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The battle between quick-service restaurants and convenience stores is picking up. Recognizing a clear opportunity to tap into the QSR industry’s growing market share — which has proven to be <a href="https://1851franchise.com/why-full-service-restaurant-franchises-are-starting-to-look-more-like-qsrs-2714686">uniquely resilient</a> against the COVID-19 pandemic — many convenience stores have opted to step up their food offerings beyond hot dogs and reheated slices of pizza. A number of these concepts now look a lot like QSR chains, including third-party delivery partnerships and on-site restaurants, but with the added bonus of gas pumps and Slurpee machines.<h4>How 7-Eleven Is Taking a Bite Out of the QSR Segment</h4>This week, <a href="http://franchise.7-eleven.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">7-Eleven</a> opened a store in <a href="https://prnewswire.com/news-releases/7-eleven-doubles-up-on-restaurant-concepts-in-newest-evolution-store-301280302.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Manassas, Virginia</a> featuring two of the franchisor’s in-house restaurant brands — <a href="https://www.nrn.com/quick-service/7-eleven-tests-another-restaurant-concept-raise-roost-chicken-biscuits?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Raise the Roost Chicken and Biscuits</a> and Parlor Pizza. Both of these concepts were created by 7-Eleven last year as part of a push toward the restaurant space. The restaurants are located side by side inside the store, with separate ordering counters and shared indoor and outdoor seating.The Manassas store is also part of the chain’s Evolution Store prototype, which was first introduced in March 2019. In addition to opportunities for onsite restaurants, other features of the Evolution Store concept include a wine cellar and beer cooler, fresh baked on-site croissants and cookies, espresso drinks, artisan craft sodas and sparkling waters.&nbsp;The Manassas Evolution Store also serves as a testing ground for 7-Eleven's <a href="https://www.7-eleven.com/lp/sips-and-snacks?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Sips and Snacks program</a>, where franchisees and company employees hand-pick exclusive products to put on the shelves. All of these features could not only drive new traffic to Raise the Roost and Parlor Pizza, but also encourage the type of destination shopping that standard QSRs can’t compete with.In addition to the Manassas location, 7-Eleven operates eight more of these high-concept stores in North Texas, New York City, Washington, D.C. and San Diego. In March, 7-Eleven also <a href="https://www.restaurantdive.com/news/7-eleven-opens-first-restaurant-drive-thru/597196/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">announced</a> its first corporate-owned drive-thru restaurant, which will service its other in-house restaurant brand, <a href="https://www.laredotacocompany.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Laredo Taco</a>.<h4>How Other Convenience Store Retailers Are Expanding&nbsp;</h4>7-Eleven isn’t the only convenience store chain growing its restaurant footprints and meal offerings. In 2020, <a href="https://www.wawa.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Wawa</a> added a <a href="https://s3.amazonaws.com/wawa-kentico-prod/wawa/media/press-releases/2020-wawa-dinner-debut-release-final_photos.pdf?ext=.pdf&utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">dinner menu</a> and opened its first <a href="https://s3.amazonaws.com/wawa-kentico-prod/wawa/media/press-releases/2020-wawa-drive-thru-announcement-falls-twp-pa-7-30-20.pdf?ext=.pdf&utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">drive-thru location</a> in an attempt to appeal to the <a href="https://1851franchise.com/what-franchisors-can-learn-from-qsr-magazines-2020-drive-thru-study-2713995">growing demand</a> for these services amid COVID-19. <a href="https://www.prnewswire.com/news-releases/sheetz-debuts-a-new-store-with-drive-thru-in-beckley-west-virginia-giving-hundreds-of-dollars-in-prizes-to-new-customers-118681029.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Sheetz</a> has been opening locations with drive-thrus for the last few years, and <a href="https://www.caseys.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Casey’s</a> has a pizza parlor and bakery with donuts made from scratch, as well as a large dining area.Many of these convenience store retailers are also cashing in on the increased demand for food delivery. In October, 7-Eleven said it had seven delivery partners, reaching <a href="https://csnews.com/7-eleven-partners-third-parties-make-delivery-available-more-consumers?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">90% of its coverage area</a>. While its new partnerships with Instacart, Uber Eats and Grubhub focus on snacks, groceries, household items and other essentials, its ongoing relationship with DoorDash, Postmates and H-E-B-owned Favor <a href="https://www.laredotacocompany.com/delivery?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">offer delivery for Laredo Taco</a>.&nbsp;&nbsp;<h4>The Advantages C-Stores Have Over QSRs</h4>As brands compete for customers’ mealtime dollars looking forward, convenience stores may have several advantages over QSRs. For one, c-stores traditionally have a wide selection of food or restaurant options, while QSR brands are limited to their branding and specific type of cuisine. Many convenience stores are also open later than fast-food chains and have the ability to operate restaurants in more <a href="https://1851franchise.com/the-future-of-nontraditional-franchise-locations-2714711">non-traditional sites</a> such as airport terminals, train stations, universities, malls, hotels and stadiums.&nbsp;Still, the question remains: Do customers really want to order dinner from a gas station? According to some recent studies, it appears they do. A National Association of Convenience Stores’ State of the Industry <a href="https://mma.prnewswire.com/media/846231/NACS_Sales_Report_2018.pdf?p=pdf&utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">report</a> found that 23% of convenience store sales come from foodservice. <a href="https://www.gasbuddy.com/NewsRoom/PressRelease/783?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">GasBuddy also released a study</a> finding that 43% of Americans ages 18 to 29 bought more c-store meals than they did three years prior.&nbsp;&nbsp;In addition to their in-demand foodservice offerings and off-premise channels, the most significant competitive threat these c-store chains bring to the table is their massive footprints. 7-Eleven has over 12,000 stores in North America — for context, that is almost the equivalent of all <a href="http://www.tacobellfranchise.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Taco Bell</a> and <a href="https://company.bk.com/franchising?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Burger King</a> locations combined (each feature about 7,000 U.S. units). 7-Eleven could also expand its restaurant footprint further with its <a href="https://corp.7-eleven.com/corp-press-releases/08-02-2020-7-eleven-inc-transforms-its-u-s-store-network-through-acquisition-of-speedway?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">2020 acquisition</a> of 3,900 Speedway stores.&nbsp;While many of these next-generation convenience store locations are corporate-run, 7-Eleven’s long-term growth plans indicate the opportunity will likely become a common strategy for franchisees as well. <a href="https://csnews.com/7-elevens-push-qsr-calls-150-new-restaurants-2021?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">In a press release last week</a>, 7-Eleven EVP and Chief Operating Officer <a href="https://www.linkedin.com/in/chris-tanco-8b593a31?utm_source=1851franchise.com&utm_medium=article&utm_campaign=why-convenience-stores-may-be-a-major-threat-to-the-qsr-industry-2715690" target="_blank" rel="nofollow">Chris Tanco</a> called the chain’s expansion plan “aggressive” and confirmed the chain’s specific intention to throw its hat into the quick-service restaurant ring.&nbsp;"Today’s opportunity is in the QSR space, and we are responding by aggressively rolling out restaurants across the country — both in Evolution Stores and beyond. Our plan is to open nearly 150 restaurants in 2021," Tanco said.

Why Convenience Stores May Be a Major Threat to the QSR Industry

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