GRAPEVINE, Texas – As NACStech, the convenience and petroleum retailing industry’s most comprehensive technology event, enters its 13th year – “I can’t believe NACStech is now a teenager,” noted conference chair Jenny Bullard – it’s clear that much has changed about the industry and its embrace of technology.
But some things have remained the same, noted Bullard, chief information officer for Flash Foods, in the Opening General Session. In 1995, during the first NACStech, industry pretax profits were $3.4 billion, which is the same as in 2007, based on the latest NACS State of the Industry data.
But pretty much everything else has changed. Back then, the industry didn’t have the competition it does today – from hypermarkets, drug stores, dollar stores, grocery stores and all other retailers.
And then there is the issue of gas prices. “In 1995, the average customer’s fill-up was $9.92. That means a customer could come in and give us a $10 bill and get back change. Today, we have $7.6 billion in credit card fees and if a customer were to actually pay with a $10 bill, he or she would get less than three gallons of gas,” said Bullard.
“But I think the biggest change is reflected in the industry’s pretax profit as a percent of sales. In 1995, it was 2.2 percent. Oh, the good old days. Today, it is 0.6 percent,” said Bullard. “We are selling a lot more stuff, but competitive pressures have driven down margins, especially on gas. But we have been able to succeed by embracing technology. But at the same time technology has given us a deluge of information. It can actually be information overload. Our goal really needs to be how we can best use this information to increase efficiencies and drive loyalty.”
With gas margins almost non-existent and credit card fees eating up profits, the need to use technology within the convenience and petroleum retailing industry is as critical as it has ever been, she noted.
“We all must embrace technology processes to help us drill down into that data we have about sales and translate that into understanding our customers and better meeting their needs,” said Bullard. “We need to embrace technology to offer customers other forms of payment to reduce credit card fees, which increased one billion dollars for our industry in the past year. We must embrace technology to reduce expenses, such as labor costs, and to increase efficiencies in our supply-chain process, to work toward interfacing the software and hardware components in our stores and home office.”
On Tuesday, NACStech will feature additional workshops and the expo will open. The event concludes Wednesday. Look for more information on the conference at www.nacstech.com, in NACS Daily and in NACS Magazine.