The breakfast menu came after field research with both c-store retailers and their consumers to determine “in a c-store environment, what would make a perfect QSR experience?”, Schultz Hartgrove, senior vice president of convenience development for Quiznos, told CSP Daily News.

The company realized it was missing a strong breakfast menu to complement the retailer’s coffee program and draw that desirable a.m. customer—which, said Hartgrove, c-stores have “abdicated” to McDonald’s, Dunkin’ Donuts and other QSRs. Regardless of how strong a c-store’s coffee is, he says, “the consumer is only going to stop once.”

The new menu includes a warm cinnamon roll with caramel topping and a sausage biscuit sandwich. The convenience-centric items join the Breakfast Sammie, a traditional Quiznos sub with eggs and ham or sausage.

The new breakfast platform requires no new equipment for operators, and Hartgrove said it could potentially be rolled out to traditional locations that are in densely populated areas with heavy foot traffic.

“We feel this has really big growth [potential], but we don’t see this going to all stores,” he said.

The suggested price point for the breakfast items range from $2.29 to $2.79—low enough for customers to get a food item and a cup of coffee for under $5, said Hartgrove.

“Convenience and breakfast are interlinked, and we wanted to address that from not only the operator standpoint, but the consumer standpoint as well,” he added.

Up next, Quiznos is planning to add a grab-and-go platform for its c-store locations. The cold-sandwich format will give retailers the opportunity to offer pre-made sandwiches in off-hours or for hurried customers without going through a third-party vendor. The platform is expected to launch in the second quarter.

Related reading at CSP:  Quiznos Courting C-Stores

The bad news is a double whammy is impacting convenience retailers’ sales and margins in this all-important area of the store. With unemployment at record highs, once-core customers are out of work and no longer making their usual morning commutes — or their daily java stops. Coupled with that is the increasing coffee competition c-stores are facing from quick-service restaurants, doughnut shops and gourmet coffee houses.

The good news, though, is c-stores are holding their own. Coffee servings across all U.S. convenience stores were up 2 percent in 2009 vs. the prior year, and the channel is holding steady in its share of total restaurant coffee servings. In 2009, c-stores held an 8 percent share of brewed coffee servings, and a 9 percent share of specialty coffee servings, according to market research company The NPD Group. That’s compared to c-stores’ 2008 share of 9 percent brewed, and 8 percent specialty.

“We’ve got our challenges cut out for us,” said Bonnie Riggs, NPD’s restaurant industry analyst. “We’re going through the most prolonged downtrend ever seen in the restaurant industry. But c-stores are holding up better than others. C-stores have done some pretty aggressive promoting of their products — specifically foodservice and beverages — and they will have to continue to do so; the forecast [for 2010] is more of the same.”

In spite of all the negative projections, Brian Matlock, director of foodservice for Rockland, Mass.-based Tedeschi Food Shops, is optimistic. He said the chain had a great year in 2009, and he expects an even better performance this year. “Of course, we can’t let our guard down for a second,” he said. “This isn’t the time for complacency.”

That’s why for the last year, the 189-store convenience retailer has taken “a back-to-basics approach” in its coffee program execution, narrowing the offering and focusing on quality and consistency. Currently, 161 Tedeschi Food Shops have a Green Mountain-branded program, while the rest feature either Honey Dew Donuts or Dunkin’ Donuts.

“We gave managers flexibility in bringing in products, but some stores had 16 to 17 coffee varieties [going at one time],” Matlock explained. In April 2009, the chain narrowed the program to eight core varieties, with a focus on light, premium and dark roast blends.

“Sometimes, less is more,” he noted. “When we looked at the demographics for our markets, it was apparent that six out of 10 people coming in for coffee were looking for a core blend. The rest was being divided between decaf and flavored.”

In addition to SKU adjustments, Tedeschi Food Shops concentrated on improving quality and consistency by re-energizing its foodservice training programs and reworking the company’s standards manual and store-level checklists for the coffee section. The changes made are showing some success so far, according to Matlock.

“We have been able to maintain our market share in coffee, and that was key for us. A lot of our competitors were deep discounting last year. There was a time when some were selling their coffee below 99 cents, others were at 79 cents and some were even giving it away. We were able to hold our market share in cup sales despite this, so I look at it as a win for us,” he said. “If your offering is compelling enough — if you have what the customer wants — you don’t have to deep discount to drive volume.”

Like Tedeschi Food Shops, 31-store NOCO Energy Corp., based in Tonawanda, N.Y., is feeling the heat from competitors, specifically Dunkin’ Donuts and Tim Horton’s.

