From time to time I write about exemplary examples of convenience stores that are more than just a typical 7-11 (coffee and pastries, Slurpees, some hot foods, and a small array of other foods including overpriced processed items but also, to their credit, a cold case selling milk, eggs, and related foods--the 7-11 by us sells milk and eggs (but not cage free, brown eggs) at prices competitive to supermarkets.
The problem with chain and franchised stores in serving different markets in different ways is that most of the industry has already defined their positioning--around automobile-enabled consumers, and have rigid, standardized formats that aren't conducive to differentiation. The stores make most of their money selling things that are bad for us--gasoline, cigarettes, and beer.
The drug store chains have begun to recognize the need to differentiate their stores for urban markets. For example, CVS now has a store format for cities like Washington, DC ("CVS clusters consumables in new urban store concept," Drug Store News) where the stores are conceptualized in part as a convenience store with expanded food offerings--although I think the pricing is still too high.
While Walgreens has been introducing premier stores in cities like New York City, Chicago, San Francisco, and now DC with special offerings in food and cosmetics and health care--some stores in Brooklyn sell beer on draft (bring your growler) and others have a sushi bar.
A Navarros store--the company is based in South Florida--has a cafeteria and business center ("Navarro Discount Pharmacy celebrates opening of 33rd store," Drug Store News). Walgreens many years ago used to have a separate restaurant chain, and of course, was once known for in-store food service--soda fountains--as were most pharmacies and the era's equivalent of dollar stores, the 5 and 10 cent store like Kresges, SH Kress, and Woolworths.
Convenience store companies have been slower to change. First, most are focused on gasoline sales, which makes them un-urban anyway. But industry leaders like Sheetz and Wawa have expanded their prepared food offerings, have extensive in-store seating, etc.
Interestingly, Kroger, the nation's largest supermarket company, has extensive convenience store holdings, but their stores are no different than any other company in the market. But Giant-Eagle, a supermarket chain focused on Western Pennsylvania and Ohio, has a convenience store division, Get Go, that focuses on cross-marketing, featuring store brand products, and Market District (their upscale unit) branded coffee.
Here and there are other examples of change. Parkers in Savannah Georgia has a couple of upscale stores serving the Historic district in Savannah. 7-11 has a couple of upscale test stores in Florida and NYC. Famima, a Japanese company--known for innovation--has stores on the West Coast. And here and there are some examples of more change.
The Yummy's group in Southern California, with a handful of stores, is more focused on online sales, especially of high-margin prepared food items and fast delivery within an hour ("GROCERY 3.0," Progressive Grocer) is one.
Green Zebra in Portland, Oregon is another pathbreaking example. The current issue of Convenience Store News features a story, "Convenience Can Change Its Stripes," on a new company started by people who had worked at New Seasons Supermarket, a regional health foods supermarket chain.
They call what they do "healthy convenience." It's a small format--5,000 square feet--but modeled on a grocery store. They call themselves "one half convenience store and one-half healthy foods store." And because "healthy foods" tend to cost more, they give a 7% discount to people receiving SNAP or other food program benefits. From the article:
"We offer some standards you would find in a grocery store, but in a smaller format," said Hiller-Webb."With the concept of healthy convenience, we say there is only room for the good stuff. We have a meat and seafood counter, and a cheese department, which is unexpected at a c-store, and an organic produce section."They extend innovative thinking for the entire concept and its execution. (Recognize that this isn't in a distressed area.) For example:
Because it is truly a neighborhood store, many people will ride their bikes to Green Zebra rather than drive, so the store offers more bike parking spots than it does car parking. The store also features a variety of bike amenities, including a tire tube vending machine and a cargo bike and trailer available for loan to customers who need to transport groceries home.This Portland Oregonian story on their grand opening includes video.
"There is a covered area with heat lamps outside that can seat between 20 and 30 people, and we offer customers Wi-Fi so they can take their computers out and work here if they want," Hiller-Webb added.
This store was enabled by the decade of experience the store proprietors have in working in supermarkets.
Green Zebra is a good example of four points. First, that it's possible to be innovative. Second, that if you want innovation, you're not likely to find it in chain-owned or franchised stores. So that means a third point, that if you want stores like this, especially in distressed areas, which have the need but not the demographics to support their creation, you're going to have to find ways to foster their development (financing, tax incentives, etc.). But fourth, because it's a lot easier and less risky for cities to give supports to existing companies, especially chains, it's hard to make this happen.
CITY SPOTLIGHT: Beyond Portland, U.S. Biking Infrastructure Needs to Aim Higher."