Although online shopping has taken up a substantial share of the brick-and-mortar retail market, convenience stores have shown promise and have continued to thrive with increased sales over the past few years. Owing to their continued profitability, starting and running a convenience store remains a viable option for any would-be entrepreneur eager to take the risk.

According to reports, convenience stores made around $532 billion in sales in 2020, and the industry is still expected to achieve steady growth. Even with the COVID-19 pandemic negatively affecting the retail sector, industry experts believe that 60% of the more than 150,000 convenience stores operating in the United States will still witness increased sales in coming years.

Steps on How to Start a Drive-Thru Convenience Store Business

  1. Conduct Market Research

Before you start your drive-thru convenience store, it is important to find out whether there is going to be enough demand in your area for the store. These stores are stocked with basic groceries, such as milk, butter, cereal, and juices like a normal store, but there is no in-store shopping.

With double drive-thru lanes, customers can easily pull up and place an order, or in advance via a mobile app, and have groceries placed in their cars upon arrival. It is also a good idea to check out the competition. Take your time to count how many outlets are in your area selling convenience lines.

Note that convenience lines include items like tobacco products, newspapers and magazines, confectionery, soft drinks, snacks, alcohol, fresh products, fruit and vegetables, food-to-go, bread, milk, chilled foods, and other ‘top-up’ or ‘emergency’ items. This will surely give have a clear idea of what is necessary to succeed in your endeavor.

a. Who is the Target Audience?

According to industry reports, Millennials are prime customers for shops that stock high-margin pre-made and packaged meals and common household goods. While these customers are good, they are more sporadic. A drive-thru convenience store may also have different types of customers, for instance:

  • Working people purchase their papers, breakfast, lunch, snacks, or the odd grocery item. Many of these people may not live in the area
  • Residents like young families, elderly or unemployed people who are in the area all the time
  • Residents who work elsewhere and who return in the evenings and at weekends
  • Local businesses that purchase items such as newspapers, milk, tea, coffee, and so on
  • People on the move, as long as you have some parking nearby
  • Trade customers, to whom you supply goods at a discount

Note that each category of the customer may purchase different types of goods. A good number of your customers will be regulars, with whom you have established a personal relationship.

b. Is Drive-Thru Convenience Store a Profitable Business?

Yes. But it will most often depend on how well the business is managed. In this line of business, you will have to steadily deal with high fixed costs of your products and other expenses like your inventory, rent, and your payroll. You will also deal with operating expenses like utilities while optimizing your product catalog and pricing.

 c. Are There Existing Niches in the Industry?
  • Drive-Thru Café
  • Drive-Thru Handmade Items Shop
  • Drive-Thru Convenience Store for pet food or pet owners
  • Trendy T-shirt Shops
  • Eco-friendly Products
  • Beauty Products
  • Driver Thru Gadget Shop
  • Drive-Thru Liquor Store
d. Who are the Major Competitors?
  • Big Daddy’s Liquor Store & Carry Out
  • Cajun Daiquiris
  • W Grill to Go
  • Liquor World
  • Hoboken Beer and Soda Outlet
  • Beer To Go Drive Thru Beer Barn
  • Henry’s Liquors
  • Alta Dena Drive-In Dairy
  • Pik Quik
e. Are There County or State Regulations or Zoning Laws for Drive-Thru Convenience Store Business?

Yes, depending on where you intend to start your drive-thru convenience store and what you intend to sell; you will have to obtain certain business licenses and permits from your state, county, and local government. In addition to general operating licenses; you might need specific licenses to sell tobacco and alcohol.

f. Is There a Franchise for Drive-Thru Convenience Store Business?
  • Farm Stores: From $128,501
  • Street Corner: From $99,400
  • Gateway Newstands: From $55,875
  • Dash In: From $138,600
  • 7-Eleven: From $37,550
  • AMPM: From $430,698
  • Racetrac: $1,000,000
  • Circle K: From $185,500
g. What Do You Need to Start a Drive-Thru Convenience Store Business?
  • Adequate Research
  • A Good Niche
  • DBA
  • Reliable Supplier
  • Drive-Thru Window
  • Necessary Licenses and Permits
  • Ecommerce Marketplace or Platforms
  • Customer Acquisition Plan
  • EIN (Employer Identification Number)/Federal Tax ID Number
  1. Memorable Drive Thru Convenience Store Business Names

