business news in context, analysis with attitude

The Philadelphia Inquirer reports on the impact that the convenience store industry is having on the traditional grocery business…symbolized by the fact that Wawa, the dominant c-store company in the Philly area, has surpassed Safeway-owned Genuardi’s to move into third place in terms of market share. (Albertsons’ Acme Markets is first, and ShopRite is second.)

Wawa president Howard Stoeckel tells the paper that the chain “is drawing more customers in part because it has expanded or replaced some of its older stores, adding more parking and selling gasoline where it has the room to put in underground storage tanks.” And, he said, there’s the obvious - "People want speed of service and a simpler trip to the store," he said.

Of course, the shift in market position may say as much about Safeway as Wawa. Since Genuardi’s was acquired by Safeway in 2001, it has steadily lost share and volume, at least in part because of the parent company’s centralization policies, which moved buying decisions for the company to California. Lately, however, Safeway says it has been talking great pains to change that and localize management and decision-making.
KC's View:
The thing we’ve noticed about a number of the c-store chains that we’ve visited lately is that they seem extraordinarily facile about changing up their business model to appeal to consumers’ changing tastes. Look at companies like Wawa, Sheetz and Tiger Fuel, and you see companies that appear to understand the game that they’re playing.

This isn’t to suggest that these folks have it all figured out, or that they don’t face significant challenges. But they seem to be entering battle with their eyes open.

There is, of course, the ever-present possibility that Wal-Mart could decide to get into the c-store business, which would change everything. You never know.

Yesterday, by the way, we speculated that Wal-Mart could decide to get into the dollar store business at some point…and one MNB user wrote in to suggest that we are both delusional and paranoid.

Maybe. But as the wise man once said, even paranoid people have enemies.