What's Happening?
The National Association of Convenience Stores (NACS) has highlighted the need for convenience stores to diversify their revenue streams as fuel sales decline. At the 2025 NACS Show, Chris Rapanick, managing
director of research at NACS, emphasized the importance of improving business operations beyond fuel sales. In 2024, convenience stores saw a 5.7% decrease in fuel revenues, attributed to a 6.5% drop in average gas prices. Foodservice emerged as a key driver of sales, while tobacco and fuel struggled. Rapanick suggested that stores consider adding foodservice or car wash services to boost profitability.
Why It's Important?
The decline in fuel sales presents a significant challenge for convenience stores, which traditionally rely heavily on fuel revenue. As the industry faces changing consumer preferences and economic conditions, diversification becomes crucial for sustaining profitability. By expanding into foodservice and other areas, convenience stores can mitigate the impact of declining fuel sales and adapt to evolving market demands. This shift could lead to increased competition and innovation within the convenience store sector, potentially reshaping the industry landscape.
What's Next?
Convenience stores may explore various strategies to diversify their offerings, such as enhancing foodservice options or introducing subscription-based car wash services. Operators will need to focus on cutting operational expenses and improving employee retention to maintain profitability. The industry might also see increased investment in technology and customer engagement initiatives to attract and retain customers.
Beyond the Headlines
The push for diversification in convenience stores reflects broader trends in retail, where businesses are increasingly seeking to adapt to changing consumer behaviors and economic pressures. This development may lead to discussions on the future of retail and the role of convenience stores in providing essential services beyond traditional offerings.
