retail operations are about—optimizing efficiency to increase sales and profits.

The Takeaway

Even though I’m on a break from this particular brand, I will return. You may be wondering why I would do that when I noticed so many areas in need of improvement. If there’s one thing I’ve come to know by working at Zenput, it’s that imperfection in the convenience and foodservice industry exists. However, there are always opportunities to improve. This brand is at least trying, and I appreciate that effort.

For instance, the digital ordering kiosks and order accuracy manager are a step in the right  direction. The food always tastes good with fresh ingredients, and this location is convenient to where I work. And yes, last time I ordered a tuna sandwich, it was prepared normally.

That’s the opportunity for this franchise. They have a respected brand name and excellent customer volume during lunch hour. They shouldn’t take that for granted. Don’t just meet brand expectations—strive to exceed them. You can with the right tools.

Topics: Restaurants

Brand Auditing for Convenience Stores

By Brian Harris

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Previously, we’ve discussed the basics for building a brand audit for quick-service restaurants. While the same can be applied to convenience stores, we want to focus on a key aspect of brand auditing that’s especially relevant to convenience stores: brand identity.

How’s your identity these days? Is it strong and vibrant? Are you conveying to customers what makes you special? Better yet, are you wondering how on earth you can be expected to measure something like brand identity?

Well, there’s good news—it is possible to audit your c-store brand.

Consider this: QSRs have an advantage of being distinct from one another just by their signature food items. A customer isn’t going to McDonald’s because they have better ketchup than Burger King. They’re going because they have a craving for a Big Mac or a McFlurry. But it’s trickier for convenience stores that offer many of the same packaged goods and have a history centered around the gas island.

Fortunately, consumer perception of the industry—especially in terms of foodservice—is slowly changing. C-store retailers that are winning the brand identity game are those who have strong products and packaging. Think of the 7-Eleven Slurpee and Wawa Hoagie. Sheetz has branded its own Made to Order menu while QuikTrip offers QT Kitchens.

Promoting those unique products—whether it’s a fountain drink special or a proprietary snack—can be do wonders for brand identity in the short and long term.

However, clever marketing ideas are only as good as your ability to follow through and execute. So let’s revisit this idea of building a brand auditing survey, while taking a closer look at some areas a convenience store can check for compliance.

Brand Auditing with SWOT

You may already be familiar with SWOT, which stands for strengths, weaknesses, opportunities and threats. Completing a SWOT analysis at the store level may be the answer to finding out how your network can reach the next level of success. Here’s an example of building a convenience store brand audit with SWOT:

Strength - Individually branded/proprietary products

  • Quantity of product
  • Date packaged
  • Price
  • Placement in the store (Verify your planogram.)
  • Promotional displays and/or signage

Weakness - Cleanliness

For now, assume this is a weakness because it is a classic thorn in the side for the industry. No one wants to buy your food when they’re grossed out.

  • Cleanliness of fuel islands
  • Cleanliness/clarity of windows
  • Condition of floor
  • Cleanliness of counters/customer food prep areas (coffee bar/beverage dispensers/grab-and-go islands)

Opportunity - Increased Exclusive Product Offerings

  • Inventory quantity (Do stores have more floor/shelf space for more proprietary products?)
  • Product quality (freshness, dates, price, etc.)
  • Effectiveness of retail promotions (Verify promotions. Are products, signage, and placement correct?)

Threats – Competitive Promotions

  • Category awareness
    Vendors are your retail partners, but they are also competitors in proprietary products. How are they pricing products and what kind of products do they offer?  Knowing this can help optimize sales. An example is the success of Wawa Iced Tea. Wawa chose not to complete with major soft drink manufacturers in the soft drink space. Rather, there was more opportunity to compete in proprietary iced tea.
  • C-store competitor awareness
    Do you know what promotions your competitor down the street is offering? If not, it’s time to find out. Make this a part of your regional manager’s routine store visit.

