All Eyes on Kwik Trip

A Sunday news feature details the Midwest retailer's food and distribution strategy, as well as its long-term expansion plans.

March 08, 2011

LA CROSSE, WI - The Milwaukee Journal Sentinel featured Wisconsin's Kwik Trip earlier this week, a family-owned convenience store chain that amassed $3.4 billion in sales last year and recently announced a three-year growth plan that sustains its 20-store-per-year expansion pace.

Over the next three years, the expansion translates into an additional 2,000 jobs among truckers, food production and distribution center workers.

With stores located in Wisconsin, Minnesota, and Iowa, Kwik Trip employs nearly 10,000 people among 409 stores, including 1,000 at its La Crosse headquarters and food plants. The company's food operations produce, among other items, Glazers doughnuts, which it developed to compete with Krispy Kreme.

"Our goal was to sell a couple hundred thousand a week," said Steve Loehr, vice president of support operations. After a year developing the product and setting up production, Glazers are selling at the rate of 1 million a week, while Krispy Kreme has closed stores around Wisconsin.

Over the past few years, the company has expanded its food production and has begun selling food wholesale to other companies. "The facilities are built larger than what we need," said John McHugh, manager of corporate communications.

As Kwik Trip's business model includes producing food products and trucking them daily, it is limiting its reach to a 300-mile radius, Zietlow said. However, that hardly presents a financial handicap, as Zietlow said there are sufficient quality locations inside its current market zone to allow the company to build 20 new stores a year for the next 20 years.

Kwik Trip also boasts one of the industry's lowest turnover ratios, 24%, partly owing to the company giving 40% of its pretax profits to its employees. The company retains a vertically integrated business model, making and/or processing the food it sells while implementing an employee-friendly culture.

"They're probably one of the four or five companies nationally that you'd come up with who's leading the industry," said Neil Stern, senior partner at McMillanDoolittle. "They've been defining what the convenience store of the future should look like."

The feature highlighted Kwik Trip's "We won't be undersold in any market" philosophy.

The company's success has attracted a long line of interested buyers, though the family business is likely to stay as such for the foreseeable feature, according to Zietlow.

"It's not for sale."

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