C-store industry sets new record even as growth decelerates
Sales in the convenience store industry advanced 2.7% during 2012, well below a prior year gain of 18.5%, as meaningful economic growth hampered results.
According to NACS, the Association for Convenience and Fuel Retailing, total industry sales increased 2.7% to slightly more than $700 billion in 2012. The increase was comprised of a 2.2% increase that saw in store sales reach $199.3 billion and motor fuel sales increase 2.9% to $501 billion. The in-store sales growth was driven by double-digit sales gains in several subcategories, including: alternative snacks, which include meat snacks and health, energy and protein bars (12.2%), liquor, a relatively small subcategory (11.6%), cold dispensed beverages (11.3%) and sweet snacks (10.3%).
According to NACS, the pace of growth was hindered by a sluggish economic picture as unemployment remained high, disposable income per capita was weak and real GDP growth was insufficient to generate strong employment growth.
"The convenience store industry depends on strong commuter traffic to generate store visits, both on the way to work and the way home. Until the labor force gets back to work, the industry will likely endure lower fuel sales and poorer inside sales than would be expected under higher levels of performance in the overall economy," according to NACS.
Even so, growth is growth and the C-store industry is riding a multiple year upward trend that has seen sales more than double to $700 billion from $290.6 billion in 2002.
The same is true of total industry store count. Last year, the total number of C-stores was pegged at 149,220 units, compared to 148,126 the prior year.
"Store count grew by 12.7% over the last ten years but has slowed to a 2% growth over the last five years and reflects the difficult economic times," NACS said. "Retailers are reacting to the limited economic growth by maintaining a conservative posture on overall store growth. In some cases, consolidation strategies may be preferred over saturating an existing market area with new stores."
While the NACS reported sounded a bit glum about the decelerating pace of growth, in 2012 the industry set new records across the board with store count, inside merchandise sales and motor fuel sales.