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Sheetz to add food-only stores to promote growth in urban areas, exec Woodley says

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Dave Woodley is executive vice president for sales and marketing at Sheetz Inc., an Altoona-based operator of about 500 convenience stores.

Family-owned convenience store chain Sheetz Inc. crossed a milestone last month when it opened its 500th store, one of about 30 the Altoona-based company plans to open this year.

Known for its large gas stations with myriad fresh made-to-order food choices that are popular with travelers, the company grew to $6.9 billion in sales last year, up nearly 5 percent from the previous year.

In a bid to expand into urban markets, the company, which employs more than 16,000 people, is pushing a new store model — one without the gas pumps that focuses on higher-margin sales of food and beverages, said Dave Woodley, the company’s executive vice president of sales and marketing.

“Our platform has obviously changed from a convenience store to more of a restaurant feel,” he said.

In an interview with the Tribune-Review, Woodley discussed Sheetz’s growth and expansion plans, including adding its first fuel-free convenience stores, which would allow the company to enter urban markets where it hasn’t had a presence. Here are edited excerpts.

Trib: What has been driving Sheetz’s growth?

Woodley: Our concentration in food and beverage. We’ve sold beverages for a long time. But we really started in the late ’80s selling food, and in particular our MTO platform — our made-to-order platform — that has really grown our business.

Trib: How much of the growth is from adding more stores?

Woodley: That’s certainly a percentage of it. This past year, we’ve added between 28 and 30 new stores, and that’s what we see in the future, is adding about 28 to 30 new stores (a year).

Trib: If food is that important, do you ever see a day where Sheetz might set up a restaurant and not have the gas station?

Woodley: We just opened a site in West Virginia, which is a fuel-free site, right on West Virginia University. It has a big food and beverage presence, and it has a grocery store component as well. We have another one already signed, and it’s (going to be) in State College, Pa. It’s something that we have been planning for probably the last three years.

Trib: Do you see these stores primarily being on college campuses, or in any urban center?

Woodley: The current (gas station) model we have today is tough to take into an urban setting, so (fuel-free stores) gives us an opportunity to expand our model and move into a more urban setting. It’s not necessarily going to be all college.

Trib: And why is your model difficult to take into an urban setting?

Woodley: If you think about the size of the lot you need with fuel, that makes it difficult.

Trib: How many of your new stores do you expect to be food-only stores?

Woodley: We’ve only had the one now and have the other up in State College, and we’re looking at a couple more sites to do that. I would say a number is hard to define for us because it will depend on getting the right site and in the right area. It’s taken us three years to get where we are with these two. It’s really hard for me to say how many we’re going to end up with.

Trib: When you’re expanding, are you looking at particular geographic areas?

Woodley: We’ve been growing pretty equally west, east and south. Our newest area we grew into is North Carolina. We’re in Pennsylvania, Maryland, Virginia, Ohio, West Virginia and North Carolina.

Trib: I understand Sheetz has a lot of expansion opportunity to our west, where there isn’t as much competition?

Woodley: Competition is really everywhere we go, whether it be a quick-service restaurant or a fast-casual restaurant. I don’t think there’s any more or less competition where we’ve grown.

Trib: You just mentioned restaurants and not gas stations as competition. Why is that?

Woodley: The channels have been blurring for quite some time, from the convenience store industry to the (quick-service restaurant) industry to the fast-casual industry. So as we move into, and have been growing our food and beverage business, that becomes more and more important to us.

Trib: How much of Sheetz’s sales come from food, versus gasoline?

Woodley: That’s where most of our growth has been coming from is out of our food and beverage business. If you think of the convenience store business, cigarettes and tobacco have matured and gas has matured. So food and beverage has become a much bigger part of our mix because of that.

Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or [email protected].

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