Are partnerships between c-stores and fast food restaurants worth it?

The US is a big place. And you can’t fly everywhere easily. Driving is an essential part of the country.

As a “military brat”, I grew up in Italy and it was no different. Waking up early to beat traffic to go and stay with family or visit different bases, we would drive from one end of the country to the other (probably equivalent to crossing a state line in the US 😊).

Usually, we’d be getting hungry around noon.

In my moment of need, there never were great food options...except for a gas station. My nutritious lunches would include sub-par sandwiches, packets of chips and the inevitable candy bar.

I’ve been in the US for a long time now and whilst I experienced that when I first moved here, it’s amazing how much that has changed. Cheap snacks have been replaced with satisfying meals! 😍

We were talking to the great guys down at Winsight Media about how much the C-Store has evolved to partner up with fast food chains, beverage brands and- in some cases- have even developed their own food brands.

And this got me thinking. Is it better to co-brand or is it better to keep products in-house under a flagship brand?

What makes a good brand, anyway?

As a pricing software company, we talk a lot at EdgePetrol about why consumers visit gas stations and one of great sources of data that comes up is the NACS Consumer Fuels Survey, which tells us that “consumers are not as driven by price in 2020 (58%) as they were five years ago (71%)”.

Younger customers aged 18-34 (I fall in that bracket) choose where to fill their tanks based on what they want to purchase in the store. And twice as many consumers are stating they have a c-store or chain preference than eight years ago.

This is where a fast food restaurant synergy comes into play. Everyone knows Burger King, Mcdonalds, Wendy’s etc. In other words you know what you get. I’ve spoken to many friends who refuse to eat products made at a gas station because in their words “they wouldn’t eat lunch or dinner where they refuel” - it seems that stigma has not totally left the market.

This is why so many opt for a fast food franchise as people are more likely to trust what they are getting (even if it can be considered nutritionally equivalent to my sub-par sandwich and candy bar back in Italy).

What about In-house Brands?

Even though you probably agree with me that fast food places can, on paper, have huge synergy, it is strange to note that they haven’t actually impacted C-store profits in the US in the way you may expect. Many retailers are totally resistant to the idea. I could not wrap my head around this, but here is the issue: I was thinking in an outdated way.

When I considered gas station food, all I could think about is hotdogs, pizza slices and if I was lucky some chicken wings with a fountain drink or slushie (which I love by the way).

Nowadays though, this is simply not the case. Many gas stations are becoming literal restaurants with sleek and modern buildings.

One great example is WAWA. They were ahead of the curve in their strategic choices. Their food is appreciated by many and every time I’ve eaten there, quality has always been very good. One of our customers says they have a “cult following” and even he goes there to buy his hoagies (despite the fact he owns 15 of his own stores).

They understood early on that they needed to diversity their profits and invest in higher margin items such as quality hot food. WAWA started selling their in-house sandwiches in the mid 90’s, but many have just started transitioning into this segment. 

That is about a 25 year first mover advantage and in my opinion it paid off. I am one example, but in my case they are the only gas station I use Uber Eats on.

Both myself and our CRO Mark Truman consider ourselves big foodies. He was travelling around the US in 2019 when EdgePetrol decided to move into the market and he ate at a fair few gas stations along the way. He’s a sucker for ‘top-notch’ fast food like In-and-Out and Chick-Fil-A, but loves nothing more than a trip to Buc-ees. If you’ve never seen one of these stations it really is worth going to check them out. Not only is the hot food there awesome, but you can spend an hour in the store looking at everything they have to offer. Plus, they’ve got some great merchandise!

So, where is your favorite gas station to eat and what is your food of choice? Let us know at hello@edgepetrol.com and we’ll give you a mention in the follow up to this article.