The convenience store industry is enjoying strong sales growth in the first half of 2023, according to a recent survey by the National Association of Convenience Stores (NACS). Two out of three retailers (66%) report that their sales for the first seven months of 2023 were higher than sales during the same time period in 2022.
This growth is being driven by a number of factors, including:
- Increased consumer spending: With the economy improving, consumers are spending more money, and convenience stores are a convenient and affordable option for many people.
- Rising gas prices: As gas prices have risen, convenience stores have benefited from increased sales of snacks, drinks, and other items that motorists purchase while filling up their tanks.
- Expansion of food service offerings: Convenience stores are increasingly expanding their food service offerings, which is attracting new customers and driving sales growth.
In addition to these factors, the convenience store industry is also benefiting from the growth of e-commerce. As more and more people shop online, convenience stores are becoming an important last-mile delivery point for retailers. This trend is expected to continue in the years to come, which will further boost the growth of the convenience store industry.
The convenience store industry is a dynamic and growing sector with a lot of potential for investors. The strong sales growth in the first half of 2023 is a positive sign for the industry, and the M&A activity that is picking up is a further indication of the sector’s attractiveness. Investors who are looking for a profitable and growing investment opportunity should consider the convenience store industry.
Here are some of the key factors that investors should consider when evaluating convenience store stocks:
- Location: Convenience stores are typically located in high-traffic areas, such as near gas stations, highways, and shopping malls. This is important for ensuring a steady stream of customers.
- Brand recognition: Convenience stores with strong brand recognition are more likely to attract customers and generate sales.
- Food service offerings: Convenience stores that offer a variety of food service options, such as hot food, cold food, and prepared food, are more likely to attract customers and generate sales.
- Technology: Convenience stores that are using technology to improve their operations, such as self-checkout and mobile ordering, are more likely to be successful in the long run.
- Competition: The convenience store industry is a competitive one, but there are a few large players that dominate the market. These players have the resources to invest in new technologies and marketing initiatives, which can give them a competitive advantage.
The convenience store industry is a promising one for investors, but it is important to do your research and invest in the right companies. By considering the factors listed above, you can increase your chances of making a successful investment.
Here are some additional thoughts on the future of the convenience store industry:
- The industry is expected to continue to grow in the coming years, driven by factors such as the growth of e-commerce and the increasing demand for convenience.
- Convenience stores are likely to continue to expand their food service offerings, as this is a key way to attract and retain customers.
- Technology will play an increasingly important role in the convenience store industry, as stores adopt new technologies to improve their operations and customer experience.
Overall, the convenience store industry is a dynamic and growing one with a lot of potential for investors. If you are looking for a profitable and growing investment opportunity, the convenience store industry is worth considering.
Ryan Pankratz is Business Intermediary of Creative Business Services/CBS-Global.
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