All-Conquering Convenience

Quick-and-Easy Is Blurring the Shopping Lines

A few years ago, you almost never heard anyone in the mainstream retail industry worry about competition from convenience stores.

Now, when executives at supermarkets, drugstores and discounters fret about the various formats that lure away customers, the lowly convenience store ranks right up there with other rival retail channels. Why is this once overlooked, much-maligned industry all of a sudden getting so much respect?

Largely, it's because convenience stores offer two things that traditional retailers have been rushing to add in recent years: convenience and food. It helps, too, that many convenience stores today are cleaner, hipper, more focused and better managed than they used to be.

"For a while, convenience stores took the best from other retail channels," said Jeff Lenard, a spokesman for the National Association of Convenience Stores. "Now you're seeing other channels taking the best ideas from convenience stores and making it work for them."

Of course, the convenience store industry wants to tout that message. But it happens to be true. Just about every drugstore and supermarket chain is looking at ways to put more fast-moving items toward the front of the store and facilitate quick trips in and out for customers. Some are even experimenting with their own convenience store formats, and several major chains are jumping into the gasoline retailing business.

In the end, it may be that true convenience is something that is best done by the convenience stores, while full-service stores should focus on doing what they do better. But it's hard to turn a blind eye when the competition is eating your lunch.

Industry trade publication Convenience Store News reports that non-gas sales at convenience stores have grown faster in recent years than sales at any other category of retail outlets, including restaurants, food stores and drugstores, especially between 1998 and 2002. Meanwhile, the number of trips shoppers make to stores is falling across all retail channels, according to Maureen Azzato, publisher and editorial director of the magazine.

"The only place it's not down as dramatically is in convenience stores," she said. "People don't like shopping that much and [want to] be more efficient with how they're doing it."

The blurring of the lines between different types of retail formats has fundamentally changed the business. Today, you can buy patio furniture and toys at the supermarket, bread and milk at the drugstore and groceries at Wal-Mart. It's causing considerable angst among retailers worried about how to differentiate themselves.

Until recently, convenience stores had been somewhat immune to this trend. They always carried a few of the best-selling items from all types of stores, so in some respects theirs was the original line-blurring format. But convenience stores were, for decades, the places where "Bubba" shopped, while being overtly avoided by the predominantly female customer base of traditional shopping outlets.