Chicago Convenience in-store sales grew 4.9% in 2009, according to figures released Wednesday by the National Association of Convenience Stores. The figures were released at the annual NACS State of the Industry Summit.
While in-store sales rose to $182.4 billion, a sharp decline in gas prices led to a drop in motor fuels revenues for the industry The average price for a gallon of gas dropped 28.5% to $2.28 in 2009, and pulled down motor fuels revenues 26.9% to $328.7 billion. Still, motor fuels sales continue to dominate industry revenues, accounting for 68.4% of all sales dollars.
Overall, convenience store sales in 2009 were $511.1 billion. Industry profits fell 7.6% to $4.8 billion, but were still the fourth largest in the industry’s history.
“Our strong industry numbers show that our value proposition of convenience continues to resonate with consumers,” said NACS vice chairman of research Greg Parker, president and CEO of The Parker Cos., Savannah, Ga. “It is astounding that we have grown in-store sales during the worst economic downturn in more than half a century and it shows that our passionate focus on the customer may make us recession resistant.”
Credit-card fees continue to be the industry’s top pain point and second largest expense item -- behind only labor costs. While overall credit-card fees dropped 11.9% to $7.4 billion, the drop was significantly less than what would be expected with the drop in the industry’s revenue dollars. As a percentage of overall sales, credit card fees actually increased, from 1.35% to 1.45% of total industry sales dollars, factoring in all forms of payment, including cash and check. Total credit-card fees also surpassed overall convenience store industry profits for the fourth straight year.
Cigarettes once again led in-store sales, and increased share to 35.8% of in-store sales. The increase in sales dollars was driven by the $1 per pack increase in the federal tax on cigarettes that took effect in April 2009, as well as additional state tax increases.
Foodservice, which includes food prepared on site, commissary items and hot, cold and frozen dispensed beverages, continued to grow in 2009. It contributed 20.2% of overall industry profits.
More than 75% of in-store sales in convenience store s were from the top five categories: