<\/p>\n
Convenience store chains command customer loyalty, and sometimes cult-like followings, on a local and regional level. <\/p>\n
While 7-Eleven has built a national brand, even major regional players such as Wawa, Sheetz, and RaceTrac inspire fierce loyalty in their home markets but remain far less recognizable nationally.<\/p>\n
Despite rising price sensitivity at the pump, both consumers and convenience retailers agree that drivers are willing to go out of their way to visit the c-store they prefer, according to the results of a survey released by NACS.<\/p>\n
“Seventy-four percent of drivers say they will drive 5 minutes out of their way to go to the store they prefer, contrasted with 64% who say they would drive 5 minutes out of their way to save 5 cents per gallon,” according to the survey.<\/p>\n
That’s a loyalty story that makes it risky for a larger player to buy smaller brands, close them, and rebrand them under a new banner. <\/p>\n
Doing that risks pushing some loyal customers toward competing chains, but it’s a risk Cumberland Farms plans to take across multiple chains that it owns.<\/p>\n
“The risk when a retail giant consolidates regional banners under a single flagship name like Cumberland Farms is that you instantly erase decades of local brand equity. Consumers are fiercely loyal to their neighborhood convenience store networks \u2014 whether it is Tom Thumb in the South, Turkey Hill, or Loaf ‘N Jug out West. Those names represent a highly familiar community presence,” RTM Nexus CEO Dominick Miserandino told TheStreet. <\/p>\n
“When you tear down a beloved local sign and replace it with a national corporate logo, you are gambling with customer habits,” he added.<\/p>\n
Cumberland Farms shares IPO plans<\/p>\n
As a native New Englander, I grew up with Cumberland Farms as the sort of fancy convenience store. Unlike the smaller local chains we visited more often, “Cumby’s,” as it was known colloquially, had its own house brands, offered a less cluttered presentation, and was generally nicer.<\/p>\n
Now, as the chain has grown well beyond New England, Cumberland Farms filed a registration statement with the U.S. Securities and Exchange Commission (SEC) connected to a potential initial public offering (IPO).<\/p>\n
The price range and number of shares to be offered have not yet been determined, but the company will trade on the Nasdaq with the \u201cCMBY\u201d ticker symbol, a news release said.\u00a0<\/p>\n
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\u201cThe proposed offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering,\u201d the release said.\u00a0<\/p>\n
The company had more than 3,240 sites as of March 31 in the United States and Europe, with more than 1,460 in 24 U.S. states, according to the filing with the SEC. The business also had more than 6 million loyalty members as of April.<\/p>\n
Convenience stores compete for customers with fast-food chains.<\/p>\n
Shutterstock<\/p>\n
Cumberland Farms dropping multiple chains<\/p>\n
In the release, the chain shared plans to rebrand 600 to 700 c-stores to the Cumberland Farms banner over the next five years.<\/p>\n
That’s not a new strategy for Cumberland Farms, as it shared plans in 2022 to rebrand all 113 Tom Thumb locations. The chain also plans to put its name on most of its U.S. portfolio, which also includes Coen Markets, Turkey Hill, Loaf \u2019N Jug, and several other banners, as Cumberland Farms locations.<\/p>\n
“Progress has been slower than initially expected. The Tom Thumb conversions were originally slated for completion in 2024, but as of April only 55 of the stores had been rebranded. Across its entire U.S. network, Cumberland Farms had converted 77 stores by the end of April,” CStore Dive reported.<\/p>\n
The chain, however, continues to move forward with consolidating its brands under the Cumberland Farms name.<\/p>\n
Cumberland Farms has also begun rebranding its Sprint banner in Georgia and South Carolina, completing 13 so far. It has rebranded all nine Neon Marketplace sites in the Northeast that it acquired last year and has started converting 101 of its 139 Loaf \u2019N Jug locations, focusing exclusively on Colorado stores.
\nSource: CStore Dive<\/p>\n
The chain also shared plans to grow.<\/p>\n
\u201cWe plan to extend the Cumberland Farms brand beyond its historical regional footprint by expanding it across our broader United States network, creating a unified and cohesive brand identity,\u201d the company said in its IPO registration statement.\u00a0<\/p>\n
American convenience stores are changing<\/p>\n
How Americans use convenience stores has changed, Shell\u2019s Global Manager of Convenience Retailing Operations Richard Garcia told Nielsen NIQ.<\/p>\n
\u201cThe historical model for convenience, particularly in the U.S., is that you use fuel to attract people to your location,\u201d he shared. \u201cThat is absolutely changing to the store becoming the destination, and while they\u2019re there, you hope they might buy fuel. Now it\u2019s already happened.\u201d<\/p>\n
Many of the changes are about attracting customers more often.<\/p>\n
\u201cWhen you look at our numbers, the average person fills up their car, I think it\u2019s 2, 2.3 times a month. The average C-store shopper comes to a convenience store more than three times a week. So, the store has become the destination,\u201d he added.<\/p>\n
Fresher food has become a driver for the industry.<\/p>\n
\u201cToday, next to standard-issue soft drinks and churros, shoppers often encounter branded coffees, premium shakes and meal offerings that can rival the quality of many quick-service restaurants. Customizable fare such as made-to-order sandwiches, hot soups and sides \u2014 even items from the grill \u2014 are making their way onto C-store menus, driving traffic for meal-based (versus gasoline-based) missions,\u201d L.E.K. Consulting reported in its Evolving the Convenience Store report.<\/p>\n
Not having a well-developed food menu can cause customers to leave a convenience store and go to a fast-food or quick-serve restaurant.<\/p>\n
Convenience stores have been losing customers to fast-food and quick-service restaurants, according to the most recent Convenience Voices study from NACS.<\/p>\n
\u201cA limited c-store menu was the most frequently cited reason why consumers said they would go to a QSR. 37.9% of those surveyed said they wanted to purchase a food item that the c-store didn\u2019t offer. A close second, 27.3%, said that while they purchased food at the convenience store, they wanted additional food options that weren\u2019t available,\u201d according to the study.<\/p>\n
Related: Costco makes AI pricing change members did not see coming<\/p>\n
#Convenience #store #giant #closing #multiple #brands<\/p>\n","protected":false},"excerpt":{"rendered":"
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