  • Groceries in a Minute
  • Quick and Convenient
  • Flash Shopping
  • Quik Flash
  • Services in Seconds
  • Shopping Sprint
  • Pax Dash
  • 12 Seconds Zone
  • In Motion
  • Per Second
  • Speedy Spice
  • Rapid Shopping
  • Quick Chicken
  • Pull Up Pick Up
  • Drive Through
  • Station Helpers
  • Shopping Help
  • Sprint Goods
  • Quick Turnaround
  • Just A Sec
  1. Register your Business

a. What Type of Business Structure is Best for Drive-Thru Convenience Store Business?

There are three commonly used business structures in the retail industry: sole proprietorship, C Corporation, and LLC. Of these three, the most ideal to consider is the LLC. Have it in mind that the LLC offers increased protection of your assets by establishing your business as a separate legal entity.

Even though the liability protection isn’t entirely foolproof, it will give you more protection than a sole proprietorship. You will only be expected to adhere to additional filing requirements and will have to pay both incorporation and ongoing fees.

b. Steps to Form an LLC
  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.
c. What Type of License is Needed to Open a Drive-Thru Convenience Store Business?
  • Sales tax permit
  • Employer identification number (EIN)
  • City or county business license
  • Occupancy permit
  • Alcohol and tobacco license
  • Health and safety permits
  • Lottery license
  • Gas permits (i.e. EPA inspection)
d. What Type of Certification is Needed to Open a Drive-Thru Convenience Store Business?

Truth be told, there are no mandatory certifications required to start or run a drive-thru convenience store, however, you should consider some certification courses in the retail industry to add more weight to your business brand.

  • Program Management Professional (PgMP)
  • Automotive Sales Professional
  • Certified Manager Certification (CM)
  • Certified Sales Professional (CSP)
  • Certified Management Accountant (CMA)
e. What Documents are Needed to Open a Drive-Thru Convenience Store Business?
  • Business License
  • Business Plan
  • Online Terms of Use (if you have a website)
  • Online Privacy Policy Document (for online payment portal)
  • DBA
  • EIN
  • Business and liability insurance
  • Federal Tax Payer’s ID
  • Terms and Conditions
  • Refund policy
f. Do You Need a Trademark, Copyright, or Patent?

No, you won’t need to file intellectual property protection/trademark since you can start and run this business without having to bother anyone for using your company’s intellectual properties in any way. Howbeit, if you are looking to protect your company’s logo and other documents or software that are unique to you or even jingles and media production concepts, then you can consider filing for intellectual property protection with the USPTO.

  1. Do your Cost Analysis and Budgeting

a. How Much Does It Cost to Start a Drive-Thru Convenience Store Business?

According to reports, depending on the size of the store, location, products, services provided, and the number of employees on the payroll, the cost of starting a Drive-Thru Convenience Store can range from $10,000 to over $1 million.

b. What are the Costs Involved?
  • Equipment and supplies: $145,000
  • Building renovations: $23,560
  • Furniture and fixtures such as checkout counters, refrigerators, freezers, shelving, registers, surveillance cameras to deter theft, etc.: $75,670
  • Inventory: $300,000
  • Storefront property rent: $87,000
  • LLC& corporations registration: $500
  • Small business insurance: $22,000
  • Lawyer fees: $1,500
  • Business software: $3,700
  • Licenses and permits: $12,140
  • Working capital: $100,000
c. What Factors Determine the Cost of Opening a Drive-Thru Convenience Store Business?
  • Business license and permits
  • Business structure and registration
  • Insurance
  • Rent, renovation, and furnishing of the store
  • Inventory
  • Number of employees
  • Advertising and marketing plan
  • Miscellaneous
d. Do You Need to Build a Facility?

