C-Stores Recapture Coffee

Published in CSP Daily News

Exclusive study shows highest sales since 2008

By  Mitch Morrison, Vice President & Group Editor

NEW YORK --  The convenience channel's continued efforts to upgrade its coffee offering--considered by many the gateway to any successful breakfast foodservice offer--is paying dividends.

In data obtained exclusively by CSP Daily News, the convenience store industry reported its highest coffee sales in five years.

A report by foodservice market research specialists StudyLogic, Long Island, N.Y., shows 2012 net coffee sales at more than $2.85 billion, placing it third in total coffee volume, behind coffee shops and burger restaurants. (Coffee sales include brewed, espresso and blending services.)

"This is an exciting time for c-stores," said Samuel Nahmias, executive vice president and COO at StudyLogic. "For the first time in five years, c-stores are finally growing their total hot beverage unit sales after the economy fell in late 2008. We are now back and above historical unit consumption levels.

The report comes on the heels of an exclusive rankings report by StudyLogic that showed three c-store chains placing in the Top 10 in total U.S. coffee sales: 7-Eleven (fourth with 4.75% market share), and a virtual tie with Speedway and Wawa taking seventh and eighth with 1.55%.

As for the channel, c-stores reported a record high in total coffee sales with $2.8 billion in 2008, but then saw the numbers slide in 2009 to $2.66 billion during the height of the national recession and as several major QSRs and coffee shops, including McDonald's and Dunkin' Donuts, ramped up their offerings.

Looking at overall channel growth, the convenience channel, due in large part to the significant slide in 2009 and subsequent efforts to recapture lost sales, saw the smallest growth. According to StudyLogic, the convenience sector's total coffee growth since 2008 was only 2%, compared to nearly 15% growth for sandwich shops and 18.7% increase for coffee shops.

The only channel to actually lose coffee sales dollars over the past five years was pizza restaurants.

"C-stores are getting smarter about their coffee offerings with enhances beverage quality and new made-to-order platforms," Nahmias said. "Consumers are starting to recognize c-stores as another convenient source for a quality coffee beverage comparable to coffee shops."

By Mitch Morrison, Vice President & Group Editor
View More Articles By Mitch Morrison