CONVENIENCE stores are drawing customers away from major fast food chains like McDonalds with lower priced items.
With morning traffic at fast-food chain restaurants falling over the last three years, convenience stores are making sire their prices to beat McDonald’s, which dominates as a quick-service breakfast option.
“[Quick-service restaurants] are looking at late-night sales and early morning sales, and they are directly looking at convenience stores and saying, ‘What is working? How can we bring that to our stores?’” Jeff Lenard, a spokesperson for the National Association of Convenience Stores told CNBC.
Casey’s General Stores, an Iowa-based company with nearly 2,900 stores across 19 states, is rising as a breakfast competitor.
Casey’s is most notably known for its pizza options, including its breakfast pizza which was first introduced in 2001.
The breakfast pizza is topped with scrambled eggs, cheese, cheese sauce or gravy, with the options to add bacon, sausage or veggies. Each pie consists of 12 slices and comes in at $17.99.
Casey’s offers nine different items on their breakfast menu, with a $1.49 hashbrown being their cheapest item.
Customers can purchase egg and cheese sandwiches with either bacon or sausage on their choice of croissant or biscuits for $3.69 in Iowa.
The store also offers a loaded breakfast burrito or loaded breakfast bowl for $4.99.
A bacon, egg and cheese biscuit from McDonald’s on its own is priced around $5.89, which is $2.20 more than Casey’s.
The meal option at McDonald, which includes a drink and a hashbrown on the side, is $11.29.
“While [a] convenience store broadly does have some tailwind from being a lower price point, the ultimate differentiator, and what’s really going to set apart the winners from losers, is that quality aspect of it,” Circana Senior Vice President and Foodservice Industry Advisor David Portalatin said in an interview with CNBC.
BREAKFAST BEATING
While Casey’s offers lower prices, their breakfast menu is not as diverse as McDonald’s.
The fast food giant offers 21 breakfast menu items ranging from oatmeal to burritos to pancakes and sandwiches.
However convenience stores like Casey’s have more variety, such as energy drinks, smoothies, granola bars, bananas and more, items that fast-food chains don’t commonly carry.
A survey conducted by Intouch Insight found that 72% of consumers find convenience stores to be a “viable alternative” to fast food restaurants, a 56% increase from the year prior.
Morning sales can be vital for businesses as they can attract customers who are considering skipping out on breakfast.
Morning visits accounted for 24.8% of McDonald’s traffic in 2024, according to data from Placer.ai. However, breakfast food traffic decreased an average of 23% in 2023, compared to 2019.
Fast Food meal deals
Here are some of the current value meals offered by popular fast food joints.
Taco Bell’s $7 Luxe Cravings Box:
- Chalupa Supreme
- Beefy Five-Layer Burrito
- Double Stacked Taco
- Chips and nacho cheese sauce
- Medium drink
McDonald’s $5 Meal Deal:
- McDouble or McChicken sandwich
- Four-piece Chicken McNuggets
- Small fries
- Small soft drink
Wendy’s $5 Biggie Bag:
- Junior Bacon Cheeseburger or Crispy Chicken Sandwich
- Four-piece chicken nuggets
- Junior fries
- Small soft drink
Burger King’s $5 Your Way Meal:
- Whopper Junior, Chicken Junior, or Bacon Cheeseburger
- Fries
- Four-piece chicken nuggets
- Soft drink
Rising costs are causing consumers to opt against buying breakfast from stores.
“Inflation is not helping either – breakfast is the easiest of all the meals to skip when considering cost-cutting,” Revenue Management Solutions, a company that provides data to help business operations, said.
“This has more to do with customers skipping breakfast altogether as a way to cut back on spending. With many people now commuting to work again, there’s also a shift toward having breakfast at home rather than grabbing it on the go,” RMS Senior Vice President of Consulting Services Richard Delvallée told NRN.
The RMS suggested business entice customers to purchase breakfast by offering free items with purchases–particularly coffee.
McDonald’s has moved to attract customers with the new McValue Menu for discounted options.
The move came 11 years after the fast food chain discarded their dollar menu.
The McValue menu offers breakfast deals where customers can purchase a sausage biscuit, McMuffin, burrito or hashbrown and another one of those items for just one more dollar.
