Texas likes to be recognized for its excesses and the constant desire to be bigger, faster, stronger, and richer. It has the highest oil, cotton, and livestock production in the US. It is the second-largest state in the country, behind only Alaska, and the second-most populous, this time behind California.
When it comes to retail, we also find some standout examples. This time, my discovery was the beloved Buc-ee’s, a traditional gas station and convenience store. As soon as I arrived, locals told me: you need to do your grocery shopping at H-E-B (I’ve talked about them here on the blog) and refuel at Buc-ee’s. The latter is so popular that the visit is recommended in various blogs that talk about interesting things to do in Houston. I had never seen a gas station/convenience store be a tourist attraction.
It is.
First, a bit about the company’s history.
It was founded in 1982 and is still owned by Arch “Beaver” Aplin III, headquartered in Lake Jackson, Texas. The chain began expansion with its first travel center in Luling, Texas only in 2003, and by 2018 started expanding outside Texas, with the opening of a location in Baldwin County, Alabama, and has since opened locations in Georgia, Florida, Kentucky, South Carolina, and Tennessee.
The company holds Guinness Book records as the largest convenience store (with over 73,000 square feet), the largest car wash, and the largest gas station in the world (100 fuel pumps). The bathrooms were also considered the cleanest in the US in a national survey in 2012 (there’s a survey for everything!).
The brand is very friendly. A smiling beaver with a red cap, inspired by an old toothpaste brand, is present from the facade to the packaging of own-brand products. This is one of Buc-ee’s great twists.
What’s the Twist
Positioned in the SIZE brand territory, where size truly matters and is used as a unique selling proposition, Buc-ee’s combines its colossal size with a high-value shopping experience through a very fluid shopping journey.
This is explained by the simple math that most convenience-store revenue comes from gas sales – 60% of Buc-ee’s revenue, for instance. Profit margins on gas, however, tend to be in the low single digits, while margins on food and beverages (and other merchandise) can be more than 30%.
The environment is perfectly designed for the traveler who needs a break to continue the journey. In addition to all the services for vehicles, the environment is a true shopping destination, I would say a department store of convenience.
In addition to the aforementioned ultra-clean bathrooms, the chain has created a very practical and effective system for the main items sought by travelers: drinks (especially coffee) and fast food.
In these items, the experience is a show. The coffee stations serve several people at the same time with great dynamism and a variety of options. Cold drinks also have an operational logic that flows and does not generate waits to serve.
Own-brand products occupy a large part of the store, ranging from gummy bears to hot sauce. Packaged jerkies are local favorites. Other items are very well-organized and signaled, facilitating navigation and the quick movement of those in a hurry to continue their journey. Currently, own-brand products represent around 12% of the general assortment in stores, with margins of 40%.
On the opposite side of the food, there is a large area with great products ranging from kitchen utensils, decorations, clothing, and outdoor items. The appeal to local references in the products is fantastic, as well as the visual merchandising. It is clear that there is a VM team behind the careful display of the assortment. The furniture is well-crafted and paces the different zones along the aisles.
The stimuli for bundled sales and impulse purchases are strategies executed very effectively by the brand.
The beaver icon is seen throughout the environment and in various presentations. Exaggerating a bit (as a good Texan would), it’s the local Mickey.
Most interesting of all, in my opinion, is the central part of the store, where an oval station, divided into two areas, produces and packages sandwiches, chips, sweets, and snacks.
Watching the synchronized team preparing the meats with great enthusiasm is already an attraction in itself. The open kitchen system leaves customers more eager to eat and works much better than any piece of communication. This also applies to the different nuts that are roasted, caramelized, and packaged in front of passersby.
The flow of people is insane. And nothing stops. There is no confusion or wait. There is also no place to sit and eat. Everything is designed for those who need quality, flavor, and speed. This logic of the environment has the downside of losing a high average ticket, prioritizing the flow of the journey. However, that’s not what we see at Buc-ee’s.
With a strong appetite appeal (smells, sounds, fresh food), visual organization, highly effective operational logic, and excellent product placement, the chain manages to exceed the expectations of the most hurried.
As I mentioned, the numbers are big, and the owners’ boldness is too. To build this Texan mini-empire, many loans were necessary. For an idea, the Katy operation near Houston cost 17 million dollars. From the flow of people, I observed in just over an hour of visit, I believe that it may take longer than average, but it will certainly pay off.
Even being below the radar of big retail names, a visit to Buc-ee’s is a complete lesson in consumer dynamics and should be featured as a case in seminars and universities. After all, seeing someone wearing a T-shirt with the brand of a gas station on the chest is not for everyone. What a twist.
Throughout the environment, carts and baskets are strategically positioned to optimize the time of visitors who may have “forgotten” to pick them up at the store entrance.
