C-store Update I’m from Washington DC and I’m here to help! August 16, 2012
ABOUT NACS The Association for Convenience & Fuel Retailing
The Association for Convenience & Fuel Retailing
About NACS Founded in 1961 More than 2,200 retail member companies • Operating more than 50,000 stores in the US • Operating more than 300,000 stores globally • Members in 44 countries • 47 of the 50 largest companies in the industry • Over 70% of our US members operate 10 or fewer stores • Increasingly diverse retail membership o Delta Sonic Car Wash, Kroger, Publix, Giant Eagle, Follett College Book Stores, TA Travel Centers, Colorado Café Associates, Home Depot, Army and Air Force Exchange Services, Marine Corps Exchange o Suncor, Quickie Convenience Stores, Topaz Energy Group, SPAR UK, Total, Emirates National Oil Co (ENOC), Pick n Pay, Seicomart, Family Mart|Famima, PetroChina, 7-Eleven Stores Pty. Ltd, JMEL, OXXO, Repsol, Ipiranga, YPF SA Approximately 1,600 supplier member companies The Association for Convenience & Fuel Retailing
NACS’ three pronged focus Knowledge Connections State of the Industry (SOI) The NACS Show Data through CSX SOI Summit Convenience Tracking THE Tech EVENT. Program (CTP) HR Forum NACS Consulting NACS Research NACS Leadership Forum NACS CAFÉ NACS Global Forum & Study Technology and payment Tours standards (PCATS) NACS Social Media Leadership Executive NACS International Program at Cornell Advocacy Educational products and programs Government Relations NACS Magazine & NACS Media Relations Daily NACS Help Desk The Association for Convenience & Fuel Retailing
ABOUT OUR INDUSTRY The Association for Convenience & Fuel Retailing
About our industry Our 148,126 stores equal more than all the other retail channels combined Over 93,000 of stores are run by single store operators • 2011 sales equaled $682 Billion USD We process about 162 million transactions per day 98% of Americans shop at c-stores once/month We sell 82% of the motor fuel sold in the U.S. We employee about 1,900,000 million workers on the retail side alone We have stores in every congressional district We are the mosaic of America • Every race, creed, gender, income, age The Association for Convenience & Fuel Retailing
Industry Store Count Single Stores All Others 160,000 145,119 146,294 144,875 144,541 146,341 148,126 138,205 140,655 140,000 132,424 130,659 124,516 54,917 54,526 55,611 55,162 55,308 54,492 119,751 56,081 53,435 120,000 54,029 54,615 56,904 59,876 100,000 80,000 60,000 93,209 91,815 90,683 89,957 89,567 90,049 84,770 84,574 78,395 76,044 67,612 59,875 40,000 20,000 - 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 The Association for Convenience & Fuel Retailing Source: Nielsen TDLinx, NACS Research
Dollars in Billions The Association for Convenience & Fuel Retailing $100.0 $200.0 $300.0 $400.0 $500.0 $600.0 $0.0 1981 Industry Sales 1982 1983 Inside Sales Motor Fuels Sales 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 $681.9 Billion 1998 Source: NACS State of the Industry Survey of 2011 Data & CSX, LLC. 1999 2000 2001 112.0 171.0 2002 181.3 109.3 2003 116.2 220.8 2004 132.1 262.6 2005 151.1 344.2 2006 163.6 405.8 2007 168.5 408.9 2008 173.9 450.2 2009 182.4 328.7 2010 190.4 385.2 2011 195.0 486.9
Same-Firm Sales Per Store/Per Month 2010 2011 % Change Total All Sales $390,499 $464,558 19.0% Fuel Sales $336,014 $427,097 27.1% Fuel Gallons 124,157 123,710 (0.4)% Average Selling Price $2.71 $3.45 27.6% In-Store Sales $125,116 $129,208 3.3% Foodservice Sales $21,155 $23,431 10.8% Merchandise Sales $104,979 $107,135 2.1% Mdse Less Cigarettes 2.3% $62,400 $63,804 Cigarettes (1.0)% $52,546 $52,045 The Association for Convenience & Fuel Retailing Source: NACS State of the Industry Survey of 2011 Data & CSX, LLC.
Same-Firm Gross Profit Per Store/Per Month 2010 2011 % Change Total Gross Profit $59,495 $63,411 6.6% Fuel $20,475 $22,759 11.2% In-Store $38,317 $39,880 4.1% Foodservice $11,030 $11,854 7.5% Merchandise $27,885 $28,660 2.8% Mdse Less Cigarettes 4.4% $21,228 $22,158 Cigarettes (2.6)% $7,774 $7,571 The Association for Convenience & Fuel Retailing Source: NACS State of the Industry Survey of 2011 Data & CSX, LLC.
