A Thorn in McDonald’s Side
WSJ features c-store foodservice upon QSR’s declaration
Published in CSP Daily News
NEW YORK -- It was the briefest of mentions, but when the president of McDonald’s USA, Mike Andres, mentioned during a conference call with investors in early December that convenience stores are among the significant competition the quick-service-restaurant chain is struggling against, the Wall Street Journalnoticed.
Particularly in the Northeast, Andres noted while outlining McD.’s “experience of the future,” c-stores have become a thorn in McDonald’s side, among the reasons the burger chain is battling back against a two-year decline in sales.
For WSJ, this became an opportunity to focus on c-store and grocery-store foodservice and where the channel is getting it right.
Here is a digest that Wall Street Journal story:
Consumers weighing whether to dine out at a tablecloth restaurant or a fast-food joint now have additional options to consider: the grocery store and the minimart. …
Sheetz Inc., a chain of 487 convenience stores and gas stations, has rolled out barista stations that offer fruit smoothies and coffee drinks, as well as full-service kitchens that can make items like mozzarella sticks and burritos and provide in-store seating. And Wawa Inc.’s more than 650 convenience stores have counters that make items from French onion soup to custom-ordered sandwiches. The Wawa, Pa., company aims to compete with fast-casual chains like Panera Bread Co. in terms of quality, but at fast-food prices, says Mike Sherlock, vice president of fresh food and beverage. …
Convenience stores are embracing fresh foods to compensate for softer sales of some of their traditional offerings.
“The other things c-stores sell are under pressure,” said Joe Sheetz, chief executive of his namesake chain. “People don’t smoke as much as they used to or use as much gas as they used to.” He added that food is far more profitable for Sheetz than gasoline, with margins of up to 40%, compared with about 5% for gas.
Sheetz makes its entire menu available 24 hours a day rather than segmenting breakfast, lunch and dinner. The CEO says such flexibility is particularly appealing to customers in their mid-teens to mid-30s, who have been defecting from places like McDonald’s.
Click here to read the complete WSJ story.
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