Terry Messmer, director of merchandising for the chain’s NOCO Express convenience stores, said a new coffee shop seems to be popping up on every corner. “We’re in a highly competitive market, and that’s our biggest struggle,” he explained. “It seems every day a new Tim Horton’s is opening up here.”

Read more at: Convenience Store News

Restaurants and Institution Magazine reports that Dunkin’ Donuts, America’s favorite every day, all-day stop for coffee and baked goods, announced today the signing of a multi-unit store development agreement with Roadrunner Markets for seven new restaurants in Tri-Cities, TN and the surrounding areas of Northeast Tennessee and Southwest Virginia. The first two locations are anticipated to open in 2011 and the remainder by 2015. Dunkin’ Donuts development in Tri-Cities is part of a steady and strategic growth strategy, which includes expanding in existing markets while entering new cities across the country to help drive the leading coffee and bakery chain’s growth.

Roadrunner Markets currently operates 90 convenience stores under the Shell, BP, Chevron and Sunoco brands. The principals of the company have extensive experience in the development, acquisition, construction and operation of convenience stores in the states of Tennessee, Virginia, North Carolina and South Carolina. In addition, they have negotiated contracts, developed space and acted as landlord for 16 fast food franchises.

“We are excited to expand our portfolio to include Dunkin’ Donuts and look forward to playing an important role in the daily lives of people who live and work in the Tri-Cities community,” said Ryan Broyles, president, Roadrunner Markets.

This development agreement sells out Tri-Cities for future franchise sales, however, franchising opportunities are still available in a variety of cities in the U.S. within the Midwest, Mid-Atlantic and the Southeast. Opportunities also exist throughout Florida, Georgia, Washington, DC, Illinois and Michigan, among other states.

To drive its expansion efforts, Dunkin’ Donuts has aligned its strategy to support the growth opportunities and consumer needs of individual markets. As a result, the company continues to expand with single and multi-unit opportunities with no minimum unit requirements.

Ideally, franchisees should possess a minimum net worth of $500,000 and liquid assets of at least $250,000, but financial qualifications will vary based on the opportunity available by market. This evolution of Dunkin’ Donuts’ franchise sales effort enables the brand to expand in markets more aggressively, while balancing its market penetration and maturity.

“Dunkin’ Donuts is excited to expand its footprint in Tri-Cities with Roadrunner Markets,” said Grant Benson, CFE, vice president of franchising and market planning, Dunkin’ Brands, Inc. “Our secret to success is our passionate franchisees that provide a high-level of customer service to our customers everyday, and we’re confident Ryan and his team will grow and prosper in Tri-Cities.”

Building a solid network of stores within a market enables Dunkin’ Donuts to invest in a distribution model that provides a consistent, high-quality product customers expect “in the way and on the way” of their daily routines. In an effort to keep the brand fresh and competitive, Dunkin’ Donuts offers flexible concepts for any real estate format including free-standing stores, end caps, in-line sites, gas and convenience, travel plazas, universities, as well as other retail environments.

According to Benson, “Dunkin’ Donuts is proud to energize Americans and keep the honest, hard-working, value-driven people of this country running every day. Our recent and ongoing menu enhancements meet the needs of today’s on-the-go consumers, moving Dunkin’ Donuts beyond breakfast with high-quality food and beverage items available all day.”

Historically a doughnut and hot coffee chain, Dunkin’ Donuts has expanded its offering to include frozen and iced beverages, a full bakery assortment including bagels and muffins, breakfast sandwiches, and an all-day Oven-Toasted menu which includes flatbread sandwiches, hash browns and buttermilk biscuits. The new platform marks the most significant change to Dunkin’ Donuts product lineup since the company launched espresso-based beverages in 2003.

For your information Circle K is also owns approximately  14 Dunkin Donuts Franchises in the Cleveland Ohio Area

Convenience Store News reports:

Circle K currently boasts more than 450 convenience stores in Florida, which the retailer said bring convenience and quality products to the marketplace, offering a one-of-a-kind shopping experience designed for today’s on-the-go consumer.

In a news release issued yesterday, Circle K noted its stores have established a long-standing tradition of convenience and quality that drives traffic, creates customer loyalty and provides an unparalleled retail opportunity for potential franchisees.

“Circle K is committed to building long-term value for franchisees by offering one of the most competitive retailing systems in the world,” Lisa Geyer, director of franchise development and operations for the company, said in a statement.

