MACS Bursts Onto the C-Store Scene

MACS Convenience Stores, Uppy'sIt’s been a busy first year for Mid-Atlantic Convenience Stores, which  is set to roll out a proprietary foodservice program and is developing a unified retail image.

By: Erin Rigik, Associate Editor.

Mid-Atlantic Convenience Stores (MACS) might not be the oldest company in the industry, but it’s certainly poised for growth in 2011 as it has been expanding retail operations at a dizzying pace since its debut in June 2010.

MACS was formed as a retail rollup company by Greenwich, Conn.-based Catterton Partners, a private equity firm, last June, when the company acquired a majority interest in Richmond, Va.-based Uppy’s Convenience Stores (44 stores), followed by 170 convenience stores from ExxonMobil in Maryland, Virginia and Delaware.

The acquisition also included Southside Oil, Uppy’s wholesale and distribution arm that now serves more than 250 independently-operated retail fuel locations and 68 company-operated locations in the Mid-Atlantic Region and Southern U.S., as well as a considerable wholesale business that came with its Exxon assets.

Steven Uphoff, who in 1995 founded Uppy’s, took on the role of CEO of MACS, which arrived with a bang on the c-store scene as an already sizeable entity. What’s more, the deal with Exxon made MACS the largest ExxonMobil fuel distributor in the U.S.

“We went from having four transport trucks to having almost 40 trucks, and we went from the original 44 Uppy’s stores to a chain of 300 stores selling 90 million to 600 million gallons of gas and with fuel-delivery operations across the Mid-Atlantic overnight,” said Jim Summers, president and chief operating officer of MACS.

In such a fragmented industry, where small chains are fighting to stay afloat amid rising gas prices and cigarette taxes, MACS’ size gives it the strength and resources to thrive, Summers said.

In August, MACS acquired another 58 c-store/fuel stations located in northern Virginia and Maryland from Exxon Mobil Corp., further positioning itself as a chain to watch.

“Here was a small entrepreneurial company and all of a sudden it just exploded,” said Summers, who was brought on board in August to put together a professional leadership team to manage the consolidation and grow acquisitions for the company. “We spent the first six months in what I’d call the start up phase, figuring out how to keep the dealers happy, transporting the fuel properly, and making sure our convenience stores were running well.”

Growing From the Inside Out
With the startup phase complete, MACS has turned its attention to what Summers called its “operations phase,” which includes developing a growth strategy beginning with a proprietary foodservice offering.

“We’ve developed a terrific coffee program and with that we’ll be rolling out items like breakfast sandwiches, an oatmeal machine and a roller grill program,” said Summers. “We’re working with companies to get that really craveable roller grill product—not just hot dogs, but products such as Buffalo chicken, so we have signature products customers really like.”

At the smallest stores, customers will be able to find a great consistent cup of coffee, he said, while bigger stores will offer not only regular and decaf options, but also a flavored coffee and an on-trend country of origin coffee, such as Sumatra.
After months of product testing and consumer research, the coffee program is set to hit stores by the end of March. “Having a great cup of coffee is fundamental for being in the business,” Summers noted.

The fountain offering is receiving a revamp as well, with new fusion fountain dispensers set to feature both Coke and Pepsi, as well as flavor shots and on-trend chewable ice. “Onto that we’re building a sandwich program and a pizza program, so customers are going to walk into our stores and all of a sudden see this coffee and fountain section with foodservice in the middle with a half circle with graphics behind it, and it’s going to show we have something new going on in our stores,” Summers said.

Currently MACS also has 11 Subway restaurants that came with the Uppy’s acquisition. While the restaurants continue to be profitable and drive traffic, Summers expects those to be slowly fazed out as the contracts expire and MACS moves fully toward its proprietary foodservice vision.

Store Makeovers
A reimaging is in the offing as well for the chain’s 300 stores, which are currently running under multiple banners, including Uppy’s, ExxonMobil’s On the Run and BP. MACS is currently working with a consumer research firm on a new branding name in order to unify the chain under one banner.

“We have a couple great names and are testing how they resonate with consumers right now,”  said Summers, who noted the target date for rolling out a new banner is currently set for July 2011. “You’ll see a definite refresh to the stores as we come in with our foodservice, our proprietary coffee and food programs, and new graphics packages in the stores.”

Business Support Center

In another big move, this February MACS announced it had consolidated four former headquarters into a new 22,000 square-foot Business Support Center. “We changed the name of our new corporate office to the Business Support Center to help everyone understand our job is to support the people out on the field, whether it’s our transport business, our wholesale fuel business or convenience stores,” Summers noted.

The facility features offices, training facilities, a food and beverage zone, a test kitchen for development of new food concepts, a technology lab for pre-testing operating systems such as POS solutions, an exercise room and a staff relaxation area.

“The morale has gone up unbelievably now that we’re in one building, and everyone sees what the vision is for the company and how we’re a growing company,” Summers noted.

Steamrolling Ahead
With the company consolidated and a food program ready to roll out to customers, MACS is ready to turn its attention to even bigger goals in 2011. “Our big focus right now is on acquisitions, whether that be single stores or large groups of stores. We’re ready now to start working on those acquisitions and folding some other stores into our company. I predict we will have some very strong growth in 2011,” Summers said. “There are not a lot of companies out there that are growing as quickly as we are. It’s exciting to be part of a company that’s growing like this.”

At a Glance:

Mid-Atlantic Convenience Stores
Headquarters: Richmond, Va.
Employees: More than 800
Fuel brands: BP and ExxonMobil
Store count: About 300 company-operated units
MACS Executive Team:
• Steve Uphoff, CEO
• Jim Summers, President and Chief Operating Officer
• Neil McCarthy, Senior Vice President and Chief Information Officer
• Mike Squillace Senior Vice President of Merchandising and Retail Operations
• Adam Marcus, Senior Vice President of Wholesale Fuels and Distribution
• Harvey Hicks, Senior Vice President of Finance
• Kathy Meadows, Director of Human Resources

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