Yes, but if you do not already have a commercial property where you can open a drive-thru convenience store, then you can lease a commercial space. Have it in mind that leasing the space ensures that you will not be stuck with an empty building should your store fail to attract the level of crowd you want.

Adding a drive-thru to an already existing convenience store will cost up to 50% of your total capital. Also, note that the cost of opening a drive-thru can run from $35,000 for a small business to $80,000 for a bigger business.

e. What are the Ongoing Expenses for Running a Drive-Thru Convenience Store Business?
  • Marketing expenses
  • Rent
  • Insurance
  • Legal expenses
  • Accounting
  • Utilities
  • Inventory
  • Payroll expenses
f. What is the Average Salary of your Staff?
  • Chief Executive Officer: $67,580
  • Human Resources and Admin Manager: $52,640
  • Business Developer: $48,720
  • Accountant: $46,510
  • Sales Executive: $36,000
  • Call Center Agent: $32,840
g. How Do You Get Funding to Start a Drive-Thru Convenience Store Business
  • Business loans
  • A business line of credit
  • Friends and family
  • Angel investors
  • Crowdfunding
  1. Write a Business Plan

a. Executive Summary

Flash Shopping will be a set pacer and the convenience store of the 21st Century future, fulfilling a need that will continue to exist into the future – the need for convenience. Our intention at Flash Shopping is to build a convenience store that will be fully automated, open for 24 hours, and more like an enormous dispensing machine than a traditional store.

b. Products and Service
  • Fresh fruit and vegetables
  • Alcohol and soft drinks
  • Dairy products such as butter, yogurt, cheese
  • Desserts and cakes
  • Sandwiches
  • Freshly baked goods
  • Fast food to go
  • Takeaway coffee and other hot drinks
  • Newspapers and magazines
  • Cigarettes and tobacco
  • Many household and grocery items such as toilet paper, tea, coffee, and pet food
c. Mission Statement

Our mission at Flash Shopping is to build a new and revolutionary distribution outlet that will massively reduce the time customers spend shopping. We are looking to become the first to market with this daring new idea to capture market share and create greater than average profits.

Vision Statement

At Flash Shopping, our vision is to become an automated market. We intend to sustain our cost after year 1, and then pay back our investors as well as own our equipment in year 2. Starting from year 3, employees and owners will get dividends.

d. Goals and Objectives
  • Attain a high level of visibility through the media, billboards, and other advertising.
  • Establish rigid procedures for cost control and incentives for maintaining tight control.
  • Expend a significant amount on R&D to constantly be able to offer better and greater products and services.
e. Organizational Structure
  • Chief Executive Officer/President
  • Human Resources and Admin Manager
  • Business Developer
  • Accountant
  • Sales Executive
  • Call Center Agent

Marketing Plan

a. SWOT Analysis
Strength
  • Different and unique
  • Fast and Convenient
  • Location
  • Innovation
Weaknesses
  • Food kind
  • Different idea
  • Business Awareness
  • Health and safety
Opportunities
  • Loyalty program
  • Expansion
  • Low fat/sugar foods
  • Environmentally friendly products/procedures
  • Expansion
Threats
  • Competitors loyalty program
  • Non-patented products
  • Competition
b. How Do Drive-Thru Convenience Store Businesses Make Money?

Just like a normal convenience store, a drive-thru convenience store makes money by purchasing goods and selling those goods to customers. These stores can sell things like snacks, soft drinks, car accessories, lottery tickets, tobacco, and sometimes alcohol.

c. Payment Options
  • Payment with cash
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via mobile money transfer
d. Sales & Advertising Strategies
  • Devote a lane for mobile pickup orders only.
  • Adapt your menu to shifting mealtimes.
  • Invest in Good Menu Design
  • Improve Order Accuracy
  • Find An Experienced Vendor Partner Who Knows the QSR Landscape
  • Speed up your service at the drive-thru without sacrificing quality.
  • Teach your employees about upselling.
  • Use Multiple Signs to Minimize Confusion and Promote LTOs
  • Use promotional signage to promote special offers.