The Takeaway

If you’re going to devote time to creating a brand audit survey, at least make sure it will provide actionable insights. Keep in mind it’s not about the quantity of questions you ask—it’s about the quality. Importantly, create a survey that goes beyond “yes” and “no” answers. Go in with the mindset that you want to fix any problem that may be uncovered. Ask for photos, gather data by scanning barcodes, and evaluate store conditions on a sliding 1-10 scale. Following this process over a period of time will reveal both exceptions and successes you may not have initially recognized.

Topics: C-store

Your Sales Are Falling: What Next?

By Brian Harris

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Marketing and operations: In your organization, do they work together like peanut butter and jelly? Or are they more like oil and water?

If they’re the latter, you could have a problem on your hands when your sales fall or when they “hiccup.” A hiccup is temporary. You make an adjustment—drink some water, hold your hands above your head—and it eventually it goes away. But a persistent hiccup is a more serious condition that may require medical attention. In the world of sales, this attention may come in the form of a retail sales audit. Or, it may just be a matter of looking at both marketing and operations at the store level.

The “Dos” and “Don’ts” of Diagnosing the Problem

DON’T throw more money at a program without a way of measuring ROI

What change did you make in marketing? Look at changes in your loyalty programs or couponing. Although this may seem like backdoor data analysis, the success of marketing programs is very much tied to store-level processes. For instance, a change in your marketing program must be communicated at the store level in order to be successful.

DO make adjustments in the field

Once it rolls out across your network, a marketing program isn’t a framed portrait hanging on a wall. It’s living, breathing, and changing. Gathering store-level insights helps you respond to real-time challenges. Communicating those challenges to staff in a timely way is just as critical.

DON’T mistake an operations problem for a marketing problem

Let’s reconsider the hypothetical loyalty program rollout. Have your employees received proper training to explain the new program to a customer who has questions? Preparedness doesn’t have to involve a face-to-face customer interaction. With the arrival of warm weather, many convenience stores are rolling out fountain drink beverage programs. If those machines aren’t prepped and ready for higher volume, the results of that program could be disastrous. C-store shoppers pair snacks with beverage purchases, so the loss can be felt across multiple categories.

DON’T blame your staff

True, some employees are prone to underperformance. But preparation, training, and accountability are on their managers. Employees will become disenfranchised when they aren’t given feedback or if they don’t think a manager is responding to their specific needs. Listen to your staff—they’re your eyes and ears in the store.

DO audit your staff

You’ve heard the saying that your team is only as strong as its weakest link. Your regional manager doesn’t have to interrogate staff on his/her next visit to the store. But asking employees a few questions at the point-of-sale, observing their ability to assist a customer, and generally noting their whereabouts in the store (staffing behind registers, at the food ordering counter, etc.), can be helpful in understanding sales performance.

DON’T blame outside competition for stagnating sales

It could be that there’s a new competitor in the market, but their presence shouldn’t sabotage your business suddenly. Strive to perfect your greatest strengths, but also address your weaknesses. With the rise of channel blurring and added competition from quick-service restaurants and drug stores, there’s little room for error in providing “the basics”—a clean, inviting store with friendly staff.

DO create checklists to make sure the basics are being met

Use a checklist to ensure that daily operational tasks are met. Also note where expectations are exceeded. Reward managers and employees for a job well done. These recognitions incentivize employees and can do wonders for morale.

“There’s an App for That”

DO look at how technology can help your network improve.

A mobile solution like Zenput provides store-level insights and accountability. Track the progress of a marketing program rollout. Create checklists to strengthen your core operations and identify weaknesses. Upload a photo or video to get the point across faster and with clarity.

We started out with a basic question: What do you do next when sales are falling? Well, where do most people turn when they have a question or need? Nowadays, a lot of them reach for their mobile device to look up an answer! That’s what Zenput provides—real-time answers at your fingertips, readily accessible through a user-friendly platform.

Topics: Retail

Time to Reject the Status Quo in the C-store Workforce

By Brian Harris

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Now in its eighth year, Convenience Store Decisions and Humetrics Human Resources Benchmarking Survey identifies the key employee issues affecting convenience store retailers and what they can do to overcome them.

Respondents represented chains of varying sizes with varying annual revenue. About 45% were corporate personnel, and store managers and human resource professionals represented another 23% each. Below, we’ve summarized some of the report’s key findings, and offered our own analysis on what can improve.

