April 30, 2004

C-Stores

Latest U.S. Convenience Store Count Shows 130,659 Stores

For Immediate Release

April 14, 2004

Contact: [email protected]
(703) 684-3600

Latest U.S. Convenience Store Count Shows 130,659 Stores


ALEXANDRIA, Va. The number of convenience stores selling motor fuels grew 4.3 percent in 2003, but the overall number of convenience stores dipped slightly, dropping 1.3 percent to 130,659 stores, according to the new National Association of Convenience Stores (NACS)/TDLinx Official Industry Store Count, as of December 31, 2003. The count is based on the convenience store universe, tracked and marketed by TDLinx, and is endorsed by NACS.

Last year, the official store count was 132,424 stores. Ten years ago, the official industry store count stood at 98,400; 20 years ago there were 80,900 stores, and 30 years ago there were 27,900.

The 1.3 percent decrease in the number of U.S. convenience stores at year-end 2003 over 2002 is a net change number reflecting 9,500 store closings versus 8,000 openings. Importantly, the count also incorporates existing non-convenience stores that were classified or remodeled and now meet the NACS' definition of a convenience store, which includes a broad merchandise mix and a minimum of 500 stock-keeping units (SKUs).

Stores selling motor fuels at new high
A total of 106,240 convenience stores (81.3 percent of all stores) now sell motor fuels; both the number and percentage are all-time highs. Meanwhile, the percentage of stores that do not sell motor fuels plummeted 20.2 percent. There are now 6,182 less stores that do not sell motor fuels, outpacing the increase of 4,417 stores that sell motor fuels

"As competition for the convenience customer continues to intensify, it is clear that stores are increasingly looking to add products and services such as motor fuels to their offers. At the same time, this competition also is making some operators re-examine the profitability of all of their stores, and the closings of less profitable stores are the primary contributor to the store count decline," said Teri Richman, NACS senior vice president of research and public affairs.

"While the number of convenience stores remained relatively static from the year prior, there was still a significant amount of change happening within the channel," said Scott Taylor, TDLinx executive vice president and general manager. "In 2003, TDLinx tracked 92,770 convenience store changes -- these changes include store openings and closings, banner names, reporting and owner relationships and supplier changes. Nearly three-quarters of all stores (71 percent) had some sort of change last year."

Texas leads the nation in total number of convenience stores (12,805), as well as number of convenience stores selling motor fuels (11,198). Meanwhile, the eight-state South Atlantic region (which includes the District of Columbia) continues to be the region with the most convenience stores in the country -- 30,176 stores -- nearly one-quarter of all stores in the U.S. The only region to see an increase in the number of stores was the Middle Atlantic region (New York, New Jersey and Pennsylvania), which saw a 2.2 percent increase.

The industry continues to be composed by a majority of small, "independent" operators -- stores that are owned and operated as a one-store business or franchise, but both the total number and percentage of one-store operators declined in 2003. The total number of one-store operators declined 3.0 percent to drop to 76,043; however, one-store operators still make up the majority of stores (58.2 percent) in the United States.

Highlights from the new convenience store industry store count include:

Texas remains #1: Texas accounts for nearly one in 10 of all U.S. convenience stores, totaling 12,805 stores. The rest of the top 10 states in terms to total stores are: California (9,064 stores), Florida (8,763), New York (6,581), North Carolina (5,587), Georgia (5,554), Ohio (4,761), Michigan (4,332), Virginia (4,131) and Illinois (4,077). Virginia is the only new entry in the top 10.

More single-store businesses than chain stores: Nearly three-fifths (58.2 percent) of the country's convenience stores (76,043 stores total) are categorized as single-store companies in the latest store count. Meanwhile, 13.3 percent (17,316 stores) are owned and operated by companies having more than 500 stores. Washington state has the highest percentage of stores operated as single-store businesses (81.3 percent of all stores), while Colorado has the fewest (31.8 percent). Meanwhile, Colorado has the highest percentage of stores that are operated by businesses owning 500 or more stores (38.8 percent of all stores). Twenty-four states have less than 10 percent of all stores owned and operated by these larger businesses.

America's fuel retailers: A total of 106,240 convenience stores, or 81.3 percent of all stores, sell motor fuels. More than half of these stores are one-store operators (55,426 stores). In 24 states, the percentage of stores that sell motor fuels tops 90 percent, led by the 98.5 percent of stores in North Dakota that sell fuel (only five stores do not sell motor fuels in the state). Not surprisingly, the two states that mandate full-service for motor fuels sales had among the lowest percentages of stores selling motor fuels. New Jersey had the smallest percentage of stores selling fuels (33.7 percent), and Oregon had the third lowest (49.5 percent, slightly more than the 46.1 percent in Massachusetts). Overall, convenience store retailers sell approximately three-quarters of the gasoline purchased in the U.S.

Motor fuels are an increasingly important offer for stores: Even though motor fuels margins reached a 17-year low in 2002, according to the NACS 2003 State of the Industry report, more stores are offering motor fuels than ever before to drive customer traffic. Every region across the country saw an increase in the number of stores selling motor fuels, led by the 15.3 percent increase in the Middle Atlantic states (New York, New Jersey and Pennsylvania). Meanwhile, every region saw a decrease in the number of stores that did not sell motor fuels, led by the West North Central states (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota), which saw a drop of 40.5 percent.

Change is a constant within the industry: Most of the stores (71 percent) had some sort of change in 2003, whether a change in ownership, a supplier relationship, brand name or an opening or closing.
Chains/
Franchises All Other
Stores Total
Industry
Change in store type 6,234 3,876 10,110
Change in ownership 45,179 9,780 54,959
Change in supplier name/brand 4,787 5,402 10,189
Stores opened 1,332 6,702 8,034
Stores closed 3,405 6,073 9,478
Total changes 60,937 31,833 92,770

Source: TDLinx


-###-

The National Association of Convenience Stores (NACS) is an international trade association representing 1,900 retail and 1,800 supplier members. The U.S. convenience store industry posted more than $290 billion in total sales for 2002, with $181 billion in motor fuel sales.

TDLinx is recognized as the universally accepted store, outlet and account coding structure and premier source of retail/on-premise channel information. With TDLinx Codes, consumer packaged goods manufacturers and alcohol beverage suppliers are enabled to aggregate to a customer view, integrate disparate data and activity, communicate seamlessly on a code-to-code basis and evaluate in any frame of reference with a systematic and repeatable process. TDLinx covers over 600,000 locations, 11,000 accounts and up to five layers of account hierarchy. TDLinx is a division of ACNielsen, a VNU business.


Latest U.S. Convenience Store Count Shows 130,659 Stores

Posted by Craig at April 30, 2004 02:07 PM