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Circle K Stores begin piloting Holiday’s grab-and-go concept

Screen Shot 2019-07-17 at 5.18.39 PMIt may appear that Alimentation Couche-Tard Inc. has hit the pause button on acquisition activity after a busy few years; however, the retailer is not standing still.

The Laval-based convenience store operator has had its plate full with the rebranding of its retail network to one new global Circle K brand and has been making progress integrating its last two acquisitions: San Antonio-based CST Brands Inc. and Bloomington, Minn.-based Holiday Stationstores Inc.

“The performance of same-store sales in the CST network, both in the U.S. and Canada, continued to be a strong network leader throughout the year,” Couche-Tard President and CEO Brian Hannasch reported during the company’s fourth-quarter fiscal year 2019 earnings call on July 10.

“In addition, the annual synergies run-rate surpassed Couche-Tard’s target of $215 million over the three years following the transaction — which is one year earlier than planned,” he noted.

These synergies resulted in reductions in operating, selling, administrative and general expenses; as well as improvements in road transportation fuel and merchandise distribution and supply costs, the company noted in its earnings release.

“I want to thank all of our team members directly involved in this impressive achievement, including our operations, shared services, finance and HR teams,” Hannasch said. “As we continue down this road, I am confident we’ll realize even more synergies.”

THE HOLIDAY PLAN

In the integration of the Holiday network, the CEO said several reverse-synergy initiatives are “well underway, with measurable results now impacting our bottom line in the broader network.”

Over the past year, several of Couche-Tard’s business units in North America have adopted best practices and products from Holiday. This includes the integration of Holiday’s private-label beef jerky line and its “Crispy” treats program, according to Hannasch.

Several business units also have implemented Holiday’s top-performing promotional offers. For instance, during the fourth quarter, most of the North American business units introduced the first wave of Holiday’s smart-value marketing program.

“Based on early results and limited SKU participation, this program looks to be capable of delivering significant return on incremental sales once fully implemented networkwide,” Hannasch said.

“We continue to work actively on integrating operational excellence programs from Holiday, including a key focus on a storefront tool that helps store managers have the resources and information they need in one place, in a well-structured and prioritized way, so that it can be effectively executed,” he continued.

Additionally, Couche-Tard recently began piloting Holiday’s grab-and-go foodservice concept in select markets. The pilot draws on the full array of Holiday’s food offers, including its menu assortment, equipment theater and operating model.

As of April 28, Couche-Tard’s network comprised 9,866 convenience stores throughout North America, including 8,629 stores with fuel. Its North American network consists of 19 business units, including 15 in the United States covering 48 states and four in Canada covering all 10 provinces. In addition, through CrossAmerica Partners LP, Couche-Tard supplies road transportation fuel under various brands to approximately 1,300 locations in the U.S.

In Europe, Couche-Tard operates a broad retail network across Scandinavia, Ireland, Poland, the Baltics and Russia through 10 business units. As of April 28, Couche-Tard’s European network comprised 2,709 stores.

In addition, under licensing agreements, more than 2,150 stores are operated under the Circle K banner in 15 other countries and territories, which brings the worldwide total network to more than 16,000 stores.

Originally published at Convenience Store News. 


What convenience store operators can learn from Amazon Go

Screen Shot 2019-05-13 at 10.29.53 PMIn September 2018, Amazon opened its fourth Amazon Go store, this time in Chicago.  If convenience store operators assumed there would be long lines of people eagerly awaiting the store opening, they would be wrong.

Instead, there was quite a bit of hesitancy among potential shoppers. Many just had too many questions and concerns about the store to rush right in.  Flashing through lots of minds were questions such as these:

  • How does the store work?
  • Will there be anyone there to help me?
  • Do I need a credit card or do they take cash?
  • Will I look like a fool trying to figure everything out?

Eventually, Chicagoans bought in.  According to the Chicago Tribune, they discovered a store selling “grab-and-go food items designed to let busy shoppers skip the checkout line, and just walk out.” In fact, Amazon calls the experience of shopping in these stores “walk out shopping.”

Walk out shopping begins as soon as someone enters the store, when they scan the Amazon Go app.  The app includes necessary shopper information, including the user’s credit card for charges.

However, a lot is going on behind the scenes that shoppers likely are not aware of, and Amazon has kept tight lips about much of the background technology in these outlets.

We do know that the when customers place something in their shopping basket or cart, motion detectors are triggered to charge the customer’s credit card account, but some other theoretical functions of the technology include:

  • Facial recognition software that maps a shopper’s facial expressions and records the moment when, for instance, a shopper’s face “lights up” upon seeing a product they like.
  • Evaluation of shopping patterns and habits, such as how long it takes shoppers to shop, whether most shoppers walk clockwise or counterclockwise through the store and why they shop as they do.
  • The determination of how often shoppers read food labels that  indicate the ingredients used to make the many grab-and-go food items marketed in the store.

So, what is really going on here?  Are these stores designed for shopping or collecting shopper data?  It appears it is some of both.

Determining how shoppers shop could help Amazon determine how many people must staff each store.  Technology also helps food service operators, especially those providing grab-and-go food items, to quickly learn which products makes a shopper’s face light up. If their product is greeted with a frown instead of a smile, it gives them an opportunity to do something about it.

For example, what if those frowns are because a food item has too much fat, cholesterol or sodium in it?

It is likely, over time, that convenience store operators will get more insight into the shopper data collected at these Amazon Go store locations.

The data collected will not only help Amazon, but convenience store operators as well. Operators will better understand how shoppers shop. If a shopper, for instance, disapproves of ingredients in a grab-and-go food item, operators can quickly and easily implement a recipe—and subsequent label—change with an assist from the store’s kitchen automation system.

Originally published at Convenience Store News. 


Back to basics: Amazon opens first Go store that accepts cash

Screen Shot 2019-05-13 at 9.59.51 PMAmazon launched its high-tech Go convenience store a year ago, where shoppers can pull items off the shelf and walk out.

Now it’s adding a decidedly low-tech feature: accepting cash.

Its new store that opened in New York City this month is the first Amazon Go store to do so. At its other shops, customers can only enter with an app that links to a credit card or an Amazon account.

The company, facing a backlash from those who believe cashless stores discriminate against the poor, confirmed last month that it was working on a way to accept dollar bills and coins.

In the new store, employees will swipe those who want to pay by cash through the turnstile entrance. After shoppers grab what they want off the shelves, an employee will scan each item with a mobile device, take the cash, give customers their change from a cash drawer and hand them a receipt.

Cameron Janes, who oversees Amazon’s stores, says the way it accepts cash could change in the future, but declined to give details.

“This is how we’re starting,” he says. “We’re going to learn from customers on what works and what doesn’t work and then iterate and improve it over time.”

A small but growing number of stores around the country have gone cash-free. But some activists and politicians say that discriminates against people who don’t have a bank account.

Philadelphia became the first city to ban cashless stores earlier this year, and New Jersey passed a statewide ban soon after. San Francisco will soon require brick-and-mortar retailers to take cash as payment, and a similar law is being considered in New York City.

It’s not clear how many shoppers will skip the app and want to pay by cash at Amazon Go. The New York store, the first in the city, is in Brookfield Place, a high-end shopping mall and office complex that houses a Gucci store and office workers from banks and credit card companies. Amazon expects many of its customers to be workers looking to pick up a lunchtime salad or sandwich, people who live in the area or tourists visiting the nearby World Trade Center.

A line quickly formed outside of the store Tuesday and Amazon employees were allowing shoppers and the curious inside only when others left.

Amazon didn’t say when its 11 other Go stores will start accepting cash.