Developing a Store of the FutureJun 26, 2023
Change is inevitable.
We change where we live; we change relationships; and we change our jobs. Change has been with us throughout time, but the worldwide pandemic seemed to put change on hyperdrive. Every timeline became compressed and long-term trends seemingly happened overnight. It was and still is, shifting paradigms at an accelerated pace.
So how do we react to change when it comes to designing a new store to address changing consumers? Developing a Store-of-the-Future takes a lot of thought to consider all the potential elements that should be included in a go-forward operation. Some may be “need to have” to survive while others may be “nice to have”. A lot will depend on your location, the competition, the consumer and quite candidly, the amount of capital you can afford to spend.
Six major areas seem to be percolating change all at the same time including: 1) product expansions; 2) technology enhancements; 3) service improvements; 4) product acquisition methods; 5) improved operational efficiencies; and 6) overall store design. Addressing all of these can be daunting, but taking a holistic view of a Store-of-the-Future will allow you to not only survive but to set yourself up for long term prosperity.
Here is a deeper dive:
- Product expansion – Foodservice has become a must-have in the c-store world, and we are not talking about a frozen burrito nuked in a microwave. Expanding into foodservice can present several options from simply renting your space to a branded foodservice franchise operator (i.e., Subway); becoming a branded franchisee yourself; or going the “fully Monty” and developing your own proprietary foodservice operation. In the latter, you will need to determine whether you are MTO (Made-to-Order) or Grab-n-Go (or both). Every part of the proprietary food operation must be developed by you from the menu to equipment to operational procedures and marketing.
- Technology enhancements – Armed with the latest smart phone, today’s consumers are becoming more and more tech savvy. The comfort level in pre-ordering via an app; using self-checkout; and customizing their order through customer-facing kiosks is becoming more commonplace. C-stores need to raise the bar in their locations regarding technology or the consumer will seek the path of least resistance in their patronage. Lastly, technology solutions should be integrated into store operations to create efficiencies, manage labor, and improve throughput.
- Service improvements – Expanding services keeps the convenience store industry relevant and prosperous in the future. Like it or not, the world is becoming more electric and accommodating EV’s at your existing location must be a consideration. Simply adding a charging station is the least common denominator in the equation – giving the consumer something of value for the 30+ minutes they will have to wait for their car to charge is another thing. If you think the consumer will be content walking the aisles in your c-store for 30 minutes, think again. On the other hand, providing them with a credible foodservice option complete with a seating area where than can connect to Wi-Fi and work for 30 minutes is an attractive proposition.
- Product Acquisition Options – The pandemic manifested several ideas on how customers can get to the products that they want. In a matter of months, c-stores were offering pick-up, carryout and delivery options for their customers. Many of these options were implemented outside of the convenience store industry as well so the consumer has become accustomed to these product options. As the acceptance curve continues, more and more options continue to emerge such as drive-thrus and mobile trucks. Store-of-the-Future designs should consider some, if not all, of these options.
- Improved Operational Efficiencies – A new store design should include accommodating improved store flow to capitalize on the above product acquisition options. If you skew more toward pick-up and delivery, have you accounted for queuing areas? If you are adding a drive-thru, what items are included and how to you efficiently assemble these without having to traverse the entire store each time? As you determine the attributes of your Store-of-the-Future, it is vital that operational considerations are considered along the way.
- Overall Store Design – Lastly, designing the new location should combine material choices and amenities that are pleasant on the consumer eye to create loyalty. I think we can all agree that Starbucks has raised the bar of their coffee offering, not simply for the product, but for the surroundings that their customers enjoy will drinking their product. If your c-store still looks like a typical c-store, you run the risk of having customers seek better environmental options. Coffee is a commodity at its heart but can become much more than that when placed in an elevated environment.
So, where do you start to create a Store-of-the-Future? I like to approach these projects with a four-part process – keeping in mind that each phase contains many subsets:
- Phase 1 – Project planning
- Determine QSR and Branded Partners
- Develop a Business Plan and Proforma
- Transitional planning
- Phase 2 – Develop the Site Attributes
- Site Plan development
- Space Planning and Equipment
- C-store and Foodservice Branding
- Menu Development (if proprietary food)
- Phase 3 – Put the Plan into Action
- C-store Design
- Foodservice Design
- Packaging Development
- Uniforms Development
- Phase 4 – Operationalize the Location
- Determine Suppliers
- Integrate the Technology Solutions
- Address Operational Procedures
- Develop Marketing Strategies
- Consult with Builders
In summary, developing a Store-of-the-Future used to be an aspirational exercise to put your best foot forward. In today’s post-pandemic world, with so many consumer thought-processes being upended, it has become an item of necessity to remain relevant. This should present a sense of urgency for your team while at the same time be very exciting to be able to address many operational and design changes in one full swoop. It is time to look forward!