August brought little relief to this summer’s convenience store traffic drought, with energy drinks and chocolate providing the silver lining, per a report this week from Jefferies Equity Research.
Convenience store traffic was down 115 bps from July. On a rolling three-month basis, foot traffic has dropped 2.5%.
Despite some companies claiming improvement in the channel, “there is no strong evidence of this in the data,” according to Jefferies.
Energy drinks remain the big winner in c-stores. The category continues to lead the pack in beverages, with the sales expanding 10.3% year-over-year in the last three months as volume rose 8.3%. Double-digit growth stands in contrast to the 2.6% gain in the total non-alc beverage category. Volume in total non-alc fell 0.3%. Value-added water sales went up 1.7%, while volume declined just under 1% in the period.
While pricing is “sticking” in energy, consumers are prioritizing functional beverages over soft drinks and sports drinks. Soft drink dollar sales improved slightly to 0.1%, up from -0.4 in the last six months. Meanwhile, sports drink sales dropped 2.3%. Both categories saw volume slip 3.5% and 4.5%, respectively.
Looking towards snacks, sales fell in the last three-months for corn chips (6.5%), potato chips (6%), and cake (5%) with constrained volume playing a key role. The Jefferies report attributes the declines in salty snacks, particularly chips, to a shift towards better-for-you products.
Some food categories were up, however, during the last three-month period: chocolate (5.7%), gum (3.8%), snack mixes (3.3%), cheese snacks (1.6%) and meat snacks (1.5%) all reported sales gains. Yet volume was down across categories, with the only outliers being frozen novelties (2.2%) and a slight bump for chocolate (0.1%).