In an interview with C&I for the magazine’s latest Global Trends Report, NACS Global Director Mark Wohltmann shared insights on the key forces shaping the future of petrol and convenience retail.
C&I: What are the dominant global trends currently shaping the petrol and convenience industry?
Wohltmann: We conduct an annual NACS Global Strategic Industry Issues survey, asking the senior leaders in more than 60 countries what the top issues are for the industry. The main topics (in no particular order) are expanding foodservice offers, the continuing change in mobility and fueling energy sources, store design that best reflects the primary store offer (gas vs, food, etc.) and the digitisation of the customer journey.
C&I: Which regions or countries are leading innovation in the convenience space – and why?
Wohltmann: Foodservice is incredibly advanced in Ireland. Strong competition has led to incredible focus and advancement over the past two decades.
EV mobility is seen best in China, and that’s driven by government mandates rather than good business cases.
Architecture is very advanced in the Middle East, and that’s driven by the need to deal with extreme climate conditions and pushed by highly profitable oil operations.
C&I: How is the fuel-to-retail transition unfolding globally – and how far along are we in the shift to EVs or alternative fuels?
Wohltmann: The elected leaders of big cities generally want to minimise – or eliminate – emissions, and often force an EV-only approach, which is an overly simplistic approach to a much more complex issue.
Certainly, many countries are more advanced than others, but let’s take the United States, for example. New car sales annually are about 14 million and there are approximately 300 million registered vehicles. It would take more than 20 years to replace the current fleet based on these sales, and that doesn’t factor in that less than 10 per cent of vehicle sales now are EVs.
Emergency services need reliable fuel and will focus on reducing emissions, which may be e-fuels and biofuel. Long-haul trucking may move to hydrogen. Meanwhile, air travel will likely be the first users of e-fuels, due to cost. Once it is scaled, it could spread to other parts of mobility.
C&I: How are retailers using digital tools – such as apps, loyalty, AI, or automation – to improve performance?
Wohltmann: The “digitization of business” is underway. Anything from customer interaction to social advertising to employee training and gamification to POS management is quickly moving online. Tools are being used to deal with labor unavailability, to connect data sources, stores, regions, … and to present a modern and current offer to digital-savvy customers.
C&I: How is sustainability influencing store operations, product ranging or packaging globally?
Wohltmann: In some cases, government mandates are requiring retailers to go green, while consumers are seeking more sustainable options, especially related to packaging. In Europe, consumers and governments that have this on top of their agenda, while voluntary change is driving this across Asia and Africa. And while it is an important consideration and concern, it also has to work in an environment where consumers have concerns about the economy and their own financial situation. Anything that is more sustainable but cost more may have challenges in gaining acceptance from consumers.
C&I: What role is convenience retail playing in the broader omnichannel retail landscape?
Wohltmann: Convenience stores are increasingly moving to advertise online or even offer click-and-collect — especially with coffee and foodservice. Retailers that operate multi-format retail are increasingly integrating their operations to include small formats. From a consumer perspective, anything that has the same store name on it belongs to that retailer and they expect seamless integration for shopping, pricing and returns across all formats. Consumers don’t think about specific formats; they think about which retailers best meet their needs, regardless of format definition.
C&I: Are there key differences in how urban vs rural convenience formats are evolving globally?
Wohltmann: Urban convenience is growing in square footage to make it profitable. At the same time there is consolidation and bringing stores under big brand ownership.
In rural settings there is a trend for convenience becoming neighborhood centers that also serve as hubs to socialize. The trend for consolidation and branding is much slower.
C&I: What are your predictions for where the global P&C industry will be by 2030?
Wohltmann: For convenience retailing, the focus will continue to be on convenience, and that definition is always defined by the customer. Those who best address consumer needs will define the future of the industry, and that likely will include a continued focus on foodservice, technology and customer experience.
Full article Global forces reshaping petrol and convenience retail - Convenience & Impulse Retailing
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