Circle K outlines New Zealand expansion

Circle K outlines New Zealand expansion

Circle K plans to open more than 100 stores across New Zealand, making it one of NZ’s largest grocery convenience and food service outlet chains.

Pamma Retail Group (PMG), which purchased the master license rights of Circle K, estimates 30% of the sites will be greenfield with the remaining 70 per cent conversions of current independent stores.

Iqubal Basra, Site Development Director, said they currently have four stores up and running under the Circle K trademark but with the high number of independent convenience stores currently reaching out, this will expand rapidly.

Basra says the target is to convert 2% of New Zealand’s 5,000 convenience stores to the brand.

They are ideally looking for 200m2 sites that can operate 24 hours a day but can also work with sites with smaller footprints or that operate on reduced hours in rural or lower traffic areas.

“The last four years have just been trying to build the systems and supply chains and put them all in place here and make sure the model works. Now we’re seeing a good return on investment, so we’re trying to replicate that and re-sell it on because it’s a proven model.”

According to Basra, the appeal of converting to a Circle K is the improved retail offering – with stores carrying more than 2,000 different SKUs – and the potential to increase store margins.

“Our margins are very good because of our food offer. We’ve got fryers, chips, combos, hot dogs, and your margin goes up quite dramatically because we’re basically a fast-food chain in a convenience store.

“What New Zealanders can expect to find in one of our stores is a significantly different retail experience from the traditional corner dairy and service station. The larger stores are a hybrid of a convenience store and prepared food outlet.”

Basra said they have a comprehensive training program and team of specialists who can assist store owners in moving away from a dependence on tobacco as a revenue source, which is planned to be eliminated by the New Zealand Government by 2025.

“With us, they will be able to leverage the buying power of a multinational along with the market intelligence and data insights that will help them progress with these changing customer behaviours and regulations.”

Part of the expansion involves opening some of the first purpose-built electric vehicle charging stations across the country, and with that development will come a space catering to those waiting for their vehicle to charge including seating areas, televisions, and phone chargers.

“The growth in EVs is set to impact the way fuel outlets are designed, and to address that change, Circle K NZ is planning to transform the retail fuel market – opening some of the first purpose-built EV charging and petrol stations at sites around the country as the industry closely watches how the EV trend will reinvent the traditional petrol station.”

The search for new sites includes looking for service stations and operators that will be specifically designed to accommodate the growth of EVs in New Zealand.

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