Parker’s Southern Hospitality
Originally published in CSP Magazine
By Greg Parker, President and CEO
How Parker’s is going to become a multibillion-dollar business
Many of you called me crazy.
Here I was, a successful convenience store operator with more than 35 years of entrepreneurial experience, the owner of a popular chain based in beautiful Savannah, Ga.
And I was thinking big. Really big. When I wrote a guest article for CSP magazine’s October 2013 issue, I openly shared my plans for explosive growth at Parkers for 2014 and beyond. I revealed that I wanted to grow Parker’s from a $500 million company to a multibillion one over the next decade.
Some readers considered this a midlife crisis or a pie-in-the-sky dream. I viewed it as a realistic opportunity, an achievable goal—and a bold challenge worth fighting for.
I knew it would require my full attention and something necessary as part of Jim Collins’ BHAG (Big, Hairy, Audacious Goal). I’d have to invest. Big. I would need to expand my team and grow at an unprecedented pace without compromising the high quality, customer service and brand loyalty that has made Parker’s a successful midsize operation.
I decided to widen my longtime, loyal “inner circle,” augmenting their expertise with new hires in key positions ranging from operations and foodservice to human resources and IT. To move from a chain of 36 stores to more than 100 locations, I recognized early on that the strategic way to grow is by investing—not just in dollars, but in talent.
I would need a team of eager, passionate, fire-in-the-belly leaders driven to partake in a growing enterprise, folks not afraid to counter my suppositions and seek out the best solutions to the loftiest of challenges.
So where are we today? I can honestly say the past year has been the busiest of my professional life. We built eight stores in 10 months and were named to the prestigious Inc. 500/5000 list of the fastest-growing private companies in America for the third consecutive year, an accomplishment of which I’m extremely proud.
We were voted Best Convenience Store Company by readers of the Savannah Morning News, Savannah Magazine and the Island Packet. We’re now in the process of planning a December move into our stylish new corporate headquarters, located in the iconic Philbrick Mansion in the heart of Savannah’s stunning National Historic Landmark District.
I have every confidence the new Parker’s headquarters will be a true showcase, with each of our teams arranged in “pods” and with plenty of conference rooms that will provide space for our internal meetings and for members of the community to exchange ideas. We’re also launching a new Parker’s website before year-end.
Over the past year, we have expanded our core team significantly, adding Bill Bishop as our new vice president of real estate and development, as well as national experts in human resources, IT, foodservice, operations and a range of other areas. Their experience, insight and wisdom have increased our bench strength and made us a more competitive company. We’re stronger than ever, growing at an unbelievable pace.
These investments in expanding the Parker’s team and our corporate brand have yielded a significant return on investment. By any measure, our numbers are impressive.
Our year-over-year EBITDA (earnings before interest, taxes, depreciation and amortization) has increased 36.8%. Overall gas sales at Parker’s have increased by 33% over last year, an incredible accomplishment in our era of declining consumer consumption.
In addition, our in-store sales have surged to 28% over last year, which was already a record high. However, the picture hasn’t always been rosy. It has been difficult to hire the right people for key positions, and some of our recruitment efforts haven’t panned out the way we originally planned.
Over the past year, I’ve learned that growth provides an opportunity for reflection and the chance to learn from our mistakes. I’ve been forced to take a deeper look at who we are and what we value most at Parker’s.
I’ve also learned that to keep quality high during a period of ambitious growth, it’s imperative to stay connected to my team and to ramp up training efforts.
That’s why we opened the Parker’s Academy of Excellence in Savannah to train our team members. We’ve built a convenience-store interior to train employees and have established 12 centers where we develop leadership and management skills. By creating our own training academy and developing our own training modules, we’re ensuring that Parker’s employees work from a common foundation toward the same shared goals.
But how do we continue to grow strategically while continuing to deliver on the Parker’s brand promise? It’s critical that I serve as an effective, engaged mentor for my team, coaching my direct reports in operations, real estate and other areas. I need to inspire my team members with a sense of entrepreneurship and a desire to work with a sense of urgency. Even more important, I want every Parker’s employee to feel a sense of ownership and to know that they are invested in our long-term success.
I’ve also brought in former Amoco vice president and BPAMA executive director John Kleine to serve as our corporate coach and to be a mentor to my core team members. His counsel and insight has proven invaluable.
I’m impressed by how our longtime employees have stepped up and how new hires have brought fresh ideas and great energy to Parker’s. Growth has been challenging—and sometimes painful—but also a humbling and rewarding experience.
The Importance of Technology
There are two major ways for c-store companies to grow: by adding store count and by expanding sales within your network. At Parker’s, we’re doing both.
We’ve found that technology is key to growing organically within existing stores in a diminishing-consumption market. So we’ve taken a strategic approach to technology, using it to boost sales, increase customer loyalty, decrease transaction time and make our customers’ lives easier. The result? We’ve grown in-store sales for stores open at least a year by 6.9% and gas sales by 5.9% over the previous year.
