Acquisition brings fresh vision to New Distributing, Cimarron Express.
When New Distributing Co., a family-owned c-store operation in Victoria, Texas, added three new locations last November to its existing six, it knew exactly what it was buying into: foodservice expertise.
The Cimarron stores the company purchased were part of another familyowned operation, this one with 25 years of experience in running full-service bakeries. Combined with New Distributing’s 60 years perfecting Shell, Conoco, Phillips 66 and Valero Fastop stores, it might just be a recipe for success.
Mike Ross, New Distributing’s general manager, has been in the c-store business for 32 years. For the past six months, he has worked alongside Sandra Valdez and other employees who stayed on when Cimarron store ownership changed. Valdez has spent the past 18 years working for Cimarron and now manages a 2,400-square-foot Cimarron Express, which is fronted by the Shell brand with six fueling positions in an affluent Victoria neighborhood.
“I was very emotional with the switch, but I love this company,” Valdez says. “I’m thankful to them that they include me in a lot of decision making.”
Ross is thankful for what Valdez offers. “The first change we made was to make no changes at all,” says Ross, who thought it important to observe what worked before any adjustments were made to the new stores. “We considered rebranding the stores, but the Cimarron reputation is already strong. Now we just tag our Fastops and Cimarrons as ‘Victoria’s Hometown Convenience Stores.’ ”
Cimarron Express is part of a new chapter for New Distributing—a foodservice chapter. “Everyone sells Pepsi and everyone sells Frito-Lay,” Ross says. “What else can you give them to make your store a destination?”
Baked goods, for starters. The Cimarron Express bakery accounts for roughly 35% of total inside sales. In a typical week in 2012, the store brought in $48,000, one-third of which came from cookies, cakes, pies and other freshly baked treats.
Out of the Oven
They call it a full-service bakery, and do they mean it: They sell everything from doughnuts to wedding cakes, all made on site. Goods are even shipped across the globe. The first thing you see to your right when you walk in the store is a large bakery case between the two registers. Microwaves behind the registers can warm bakery purchases at customers’ requests. Also behind the registers is a holding area for preordered party trays, cakes and dozens of cookies and cupcakes. Iced sugar cookies, decorated in many varieties, are the most popular preordered item. To the left of the entrance is a revolving 6-foot refrigerated case filled with ready-to-purchase cheesecakes, Italian cream cakes and pies.
Also to the left of the store is a 20-square-foot deli case stocked with items such as homemade banana pudding, Jell-O, and red velvet and German cupcakes. Nearby is an 8-foot open-air deli case displaying premade sandwiches, salads and fruit bowls. A 12-foot-by-4-foot tabletop offers more baked goods, including pecan sandies, homemade bread and trail mix. The chain plans to double the display space of baked goods to 96 square feet via multi-tiered shelving.
Each Cimarron location has some kind of similar on-site bakery, and Ross plans to have the sites provide baked goods to the Fastop locations. And Ross is keeping a close eye on Cimarron Express’ other assets: a 4-foot gondola of automotive products; locally made Linda’s Candles and air fresheners, which bring in about $3,000 each month; and 24 feet of ice cream. Cimarron Express has become a local destination for Texas favorite Blue Bell. There’s plenty to observe, learn and apply to other stores.
“We’re going to continue to remerchandise all three stores and we’re going to continue to tweak our product offering to meet customer needs,” Ross says. “We brought our expertise on the c-store side to the Cimarron locations, and we do plan on taking Cimarron’s foodservice expertise and implementing it in the Fastop locations.” Ross has begun to make a few changes and has already seen some early results. He implemented a multipack cigarette and tobacco promotion in Cimarron Express that has worked well in the Fastop stores; tobacco margins are trending upward.
He also plans to add propane and money orders to the Cimarron stores, and is currently in the process of bringing some baked goods and Cimarron sandwiches to Fastop. The addition of these three stores has other benefits. New Distributing now has enough stores to get a competitive advantage on pricing from distributors, but not so many as to make business inflexible. “At a large company you have to go through layers and layers for a single development,” Ross says, “but we can effect change immediately. We can do things at a single site or all nine locations. We can implement changes in a single day, and if we see something that’s not working, we can go to Plan B right away.”
This new partnership has lots cookin’, and Ross has high hopes that the finished product will be sweet. “I’m certain,” he says, “all our locations will benefit from all.”
Kickback Points Kick Off Succsess
“We’re not the cheapest c-store in town, but our new loyalty program allows us to give back to the customer,” says Mike Ross, New Distributing’s general manager. “The program has been extremely successful for us. It shows that a smaller company can do loyalty and do it well.” Some details of the program:
- New Distributing implemented the Kickback Points program through Conoco in its six original stores.
- The company issued 57,000 loyalty cards in a town of 63,000 people.
- 80% of the points issued have been redeemed.
- Gallons have been up by double digits for almost a year since the program’s implementation.
- Plans are in place to expand the loyalty concept to the new Cimarron stores.