Double Trouble?

May 14, 2013

double-troubleTony Holmes had a problem: The drive thru at his high-traffic Chick-fil-A restaurant in Apex, North Carolina, was too crowded.

For nearly two years, he tried line busting with employees outside wearing headsets. Then he gave those employees handheld remote units to streamline ordering. Both methods helped alleviate the drive thru’s bottleneck, but there were other issues that technology and manpower couldn’t address.

So in November, Holmes installed a dual drive-thru lane.

“I recognized pretty early on from a volume standpoint that our drive thru had hit a lid, so to speak,” says Holmes, whose unit does an average 1,800 transactions a day. “We were at maximum capacity for lots of different reasons.”

The crowded, one-lane system was causing many customers to reach the dreaded turn-away point. “It’s an intuitive thing,” Holmes says. “People see that line and think, ‘I’m going to park and go inside,’ or ‘I’m going to go somewhere else.’”

A restaurant has a big problem if customers drive up and consider leaving, says Darren Tristano, executive vice president of Technomic, a restaurant consulting and research firm. “Every restaurant is marketing to get customers,” he says. “If you can’t manage them in an efficient manner, then you’ll lose that marketing effort, and you’re going to lose out on those customers. That is critically important to surviving today.”

Adam Noyes is the chief restaurant operations officer at Checkers/Rally’s. He says the chain is the biggest dual drive-thru concept in the country, with 85–90 percent of its locations featuring double drive thrus.

Noyes says that for operators who decide dual drive thrus are the best approach for their brand, it’s essential both lanes stay open during operating hours. “And if you’re going to have a double drive thru, you’ve got to have the technology, people systems, and training to be able to deliver on that experience,” he says. He adds that there is a learning curve for both staff and customers when installing dual drive thrus.

“When guests pull up to the passenger side [drive thru], that side is better designed for those with multiple guests, because you have to reach across,” Noyes says. “But that’s really the only negative. Our guests have learned that when you’re going to that side, it can be fun because they let the child pay and it’s a different experience. They turn that negative into a positive.”

Holmes’s parking lot isn’t backed up anymore, but he still has difficulties with the drive thru. His dual drive thru’s lanes each have a speaker box and menuboard, and merge into one lane up to the window, where guests pay for and receive their food. While his bottleneck used to be at the speaker box, it’s now at the window, an issue common with dual lanes that merge.

Holmes has increased staffing, not only to operate the drive thru, but also because traffic has increased inside the store. He says he doesn’t mind the extra staff. “What we’re able to do now is spend a little more time on service with guests, more than what we could before,” he says. “It changes the dynamic, but also gives you a better opportunity to serve guests.”

Noyes says extra staff when adding a second drive-thru lane can decrease the stress factor for all parties. “It gives the employees the opportunity to stop and be sure that they’re being friendly to the guests,” he says. “Sometimes when they’re doing so many things, they get overwhelmed and forget that hospitality piece.”

Cross-training staff is also imperative when operating a dual drive thru, Noyes says. “Being sure that an employee can easily slide over and help take an order or help bag an order, that’s another key piece so that you’re as efficient and productive as possible,” he says.

While there are a few negatives to the dual drive thru—including additional training, technology, and costs—it can be a boon to business if done correctly, Noyes says. “When guests pull up to our lot and see that they can choose between one lane or two, the perception is that it’s going to be a faster experience.”

For Holmes, a second drive-thru lane has produced tangible results. When his drive thru was a single lane, the maximum number of cars he could get through in a day was 123; with a second lane, that number has jumped to 143. In addition, revenue has increased 20 percent in two months, and his unit has moved up 150 spots in overall system rankings for the peak dayparts of lunch and dinner.

“From a volume standpoint, we’ve seen a good bump,” he says. “I was probably on a 7 percent increase for the year, and we [went] up 10–12 percent in November and December.”

While much of Checker’s/Rally’s business comes from dual drive thrus, Noyes says the option doesn’t work for every brand or location. To be more flexible, he says, the chain now offers franchisees a choice between dual-lane and traditional single-lane drive thrus.

“At the end of the day, it’s about convenience to the guests. How it’s delivered isn’t as critical,” Noyes says. Lately, new growth for the brand has been in urban centers such as New York City, where drive thrus aren’t possible—or even necessary.

