West Virginia-based BFS Companies was one of the first gas station convenience store chains to tackle this challenge, and today, among its 62 stores in four states, it is a franchisee for 10 Subways, eight Gloria Jeans, seven Dairy Queens, two Tim Hortons, two Huddle Houses and two Charley’s Grilled Subs, as well as four unbranded truck stop restaurants. BFS also owns and operates 35 Little Caesar and 12 Burger King franchises, some freestanding and some in stores.
Speed and service are important, and cleanliness is paramount to winning over customers to the combo model, according to Gary Hatch, BFS’s director of merchandising. But the most crucial part is creating a sense of physical division with the space arrangement. That way, in customers’ minds, the gas station and restaurant are separate.
“All of our stores are configured differently, but we try to build separate environments, either with a food court setup or with separate entrances for food and gas,” Hatch says.
Most recently, BFS has begun putting a restaurant on each end of the building, with a convenience store in the middle; the restaurants have their own entrances and are accessible from inside the store, too. BFS’s new units using this layout are about 8,000 square feet, with about 3,500 square feet for the convenience store.
“The restaurants require a lot of square footage for the kitchen, seating and drive-thru,” he says.
BFS has grown its chain of gas station convenience stores through acquisitions of single units and multiple locations as well as through ground-up construction. The company always makes significant improvements to acquired units to maximize their potential.
The goal is to add a couple new units per year. “We’re trying to grow intelligently,” Hatch says.
“In this economy, there are a lot of locations for sale and we are choosy about what we purchase,” he says. Additionally, “We’re always upgrading and remodeling stores and investing prudently in new technology.”
Since BFS helped pioneer the gas station/fast-food restaurant combination, it has become pervasive across the country. Originally, the move made BFS stores competitive; now, it keeps them competitive.
Gas stations are frequently located on prime real estate with access to high traffic volume, and it behooves those property owners to generate as much revenue as possible from the same valuable location. Another example of this strategy: 10 of BFS’s convenience stores have car washes; seven sell liquor. “You have to give customers more than one reason to drive onto your parking lot,” Hatch says. “And nowadays, customers want it all.”
BFS was also one of the first companies to combine gas stations and convenience stores – back in 1982. “We’ve always been diversified, with multiple profit generators,” he says.
The company was started in 1974 as Bruceton Farm Service by founder Marshall Bishop, who is still the owner and CEO. Soon after opening his first Southern States franchise in Bruceton Mills, W.V., Bishop installed retail gas pumps at his store. Today, the company – which operates in northern West Virginia, southwestern Pennsylvania, western Maryland and eastern Ohio – also owns 16 bulk fuel terminals, which supply commercial and residential customers, and four Southern States agricultural stores.
Hatch has worked at BFS for 27 years — 20 of them as director of operations — and he’s seen it go through many cycles. “When part of our business is not flourishing, another part is,” he says. “Convenience does well in the summer. Bulk fuel, which includes heating oil, does well in the winter. The agricultural stores do well in the spring. Food does well year-round.”
But there’s more to diversifying than merely putting different elements in an operational portfolio, according to Hatch. Those elements have to be able to evolve with market changes, just as its gas stations have with the addition of convenience stores and then fast-food restaurants.
For example, “Southern States agricultural stores traditionally served farmers, but that’s a dwindling target market, so today, our locations are catering more to home garden customers,” he explains. “Our adaptability is one of the reasons we’ve been able to grow so much in one generation of ownership.”