The traditional concept of three meals a day is largely gone, as on-the-go lifestyles and demographic shifts—not to mention the increase in snacking—have changed when meals are consumed. Understanding how and why eating occasions are changing can have a profound impact on convenience store sales over the next five years and beyond.

“You’re increasingly seeing the (c-store) industry move from a gas station that, oh, by the way, has food, to a restaurant that, oh, by the way, has the opportunity for a fill up or a charge.”

—August 19, 2024, MarketPlace article, “When Did Convenience Store Food Get Better?”

“By tempting customers’ palates with fresh deli sandwiches and build-your-own burgers, the humble food marts want to become an alternative to fast-food restaurants for busy Americans who crave easy, interesting and less expensive eating options.”

—October 20, 2024, Associated Press article, “Will U.S. Convenience Stores Find the Secret to Selling Better Food?”

These mainstream news stories are telling a broader audience beyond the industry what loyal c-store customers already know: Convenience stores are increasingly leading with their foodservice offer.

Because of the industry’s focus on redefining its offer, foodservice has more than doubled its share of in-store sales in the past two decades—from 13.1% in 2003 to 26.7% in 2023, according to NACS State of the Industry data.

This 20-year journey was made possible because of innovation in the kitchens of c-stores across the country that have figured out how to offer tasty, fast and affordable options.

Whether foodservice will again double its percentage of sales, and if so how quickly, will depend on how retailers navigate emerging trends and their continued excellence at addressing the food-focused needs of their customers.

A NACS survey conducted in late 2024 of convenience store customers explored four areas:

1. Consumer sentiment about their finances and the economy

2. Personal preferences for healthy options

3. The change in meal occasions

4. How the c-store foodservice offer meets—or in some cases, doesn’t meet—consumer expectations

They’re Feeling Okay-ish

As any retailer knows, happy consumers are much more likely to spend money than those who are concerned about their finances. With the 2024 election now in the rearview mirror, consumers are marginally more optimistic about the state of the economy than they were in January 2024 prior to the election. However, there is a lot of things that worry Americans, and that should be cause for concern for any retailer.

Consumers are extremely stressed about their finances: More than one in three (35%) say they worry about their finances “all the time.” Women are much more likely than men to worry about their finances “all the time” (40% vs. 29%). The age demographic that most worries all the time about finances are those ages 35 to 49 (40%).

Concerns over finances are clearly tied to the inflation/cost of living issue that played a central role in the 2024 election. When asked in their own words to name the most important issue facing the country or facing their own communities, inflation/cost of living took the top spot, followed closely by the related issue of economy/jobs. Combined, these issues are far ahead of the next biggest concern of consumers: immigration (at the national level) and crime (at the local level).

Despite their concerns about finances, consumer optimism about the economy has grown over the past two years, with a bare majority now tilting towards optimism.

The enormous swing in optimism since 2023 likely has a direct tie to gas prices. At the time of this survey, gas prices were around $3 per gallon. But in early 2023, the memory of $5-plus gas in the summer of 2022 was still fresh in the minds of the consumer—and 87% of consumers say that gas prices affect their feelings about the economy.

One last point on gas prices. Consumers are uncertain whether the results of the 2024 election will significantly change gas prices—or inflation and prices of other everyday goods and services overall. However, they are inclined to believe that the election result will improve the stock market and the overall economy.

Healthy OptionsAre a Great Option

Finances are unquestionably the top concern of consumers, but health is their second biggest concern.

That said, consumers offer mixed signals for their concern with their health affects their food purchases.

Consumers say that they should be eating healthier, but at the same time they say they are eating a healthy diet. The way to reconcile those two statements is related to conviction. While roughly half of all consumers (49%) agree with the statement that they eat a healthy diet, only 15% “strongly agree” with that statement.

It’s how you message to these consumers that will be important. Are you seen as encouraging them to try something new—or are you seen as making them feel guilty about their choices?

Goodbye Three Square Meals

The typical American convenience store customer is eating two meals a day, with breakfast being the meal most often skipped. By contrast, the most common main meal is dinner, which is most routinely eaten at home. Taken together, that means the big immediate opportunity for c-stores is lunch and snacks, including before and/or after lunch.

Who eats out? Not surprisingly, younger consumers ages 18-34. On weekdays, one in five (20%) say they eat dinner out and more than two in five (41%) say they eat lunch out. On weekends, they are even more likely to eat lunch out (30%) and roughly the same amount eat dinner out (38%) as on weekdays.

Dinner is not often seen as an opportunity for c-stores or QSRs due to the fact that it is typically the meal that most often involves the entire family. However, there may be opportunities for retailers who position their offer toward individuals, as opposed to families, especially since younger consumers are most likely to be single—and eat dinner out.

Snacking, meanwhile, is another great opportunity. Snacks may function as a meal of sorts for consumers who graze instead of eating a standard meal. Given that more than three in four consumers (76%) snack at least once a day, there is plenty of opportunity to tell them how your snack options—healthy or otherwise—might mesh with their desire for snacking

They Like You … Most of the Time

Customers have embraced convenience stores and their food offer. Nearly one in five (19%) visit a convenience store at least every day as part of a meal occasion.

To continue to grow foodservice sales, c-stores will need to both expand their customer base and keep current customers amid a highly competitive marketplace. Do c-stores meet customer needs for food—and if they fall short, where?

The great news is that only 9% of customers say their last c-store experience fell short of expectations in terms of getting what they needed.

For customers who weren’t able to accomplish everything they wanted, product availability was most often cited—either the item desired was out of stock or not carried by the store.

A bigger concern is that whether they are satisfied or not, a sizable percentage of c-store customers immediately go to another store on a foodservice mission.

Why are they going somewhere else? The good news is that it’s largely not because of operations issues like cleanliness or customer service.

Instead, they are going somewhere else out of a desire for a specific food offering. They wanted a specific food place (like McDonald’s or some other desired brand), better options (more healthy options?) or product availability (out of stocks or a limited menu). In short, a majority of these customers are going to another place to get food because the offering at a particular c-store didn’t fully meet their needs.

Your Opportunities

Convenience stores have scooped up a sizable percentage of foodservice sales that used to belong to quick-serve restaurants. But QSRs are not sitting by idly, and they have aggressively sought out opportunities to steal back sales—by focusing more on late-night sales and even snacking.

What can convenience stores do to continue to grow their foodservice sales?

First, have the conversation with your customer before they step inside the store, whether on your app or your gas dispensers. Nearly half (43%) of all customers say the main reason that they stopped at a store was to buy gas. That’s more than said they went to get food or a beverage combined.

While most customers already have a good idea of what they want to purchase as soon as they walk inside the store, about one in three customers are open to trying something new—and that’s a huge opportunity.

Find different ways to present your products to consumers that address both their needs and concerns.

• What is your message and offer that provides value, appealing to financial concerns?

• How can you present healthy options—whether prepared or packaged items—in a way customers want to receive them?

• Can you help them redefine snacks as meals—or vice versa? It may be as simple as calling out products as meals, like labeling a section of health bars as “great for breakfast.”

2025 brings a new year of opportunities for convenience stores and their post-election, post-pandemic customers. Successful operators who connect the dots between their in-store offering and customer desires will be poised for continued success in the short and long term.