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Could This Top TSX Stock See a Dramatic Price Increase?

Nikhil Kumar
·3 min read
gas station, convenience store, gas pumps

Recently, Alimentation Couche-Tard (TSX:ATD.B) has been laser-focused on improving the customer experience by growing the company’s fresh food offer, localizing product pricing on a store-by store basis, and adding easier payment and delivery options both inside Couche-Tard stores and on the company’s forecourts. Couche-Tard has also been keeping the company’s customers engaged with new, more modern branding, enhanced store layouts, and gamification promotions to drive traffic.

The company is focused on expanding Couche-Tard’s new food initiative, Fresh Food Fast, which remains the company’s top priority. Couche-Tard wants to offer best-in class, great-tasting food for the company’s customers on the go which, it believes, is key to the company’s future as an innovated, differentiated retailer.

Studying outperforming stores

In North America, Couche-Tard completed the first stage of opening 1,500 fresh food stores and will be expanding the program to an additional 2,600 stores in fiscal 2022. As Couche-Tard continues to work and refine the operational side, the company’s focus remains on the quality and ease of the offer, both for the customer and for the company’s store team members. The company has determined that fresh food stores continue to outperform those without in the same markets.

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In Europe, Couche-Tard has continued to develop the new Fresh Food Fast concept as a platform for future growth and will be adding the program to 500 sites in fiscal 2022. The company is making it easier for Couche-Tard’s customers by introducing a self-service option, adding grab-and-go elements to the freshly prepared offers that it already has in the company’s stores.

Data-centric company

Being a more data-centric company is one of Couche-Tard’s biggest strategic goals, as it believes there is a very large prize to be made by optimizing locally in terms of pricing, assortment, and promotions. After piloting store-by-store pricing in Couche-Tard’s Sweden and Grand Canyon business units, the company rolled it out to nine more divisions this year. Couche-Tard started with a limited number of stores to make sure the company was doing it right and conducted benchmarking exercises regularly.

As Couche-Tard evolves, the company wants to keep true to Couche-Tard’s core business and do what it does best to make Couche-Tard’s customers’ lives a little easier every day. The company recognizes that it can achieve this by improving the customer experience from Couche-Tard’s food and beverage offerings, by expanding Couche-Tard’s localized pricing and promotional capabilities, and by becoming one of the most trusted brands in the industry. The company appears determined to meet Couche-Tard’s customers’ needs and continually redefine convenience to delight the customer.

Use of store-specific data

In the recent fiscal year, the company reported an improvement in gross margin dollars, which exceeded Couche-Tard’s projections. In the upcoming fiscal year, the company plans to bring new initiatives to the remainder of the network and begin using store-specific data to enhance product assortment and promotional activity.

In Norway, after piloting Couche-Tard’s pioneering licence plate-recognition payment system at the forecourt and seeing strong results, the company has launched the initiative across Couche-Tard’s entire Sweden business unit with plans to expand across the network.

The post Could This Top TSX Stock See a Dramatic Price Increase? appeared first on The Motley Fool Canada.

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The Motley Fool owns shares of and recommends ALIMENTATION COUCHE-TARD INC. Fool contributor Nikhil Kumar has no position in any of the stocks mentioned.

2021