COMMERCE CITY — The world’s largest convenience retailer is looking at expanding in the city within the next two years.
7-Eleven, Inc., working with Commerce City’s economic development team, opened a new location last month in the core part of the city, and 7-Eleven Regional Development Director Stephen Oliver said this debut is only part of the company’s expansion efforts.
“We are currently working on four locations in Commerce City, including the 69th Avenue and Dahlia Street store, which just opened,” Oliver said. “The other three sites also are expected to open this year with one or two more opening in 2014.”
The newly opened store made use of vacant land, and in addition to building the store, 7-Eleven made improvements to the landscaping to develop the site. With other projects, the company also remodels second- or third-generation buildings.
Oliver credited city efforts with making the deal a reality.
“Commerce City has been great to work with,” Oliver said. “The leadership is pro-business and has made us feel welcomed.”
City Economic Development Manager Walter Williams said the chain’s rapid expansion in the area required an attentive eye.
“With so many 7-Eleven stores opening within a short time frame, this focused attention from the city helps avoid costly mistakes,” Williams said.
As signs of economic recovery trickle in, the convenience store sector appears poised for a strong year in 2013. Industry publication Convenience Store Decisions released the results of its annual survey last month, which collected data from 199 convenience store chains from across the country representing more than 19,000 stores.
The survey showed that while the entire convenience store industry averaged $24,765 a month in food service sales in 2012, larger chains such as 7-Eleven generated an average of $40,780 per month.
The survey’s authors attributed the success of the larger chains, among other factors, on the availability of more name brands and greater variety of fresh foods for customers looking to “grab and go.”
“That doesn’t imply that food service sales will spoil over time for smaller operators,” said David Bishop, one of the survey’s authors. “But rather they have structural challenges to overcome in order to compete more effectively in the crowded and competitive space called retail food service.”
These food service sales can be crucial for a company such as 7-Eleven, which uses a mixture of franchises and company-owned stores throughout the country to generate profits. The unpredictable nature and low margin of gasoline sales forces many companies to differentiate using name brand recognition.
“When it comes to branding approaches, a lot depends on the subcategory,” Bishop said. “In sandwiches, proprietary branding is dominant with 53 percent of all the retailers following this approach. It’s even greater with larger retailers. For example, 64 percent of retailers with 200 or more stores reported that they currently operate a proprietary sandwich brand.”