Financial Projection

a. How Much Should You Charge for your product/Service?

The truth about a drive-thru convenience store is that you can mark many items up by a higher percentage than your local grocery stores or supercenters do. Have it in mind that your customers will be paying for the convenience. As a drive-thru convenience store, you can charge a customer about eleven percent more than an independent grocery store does and about 20 percent more than a mass store like Wal-Mart does.

b. How Much Profit Do Drive-Thru Convenience Store Business Owners Make a Year?

Note that business structure, location, and other factors will influence an owner’s take-home pay. However, the average store owner earns about $66,000 per year.

c. What Factors Determine the Amount of Profit to Be Made?
  • Supplier
  • Business Size
  • Marketing and Customer Retention Strategies
  • Investment
  • Business Agreements 
d. What is the Profit Margin of a Drive-Thru Convenience Store Business?

According to industry reports, average convenience store profit margins have been quite low, hovering around 2% for independently owned stores.

e. What is the Sales Forecast?
  • First Fiscal Year (FY1): $345,000
  • Second Fiscal Year (FY2): $1,089,000
  • Third Fiscal Year (FY3): $2,134,000
  1. Set Up your Shop 

a. How Do You Choose a Perfect Location for Drive-Thru Convenience Store Business

Most important factors to consider when choosing a suitable location for a drive-thru convenience store business include;

  • Supply Chain
  • Demographics
  • Basic Infrastructures
  • Closeness to the market
  • Distributive channel
  • Competitors
b. What State and City are Best to Open a Drive-Thru Convenience Store Business?
  • Raleigh, North Carolina
  • Billings, Montana
  • Boulder, Colorado
  • Plano, Texas
  • Scottsdale, Arizona
  • Lynchburg, Virginia
  • Oklahoma City, Oklahoma
  • Madison, Wisconsin
  • Memphis, Tennessee
  • Amarillo, Texas
c. What Equipment is Needed to Operate?
  • Refrigerators and freezers.
  • Drink dispensers.
  • Commercial coffee makers.
  • Shelving
  • Hot food displays and hot dog rollers.
  • Ice machines.
  • Food warmers.
  • Cleaning tools and supplies.
  1. Hire Employees

Finding very good employees for your drive-thru convenience store will be a daunting task, and as the owner, you need a flexible schedule or management staff to cover employees who fail to show up for their shifts. You also have to steadily search for reliable employees coupled with carrying out background checks and random drug testing. You wouldn’t need to expand the team unless you are expanding hours or potentially opening another window.

  1. Launch the Business Proper

Truth be told, exposure is necessary for the success of any business, which is why hosting a lunch party for your drive-thru business is necessary to enable you to reach your goals. Note that it can really make a massive difference in your performance and when done right, it can launch you further ahead in this competitive industry.

You should consider seeking the expertise of a professional events organizer. This will ensure that the launch becomes a competitive edge as it will heighten press coverage and enhance brand awareness

a. What Makes a Drive-Thru Convenience Store Business Successful?
  • The Right Technology
  • Organized Layout
  • Order Accuracy
  • Fast Ordering Times
  • Great service
  • Install confirmation boards
  • Put safety first
b. What Happens During a Typical Day at a Drive-Thru Convenience Store Business?

In this line of business, some of the daily activities include creating and managing the schedules of employees and scheduling, receiving, and unpacking shipments or inventory. You are also expected to be vigilant about the health and safety regulations of your store, especially if you decide to sell food that you make yourself. Have it in mind that you will be also be tasked with the payroll of your employees.

A great deal of any given day will be spent arranging and organizing displays and straightening up shelves so that the store looks organized and goods can be found easily. Of course, checking out customers throughout the day will also take up much of your time.

c. What Skills and Experience Do You Need to Build a Drive-Thru Convenience Store Business?
  • Determination
  • Resourcefulness
  • Time Management Skills
  • Adaptability Skills
  • Accounting Skills
  • Creativity Skills
  • Strategy Skills
  • Customer Service Skills
  • Sales Skills