In-Store Sales Contribution Average Monthly Sales = $128,187 3.1% All Other Alternative 7.61%, -0.7pts 1.74%, +0.1pts Cigarettes Milk 38.09%, -1.4pts 1.81%, +0.1pts Sweet 2.04%, +0.1pts Candy 2.75%, flat Salty 3.45%, +0.1pts OTP 4.04%, +0.1pts Beer 7.27%, +0.1pts Foodservice Pack Bev 16.86%, 14.34%, +0.9pts +0.6pts The Association for Convenience & Fuel Retailing Source: NACS State of the Industry Survey of 2011 Data & CSX, LLC.
In-Store GP Dollar Contribution Average Monthly Margin = $39,880 4.1% All Other Milk 10.88%, -0.5pts 1.40%, -0.3pts Sweet 2.18%, +0.2pts Alternative Foodservice 2.45%, flat 29.37%, +0.9pts OTP 4.08%, +0.1pts Salty 4.21%, +0.2pts Candy 4.44%, -0.1pts Beer 4.48%, -0.1pts Pack Bev Cigarettes 18.42%, +0.7pts 18.09%, -1.2pts The Association for Convenience & Fuel Retailing Source: NACS State of the Industry Survey of 2011 Data & CSX, LLC.
Credit Card Fees vs. Pretax Profit $12.0 $11.1B Card Fees Pretax Profit $11.0 Durbin shaved $90 Million in 2011 $10.0 $9.0 $9.0 $8.4 $7.6 $8.0 Billions of Dollars $7.0B $6.6 $7.4 $7.0 $6.6 $5.9 $6.0 $5.0 $5.4 $5.0 $5.2 $4.8 Transactions Card Costs $4.0 0% 4% $4.8 $4.0 $3.8 Fuel Cost $3.5 96% $3.0 $3.2 Card Cost Increase Detail $2.0 2003 2004 2005 2006 2007 2008 2009 2010 2011 The Association for Convenience & Fuel Retailing Source: NACS State of the Industry Survey of 2011 Data & CSX, LLC.
DURBIN SWIPE FEE UPDATE The Association for Convenience & Fuel Retailing
Durbin update Most of the Federal Reserve’s rules on debit swipe fees went into effect October 1, 2011 Those rules limit swipe fees on debit purchases made with cards issued by banks with more than $10 billion in assets The limits on these transactions now are 21 cents plus 0.05% of the transaction amount and a 1 cent fraud prevention adjustment versus the 7-12 cents the Fed research initially proposed According to the Fed, these limits mean the average fee being charged on covered debit transactions is 24 cents NACS believes the Fed mishandled the rule and did not follow the law as written. NACS along with NRF, FMI and NRA have sued the Fed over that issue The Association for Convenience & Fuel Retailing
Durbin update So does Senator Dick Durbin On May 10 th Senator Durbin files a friend of the court brief • “In its efforts to accommodate the banks, the board’s Final Rule failed in several respects to follow the law. As the plaintiffs have correctly argued, the board’s final rule making exceeded the statutory authority that Congress gave the board,” Durbin argued in the brief. Congress is now through addressing debit cards – that is up to the Court and the Fed. In the meantime, VISA and MasterCard announce new “Card Association Fees” putting the Department of Justice on alert… Our friend Senator Dick Durbin The Association for Convenience & Fuel Retailing
Durbin update VISA’s new fees: • A Transaction Integrity Fee (new, post-Durbin) • Revisions to its Network Acquirer Processing Fee (old, slight reduction of ½ penny per transaction) • A Fixed Acquirer Network Fee (FANF; new, post-Durbin) MasterCard’s new fees: • Annual License and Registration Fee (new, post-Durbin) • Annual Type III Third Party Processor (TPP) Registration Fee (new, post- Durbin) The Association for Convenience & Fuel Retailing
Durbin update Congress has never taken action on credit card swipe fees which remain too high. Now we are educating Members of Congress about credit card swipe fees and convincing them that reform is needed. We must push our message everywhere we can – in the press and directly to the industry – in order to get some relief on the credit card front. The Association for Convenience & Fuel Retailing
FDA UPDATE The Association for Convenience & Fuel Retailing
How the public feels “This act expands bureaucracy,” “The bill will increase taxes on Americans” “It expands the authority of an inefficient agency (FDA) already struggling with the approval process for, and monitoring of, existing drugs.” “The Act will distract the FDA from its core mission of approving safe and effective products – a standard unachievable by any tobacco product.” The Association for Convenience & Fuel Retailing
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