What Wal-Mart’s New C-Stores Mean for the Industry

By Lance Winslow

It appears that Wal-Mart plans on setting up hundreds of convenience stores in the near future, and many of these will be completed before 2012. Why is Wal-Mart getting into the c-store business, you wonder? Well, consider if you will that at many of its superstores the company also sells fuel, and since more and more patrons are using the Sam’s Club card, and Wal-Mart credit cards to buy fuel, it may as well have a c-store out front for everybody.

Can Wal-Mart compete in this venue?

Of course, Wal-Mart already has a captured audience, which will only grow as the price of fuel goes up higher and higher and consumers are trying to squeeze a few more pennies out of each gallon. Also, Wal-Mart will be able to sell products in its c-stores at a price point cheaper than other convenience stores, as it has a big buying advantage with its vendors. Does this mean other convenience stores will lose business to Sam’s Club and Wal-Mart c-stores? Yes, it could throw a loop in the industry, but it probably will not be too big a deal since Wal-Mart is only planning a few hundred of these stores between 2011 and 2012.

In the future, it could be more devastating to the industry if Wal-Mart starts throwing up convenience stores all over the place, but I don’t see that happening.

Still, it could be a challenge for those c-stores in close proximity, similarly when Wal-Mart entered the oil change industry, and started selling tires, that hurt both tire stores and quick lubes. And Wal-Mart is known for low-price, high-volume strategies. They do even better during difficult economies, or when the rest of the industry is either inflating prices to customers, or the price of those commodities skyrocket, which is what’s happening with the price of oil, thus why gasoline is so expensive. Perhaps, in a way, it will just keep everyone honest and, what the heck, a little competition is always healthy for an industry.

Indeed, this could very well change the entire dynamics of the industry, and Wal-Mart may even put these minimart type stores in locations other than its own current properties at some point in the future—who knows?

Should the industry be alarmed?

Yes, I think so, and I think the car wash industry may be next, as I believe that Procter & Gamble, which is already one of Wal-Mart’s very big suppliers, and a company which has already entered the car wash industry, could easily get together and put car washes on all the Wal-Mart parking lots as well. Of course, like anything, that too is merely speculation, but I wouldn’t be surprised. In fact, that’s what I’d do if I were Wal-Mart. Any time a large company of this size attempts to enter a new sector, the industry involved should take notice and be concerned. The dynamics of the c-store sector will change. Please consider all this, and think on it.

By Lance Winslow

www.carwashguy.com

  • http://www.facebook.com/profile.php?id=100000176348804 Anonymous

    When your ready-2-eat it’s the Grocerant niche that is filling the void today. Wal-mart is entering the convenience store niche in order to reach it consumer at an increased frequency.

    When it’s 4PM most conusmers don’t know what’s for dinner. They want bundled options fast. The Grocerant niche is the platform. Wal-mart gets it!

  • Cjcraig001

    Sounds cool! I have been in the C-store field, as a Store Manager for 20 years and I would go to work for Walmart in a heart beat. Walmart is the number one retailer, so they would dominate in the Convenience market and add carwashes, they would be unstopable.

  • Xeuropn

    Having car washes on Grocery store properties isn’t new. When I lived in Germany back in the 80’s-90’s, both Wertkauf (which Walmart ventured with for a short time) and Famila Centers had automatic car washes for a great deal.

  • madmilker

    This is for you….Lance!!!!!

    Did you know everything in ones country hinges on its currency.

    Did you also know that Retail makes NOTHING and the Government only makes MORE DEBT.

    Now, for the past 100 years in America the Government in Washington D. C. has put we the people from a $2.6 billion debt load in 1910 to over $14 trillion today.

    And with 1975 being the last year America had a trade surplus more Retail has been born and more and more NOTHING is being made.

    See, it’s all about the American currency(George Washington)and just how those dollars float around.

    Years ago when they floated around this great union helping each hand George was touching foreigners would had given their left nut just to touch one of them.

    But today it be a different story because for the past thirty-six years more and more of those George Washington’s have been sent to foreign lands and now all those foreigners have we the people and Uncle Sam by both nuts squeezing the life out of them.

    The dollar is the key in America just like the Mao(yuan) is the key in China.

    “It is the aim of good government to stimulate production, of bad government to encourage consumption.” – Jean Baptiste Say

    That quote is like 230 years ago and it makes more “cents” today than ever before…..remember, the Constitution wasn’t written for a Corporation nor was it written for a Government….it was written for We the People and the founding fathers with goose quill pens in hand and the penmanship of poets call it the American Dream.

    Now, ask yourself what was Sam Walton doing back in 1975 east of Seoul…did it have anything to do with making more products in America….

    Now, fast forward and ask yourself ….if Sam Walton didn’t take the hyphen out of Wal-Mart and replace it with a big single star Wal*Mart….was it the same person a few years back that took the star out and put the starburst at the end Walmart*.

    Think the word “rich”….99% of the people on Earth ain’t there. Yeap, 1% of the total population purdy much dictate very quietly to that 99% just how their money is spent.

    But there’s one small problem with them thinking like that…..cause it’s the 99% that hold all the power…it’s in their hand when they go to vote and it be in their pocket book and purse when they go to shop.

    Did you know Wal*Mart puts less than 5% foreign in all their stores in China….one can look at this in two ways….they are depriving the nice people of China from purchasing foreign made or they are doing for the best of the Chinese currency Mao(yuan) in making sure it doesn’t fall into foreign hands.

    Now, remember the 1975 year from above….

    and read what Lance Winslow wrote in that article “The Flow of Trade in a Global Economy”….

    “Now let us look at Wal-Mart again; you buy a product there, 6% goes to the employees, 10-18% is profit to the company, 25% goes to other costs and 50% goes to re-stock or the cost of goods sold. Of the 50% about 20-25% goes to China, a guess, but you get the point. Now then, how long will it take at 433 Billion dollars at year for China to have all of our money, leaving no money flow for us to circulate? At a 17 Trillion dollar economy less than 40-years minus the 1/6 they buy from us. Some say that if we keep putting money into our economy, it would take forever, but if we do not then eventually all the money flow will go. If China buys our debt then eventually they own us, no need to worry about a war, they are buying America, due in part to our own mismanaged trade, so whose fault is that? Not necessarily China, as they are doing what’s in the best interests, and we should make sure that trade is not only free, but fair too.”

    As an American you have the power. If you hold onto George Washington(dollar) he will not let you down.

    but did you let him down….

    “Observe good faith and justice toward all nations. Cultivate peace and harmony with all… The Nation which indulges toward another an habitual hatred or an habitual fondness is in some degree a slave. It is a slave to its animosity or to its affection, either of which is sufficient to lead it astray from its duty and its interest … Tis our true policy to steer clear of permanent alliances, with any portion of the foreign world.” – George Washington, Farewell Address, 17 Sept. 1796.
    It’s not about a cheaper price to the 1%…it’s about holding all that power that George represents.

    Today, the Federal Reserve(private bank), China and Japan hold more George Washington’s than anytime in the history of this great union and the sad part is We the People that has all the POWER let it happen.

    In 1960 U.S. goods manufacturing produced a $5 billion trade surplus and if you as an American worker(non-union and union) want those days back in America all you have to do is STOP supporting other countries and start SUPPORTING the United States of America again.

    The label Made In America will tell that 1% what it told them sixty years ago.

    God Bless Made In America cause the two things Lady Liberty needs less of today is NOTHING from Retail and MORE DEBT from the turnips in Government.

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