Organic Growth Drives Kwik Trip

In 2004, CSD awarded La Crosse, Wis.-based Kwik Trip Inc. with the Chain of the Year award recognizing a company that values people and forays into new technology, combining business and energy intelligence to save dollars.

CSD also was impressed with Kwik Trip’s use of vertical integration to control the products and support functions that affect its stores. With 30 years experience in vertical integration, the company was able to share 40% of its pre-tax profits with co-workers, and still have a sum left over to grow the business. And grow the business they have.

Since 2004, Kwik Trip has added 40 new retail locations, bringing its c-store total to 360 stores in Wisconsin, Minnesota and Iowa and has completely rebuilt 30 existing stores. It has increased its team to 9,100 employees, welcoming 700 new faces to the company this year alone.

With a strong staff in place, the company now is focusing on updating the look of its existing stores, spending $30 million over the next three years to include a warmer, softer color scheme, featuring browns and greens to give stores a more upscale look. Feedback from several customer focus groups helped shape the plan, which includes wood fixtures, subdued florescent lighting with accent lighting spotlighted on key areas and a more open look.

Focusing on Food
Faced with reduced gasoline prices, flat margins and struggling cigarette sales, the company also decided to move deeper into foodservice as a way to expand its business, and grew its foodservice category by more than 25% in 2009 alone.

“We were in our infant stages with foodservice when we won the award and still continue to grow our proprietary foodservice brand at our stores. In every store we offer a range of items from pizza to soup to fresh deli sandwiches and salads,” said Steve Loehr, the chain’s vice president of operations support.

In order to meet the ever-growing demand for foodservice in its stores, Kwik Trip’s distribution center has grown to 220,000 square feet. The larger facility enables the company to deliver fresh foods to every one of its stores each night and to expand its offering of private label products. Kwik Trip also replaced its generic, company-branded labels on fresh food products with a new label called Kitchen Cravings.

In 2007, the company opened a new $14 million Kwik Trip Kitchens food commissary and research and development facility in La Crosse. “In 2004 we were in a 6,000-square foot commissary. Our new facility is 60,000 square feet,” Loehr said.

And the expansion doesn’t end there. The company is breaking ground on a construction project that will add an additional 80,000-square feet to its existing bakery, more than doubling the size of the facility.

Dealing In Debit Cards
Kwik Trip encourages its customers to use debit cards, which are less expensive to process compared to credit cards, which carry more fees for retailers.

“A lot of consumers are using debit more. They like it, and figure it’s more secure because they’re putting their individual four digit ID number in, and they like the way it’s processed daily instead of waiting for a monthly bill from the credit card companies,” Loehr said. 

Employees remind customers of the debit option at the counter, and the company is upgrading all gas dispensers to comply with the more stringent PCI credit card standards and to accommodate debit cards at the pump.

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