Lower gas prices have increased convenience store snacking

For hungry drivers like Whitney Scott, the current below-average gas prices offer a measure of freedom.

When local gas prices last spring hovered close to $4 a gallon, drivers may have wanted to grab some snacks or sodas after filling up the tank "but didn't because gas was high," Scott said.

"Now," she said, toting a box of barbecued chicken wings from a 7-Eleven, "they have the funds to freely get what they want."

Nationwide, gas prices plunged in the second half of last year, as fracking boosted U.S. shale oil production and the OPEC oil cartel kept the spigot open.

Increasingly, experts say, drivers are taking the windfall saved at the pump and spending it inside the nearest convenience store.

Because profit margins on a gallon of gas are so thin, sales of drinks and merchandise are much more profitable for convenience store operators than fuel sales, the experts said.

For convenience stores in general, gas may bring consumers onto the lot, but drinks lure them into the store. And drinks, from Gatorade to craft beer, saw sales rise as gas prices fell.

Bonnie Herzog is a senior analyst with Wells Fargo Securities, where the research department recently surveyed representatives of more than 15,000 U.S. convenience stores.

Based on the survey results, she estimates that nonalcoholic beverage sales gained nearly 6 percent in the fourth quarter of 2014, compared with a year earlier.

Of all gas purchased by consumers in the U.S., roughly 80 percent flows from convenience store pumps, Lenard said. Only 10 percent of sales come from traditional service stations.

The average convenience store gets about 300 customers a day at the pump, Lenard said, and about 35 percent of those patrons also fuel themselves.

Seeing lower gas prices "doesn't make you hungrier or thirstier," he said. "It gives you permission to go inside."

"It's likely that total C-store revenues [for 2014] will be lower due to the lower gas prices," said Don Longo, editorial director for Convenience Store News. "However, in-store sales, merchandise and food service combined, are likely to grow more than usual, which will have a positive impact on bottom lines because" of the higher profit margins.

In 2013, motor fuels accounted for 70.7 percent of convenience store sales but only 35.6 percent of profit dollars, a report from the convenience store association noted.

Meanwhile, consumers are assessing what options the lower gas prices bring.

"It makes the economy better when you don't have to worry about gas prices being so ridiculous," said Dallas resident Karmon Robinson.