August 17, 2023

The Evolution of Convenience Retail

Gas stations were once rooted in being a quick stop, but modern convenience retail has evolved to become a destination point for consumers looking for more than just refueling. Modern convenience retail typology has changed from catering to basic needs to incorporating the user experience and creating a placemaking destination.

Dated 5000 sq. ft. gas stations have been replaced with modern convenience retailers which reach up to 25,000 sq. ft. in some places. Going beyond the offerings of a simple gas station with a snack kiosk, modern convenience retail has become a one-stop shop for buying fresh food, groceries, basic necessities and some fun.

Although convenience retail has come a long way since its inception in the United States, future success will depend on its continuing ability to adapt to the changing market conditions, including advancements in technology, use of AI (artificial intelligence), the development of the e-fuel industry, global trends toward sustainability, and the changing lifestyle of the today’s end user.

The Evolution of Convenience Retail

“Neighborhood convenience stores and gas stations used to be quick stops where you’d fill up your car with gas and maybe buy some snacks, but today they are a destination,” said Joseph Serruya, Principal for RDC. “These convenient locations have become integral parts of the community where people go to find everything they need in once place.”

Originally called ‘filling stations,’ early gas stations utilized attendants to fuel customer vehicles and by the 1950s-1960s, gas stations were common sights on the sides of major roadways. Though their initial purpose was limited to vehicle refueling only, convenience retail has since evolved to provide more than just gasoline.

“There has been a shift in convenience retail from basic necessity to becoming a placemaking environment where the user experience plays an important role,” said Rashmi Mehadia, Studio Director for RDC. “When considering adjacencies for a fuel retailer, anything that impacts or interacts with placemaking is beneficial.”

Placemaking is the practice of “transforming public spaces to strengthen the connections between people and these places.” Connection between people and places are strengthened by bringing the right adjacencies that support each other and enhance the user experience. QSR (quick service restaurant) is one such concept in convenience retail that is growing fast and creating a placemaking destination for its user. Location is an important factor in placemaking design, and convenience retailers should prioritize locations within close proximity to adjacent businesses and areas where people live or work.

“The stereotype of convenience retailers being located on freeways or stand-alone structures in urban settings with no architectural importance is slowly shifting its image,” said Rashmi Mehadia. “Now, convenience retailers are commonly located in urban settings, with emphasis given to how

it creates symbiotic relationship with its surround environment”.

In addition to operating as traditional convenience/fuel station, modern convenience retail includes restaurants, car washes, vehicle servicing shops, and more. These adjacencies have propelled fuel retailers to surpass their original purpose to become one-stop shops for the people and communities they serve.

The Future of Convenience Retail

Though convenience retail has already undergone a significant amount of evolution, it will likely continue to adapt to better serve communities. Once recent example of this has been the introduction of electric vehicles and the installation of EV (electric vehicle) charging stations into existing fuel retail properties.

“I think it is an evolution that depends on a balance between the number of pumps and the number of EV stations,” said Joseph Serruya. “Most sites have a capacity to service a certain number of cars split between gasoline pumps and EV stations. Though fuel retailers cannot exceed the site capacity, the split between gasoline pumps and EV stations may vary to meet consumer demand.”

Since charging an electric vehicle takes longer than refueling a car with gasoline, fuel retailers must ensure their locations are focused on providing a positive customer experience which includes seating areas and clean facilities. To further this goal, fuel retailers may also choose to partner with adjacent businesses, such as grocery stores, shopping centers, parking complexes, or other convenient places where people can charge their vehicles while completing other activities.

While electric vehicles have been growing in popularity, the demand for EV stations varies considerably depending on code regulations of the country or state. There are only a couple of states in the country that have code implications that force designers to incorporate EV stations on their projects. Since electric vehicles and the infrastructure to support them are more expensive than conventional vehicles, they are still less common than gasoline powered cars.

“Anything that is EV costs more upfront,” said Rashmi Mehadia. “But what I am seeing is that sustainability pledges taken by global fuel retailers for other markets, such as in Europe, are impacting US markets. These retailers are coming up with their own brands and making it less costly. A brand like Tesla that has a monopoly will soon become history as other brands enter the market and make EV less costly and more accessible.”

Electric vehicles are gaining traction for use in business-to-business transport as companies like Amazon and UPS take steps to decarbonize their vehicles. Global fuel retailers have also taken similar steps to incorporate sustainable technologies, such as Circle K which has launched their own network of fast EV charging stations.

“I think the development of the e-fuel industry will have a global impact on convenience retail,” said Rashmi Mehadia. “Convenience retailers are not only relying on technology that is already available in the market, but they are also investing in their own R&D (research and development) and creating their own sustainable solutions for their brands.”

How can RDC Help?

RDC’s team of expert architects and designers have worked extensively with convenience retail brands in both national and global markets. Our team is knowledgeable about the most recent advancements in the field of architecture, and we are ready to help you design your next retail project!