Earlier this year, we replaced every POS system with a new Radiant system, which saves up to 11 seconds on every transaction. This upgrade allows us to complete more transactions per hour per CSR, which has led to sales and profit increases.
We’re also adding LED menu boards at the stores where we serve prepared foods and are close to launching a mobile wallet, which will provide a convenient new option for customers to pay for items using their mobile devices.
I’m thrilled with a new proprietary software program that helps us decide where to build new stores. The GIS-based system can integrate traffic patterns, demographic information, elevation detail, zoning information and data about competitors to help us maximize our real-estate investments.
We’re using the latest technology to create a pro forma before every store is built. This process allows us to make informed decisions, increasing our ROI and maximizing profitability while minimizing the cannibalization rate at our new stores.
Loyalty and Empathy
I truly believe one of the keys to our success at Parker’s is our emphasis on loyalty. More than ever, it’s important to forge an emotional connection, that stickiness, with consumers. Customers have so many choices in today’s marketplace.
That’s why we’ve developed various programs and incentives that reward frequent customers and encourage them to patronize Parker’s.
However, no matter how big our company is, we know it’s vital to give back to the communities that support us. Our Fueling the Community Program donates a portion of the profit of every gallon of gas sold on the first Wednesday of the month to area schools. I’m a big believer that education is the rising tide that floats all boats and makes communities stronger.
We also made a $1 million donation to support the Parker’s Emergency and Trauma Center at Memorial Hospital in Savannah to ensure that quality medical care is available to everyone—regardless of age, race, class or ability—in our market area. Every year, we give free gas cards to benefit cancer patients and families of children in urgent need of medical care.
In addition, we’re taking the lead on an ambitious citywide Anti-Litter Campaign in Savannah. We also serve as the presenting sponsor of Picnic in the Park, a signature cultural event in Savannah that attracts more than 20,000 people to enjoy free classical music at Forsyth Park in October. Through this corporate sponsorship, we’re able to showcase talented local students and to make high-quality music available to everyone, of all ages and backgrounds, in our community.
That’s giving back to our customer base and showing our commitment to the places where we do business.
New Retail Concepts
While ramping up our team, I concluded that if we’re going to be masters of food, we need to think outside the four walls of the conventional store. We decided to follow in the footsteps of Dunkin’ Donuts and McDonald’s and do what many designers and consultants say is critical if the convenience industry is going to be fully vested in foodservice: We launched our first drive-thru store.
Located in Statesboro, Ga., our 36th location is our first to allow Mom to stay in the car with her kids while grabbing a quick snack. Today, this store does 22% of in-store sales and transactions at the drive-thru window; customers purchase everything from cigarettes to fountain drinks without leaving the their vehicle. And that’s without any prepared food or beer sales available at the drive-thru!
This was admittedly no cheap date. I believe in transparency, so I’ll share with you that we spent roughly $3 million to build our Statesboro store. Brandon Hofmann, our chief marketing officer, played a big part in our in-store design, signage and overall product selection. We’re so pleased with the results of our pilot drive-thru location that we are already making plans to roll out the model in other markets.
Over in Port Royal, S.C., we opened a new store that is now selling more than 400,000 gallons each month from six pumps. Incredibly, 35% of all sales here are being paid for with our customers’ PumpPal cards—which offer significant discounts on gas to loyalty club members—underscoring the importance of cultivating and rewarding loyalty in new and existing markets.
Our newest stores, in many ways, position us both on the forecourt and the backcourt for the demands of tomorrow. We’re excited about what 2015 holds in store.
Investing in the Future
What’s next for us at Parker’s?
We will continue to invest in talent. We will continue to invest in our stores. And we will continue to invest in new markets. To achieve our goal of adding 10 stores each year, we have to streamline our processes and work smarter than ever.
I’m confident the Parker’s paradigm will work on a grander scale, benefiting our customers as well as our employees. In every community where Parker’s does business, we raise the bar, offering bright stores, clean bathrooms, friendly staff and signature Parker’s products such as fresh-brewed iced tea, ice-cold lemonade, gourmet coffee and Chewy Ice. Fast, friendly service is our hallmark.
We target our stores to the working mother, who is the most time-starved, discriminating customer. She wants safe, clean stores, wide aisles, easy-to-find merchandise, bright lighting and a helpful staff. And that’s exactly what we deliver at every Parker’s location, 24/7.
The past year has been a time of remarkable growth and a period of incredible learning opportunities for my team and me. Am I proud of what we’ve accomplished? Absolutely. But I still have my eyes on the prize. We’re actively looking for acquisition opportunities in key markets.
Smart growth is healthy growth. That’s why I’m so excited about the future. At Parker’s, we’re charting a path for long-term growth and sustainable success. I’m eager to continue our aggressive strategy, applying important lessons we’ve learned along the way on this amazing journey.