For a half-century, the NACS State of the Industry Report has served as the premier annual benchmarking tool for the convenience and fuel retailing industry, providing key data, analysis and strategic insights to help retailers chart the course for their business.

Published in May 1970, the inaugural State of the Industry Report marked the industry’s first compilation of U.S. convenience store sales and net profit data. The first report was a simple three-page table with the title “Annual Report of Stores, Sales and Profits of 1969,” based on responses to a nine-item questionnaire distributed to NACS members. The industry’s total annual sales for the 12 months ended December 31, 1969, stood at $1.1 billion, based on reporting by 111 companies representing 6,893 stores.

For comparison, the industry averaged $1.1 billion in sales every 15 hours ($654.3 billion total in-store sales) in 2018. And 160 firms representing 24,007 stores contributed their time and data to the survey behind the 199-page NACS State of the Industry Report of 2018 Data.

Early Days

The 1970 report evolved from the Confidential Figure Exchange, first published in 1967, which shared only limited data about the industry. The results weren’t enough to give a true picture of performance, but NACS leadership believed it would compel more companies to confidentially share their data in the future, laying the groundwork for a Standard Manual of Accounts, which NACS released in 1969.

Harry C. Hunter was executive director of NACS at the time, and the association, now based in Alexandria, Virginia, was then-headquartered across the Potomac River on K Street in Washington, D.C. Chester Cadieux, who co-founded Tulsa, Oklahoma-based QuickTrip with Burt Holmes, was NACS president.

In Cadieux’s President’s Message in the November 1969 issue of the “NACS Report” newsletter, he asked members of the eight-year-old organization to respond to a call for data. “In the near future you will receive a questionnaire from this office requesting information for our first NACS State of the Industry Report,” said Cadieux, who served as NACS president during 1970-71.

“We feel that it is imperative that we in the industry cooperate and present our industry as it is and as we feel it will be (original emphasis). Of course all this information will be used only by Harry Hunter. We urge you to commit yourselves to this project and take prompt action when the questionnaire arrives in January,” he wrote.

Cadieux continued, “As our industry grows and costs increase it will be increasingly important that we be able to sharpen our management skills. Obviously one of the best ways to sharpen skills is to compare your results against those of others in the industry…”

And so the NACS State of the Industry Report (SOI) was born, and with it began a legacy of shared research and analysis to help define the size and scope of the industry. These early, pioneering efforts have led to robust study groups and the NACS State of the Industry enterprise that are critical to NACS members.

“Our industry moves at lightning speed. To succeed, you need data to help you understand not only your own business metrics but also how you stack up against the industry as a whole,” said Henry Armour, NACS president and CEO since July 2005. “Until NACS launched the State of the Industry Report, efforts to collect metrics industrywide were scattershot. NACS leadership early on understood the vital importance of benchmarking data across the convenience and fuel retailing landscape to help pinpoint trends, and their foresight has served us well. Today, the NACS SOI Report is the premier industry benchmarking tool.”

Key Milestones

In 1972, the SOI Report included a survey of gas sales for the first time. In addition, NACS affirmed its policy that sponsorship of any SOI merchandise or other studies must be approved by NACS Research.

In 1978, the NACS Compensation Report became the first comprehensive report on current convenience store compensation practices and trends at the operational and executive management levels. The report is still produced today and can be found at www.convenience.org/compreport.

In 1983, the SOI Report offered a new service: an individualized printout comparing a company’s metrics to those of the industry.

We feel that it is imperative that we in the industry cooperate and present our industry as it is and as we feel it will be.

In 1988, fast food represented 14.4% of in-store sales, an early indication of the importance that foodservice offerings would come to play in convenience retail.

In 1994, retail membership climbed to a record high of 1,766 companies, up from 1,543 the year prior. Members operated 63,000 stores in the United States and 25 countries. While small and large company diversity remained a hallmark of NACS’ membership, the distinction between traditional operators and petroleum marketers began to blur. This pollination was confirmed when the 1994 SOI report revealed that gasoline sales outpaced merchandise sales for the first time. Indeed, 45% of all NACS member companies had petroleum, oil, energy or gasoline in their corporate name. This expansion into motor fuels—as well as emerging categories like branded fast food—attracted a larger universe of suppliers.

A fuels supplement appeared in 1997, and in 1998, new categories for foodservice emerged.

Then in May 2002 the first State of the Industry Summit took place in Washington, D.C. Topics of discussion included the economic recession, channel blurring, impact of the 9/11 attacks on economy, cigarette price inflation, motor fuels competition, financial metrics, trends of the last decade and top-quartile analysis.

Credit card fees for the industry reached $5.3 billion in 2005. That same year, NACS and CSX LLC entered a multi-year agreement to enhance the entire suite of the NACS SOI research initiatives.

Soon after, in 2008, the enhanced report featured additional research supplements on same-firms’ trends (2004–07), same-store trends and technology.

Always Confidential, Always Thorough

The methodology for SOI data collection and analysis has become more sophisticated over the years as the industry has grown. NACS has invested significant resources in its State of the Industry initiatives and has partnered with best-in-class providers to deliver insightful, useful information about the industry to help NACS members maximize their effectiveness and profits.

The NACS State of the Industry Report presents key metrics in the business-critical categories of finance, store operations, merchandising and fuel sales. Report information is based on the income statement, balance sheet and productivity data provided by convenience store companies across the country, as well as other relevant data sources.

Researchers analyze and present the data in a comparative performance quartile format based on store operating profit, which allows retailers to benchmark and improve their own operations by understanding the drivers of key performance metrics.

“As consumer demands for convenience continue to evolve and shape the products, services and experience needs of shoppers, the importance of performance benchmarking and more granular insights is more critical than ever,” said Lori Stillman, NACS vice president for research. “The NACS State of the Industry Report has evolved over the past 50 years in pace with the dynamic needs of our industry and will continue to be refined to meet the needs for the next 50 years and beyond.”