Dive Brief:

• 7-Eleven has opened a store in Manassas, Virginia, that features two restaurants — Raise the Roost Chicken and Biscuits and Parlor Pizza. The two onsite restaurants are located side by side inside the store, with separate ordering counters and shared indoor and outdoor seating.
• The store is part of the convenience store chain’s Evolution Store prototype, which was first introduced in March 2019. According to a press release, the stores serve as testing grounds where customers can try items before they roll out more widely. There are now eight Evolution Stores, which each include a restaurant concept.
• In a press release, 7-Eleven EVP and Chief Operating Officer Chris Tanco, called the chain’s expansion plan aggressive, noting its intention to compete specifically in the quick-service space. "Today’s opportunity is in the QSR space, and we are responding by aggressively rolling out restaurants across the country — both in Evolution Stores and beyond. Our plan is to open nearly 150 restaurants in 2021," he said.

Dive Insight:

The blurring of the lines between quick-service restaurants and convenience stores isn’t new, but the level of competition among the two continues to rise. In 2019, Chris Gheysens, CEO of Wawa, discussed his brand’s evolution into a "restaurant-to-go" as a way for the concept to evolve and win over consumers’ food budgets. Wawa, 7-Eleven, Casey’s and QuikTrip have all recently expanded their retail footprints and meal offerings.

These efforts are making a dent. In 2019, the National Association of Convenience Stores’ State of the Industry report found that 23% of convenience store sales come from foodservice. That same year, GasBuddy released a study finding that 43% of Americans ages 18 to 29 bought more c-store meals than they did three years prior.   

Grocers are also incorporating QSRs into their stores, with operators like Saladworks rolling out with several companies to serve omnichannel demand. As store traffic has dipped and online demand has risen, retailers like Kroger and Walmart are testing out ghost kitchen concepts. 

In March 7-Eleven announced its first corporate-owned drive-thru restaurant, which will service its in-house Laredo Taco menu, as well as its traditional Slurpees. Wawa recently opened its first drive-thru-only location with fresh food, value meals, combo meals and specialty beverages. The location also includes curbside pickup.

According to The Shape of Food Retailing in the New Normal report released earlier this month, innovations targeting dayparts — the take-home dinner category posing some of the most challenges — represent a "significant opportunity for roadside retail" to increase foot traffic and sales. For the latest Evolution Store in Virginia, diners not only have the option of two restaurants but also a wine cellar and beer cooler, fresh baked items, customized espressos and other convenience options that many QSRs don't offer. 

If 7-Eleven is to be successful with this Evolution concept, expanding with both a fried chicken concept and a pizza concept is a good place to start. The demand for both has been staggering in the past year and some restaurant brands have even alerted to a potential chicken supply shortage due to such demand.

Its Manassas store will also serve as a proving ground for its Sips and Snacks emerging brands program. This means customers can purchase items submitted by up-and-coming entrepreneurs, as well as the retailer’s newest innovations. These features create more of a destination standard QSRs don’t have and could drive new traffic to trial Raise the Roost and Parlor Pizza.