Convenience stores are one of the fastest-growing foodservice channels, with foodservice accounting for 27.7% of in-store sales and 38.6% of in-store gross margin, according to the NACS State of the Industry Report® of 2024 Data.

“Foodservice is becoming more and more relevant for c-store operators. We’ve seen increasing competition between QSRs and c-stores for customers—in fact, a recent study found that an estimated 50% of QSR customers now have convenience stores in their consideration set for hot prepared foods,” said Alice Crowder, chief marketing officer at Krispy Krunchy Chicken, citing the Intouch Insights Convenience Store Trends Report for 2024. “That’s a huge leap from even a few years ago, and it’s directly attributable to convenience stores really upping their game and resetting expectations of what their customers can get.”

Offering foodservice is a great way for convenience retailers to increase sales. Additionally, partnering with third-party foodservice providers can help retailers widen that net and attract more consumers through brand recognition, on-demand products that respond to their preferences and online ordering—all in a way that can be less resource-intensive for the operator. 

“Today’s customers expect c-stores to have high-quality freshly made foods, but creating a foodservice program isn’t just a lever to pull and say, ‘We’re adding food now.’ Retailers need to have a menu they can execute, and price and merchandise appropriately,” said Crowder, adding, “That’s where a turnkey program like Krispy Krunchy Chicken can help. We’ve figured out all of those things
for retailers.” 

New Menu Addition Delivers More Choice

Earlier this year, Krispy Krunchy launched chicken nuggets, made with whole-muscle white meat chicken breasts that are marinated in a proprietary blend of seasonings, coated in a special breading and fried in small batches. 

“The recipe has a slightly tangy dill marinade and each nugget is coated in our crazy-good Krispy Krunchy coating so that you get that initial crunch and then that juicy meat,” said Crowder. “It’s also a really large nugget, especially for the price. We put so much research and consumer testing into the development of this product to make sure we were delivering the best for our c-store operators.” 

Crowder added that they’re also a great grab-and-go option. “It’s easy to eat in your car, which is increasingly important in today’s environment. And it’s great for add-ons—you can order nuggets as a meal by itself or in addition to other meal orders. It’s also great for kids, which is a segment we didn’t cater to before,” she said. 

“Based on our menu research, TURF analysis and other analytic-based insights, we found that nuggets would be accretive to operator profitability if we added them,” explained Crowder. 

Locations that have added nuggets are purchasing an average of 7.8% more poultry than stores without nuggets, according to Krispy Krunchy’s data. “Sometimes, restauranteurs add an item that’s cannibalistic to the others—you might sell 100 new units of that item but lose 100 units elsewhere. However, in the case of our nuggets, that’s not the case. We are seeing incremental sales from those stores carrying our nuggets, whether it be from new customers who are only interested in nuggets and now have that option, or people purchasing nuggets as an add-on to their existing order,” Crowder said. 

And for consumers and operators alike who are focused on value, chicken nuggets can provide the most bang for your buck. “The size of the nuggets for the cost to our operators is almost double than some of our direct competitors,” said Joe Gordon, chief supply chain and technology officer at Krispy Krunchy. “From a profitability perspective, we see that nuggets are an incremental increase—but the penny profit is exceptional and is higher than the typical industry gross margin targets.”

Going Digital Helps Drive Efficiencies

Over a year ago, Krispy Krunchy launched a third-party delivery program through Olo that has increased average sales for participating operators. Over 750 of its locations are on the platform.

“Online ordering and delivery are basically a way to open another store without opening another store,” said Crowder. “It’s a way to reach new customers, many of whom may have never been to your store in person or might not even know about it, but will discover you through a delivery app.” 

The company is in the process of rolling out a first-party program on its website, which Crowder said allows Krispy Krunchy to capture customer data. “Third-party delivery is great for attracting new guests and introducing them to the brand. First-party programs has higher profit for operators, and we can build a better relationship with customers by knowing their preferences.”

Online ordering also generates higher check averages. The average c-store basket value was $7.17 per store, per month in 2024, according to the NACS State of the Industry Report of 2024 Data. 

“For us, the average check size is about $25 for third-party delivery and a little bit more for first-party sales, at around $30,” said Crowder. “As we get to know our customers better and can target them more effectively, we see that check average increase for our operators.”

Delivery can also help boost sales during the dinnertime daypart, said Crowder. “With delivery, people are ordering in the evenings and on weekends—traditionally slower times for c-stores,” she said. 

A Profitable Partnership 

The foodservice provider that convenience retailers choose to partner with can help increase their relevancy with customers. 

“Based on our research, customers who choose Krispy Krunchy do so for three reasons: high quality, strong value and overall craveability,” said Crowder. “In other words, customers are going out of their way to purchase food at stores that offer Krispy Krunchy. They’ll drive past other locations for this chicken.”

“Quality, value and craveability are as important to our operators as they are to their guests,” said Gordon. “It’s critical to be able to say to both audiences, ‘We’ve got you. We understand what you need, and we’ll make sure you have it.’”

For Krispy Krunchy, that means streamlining its product offerings and supply chain to ensure that operators are able to sell high-quality food reliably and consistently.

“We standardized our recipes so that all our products taste the same every time, whether you’re in Maine or Los Angeles,” said Gordon. “When it comes to our supply chain, we focus on delivering fresh product to our operators on a consistent basis. We work to protect our operators from anything going wrong in the supply chain, such as supply not being available or deliveries falling through.”

Gordon said that partnering with Krispy Krunchy is the “easy button” for operators looking to offer a foodservice program. “We design our products to be simple to execute in a c-store, while also being top of the line, gold standard products that can compete with any restaurant out there,” said Gordon. 

“We were born in convenience stores and understand the business. We design our program and products with an understanding for the environment where they’ll be made and sold,” Crowder added.