Research Methods and Data Analysis

Retail sector analysed: Convenience Store

Conestoga College

Fall Semester – 2019

Section no. 8

Instructor Andrea Jansen

Group 8




Opportunities and Trends In Convenience Store Market 3

Image 2: Customer Satisfaction on Availability of Healthy Food in Convenience Stores 4

Image 3: Customers Attitude towards Branded Products 4

Marketing Mix 4

Industrial Environment (PESTLE) and Convenience Store 5



Research Strategies 6

Research Design 6

Study Setting 7

Unit of Analysis 7

Sample Size 7

Data collection 7




There are various factors that influence business opportunities available in the retail sector or more specifically, in the convenience market. For example, increasing population or increasing income positively contributes toward the growth of the convenience market. It is important for any investor to explore what existing studies and reports are telling about the growth and opportunities available in the convenience sector, before making any business investment. This paper presents a literature review analysis of business opportunities available in the convenience market in the U.K. (Waterloo Region). The literature will further explore different factors that impact the growth of convenience stores and would be important for an investor for decision making. The report presents a literature review and primary research design for the research study on the convenience sector.


Opportunities and Trends In Convenience Store Market

There are various social, economic, legal and technical factors that influence the growth of convenience retail industry. According to a report by HIM (2019), the convenience market is expected to grow at a 3.5% rate and reached 41.57 billion U.K. pounds in 2019 (HIM, 2019). However, the report says that companies operating in this market are required to keep an eye on changing trends so that they adopt such changes quickly and remain competitive in the market. The report suggested four trends that will dominate convenience market in coming years. These four trends are the refusal of plastic, preference towards healthy food, preference towards branded products, and a decrease in young shoppers (Jackson and Viehoff, 2016) in their study, identified two factors that are impacting the performance of the convenience market are health-consciousness and environment sustainability. Customers in U.K. prefer to consume ready-meals as it saves their time. Further, the authors said that people are expecting convenience stores to care for them and their health along with environment (HIM, 2019; Jackson and Viehoff, 2016).

Image 1: Customers Want to Go Green

Source: (HIM, 2019)

Rivera et al. (2014) say that the U.K. is one of the major markets for the ready-meal and convenience stores play a major role in serving this food to the customers. The authors say that ready-to-eat meals are not environment-friendly due to lengthy manufacturing, refrigeration and packaging. However, as awareness about the adverse effects of ready-to-eat food on the environment is increasing, customers are exploring ways to minimize this impact. HIM (2019) report also suggested that many customers have already started avoiding the use of plastic packaging material. They prefer to buy from the companies that offer products in sustainable/greenway (Rivera et al., 2014; HIM, 2019).

Image 2: Customer Satisfaction on Availability of Healthy Food in Convenience Stores

Source: (HIM, 2019)

Image 3: Customers Attitude towards Branded Products

Source: (HIM, 2019)

Marketing Mix

Hood et al. (2016) in their study analysed the role of the selection of the location in the success of the convenience store. According to the authors, location plays an important role in the performance and success of the store. The investor should ensure that the selected location is easily accessible by its target market and clearly visible. The study also says that if the selected location is located in a crowded market place, then the chances of success are higher. It is because customers that are coming to buy other products may also purchase from the convenience store. Han et al. (2014) in their article describing the importance of category management in the success of convenience stores. The authors said that selection of right categories helps in attracting and retaining the right customers and generating business profit. The article says that for convenience stores, it is difficult to select the right categories because of the mix of impulsive and traditional consumers. In such a situation, it is difficult for the store to collect attributes of consumers. Therefore, the authors recommended following a specific market region strategy instead of following a customized solution strategy (Han et al., 2014).

Azeem and Sharma (2015) said that the size of the convenience store varies from small to large 5000 square feet depending upon the opportunity, demand and availability of investment. The primary objective of these stores is the convenience of customers. Hence they do not compete based on price or width of products. The authors also said that high-quality in-store services play a negligible role in the performance of convenience stores. However, accessibility and high quality play an important role in the success of convenience stores. Convenience stores should be located in residential areas where it is easy for people to access the store (Azeem and Sharma, 2014; Han et al., 2014).Out of all four Ps, the most important P for a convenience store is Place. The other three Ps, i.e. price, product and promotion, play a small role in the success and performance of the convenience store (Nishida, 2014).

Industrial Environment (PESTLE) and Convenience Store

Nandonde (2019), in his article, discusses the impact of various environmental factors such as political, social, technical, and economic on the opportunities and performance of the retail Industry. The author says that not all stores perform well in the market. The business performs well when policies of local government are business-friendly.Brandsma (2018) says that technology plays an important role in the success of the business. Companies that are integrating technology in their processes are performing better than companies that are not embracing technology. However, the role of technology is limited in the convenience store. Brandsma says that convenience stores can work as a pick-up/drop-off location for online retailers for distributing products in their locality (Brandsma, 2018; Nandonde, 2019).

Akram et al. (2016), in their article, say that social factors such as age and gender significantly impact the way consumers shop. Young consumers are impulsive buyers, whereas older people buy in a planned manner. Impulse buying contributes a significant percentage in convenience store sales, and impulse sale is largely driven by the age of customers. HIM report says that the number of shoppers below 34 years is declining. In the past year, the number of young shoppers has declined by 2%. This trend shows that the social environment in the adversely impacting performance of convenience stores (Akram et al., 2016; HIM, 2019).