“If you are not constantly innovating and changing to meet the needs of consumers, you might as well hand the business over to your competitors.”
That was the message delivered by Sheetz Inc. Vice President of Marketing Louie Sheetz during the keynote address to conclude Convenience Store Decisions’ 2007 Foodservice Show in Fort Worth, Texas.
The conference provided attendees to view and discuss the trends, technology and concepts that have made foodservice such a valuable commodity in the industry.
Sheetz explained that as the company saw shifts in the percentage profit contributed from its three major categoriesfood and beverage, convenience/grocery and petroleumit needed to change its business model, which is why it developed its convenience restaurant concept.
“We are constantly trying to create a business that will put the Sheetz of today out of business,” said Sheetz, sharing the Altoona, Pa. company’s operating philosophy.”In examining consumer trends, we saw that quality, indulgence and convenience were paramount. As an industry, we were seeing competition change as well as eroding margins on our core products (gas and cigarettes).
“We took a strong look at the Sheetz consumer and found there was a huge pool of ‘neutral’ consumers that could use us for food, but weren’t because they were turned off at buying food from a gas station,” he continued. “So we began planning for a convenience restaurant concept that could win over those neutral customers while still satisfying our existing customers.”
More than 60 people within the Sheetz organization had a hand in developing the convenience restaurant, working in 12 separate groups that focused on everything from the design of the building and logo to the choice of core products, menu development, coffee and more. The first convenience restaurant was approximately 10,000 sq. ft., the bulk of that was an enormous test kitchen for chef Keith Boston to create the fare that would break the mold of “convenience food.” The state-of-the-art kitchen was visible to the customers, who could enjoy seating for 100 inside and out of the building. The company also placed the gas pumps to the rear of the building to diminish the gas aspect in the minds of customers that were typically turned off by it.
One of the main objectives with the concept was to make $50,000 a week in food and beverage sales. The convenience restaurant surpassed expectation by earning $100,000 in food and beverages sales in its first week.
But Sheetz was also open to sharing that the experience wasn’t flawless, but the company learned from the things that didn’t work and used them to its advantage.
“We originally built two convenience restaurantsone in Altoona, Pa. and one in Raleigh, N.C.and learned that there were a lot of costs involved, from initial investment to labor to utilities,” said Sheetz, who pointed out that the elaborate concept required a staff of at least 22 a day. “We were intoxicated with excitement and perhaps acted too soon. It was an expensive lesson to learn, but we were prepared to leverage our wins and ideals with our losses. It hurt and it cost us, but it was necessary. We’ve taken the best attributes and applied it to the other convenience restaurants we’ve built since.”
The concept has turned into a homerun for the company and Sheetz credits it greatly with his company’s commitment and guts.
“Innovation inspires. We found that to be true for our employees as well as our customers,” he said. “Pioneering is part of our company culture and it required a large investment of capital as well as human resources. But the convenience restaurant represents a giant leap for Sheetz.”
One of the seminar speakers, Marsha Robbins, environmental health specialist and president of HACCPplus.com, gave attendees more than a few things to ponder when it comes to food safety.
“Local, state and federal laws are the minimal standards for food safety programs,” she said. “We have to be continually raising the bar for best practices in food safety. It’s a critical part of the food business.”
Robbins didn’t pull any punches. She was quick to share statistics about what can happen when food safety isn’t taken into consideration as well as showing some disturbing pictures illustrating food safety violations.
“There are more than 13 million food-borne illnesses a yearmore than nine million are viral, four million are bacterial and more than 357,000 are parasidic, and 71% of those cases result in death,” she said. “Companies shouldn’t take comfort in health department inspection scores.
They may be in your stores for two hours a year getting a snapshot of your operation, so the onus falls on operators to incorporate best practices into their foodservice that at the minimal equal health department standards, but they should really work on exceeding them.”
Robbins was also quick to praise Sheetz for the way it handled the contaminated tomato outbreak that caused 564 confirmed salmonella cases in Maryland, Pennsylvania, Ohio, Virginia and West Virginia.
“Sheetz took responsibility for the situation and has worked tirelessly to resolve it,” she said. “Better still, it took the experience and used it to create a better program.”
CSD Awards Foodservice Innovators
As part of the 2007 food show, CSD honored two chains for their outstanding commitment to foodservice. Accepting the award for Exxon Mobil Corp., Joe Chiovera, who, as category manager of concept development, was instrumental in designing the company’s On the Run Cafe brand, and foodservice category specialist Mike Kerby, credited employees for their store-level execution.
“We are confident that we have created a strong offering, but it’s our employees that deserve so much of the credit for delivering great service to our customers every day,” Kerby said. “Without their dedication, we wouldn’t be here accepting this award.”
ExxonMobil operates a network of more than 1,300 On the Run convenience stores across the country.
John MacDougall president and founder of Nice N Easy Grocery Shoppes in Canastota, N.Y. accepted the small chain foodservice award with company Executive Vice President of Foodservice Dr. Jack Cushman.
“Foodservice was a savior for our company as we lost sales of gasoline and cigarettes to Native Americans,” MacDougall said. “Ten years ago, we knew we faced a tough decision: come up with something new to replace those sales or become irrelevant. That’s when we made the decision to get into foodservice.”