7-Eleven has evolved beyond its roller-grilled, Big Bite-branded hot dogs, with healthier salads and sides and more recently bean-to-cup coffee and espresso from touch-screen machines and a new frozen coffee Slurpee Nitro, just to name a few offerings.
Now the Texas convenience store chain believes it has hit on a food and beverage strategy that customers will crave and that will compete with quick-serve restaurants and can also be delivered by its 7Now on-demand service.
7-Eleven stores that include a Laredo Taco Co., a fresh-made taco concept with roots in South Texas, generate more than double the fresh food sales of a regular 7-Eleven, said Chris Tanco, 7-Eleven’s chief operating officer.
The Irving-based retailer and largest U.S. convenience store chain plans to have Laredo Taco restaurants in more than 500 7-Eleven stores next year.
“We finally have a breakthrough, and that’s why we want to be aggressive with a rollout,” said Tanco. “It’s now a proven concept.”
7-Eleven acquired Laredo Taco Co. three years ago with the $3.3 billion purchase of Sunoco’s convenience stores.
It’s adding the restaurant to existing 7-Eleven stores and in new “evolution stores” where the retailer is testing ideas such as beer caves, LED-lighted grocery shelves and several machines including one for fountain drinks that has faster dispensing with 24 flavors and two kinds of ice.
Laredo Taco Co. was introduced to Dallas at a 7-Eleven store last year at Sylvan Thirty in West Dallas. Two more evolution stores are now opening in Dallas.
Tacos are being served at a newly remodeled 7-Eleven in Lake Highlands at the corner of Audelia Road and Walnut Hill Lane. Another evolution store is under construction, also in northeast Dallas, at Skillman Street and Abrams Road.
“We’ve wanted to be a fresh food and beverage destination, and we know that’s where the customer wants us to go,” Tanco said. The strategy to combine a quick-service restaurant with 7-Eleven is based on a belief that there’s going to be an ongoing market share battle for quick food and delivery, he said.
Another restaurant concept called Raise the Roost that sells chicken and biscuits opened in March in a 7-Eleven in Manhattan. Two more evolution stores have opened in San Diego and Washington, D.C., with Laredo Taco inside.
“When they like our tacos with our tortillas made fresh in the store, it gives us a positive halo effect on the rest of the food items,” Tanco said. The Roost concept is also doing well and will be added to stores, he said.
Ten more evolution stores are being built in Virginia, California and Chicago. They’re being scattered based on geography and demographics.
“We’re trying to find the best combinations,” Tanco said.
Texas-based Buc-ee’s has gained attention in recent years not only for its clean bathrooms but also for its huge prepared food selection. Fuel City, which has five locations in North Texas, sells gasoline but became a popular stop when people discovered its tacos.
The Lake Highlands 7-Eleven, which originally opened in 1983, is smaller than the one at Sylvan Thirty and doesn’t have seating, but that’s part of the testing too, Tanco said. The newest evolution store has a prominent sign and staging area to the right of the checkout for the 7Now delivery program, which promises delivery in 30 minutes or less. It was put there to see if it helps with awareness of the app-based delivery program the company started in 2018.
“We have it through 2,000 stores, but the awareness level isn’t there yet,” he said. It also has contactless checkout using its 7Reward app.
Food is made in front of the customer at both Laredo Taco and Roost, but quickly, he said.
Convenience stores are competing with fast food, “and in this environment with COVID-19, people don’t want to stand in line,” Tanco said. “Some people don’t want to go inside a big-box grocery store.”
The Lake Highlands store has a large wine section with brands not typically sold in a convenience store. There’s the usual milk but no bacon and eggs, sometimes a quick purchase at a convenience store.
If shoppers notice and want it, the breakfast staples will be added, the retailer said, but they’re betting customers will opt for the freshly made breakfast tacos instead.
Twitter: @MariaHalkias
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