Stagnate Employment Indicates Stagnant Employees

It’s the perennial trend of the convenience store industry: The biggest human resources challenge in 2015 was keeping good people. Among respondents, 71% expect that to be the same case for 2016. While 26.5% expect to add more staff this year, 60% expect they will not change significantly in 2016. In terms of employee turnover, 28.3% of respondents saw an increase in 2015, but experienced an hourly employee turnover of just 55%, which is lower than what NACS, the Association for Convenience & Fuel Retailing, reported (77%).

Analysis: CSD points out that few retailers are taking any proactive measures or doing anything differently to meet this challenge. They also point out the fact that when employees are fired, it’s mostly due to attitude issues. For this reason, pre-employment attitude screening tools can help.

We see another opportunity in increasing employee accountability in a way that keeps employees engaged. This needs to be a wake-up call for the industry. We’re not advocates of micro-managing—in fact, that’s counterproductive and quells innovation. Rather, we advocate for the clear assignment of roles and the ability of the employer to follow up on whether or not tasks are completed.

Increasing the productivity of your staff will help your bottom line, and it can also make employees more engaged. No staff member should feel they’re picking up the slack for someone else on the team. When good employees believe they are heard and treated equally, they are more likely to stay. Ideally, these good employees will advance into management roles—a win for everyone!

Training on the Upswing

Whereas in 2015, 70% of respondents reported that training programs stayed about the same, 44% expect them to stay the same in 2016. Retailers who plan to increase training will put the greatest emphasis on customer service skills (78%), followed by foodservice safety/sanitation (44%), manager/district training and teamwork (43% each).

Analysis: These stats are definitely a silver lining. It tells us that retailers are realizing the benefit of increased attention to new employee on-boarding, and perhaps they’re learning the hard lessons of the food industry over the past year. While foodborne pathogens in the supply chain may be difficult to control, retailers must do everything in their power to maintain sanitary conditions in food preparation areas. It’s no longer acceptable just to “wing it”—they must follow a checklist to ensure all appropriate measures are taken.

Missed Opportunity Through Technology

When asked about new technologies acquired to improve the hiring process and/or increase productivity, nearly 60% of retailers reported no additions in 2015 and 50% have nothing planned in 2016. The other 35% mostly mentioned new systems of payroll, recruiting and scheduling.

Analysis: What about task management through mobile technology?  The best part about implementation of mobile technology is that it doesn’t require a large investment in new equipment. Rather, it’s a matter of employees downloading an app onto their smartphones. Create a checklist for your managers, assign specific tasks to specific stores, and monitor completion of critical tasks. In the convenience industry, a real-time solution—one that includes GPS locator and the ability to attach a photo—just makes sense.

It’s time to stop settling for the status quo in the convenience store workforce. From retailers to technology providers, let’s make it a goal to work together to increase productivity and improve the adaptability of this ever-changing industry.

Read CSD’s full report

Topics: C-store

McD's Channel Blurring with All-You-Can Eat Fries

By Brian Harris

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Let’s all take a moment to consider two facts about McDonald’s:

  1. Seventy percent of business comes through the drive-thru window. (Bloomberg, Nov. 15)
  2. A franchisee in Missouri is about to test a McDonald’s sit-down restaurant prototype. (St. Joseph Press-News)

Both are true—and truly opposite!  What gives?

It’s not exactly news that channel blurring has been on the rise for the past few years. Dubbed the “McDonald’s of the Future,” the restaurant will combine everything customers enjoy about modern, convenient dining. Earthy tones will evoke the feeling of a fast-casual dining atmosphere (think Panera) complete with couches, arm chairs and self-order kiosks. Touchscreen menus are not a new concept either. In another show of channel blurring with convenience stores, McDonald’s has expanded its “Create Your Taste” concept, featuring self-ordering kiosks, across the country.

While the minimum wage debate continues, self-ordering kiosks are not designed to replace employees. Rather, they are designed to enhance customer service by allowing patrons to personalize their orders, from burgers and sandwiches to desserts. But the most “restaurant-y” features of them all in the McDonald’s of the Future? All-you-can-eat french fries and tableside service!