According to the franchisor, Circle K’s leading position in the Florida market creates a host of efficiencies, such as marketing, financing, support and training for franchisees. Franchising with Circle K provides c-store operators brand recognition and superior buying power. In addition, the Circle K Franchise Program offers proven business systems, extensive training and effective promotional tools. The ongoing business support and expertise of the Circle K staff, combined with the heritage of more than half a century in the c-store industry, bring franchisees “the Circle K advantage.”

The Circle K brand has been owned by Alimentation Couche-Tard Inc. since 2003 and manages more than 4,000 stores nationwide. Circle K franchise stores account for 800-plus sites in the United States. Outside the U.S., there are nearly 4,000 Circle K stores in Hong Kong, Indonesia, Mexico and Japan.

“Our stores appeal to the neighborhood shopper filling in last-minute needs, the passer-by wanting a hot coffee and a snack, or the traveler craving a cold drink and hot dog,” Geyer stated. “We recognize that regional, national and even international market needs vary, and Circle K has been able to successfully tailor our brand strategy to address the cultural identities in the many marketplaces in which we compete.”

Anna Huddleston reports in Las Vegas Business Press that while other retailers are scrapping growth plans, the $624 billion convenience-store industry is getting even more aggressive in pursuit of new markets.

7-Eleven recently announced plans to add 200 stores nationwide by the end of the year. Drugstore chain Walgreens is refurbishing its stores to sell liquor and wine. Las Vegas chains are adding properties as the weak commercial real estate market opens new areas and technology makes it easier to tailor inventory to each store.

From brand-name coffee to signature products, the idea is not to just sell time (the average shopping experience is less than four minutes) but to make this pit stop part of daily routine.

 Co-owner Gary Yousef takes inventory at his All Star Mini Mart convenience store on Jones Boulevard in Las Vegas. Convenience stores say they are thriving in Las Vegas and across the nation during the economic downturn.

“Convenience stores have changed a lot in the last couple of years,” said Michael Lawshe, president of retail design firm Paragon Solutions. “We are getting more into quick consumable foods and less into grocery lines. It’s almost like a consolidation of consumer preferences, a hybrid of a fast-food chain and a convenience store melted together to offer everything you want.”

Convenience-store industry leaders will be in Las Vegas to discuss this and other trends from Oct. 20-23 at the National Association of Convenience Stores expo at the Las Vegas Convention Center.

Lawshe recently worked with Green Valley Grocery, a Las Vegas-based convenience store and gasoline station chain that remodeled some of its existing 41 stores as well as opened a prototype store that could qualify for a Leadership in Energy and Environmental Design certification. Green Valley Grocery has at least four new stores in the works.

Las Vegas-based City Stop convenience chain opened its 11th store last month and is under contract for a 12th. Sales have suffered as construction workers, a core customer base, lost jobs. And stores didn’t gain new patrons as homes went into foreclosure. However, thanks to fiscal responsibility early on, the crisis wasn’t as damaging as it could have been, and sales got back up in eight out of 10 stores this year.

“The first thing we did when we realized that we were facing difficult economic times was that we did everything possible to conserve cash and made sure we were as debt free as possible,” co-founder Jon Athey said. “That allowed us to reduce operating expenses and we didn’t have to lay off anybody.”

National convenience store franchisor 7-Eleven, based in Dallas, operates 164 stores in Las Vegas. It opened five new stores in 2009, with up to six in the planning stage.

“We have a very aggressive growth plan,” said Jim Girard, market manager for Las Vegas. “There are new opportunities in the recession because leasing is less expensive and we are in a strong position.”

One of the company’s new strategies in Las Vegas this year is business conversions. Struggling mom and pop stores join the franchise and the facility gets a $280,000 design and branding facelift. It’s a “win-win” situation because a conversion is significantly cheaper than opening a ground-up store and the store gets to leverage the brand, Girard said.

Revamping the food-service program is also a top priority, especially as cigarette sales continue to drop. Several other markets already have rolled out an expanded selection of hot foods that includes chicken wings and chicken tenders and oven-baked pizzas. Las Vegas will likely get this upgrade soon. The company already delivers salads and sandwiches daily.

“Customers are getting used to the perception that they can have a hot quality meal at a moderate price here,” Girard said.

The average convenience store has more than $20,000 a month in food-service sales, according to the National Association of Convenience Stores. This includes prepared food ($11,600 per month), hot dispensed beverages, such as coffee ($6,900 per month), commissary packaged sandwiches ($2,900 per month), cold dispensed beverages ($2,200 per month) and frozen dispensed beverages ($2,000 per month).

Read more at:  Las Vegas Business Press