Circle K is a convenience store company with more than 1400 stores in the U.S. and Canada. The company also has a history of purchasing and operating gas stations, including two in Texas.
The Circle K Corporation was formed in 1937 and is currently owned by private equity firm MMC Capital Partners. The company is known for its “Circle K Café” restaurants that serve coffee and pastries, as well as its Circle K branded stores.
The coffee shop concept was first introduced to the mainstream back in the 1950s, but Circle K has been serving customers with its specialty coffee shop for a few years now. The shops feature a unique blend of roasting different types of coffee and having specialty drinks available.
While Circle K Café opened its doors for business several years ago, the company is now expanding its coffee shop presence, with a new shop planned for opening in Atlanta, Georgia, in 2020.
Is Circle K Buying Speedway?
Last year, Circle K purchased two gas stations in the Texas town of Tyler. The first Circle K Gas Station was built in 1939 and is located at the northwest corner of East Main Street and North Bimini Street. The second Circle K Gas Station in Tyler is located on the southwest corner of North Broad Street and East Manion Street. The company has not announced whether or not it plans to redevelop the properties, which it bought for a combined $8.75 million.
This acquisition gave Circle K a foothold in the lucrative Texas market. Despite the popularity of Starbucks and other major coffee chains, many small towns and cities in Texas still rely on independently owned coffee shops for some of their daily coffee needs. Both of the shops Circle K recently purchased in Tyler will continue to serve that market.
Starbucks Vs. Circle K
While Circle K isn’t the biggest coffee chain in the world, it does serve some of the most popular coffee varieties, such as espresso, cappuccino, and flat white. The company also offers a French-style drink called a café au lait, which is made with regular coffee and heavy cream. What’s important to note is that these drinks are neither hot nor cold when served.
That’s in contrast to other coffee chains that keep their beverages chilled, especially Starbucks, which was established in 1971 and is the world’s largest coffee chain by revenue. Other popular coffee chains such as Dunkin’ Donuts also keep their coffee cold.
Starbucks has more than 2300 stores in over 100 countries. In terms of revenue, Starbucks has estimated that it will generate nearly $10 billion this year. That’s good news for coffee shop owners who want to avoid the volatility that comes with selling hot, freshly made coffee.
Starbucks also owns a majority of the cafes it operates, with the remaining shares held by independent operators. In 2020, the company opened more than 500 new cafes across its network of brands. Despite its size, Starbucks still relies on independent contractors to help it operate its stores. That’s why many coffee shop owners might be skeptical when it comes to the future of their businesses.
On the other hand, Circle K is a much more mature company when it comes to operating gas stations. In many U.S. cities, Circle K is the only game in town when it comes to selling gas, so the company already has experience when it comes to operating retail gas stations.
The coffee shop industry in general is also more mature, with many entrepreneurs looking to get into the business side of things. Thanks to the COVID-19 pandemic, many people are now working from home, so coffee shop revenues might be hit especially hard.
The Rise Of Coffee Shop Entrepreneurship
During the pandemic, many people are discovering the benefits of a daily coffee. In the U.S., there are many entrepreneurs who saw an opportunity to cash in on the growing coffee shop market and are setting up shop, pouring coffee, and offering pastries as a way to make a living.
The coffee craze wasn’t limited to the U.S. During the pandemic, many people are discovering the benefits of a daily coffee. In the U.S., there are many entrepreneurs who saw an opportunity to cash in on the growing coffee shop market and are setting up shop, pouring coffee, and offering pastries as a way to make a living.
According to the International Coffee Association (ICA), coffee shop revenues increased by more than 16 percent from 2019 to 2020. The organization expects that trend to continue and predicts that coffee shop revenues will account for nearly 8 percent of the entire world coffee market (which was worth almost $120 billion in 2020).
With all this growth, it’s no wonder why many coffee shop owners are looking to cash in on the trend and are wondering if buying a coffee shop is a good idea. However, even seasoned coffee shop owners might be wondering if now is a good time to get into the coffee business. The Covid-19 pandemic has put a serious dent in people’s everyday lives, and although the world is finally starting to emerge from the pandemic, there is no guarantee that the situation will return to what it was before the pandemic.
In light of the economic uncertainty that the pandemic has left in its wake, many people are looking for ways to bring in revenue and earn an income. While owning a coffee shop certainly has its perks and benefits, it’s not for everyone.
What’s Next For Coffee?
With all this talk of business and the economy, it’s important to remember that there is also good news for coffee fans. Many coffee-related events and coffee shops are opening their doors again, including some that have re-opened as part of the “reopening economy”, which aims to give people their life back to some extent. This trend is being touted as the “Second Cup Effect”. It’s a positive sign that many coffee shops are choosing to open their doors again, which means there is still a demand for high-quality indoor activities during this time of year and beyond.
In the coming months, coffee shop owners and fans alike will have to wait and see what happens with regards to the economy and whether or not Circle K will continue to expand its presence in the Texas market.
At this time, it’s still too early to tell whether or not Circle K is buying Speedway. The coffee shop chain is still expanding its presence in Texas and hasn’t made any announcements about future plans regarding the gas stations it recently purchased in that state.
The general consensus is that Circle K is likely to continue to grow its coffee shop business, due to the popularity of coffee and espresso-based drinks around the world. Even if Circle K doesn’t buy additional gas stations, it will almost certainly continue to expand its coffee shop brand to other parts of the U.S.
On the other hand, the future of coffee shops in general is still up in the air. The pandemic showed us the power that social distancing and isolation has over coffee shops and other leisure activities. It won’t be long before people want to get back out there and get their lives back to normal.
Even if the economy starts to recover, it will be a while before people get back to pre-pandemic levels. In many parts of the U.S., summer is now, which means that people are working harder to get their lives back to normal. As a result, coffee shop owners might struggle to make up for lost time.
Overall, it’s still too early to tell if or not Circle K is buying Speedway. Even if the buyer ends up not being Circle K, the information shared here will still be valuable.
This information will help coffee shop owners and fans navigate this uncharted territory and make the right decision for their business. Having more than 1400 stores under his belt, Kresovich is no stranger to buying and selling gas stations. If anything, this acquisition will hopefully serve as a wake-up call for Speedway owner Jim Gooch, who will now have to decide whether or not to try and sell the station as a whole or find a buyer for the individual locations.