One of South Jersey’s most recognizable brands — the ubiquitous Canada goose-emblem retailer that sells gasoline, 24-ounce coffees, made-to-order Italian hoagies and frozen smoothies — reaches its 50-year milestone in the convenience store business Wednesday.
Wawa’s business model embraced evolution to become a major employer and economic machine in South Jersey and has expanded its reach into more markets with more products.
“It used to just be a convenience store,” said Matt Pincus, 27, of Galloway Township, a Wawa customer since he was 10. “They’re a lot bigger now. You usually don’t see a Wawa now without a gas station.”
Wawa’s first store opened in Folsom, Pa., on April 16, 1964, to help sell milk when home deliveries declined at its long-running dairy business. In May 1968, its first New Jersey store opened in Vineland.
Now, it has more than 640 stores in six states and a Forbes-estimated $9 billion in annual revenue, placing it as the 40th-largest private company in the U.S.
In Atlantic, Cape May, Cumberland and Ocean counties, Wawa has 92 stores with more than 3,150 employees. Wawa owns more than $100 million in real estate in the four-county area, according to New Jersey property records.
Wawa CEO Chris Gheysens, who grew up in Vineland, said bringing together fresh hoagies, gasoline sales, no-surcharge ATMs and other offerings at one site made Wawa unique in the region.
“You break apart our business, we’re in the breakfast business, the lunch business, the coffee business, the fuel business,” Gheysens said. “And all of those have individual players and competitors that are very good at what they do.”
Over the years, Wawa added offerings that would later become its staples — selling freshly brewed coffee in 1975, adding touch-screen ordering for sandwiches and developing a profit-sharing plan in 1977 that evolved into an employee stock ownership plan (Wawa says 39 percent of the company is owned by associates).
One of the most visible changes was selling gasoline.
Wawa entered the full-service gasoline business in 1996 with a location outside Six Flags Great Adventure in Ocean County. Now, about half of its stores sell gasoline.
Gheysens said getting into the fuel business was a major turning point for the Wawa, Pa.-headquartered company, which has stores in New Jersey, Pennsylvania, Delaware, Maryland, Virginia and central Florida.
Last year, Wawa began rolling out self-service lottery terminals at its New Jersey stores. Wawa had tried adding lottery sales years ago but stopped when lottery transactions clogged lines at the register. Gheysens said the self-service machines made lottery practical again.
Store growth continues, with Wawa targeting Florida and northern New Jersey as its current largest expansion areas.
The company opened its first store in Hudson County in January 2013, its first in Union County in April 2013 and its first in Bergen County in October. Wawa says more are planned for North Jersey in the next two years, with more than 10 stores expected in the area by the end of 2015.
In Florida, Wawa’s plans are more ambitious.
Wawa’s first Florida store opened in Orange County in July 2012, in a location across from SeaWorld. Now, it has more than 30 stores in Florida, Gheysens said.
Wawa was attracted to the Florida market for several reasons, he said.
Transplanted snowbirds from the Mid-Atlantic region already knew the Wawa brand. There was plenty of quality real estate available. And “we felt we could amass critical density over a short period of time to become a household name in Florida like were are here, and to have the economics of our business model work,” he said.
Gheysens said Wawa is not interested in growing into a national brand.
“We’re not interested in that. There’s no vision for that,” he said.
“Ten years from now, our ambition is we’re a multiregional company. The Florida market has become a part of the culture and the customer’s everyday visit. In the Mid-Atlantic area, you will see a much more significant reinvestment in our existing stores with new platforms, new branding elements, to make them look and feel new,” he said. “In terms of offerings, you’ll see some alternative fuels. Diesel has been our most recent addition. You will start to see compressed natural gas over that time as well as potentially others. And inside the stores, we’re pushing fresh food and fresh beverage offerings.
“Where the consumer goes in the next 10 years, we’re going to go with them,” he said.
In December, Forbes estimated Wawa’s revenue grew significantly in the past decade, from $3.9 billion in 2005 to $9 billion last year.
Sheetz, a rival chain of 466 stores with no local presence in South Jersey but with stores in six other Mid-Atlantic states, ranked 18 places behind Wawa at 58th, with about $6.1 billion in revenue, Forbes said.
Marc Kalan, a Rutgers University marketing professor, said Wawa has grown effectively based largely on locations and word of mouth, and increasingly as a gasoline seller.
“They’ve really made themselves an important player in a lot of the communities here,” he said.
Convenience stores are much different than traditional, larger-format food stores, he said. This makes location critical for such stores, and Wawa clearly prioritizes this aspect.
“They’ll spend a lot of energy identifying locations that are along good traffic routes,” Kalan said. “Convenience is its own benefit for consumers. Wawa’s not going to compete on price, although they are very competitive in the gasoline market. Price is not where you compete in that sector, but on convenience, location, hours and the array of products offered.”
Jeff Bruce, 26, of Galloway, stops at a Wawa at least three times a week for food and gas.
“I think everything’s just better,” he said, grabbing a bottle of water and a bag of chips before lunch.
Brian Tyrrell, an associate professor of hospitality and tourism management at Richard Stockton College, said Wawa has developed a reputation for consistent customer service and store cleanliness, adding that the company puts much of its focus on in-store marketing, and tends to be successful at it.
“It has very aggressive in-house marketing in the store. And it works,” he said. “I’ll get the pint of macaroni and cheese when it’s on sale.”
One of those marketing efforts will likely drive big customer volumes Wednesday, when Wawa offers customers a free cup of any size coffee that day in celebration of its 50th anniversary.
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