Where there’s successful foodservice programs, there’s efficient foodservice equipment, and in the convenience store industry, there’s foodservice everywhere.
According to NACS’ State of the Industry numbers for 2010, foodservice provided the largest slice of the in-store gross-margin pie, at 26.35%, and was second in in-store sales only to cigarettes.
As consumers contemplate what to eat, it’s the retailer’s job to use their foodservice tools to attract these sales with enticing meal solutions. This includes marketing and promotions, and also how that food is prepared and with what machinery. Naturally, as convenience stores add bigger and better menus, they need to add improved foodservice equipment to keep up with the demand.
“You can’t separate foodservice from foodservice equipment,” said Larry Miller, founder and president of Sanford, Fla.-based Miller Management & Consulting Services.
Retailers are always looking for an edge when it comes to foodservice equipment, even if it means making a bold statement. For example, despite having one of the most popular roller grill programs in the country, Dallas-based 7-Eleven said that it chose Standex International Corp. as a supplier of roller grills. Successful chains can’t be afraid to try something new.
Currently, 7-Eleven is also rolling out a new hot food program using a high-speed TurboChef oven to handle several chores. It can bake pizza, which is ready to be sold whole or by the slice in just 90 seconds, and several flavors of hot chicken wings that cook in less than three minutes. Other new oven-heated offerings are white meat chicken tenders, breakfast quesadillas and hash brown potatoes, all baked in the TurboChef oven.
“Convenience store cooking is really coming of age,” said Charley Souhrada, director of member services for the National Association of Foodservice Equipment Manufacturers (NAFEM) in Chicago. “The industry has been trending toward multifunctional machines for a variety of dayparts, and reduced footprints. Both are important to convenience stores. Energy efficiency is very important as well. Those three are consistent across the board.”
This coming of age is crucial for convenience stores as they continue to gain a great share of stomach. A January report from The NPD Group, which tracks the consumer purchasing behavior of more than 49,000 U.S. convenience store shoppers, reports that in the third quarter of last year more than half of fresh prepared food customers at c-stores chose that store because of the foodservice offering, up nearly a point over the same quarter in 2008.
Fresh prepared food buyers averaged 7.8 c-store visits over a 30-day period versus 5.66 for all c-store shoppers, according to the marketing research firm’s survey. On average they purchased 4.1 products compared to the 1.64 products bought by all c-store shoppers. In addition, the food buyers’ average check was $1.65 higher than that of all c-store shoppers.
What this means is that convenience store operators can attract their share of the consumer’s dollar by offering quality foodservice options quickly and economically. But to do that, they need the most reliable, high-performance equipment in the foodservice industry.
Effective and Efficient
Larry Bowling, vice president of operations and marketing for 47 Apple Market stores operated by Workman Oil in Forest, Va., is not hesitant about his utmost goal when in the market for foodservice equipment.
Thirteen Apple Markets have a proprietary chicken program; 18 have a turnkey pizza program; and nearly all have hot dogs. There are also nine Subways, two Blimpie Sub Shops, two Lee’s Chicken outlets, and a Krystal Burger operation.
“Reliability and equipment with a proven track record,” said Bowling, whose stores get 16% of inside sales and 28% of their gross-profit dollars from foodservice. “Of course we look at how quickly we are able to get our hands on new equipment and their service availability, but we are also looking to get a return within 18-24 months.”
All that is important to David Wishard, too, but the vice president of business development for Susser Petroleum’s Stripes chain in Corpus Christi, Texas, has an easier time of equipment shopping. Stripes’ Laredo Taco Co. is one of the most successful foodservice concepts in the c-store industry, drawing well above the industry average for profit contribution.
Its menu is tortilla-based, and as such, has specialized equipment needs—everything revolves around the flat grill. The menu–and the equipment–is specialized, but not brand-dependent. For instance, Bowling uses only Henny Penny fryers for its chicken offer. Wishard is not so concerned with nameplates. Because the Laredo Taco menu is so successful, it rarely changes.
“We’re an acquisition company, so the food brand could be different, but it’s going to be produced on a flat grill,” Wishard said. “It’s a common platform. We’re pretty consistent in our core offering. When we purchase equipment, it’s the same equipment we use until it needs to be replaced.”
Of NAFEM’s 550 members, the ones that sell to convenience stores need to think of two kinds of footprints, space and carbon. Less space taken up by machines like roller grills, warmers and condiment holders means more space for other SKUs.
Also, a smaller carbon footprint—the total amount of greenhouse gases produced to directly and indirectly support human activities—is not only energy-efficient, it’s good public relations. “Green” practices have become less niche and more standard operating procedure, especially for companies with public faces.
“The customers are demanding it, and it’s the right thing to do” Miller said. “I don’t know of any equipment that’s an energy hog just to get the job done.”
This can mean not only the energy to run the equipment, but the equipment’s ability to either produce less heat or capture it better; more heat in the store means more energy used to cool the building, thus higher utility bills.
“Green is still somewhat nebulous in the marketplace,” said Souhrada. “Does it mean green construction? Does it mean energy efficient? Does it mean easier to dispose of? The answer is all three.”
Aside from energy efficiency, today’s cutting-edge foodservice equipment has computer controls for consistency and ease of employee use, speed of thermalization, the ability to help with multiple dayparts and, where relevant, the use of the minimum necessary ingredients.
For instance, manufacturer Henny Penny makes one of its fryers’ priorities an efficient use of shortening, or oil—the most expensive ingredient associated with frying food—with “shortened management features,” Miller said.
This not only cuts down on expense in the short term, it increases a machine’s ROI, a businessman’s mantra.
According to Souhrada, the smart operator looks for life extenders that serve two purposes, like water filtration systems, for ice machines and coffee makers. The higher quality water that goes into these pieces of equipment, the less mineral buildup and the better tasting the end product (ice, coffee).
“It has to be maintained so that it doesn’t impact taste or the wear and tear on the equipment,” said Souhrada.
Whether it’s ice machines, coffee makers, heated holding equipment, roller grills, fryers, ovens or fountai
n machines, Souhrada said innovation in any of these involve energy efficiency, speed and best use of space.
“Manufacturers are very much aware of retailers’ need to reduce operating cost without sacrificing speed of service or quality,” Souhrada said. “As a result the innovation we are seeing is cutting-edge equipment that can cook faster, is environmentally friendly and cost-effective.” CSD