COVID-19's Impact on Convenience Stores - What to Expect 4/3
As increasing numbers of states have issued stay-at-home orders, we’ve continued to track emerging trends in convenience retail. Not surprisingly, the industry has faced challenges alongside the entire market. However, with an “essential” business status and a stock of critical supplies close to home, convenience retailers have the chance to emerge as key players in this crisis. Similarly, there may be an opportunity for convenience retailers to stock their stores with new types of in-demand items that were traditionally offered by non-essential stores that have closed.
And while changing consumer demand has put new strains on supply chains, the US Food and Drug Administration has updated procedures to ensure that the foodservice supply chain continues to deliver.
See below for a few key highlights this week:
Average Weekly Revenue per Store
Convenience stores continue to feel the effects of the stay-at-home orders. During March, revenue per store decreased by an average of 6.5% and 14.5% per week for in-store purchases and fuel, respectively. This is the first time this year that average in-store sales have exceeded fuel sales. We can attribute this change to falling gas prices and decreased travel as a result of the coronavirus.
Total Toilet Paper Sales
Convenience stores saw a massive spike in Scott’s toilet paper sales in the days surrounding the national health emergency announcement, with total toilet paper transactions increasing from around 300 to 1,300 per day on 3/13/20. The number of rolls purchased per visit also increased from around two rolls to seven rolls per purchase. Although the number of transactions have slowed over the past couple weeks, the number of rolls purchased per visit has not, indicating that people are still stocking up when inventory is available.
% Change in Gallons of Gasoline
As of March 16th, national fuel consumption is down on average 28% from the first week of January. States with over 10,000 cases are seeing the most drastic decreases, with New Jersey, Michigan, and California all reporting a 48-58% decrease in demand for fuel.
If there is anything we’ve learned, it’s that we’re amidst very unpredictable times. As consumer behavior continues to change, retailers are positioned as a close-to-home, go-to option for essential shopping in their local communities.
We will continue to provide updates as the weeks progress.