A major rebranding initiative and a new focus on its lucrative car wash business is expected to boost profitability for Pittsfield, Massachusetts-based LiptonMart Stores.
Owned by Lipton Energy, an oil and gas distributor in western Massachusetts and southern Vermont, the small, regional player is also boosting its foodservice and adding a loyalty program as it seeks to compete against larger players in the industry.
Those competitors include large, publicly traded companies like Global Partners, which owns banners like Alltown Fresh and Jiffy Mart, and EG Group, which owns Cumberland Farms. This makes for a challenging operating environment, noted Michael Lipton, LiptonMart owner and CEO.
“We are a minnow in the ocean,” he said.
LiptonMart operates nine c-stores, one of which has a car wash. Although that car wash business was an ancillary pickup as part of an acquisition of several c-store from Fleming Oil in 2012, it has performed better than expected, and helped convince Lipton to build more.
“We gutted that and did it over, It’s been a good business for us … we are really looking to make that one of the biggest drivers for growth for us,” said Michael Lipton, LiptonMart owner and CEO.
Car washes can be very profitable and also provide “a hedge for being in the oil and gas business,” Lipton explained. "It is a hedge against electric vehicles and all that. Teslas still have to be clean.
The company has purchased property to build a freestanding car wash that Lipton expects to open by early fall 2024. The “high volume” car wash will include three pay lanes and technology that allows for a monthly subscription to the service.
Executives are also looking to purchase another c-store/car wash combination in the near future and incorporate a rewards program for car washes. Future car washes will likely be new builds.
“If you do your homework and you find the right spot, it’s safe to say you can build for less than they are selling [used car washes] for….and have the latest technology,” Lipton explained.
Rebranding as Lipton Market
LiptonMart recently began rebranding its stores under the name Lipton Market to “give it more of a food-centric feel, and make it seem more like a c-store,” Lipton said. The rebranding, which includes complete store re-designs, increased foodservice options and the addition of a loyalty program, will likely be completed sometime next year.
“We are excited about it. We’ve been this way a long time, so it’s tough to change, but we are trying to do it right,” Lipton said.
LiptonMart began the rebranding processing this summer after enlisting the help of Paragon Solutions.
Executives are being very thoughtful and deliberate as they’re planning the stores’ new food and beverage offerings. “Foodservice is so popular now,” said Lipton. “You can’t just throw it in. It’s not a set it and forget it.”
The c-stores currently offers “light” foodservice such as prepackaged sandwiches, but LiptonMart wants to move toward more grab-and-go options, including salads, pizzas and foods prepared in-store. “We are looking at bundling breakfast sandwiches, lunch sandwiches and fresh salads, expanding on what we have now,” Lipton said.
Lipton is also open to co-branding with a sandwich brand like Subway or a chicken brand like Krispy Krunchy Chicken.
LiptonMart’s coffee program includes both its own brand and Green Mountain coffees and uses bean-to-cup machines.
“We fully rolled that out at the end of last year and it has been going great,” Lipton said. “There is huge savings in waste alone [compared to] what we were brewing and throwing away.”
Another focus of the rebrand that is expected to save the company significant money is a likely shift to unbranded versus branded gas as its current contracts expire. Right now, seven LiptonMart stores have Mobil-branded gas and two have Shell stations.
“There are buying advantages to getting unbranded versus branded. Any way to save money at this point [is helpful] as volume is sort of flat,” Lipton said.
Due to the increasing cost of living, consumers are spending less money and taking fewer weekend trips, Lipton explained. ”Gas volume is flat, and there is a trickle-down effect to sales in the stores.”
Its stores in Massachusetts also face a sales ban on popular menthol cigarettes and vapes, Lipton said.
The rebrand will help LiptonMart compete with bigger players on numerous fronts, including foodservice. Lipton is also currently talking with companies such as Ignite Rewards and PDI to find the best solution for a comprehensive loyalty program that ties together its c-stores, gasoline and car washes.
“We are looking at a way we can link them,” Lipton said.
The car wash opportunity, meanwhile, holds a lot of room for innovation. A loyalty program will include memberships that will be manageable through the app. Additionally, a license plate reader will eliminate the need to put a sticker in the car, Lipton explained. "The gate will open and you can go right in.”