Kroger 2008 Annual Report Download - page 20

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The Kroger Co. Page 19
CONVENIENCE STORES
OVERVIEW
Kroger operates five convenience store divisions under the following
banners: Kwik Shop, Loaf „N Jug, Quik Stop, Tom Thumb, and Turkey Hill
Minit Markets. At year-end 2008, Kroger‟s 771 convenience stores
spanned 16 states. Subsidiaries operated 684 of the convenience stores;
87 were operated through franchise agreements. In 2008, the convenience
stores accounted for 5.0% of Kroger‟s total sales. The c-stores benefit
from synergies with the Kroger supermarkets by offering a limited selection
of private label products.
GROWTH
During 2008, we opened six convenience stores and closed 17. The new
stores range from 2,800 square feet to 3,900 square feet in size, typically
located on parcels of one to two acres. The new stores generally have a
large gasoline offering with four to eight gasoline dispensers, covered by a
large, well-lit canopy. The majority of our gasoline facilities offer pay-at-
the-pump convenience for our customers. Over 300 of our convenience
stores are tied into the Company‟s successful loyalty card program.
MARKETS
Kroger‟s convenience stores continue to concentrate on small to medium-
sized towns located near interstate highways. Two-thirds of the stores are
located in towns with fewer than 75,000 residents.
ASSET BASE
The majority of the locations occupy high-traffic corner sites. Of the 771
stores, 699 sell gasoline. During 2008, 75 stores received interior
remodels and 17 received gasoline remodels.
STORE PROFILE
Average store size at year-end was 2,780 square feet. Average weekly
customer count is approximately 4,700. The typical convenience store
stocks approximately 2,800 items, with more than 70% of non-gasoline
sales coming in five categories: soft drinks, beer, snacks, candy, and
tobacco products. Gasoline sales represented approximately 73% of the
Company‟s total convenience store sales in 2008.