C-store M&A Activity Signals Consolidation Era

Billy Roberts

June 5, 2025

Key Points

• Merger and acquisition activity among convenience stores picked up in 2024, primarily among smaller chains (those with 50 stores or fewer).
• More than two-thirds of c-stores in the U.S. are single-store operations, so significant M&A activity would reshape the nation’s c-store landscape.
• C-stores play a crucial role in addressing food insecurity in rural areas where access to grocery stores can be limited. Approximately 87% of counties with high food insecurity are rural, and c-stores often serve as vital food sources.
• Larger-chain M&A activity in 2024 focused on expansion and support for operations in new regions of the country. The fragmented nature of the c-store market, coupled with rising operational costs and the need for upgrades, drives consolidation.
• The biggest deal in the offing is 7-Eleven, which has 13,000 U.S. locations. With its market-leading position on the table, the chain’s ultimate buyer could create a massive c-store giant.

Convenience store chain mergers and acquisitions are poised to reshape the industry, and rural communities may want to take note. Today, 87% of the nation’s counties with the highest rates of food insecurity are rural communities. Many U.S. counties lack a grocery store, and only 37% of rural residents have access to major food delivery services. Mass merchandisers, like Walmart, are unevenly spread among states through various regions of the country.

Convenience stores (c-stores), however are found in towns large or small.

Indeed, the c-store industry as a whole is far from concentrated in one particular location or even store type, and many serve as almost a de facto food solution for rural communities, principally smaller c-stores. One of the nation’s largest chains, Casey’s, notes that two-thirds of its locations are in communities of less than 20,000 people. In fact, the majority of the nation’s more than 150,000 c-stores are considered smaller entities. Roughly 96,000 are part of chains of 10 or fewer locations, and 92,000 are single-unit operators. At the other end of the spectrum, 22 chains have more than 400 units, and many of these chains have shown a strong propensity toward consolidating in recent years.

Such a heavily fragmented environment appears ripe for consolidation, as overhead costs are steadily increasing and consumer adoption of electric vehicles potentially means significant capital expenditures for charging stations. Casey’s notes that acquisition costs can be upwards of $1 million per store, though that capex largely stems from upgrading or even building out new kitchens that can support its foodservice aspirations. Casey’s is just one example of c-store chains aiming to serve as a meal provider and is, in fact, the No. 5 pizza chain by volume in the country. That said, for every c-store with a restaurant-quality (or even branded) meal option, a host of c-stores offer products much more akin to a smaller grocery store. As such, particularly in rural areas, c-stores can serve to fill a number of important needs, serving as a convenient, one-stop option for food, beverage, fuel and even household staples.

C-store M&A gains steam

In terms of c-store M&A activity, acquisitions of smaller c-store entities have been particularly common over the past couple of years. Per Capstone Partners, 80% of deals in 2023 were for target companies of less than 50 stores, as were 74.1% of the transactions in 2024 (through September of that year).

Casey’s financial results demonstrate the rationale behind not only its expansion goals but also the focus on food as seen across larger c-store chains. Casey’s margin for fuel is around 12% but for prepared food and dispensed beverages, the number is closer to 59%. In the most recent quarter ending Jan. 31, 2025, prepared food and dispensed beverages accounted for 9% of Casey’s sales but 26% of its total gross profit. Expansion demands significant supply chain discipline, not only of the brand itself but also of those people and systems maintaining the quality and range of food/beverage offerings. This applies to inventory management, cold storage, and for items such as snacks, beverages and baked goods, and direct-store delivery vendors.

Established c-store brands expand into unfamiliar territories

For a number of the larger c-store chains, these supply-chain considerations have factored strongly into their regional expansion. In the southeast, Alimentation Touche-Card is well represented through its Circle K brand, but it has seen increased competition not only from Casey’s but also Wawa. Wawa is planning to build more than three dozen stores in the Florida panhandle over the next decade, while adding several stores in southern Alabama. As active as openings have been in the c-store space, it pales in comparison to 7-Eleven’s announced plans to open 1,300 new stores in North America through 2030. This would include roughly doubling the number of 7-Eleven stores with quick-service restaurants from the current 1,080 to 2,100. This is just background noise around 7-Eleven, considering it has been an acquisition target for months.

The big possibly get even bigger

Conclusion

The combined 7-Eleven/Circle K would be nearly 10x the size of their next-closest competitor and more than 13% of all c-stores in the U.S. The sheer size of each company compared to competitors highlights how dispersed the c-store market is in the country. In fact, the vast number of single-unit operators points to potential opportunities in expanding relationships, if not outright purchases or mergers, to maximize efficiencies across supply chains and distribution networks, similar to the ultimate goals behind many of larger chain acquisitions.