CHICAGO — As convenience stores strive to compete with fast-food restaurants, the emphasis is on offering greater variety of fresh, high-quality foods -- and competition is heating up, according to Technomic's Convenience Store Market Intelligence Report. C-store foodservice is a $10.9 billion industry and a major opportunity area for c-stores throughout the US.
Fifty-seven percent of consumers indicate they have purchased prepared foods from convenience stores. Approximately one-third of them who visit c-stores for fresh-food items buy prepared foods at least once a week from c-stores.

More c-stores are leveraging branded restaurants at their stores. Although Subway and McDonald's have locations built into some convenience stores, more progressive c-store chains are developing and integrating their own branded restaurants into existing stores, which transforms the perception of purchasing prepared food at a convenience store.

"Prepared food is a growth opportunity for convenience stores willing to raise the bar on quality and key attributes sought by today's consumers," says Donna Hood Crecca, Technomic senior director. "Consumers say they would visit convenience stores more often for prepared foods if those foodservice areas were improved upon. Customizing their offerings and a more appealing décor and atmosphere could enhance the experience."

Other highlights of the report include:
• Seventy-six percent of consumers who buy prepared foods from c-stores say these locations provide a convenient option.
• Two-fifths of consumers indicate they would visit c-stores for prepared foods more often if freshness and quality were improved.
• C-stores beat other types of retail locations for breakfast patronage, and they have been the only segment to see a significant increase in breakfast patronage over the past few years.
• Entrées account for more than half of c-store menu items; their share of the menu expanding significantly to 51 percent in the second quarter of 2013 from 47 percent from one year earlier. Sandwiches remains the No. 1 breakfast entrée.