Convenience stores have worked hard to shake their old “cokes and smokes” image. It seems that McDonald’s is also trying to reinvent itself from “fry and fly.” Indeed, the futuristic McDonald’s restaurant will encourage customers to come in and take their time. Kiosks can actually slow down the ordering process as customers select more fresh ingredients, customers can linger with a McCafé in the lounge area, and kids won’t want to leave the revamped play area, complete with digital play and tabletop video games. A separate party room with a dedicated staff will allow families to have birthdays and special occasions.

The Importance of the Other 30 Percent

Let’s revisit the first fact we shared about McDonald’s. While the 70% of customers visiting the drive-thru are crucial to success, the company is very wisely not overlooking the other 30% of its business.

Customized menu options tend to have higher prices, so the opportunity is to upsell on menu items. It’s also about brand-building and creating more loyalty with a better restaurant environment. When the foot traffic segment increases in value, the business benefits as a whole.

That’s an interesting proposition, whether you operate in the convenience store or QSR space. It’s smart to take the strongest area of your business and strive to become the best at it. But it’s just as wise to look at other areas where you can better serve your core customer. In this case, it seems McDonald’s is taking steps to appeal to Millennial parents, the upcoming generation of big spenders.

Testing these concepts at the store level will only broaden McDonald’s horizons. As a brand, these are the kinds of insights they’ll need if the restaurant of the future is to become a reality nationwide.

Topics: Restaurants

Bottom Line: Car Washes Increase Revenue

By Jennifer Hoffman

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With convenience stores selling an estimated 80% of the gasoline purchased in the U.S., adding a car wash may seem like a good idea. It gets even more promising when 86% of U.S. car wash equipment manufacturers reported a collective revenue increasing of 20% last year, according to a 2015 industry survey.

The study appeared in a Convenience Store Decisions article about car washes becoming a high-margin opportunity for convenience stores. “Presuming there is a market to be served and the site has the ability to process the demand, the car wash can contribute significantly to the bottom line,” Eric Wulf, CEO of the International Carwash Association, told CSD. He added that convenience store operators have more options than ever before due to new models and technologies. From mini-tunnels that minimize land usage to RFID technology that automates payment, more retailers are having success by increasing their throughput of cars per hour.

Car Wash Fundamentals

Like the convenience store or gas island, a car wash must be clean and functional, and offer a positive customer service experience. Car wash promotions are connected to the store’s marketing efforts and can tie into loyalty programs; the profit margins are intertwined.

CSD profiles Idaho-based Stinker Stores, which operates two touchless and eight soft-touch car washes. The select number of stores offering those services is notable, considering Stinker Stores operates 65 locations throughout the state. All of the systems have upgraded equipment to maximize efficiency and ensure that customers are getting the best experience.

Remember the Nationwide insurance commercial which depicted a rather large human baby as a car? Don’t mess with your customer’s baby! They will take to social media to complain, including on platforms like Yelp, and this can damage your brand.

Honk if You Have a Process

Whether installing or maintaining a car wash operation, it’s essential that you audit your operations both for functionality and marketing program compliance.

Sample audit questions:

  1. On average how long does it take a car to be washed, from the time it arrives at the terminal to the time the customer is ready to leave?
  2. Is equipment operational? (Can be more specific: brushes, rinsers, wipers, blow dryers, etc.)
  3. Is the car wash terminal an inviting, well-lit environment?

If the survey was built with Zenput, an answer of “no” to questions 2 and 3 would elicit a photo or explanation that could alert senior management that service is needed. Senior management could also set the average service time for Question 1. Therefore, they would receive an alert when the service time was taking too long. There might be a malfunction inside the tunnel or simply a traffic jam on a bright, sunny day when everyone wants a wash.

We usually say Zenput provides store-level insights. In this case, wash-level insights—down to a lack of soap—could be accounted for during an audit. It’s yet another example of how mobile technology can empower business operators to explore profit-building opportunities—without the fear of losing your shirt in the wash!

Topics: C-store