Convenience stores take on new life on college and university campuses, especially when meeting students’ demands for prepared meals.
Sales at campus convenience stores rose just under 2% from 2004 to 2005, according to FSD’s Campus C-Store Study, which shows that more than half of colleges and universities in the United States operate c-stores or convenience-retailing units.
Foodservice departments run the c-stores in about three-quarters of those stores, while bookstores, student governments and other organizations run the remainder.
It’s a category becoming increasingly lucrative for campus dining: 54% of FSD survey respondents say c-store sales increased last year. Total c-store sales volume averaged $1,324,755 in 2005, up from $1,301,546.
Other studies confirm the reason why campuses are expanding their c-store enterprises: 34% of respondents in Y-Pulse LLC’s 2005 College Student Eating Habit Survey rank convenience as a “major factor” affecting their choice of places to purchase meals, while 37% cite c-stores as a “place of purchasing a majority of meals outside the home.”
Meal-minded: Campus foodservice directors often have other factors in mind when opening c-stores, such as meeting students’ needs for prepared meals they can take back to dorms or other residences, such as off-campus apartments. “We offer home-replacement meals for students which are prepared in our dining halls and sold as plated meals in Ram’s Head Market,” says Ira Simon, director of food and vending services at the University of North Carolina-Chapel Hill.
There are two c-stores at Chapel Hill, plus a 6,500-square-foot market that opened in March 2005. C-store sales amount to about 8% of total foodservice volume. Simon says more students are interested in frozen and microwaveable meals than they are the plated HMR meals. “We are also able to offer a range of organic, kosher and other specialty food items that meet the needs of a small but important segment of our community.”
Campuses in the c-store business operate an average 2.2 stores in prime, high-traffic locations such as student centers and residences. At the University of Missouri-Columbia, there are four under the banner Mizzou Market; each name also identifies its location (e.g., Mizzou Market-Brady Student Commons).
Off-campus students are the stores’ largest customer segment, says Julaine Kiehn, director of dining services.
Two stores are located in residential areas and offer Subway items, while a third offers Noble Roman’s pizza and is open around the clock. “We also offer frozen and canned entrees,” she says. “Students purchase items to eat at that time or later.”
At Miami (Ohio) University, six c-stores accounting for 17% of total sales meet students’ prepared meal needs “to a significant extent,” says Bill Moloney, director of student dining. Four of them offer prepared hot and cold menu items, while the other two offer the department’s Uncle Phil’s Express line of pre-packaged items: wraps, sandwiches, salads, fruits, parfaits and sushi. All are prepared in Miami’s Culinary Support Center and shipped to each store daily, Moloney adds.
Like Miami, Vanderbilt University in Nashville, Tenn., operates six c-stores which collectively generate 40% of total foodservice volume. Frank Gladu, assistant vice chancellor of business services, says they are “essential” in meeting the need for prepared meals. “And we can locate them close to living spaces,” he says.
Four of the stores are open around the clock, targeting (and meeting the demands of) the late-night crowd.
Meal plans: Students at UNC, MU, Miami and Vanderbilt are able to use their meal plans in the campus c-stores, but in different ways. UNC and MU students can spend debit funds at their stores but meal equivalencies (to, say, a meal in a 19-meal-a-week) plan are not permitted. They are, however, at Vanderbilt. “Our meal plans are based on combinations of food at any location on campus,” Gladu explains. “In our c-stores, we have combinations that they can use to qualify for their meal.”
Other results from the FSD Campus C-store Study show that:
- Institutions in the southern United States are more inclined to be in the c-store business: they average nearly .5 stores per campus.
- Campuses with foodservice purchases of more than $1 million per year are more likely to operate a c-store than those under $1 million.
- Beverages are the most profitable c-store items, say 41% of respondents, while 17% say full-service sandwiches/entrees and 13% say self-service or grab-and-go sandwiches/entrees generate the most profits.
- Branded concepts are a fixture in campus c-stores, just as they are in the street-based convenience store world. More than 70% of campus c-store operators say there’s a branded concept in their store, with Starbucks Coffee the most frequently mentioned brand. Others include Freshens Smoothies, Chick-fil-A, Subway and Taco Bell.
Traffic jam: Such concepts help drive store traffic, as does strategic placement of the stores themselves. For example, at the Univ. of Minnesota, Essentials Market & Deli is an Aramark-run c-store that features a licensed Java City set-up. The store is situated near a campus bus stop, and attracts 6,400 weekly customers.
In addition to coffee, the store’s menu of Express foods, made daily, includes stacked meat sandwiches, fresh fruit cups, cheese and meat cups, hummus and pita, veggies and dip, fruit and dip, and yogurt parfaits.
THE AVERAGE CAMPUS C-STORE
Sales: $616,165 (annual)
Transaction: $4.80
Square footage: 1,290
Days in operation: 6.2 (per week)
Hours in operation: 9+ (daily)