It’s a bold title claimed by South San Francisco, California-based distributor Core-Mark International Inc. But after 130 years in business, the company can confidently say it’s backed up its words with actions.
Core-Mark has 32 distribution centers and employs about 8,500 people, the kinds of numbers you need if you’re supplying roughly 45,000 customers in the convenience store and other channels. The company delivers about 108 million cubic feet of products annually, and its 2017 sales were expected to exceed $15.6 billion.
Those numbers should only grow, says Jon Bratta, vice president of marketing. “Core-Mark has more than doubled its revenues since 2010, and we continue to forecast strong growth in the coming years.”
About 75 percent of the stores Core-Mark supplies today are c-stores, Bratta says. Other customers include drugstores, grocery stores, airports, schools, corporate campuses, movie theaters, camps and other retailers.
The company has come a long way from its beginnings, in 1888, as Glaser Bros., a tobacco store in San Francisco. Core-Mark is now one of the largest distributors and marketers of consumer goods in North America. But its overarching goal, Bratta says, hasn’t changed much in 130 years — to provide customers with the best possible service, and to help them grow their sales and profits.
The competition in Core-Mark’s corner of the distribution world is fierce. The company has several large and hundreds of small competitors in the convenience space alone, Bratta says. But Core-Mark has succeeded in differentiating itself from the crowd in various ways.
Take, for instance, the company’s pioneering work in vendor and supplier consolidation. “With our Tri-Temp fleet of trailers, we’re able to deliver many of the products that may have traditionally come from DSD suppliers.” At the top of that list, he says, are fresh food and foodservice items. Also included are things like ice cream, novelty items, general merchandise, produce and other items needed in small-format retail stores.
Core-Mark also distinguishes itself from its competitors with its FMI category management system, which helps its retail partners better compete within their markets, Bratta says. “It helps our customers better understand their store’s demographics, product and placement opportunities, key item pricing and how they can maximize their store layout from a macro standpoint.”
Core-Mark is also able to provide its customers with a level of flexibility very few other broadline suppliers in the convenience channel can offer, Bratta says. “We’re able to offer anything from a ‘drop and go’ type of delivery all the way to a fully ordered and merchandised program for our retail customers, as well as any variation in between.”
The foundation of the Core-Mark platform is a state-of-the-art supply chain that features refrigerated docks and its fleet of tri-temperature trailers built specifically for delivery to convenience stores, Bratta says. Those trailers allow Core-Mark to deliver chilled, frozen and ambient products all at the same time.
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Fresh and foodservice are growth drivers and differentiators in the c-store channel, Bratta says, and Core-Mark seizes opportunities in those categories whenever it can. “We’ve led in this space for our customers for nearly the last decade by providing better quality products than what have traditionally been available and that are on trend for today’s consumer,” he says.
When it comes to fresh, Core-Mark has made a big push to help its retail partners grow their fresh and perishable sales, Bratta says. That includes working with local commissaries to bring fresh sandwich and other fresh and perishable products to customers, and continually looking for ways to improve upon what it can source or develop for its partners.
Similar investments have been made in meeting growing demand for foodservice products. “We’re keenly aware of how important foodservice is to our industry and are fully committed to further developing products that will help our retailers grow their sales in this important space,” Bratta says.
The biggest difference between Core-Mark and many of its competitors in the foodservice realm, Bratta says, is that Core-Mark doesn’t just carry products — the company also takes an active role in the development of many of those products. “We specify items, flavor profile, texture, packaging and other elements,” he says. “The last thing our customers need is more ‘me too’ products that are uninspiring to their consumer, and we work hard on the product and programs we support to bring items that will generate not only the initial sale but many return visits based on the quality of the items we sell to our customers.”
To that end, in 2017 Core-Mark launched, in cooperation with its supplier partners, both a fried chicken program and a pizza program. In addition, Bratta says, the company has sourced and co-developed, with two artisan bakery supplier partners, a line of premium bakery items for both general and Hispanic markets. “(These programs) help our retailers in ways that existing programs in the marketplace were unable to provide,” he says. “It also helps them differentiate themselves in the communities they do business in.”
Core-Mark launched its chicken program not because of a lack of quality in the market, Bratta says, but because of difficulties some retail partners were having getting the variety of product they needed. “There are some excellent suppliers out there now, but what was lacking was flexibility, particularly as it related to required menu items,” he says. “So we partnered with BirdShack to launch a program that allowed more flexibility to the store operator but retains the excellent quality chicken of a company like Chester’s (BirdShack’s parent company).”
“The sauce is very high-quality, as is the cheese, and the crust holds up really well, which is critical in the c-store,” Bratta says. “Our customers that have cut the Basilio’s vs. others in the marketplace have come away favorably impressed.”
Core-Mark’s new offerings in its Arcadia Bay Gourmet Bakery program include not only the new line of premium items co-developed by its artisan bakery supplier partners, but also other items that Bratta says wouldn’t be out of place in more upscale settings than c-stores. “We’ve completely revamped our offer here,” he says. “They’re items you would expect to see at coffeehouses that our customers are able to offer at very competitive price points to their customers.” Many of Core-Mark’s customers don’t have the capacity to bake product on site, Bratta says.
That makes it essential for Core-Mark to choose the right type of “thaw and serve” and “thaw and heat” products and to work with its bakery partners to develop those items specifically for c-store applications. “The goal was to provide products that would not only taste great but hold up well in the c-store environment, which is just as important to our retailers.”
Commitment to health
In 2016 Core-Mark made a commitment to the Partnership for a Healthier America (PHA), a nonprofit created in conjunction with — but separate from — former First Lady Michelle Obama’s Let’s Move! initiative to combat childhood obesity.
Joining forces with PHA, Bratta says, was a way for Core-Mark to further enhance some of the changes that had already been taking place in the company for years. “The journey they were asking us to join them on was a path that we were already on, so it was well-received within the company,” he says.
Since then, Core-Mark has worked with PHA to further develop programs related to employee health and wellness. The company also has made additional commitments related to product assortment and promotions of “better for you” products. “We see a strong need for healthier products in the convenience channel, as well as other channels, and so do many of our retail customers, so partnering with PHA to help achieve this seemed like a natural fit for Core-Mark,” Bratta says.
In the effort, the company was joined by Aloha Petroleum (operators of Aloha Island Marts) and Ricker Oil Company (operators of Ricker's convenience stores) in the partnership. Bratta says PHA was a good fit for Core-Mark because of the organization’s ongoing efforts to help address childhood obesity issues and improve the country’s overall general health through improved nutrition.
Core-Mark, he says, has worked hard over most of the last decade to bring fresher, healthier solutions to our customers. The company’s commitment to PHA is not only to continue, but to accelerate that commitment to its retail customers, and also to bring better nutrition and healthier lifestyles to Core-Mark employees, too.
Through the partnership, Core-Mark promotes the healthier offerings it distributes to its more than 46,000 retail locations. The company has also modified merchandising sets to incorporate healthier options, and it provides FNV and Drink Up marketing materials to its retail customers free of cost.