A review of the gas station/convenience store industry
- The Gas Station/Convenience Store Industry?An Overview.
- Companies Competing in the Industry.
- QuikTrip Corporation.
- Love's Travel Stops & Country Stores.
- Summary of Competitors.
- Business Impact.
Consumers who purchase gasoline often choose suppliers based on both location and cost. While this combination ensures that many gas stations/convenience stores remain profitable over the long-term, some organizations operating in this industry have significant difficulty maintaining profit margins and profitability. With this in mind, this investigation considers a review of the gas station/convenience store industry.
While the central focus of this investigation is to provide an industry analysis of the gas station/convenience store industry, this research also considers companies in this industry that have been successful. In addition, the research addresses the most pervasive threats to success in the industry and recent problems that have prompted concern for investors. Finally, though a synthesis of all the information, this industry report provides clear recommendations for development in this industry.
[...] Summary of Competitors While it is quite evident that there are a number of regional and local organizations involved in the gas station/convenience store industry, with the exception of 7-Eleven, there are few dominant operators in the industry. In addition, research on these organizations shows that there are pervasive threats due to competition in the industry. Spiwak (2004) argues that threats due to competition have only been exacerbated in recent years as more companies?such as grocery stores and warehouse clubs are getting into the industry. [...]
[...] Despite the fact that the gas station/convenience store industry is one that is currently growing, the NACS goes on to note that while sales of motor fuel account for 66.5 percent of the revenues collected by organizations in this industry, low profit margins create a situation in which only 27.5 percent of motor fuel sales contribute to the gross profit of the organization. Given that 93.5 percent of all sales that take place in these organizations come from fuel sales, it is not surprising to find that the profit margins on products sold in the convenience stores must be kept relatively high. [...]