“For us to get our brand in as many places where our guests want it, we need to be able to execute in many ways. Dual drive thrus are just one piece,” he says. “The question is, How do you grow your brand? There are many avenues to be able to do that.”

C-stores Shape Up Their Health & Wellness Offerings

May 14, 2013

NATIONAL REPORT — It’s no secret that convenience stores have received a bad junk food wrap. Even First Lady Michelle Obama criticized the channel for not having anything healthy to offer. But that generalization is slowly changing as the health and wellness push moves further into the mainstream — impacting consumers all the way to the convenience retail sector.

“More consumers than ever before tell us that eating healthy and paying attention to nutrition is important,” said Darren Tristano, vice president of research at consulting firm Technomic Inc., which unveiled a new “Healthy Eating Consumer Trend Report” in January. This report showed that consumers’ perception of healthy food is changing as they become more health-conscious. The study also found that consumers strongly associate with contemporary definitions of health, but balance better-for-you food choices with occasional indulgences.

Tristano explained that more consumers are gravitating toward “health halo” claims, such as local, natural, organic, whole wheat and free range. For that reason, he advises retailers to “leverage the growing interest in the health halo by developing the kinds of menu offerings that can underscore health without detracting from taste perception.”

Recent research from Mintel also demonstrates the shift toward healthier eating. According to the market researcher, just over two-thirds of Americans are opting for healthier fare.

“Consumers are more aware than ever of their own nutritional deficits and what poor eating habits can do in terms of their long-term health,” said John Frank, Mintel’s category manager for CPG food and drink reports. “As a result, today’s consumers are seeking out healthy food with greater urgency. However, skeptical or confused consumers aren’t likely to pay a premium for healthier food.”

Smart convenience store retailers are monitoring these and other consumer health trends, with some taking a more proactive role and experimenting in-store where it makes sense. Among those making headlines recently:

  • 7-Eleven Inc. introduced a line of fresh foods and downsized some of its fare by creating portion-sized items. The goal is to have 20 percent of sales come from fresh foods in its U.S. and Canada stores, up from about 10 percent currently, according to a December New York Times report.

“We’re aspiring to be more of a food and beverage company, and that aligns with what the consumer now wants, which is more tasty, healthy, fresh food choices,” stated 7-Eleven President and CEO Joe DePinto. The c-store giant has reportedly put together a team of culinary and food science experts to study industry trends and develop new products.

  • More than a dozen convenience stores joined in a Kansas county’s efforts to reduce the community’s salt intake. Hy-Vee Convenience Store, Gas & Shop Convenience Store, Larry’s Shortstop and 10 local Kwik Shops in Shawnee County, Kan., agreed to display a standalone rack of healthy, low-sodium items (chosen and customized by a dietician) in a prominent spot in their stores. This health initiative was spearheaded by the commissioners in Shawnee County, which provided the racks, promotional signage, technical assistance and advertising.
  • C-store retailers in Brattleboro, Vt., joined the Healthy Retailers program, sponsored by the Brattleboro Area Prevention Coalition in collaboration with the Vermont Department of Health. In addition to discouraging tobacco and alcohol use among youth, the program resulted in vegetables, new fruit varieties, and ground beef and pork products from local farms being available for purchase at select convenience stores in the area.

Sonja Hubbard, former NACS chairwoman and CEO of Texarkana, Texas-based E-Z Mart Stores Inc., is one convenience industry leader who has been vocal about her belief that the opportunity exists to make c-stores a more nutritious place for consumers to shop.

In 2010, Hubbard told Convenience Store News she was initially offended by the First Lady’s remarks about the lack of healthy food in c-stores, but then felt empowered to make some changes at her own chain. Now, two years later, she shared with CSNews that she thinks “c-stores are improving on the way we are promoting existing health and nutrition options, plus we are continually adding more items and trying to grow sales in the category.”

Minute Market in Oregon is another c-store operator adding and testing better-for-you items like string cheese, low-sodium sunflower seeds, fresh fruit and “healthier” drinks for kids. “As the industry changes, we are getting more options to choose from and bring in as our main distributor picks up these healthier products,” said Phyllis Simpler, Minute Market’s operations manager. “Over the last year, especially, a lot more products have been made available to us.”