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Could a food -familiarity like Guy Fieri really be the catalyst who helps an icon of a supermarket to turn the tide and go back to the growth pile?
Time will learn it, but I look at the collaboration between Quebec -based convenience shop Play-Tardidale delivery (TSX: ATD) and Mr. Fieri as a brilliant, low risk that huge dividends could pay.
Indeed, when it comes to success in the supermarket scene nowadays, great food really moves the needle. And because more electric vehicles (EVs) dominate the roads, there is less need for gas. Perhaps it is the great selection of tasty and unique foods that are the most important attraction for those who drive to a supermarket, instead of the fuel pump that is next to it.
Flavortown is coming to Circle K-it is a big problem because Couche-Tard is seriously about food
Although Couche-Tard has taken a fairly long way when it comes to the range of fresh and hot food, I think work should be done. The Guy Fieri Collab is one that could yield a wave of food traffic, because consumers try to get a taste of what Flavortown has to offer.
Indeed, the food products inspired by Flavortown will roll out quite slowly over Circle K locations. But if they show early signs of success (I think they will do that), I don’t think it will take a long time before such menu items become an important revenue growth driver for Couche-Tard, a company that can clearly recognize the same store sales growth (SSSSG) to be had in ready-made food.
So what should investors expect if Guy Fieri and Circle K work together to improve the company’s food offering?
It seems that Couche-Tard has covered all the bases, with breakfast, lunch and even dinner. Whether we are talking about the Bacon Mac & Cheese Burger (who would not try this?), Sweet and spicy baked chicken waffle sandwiches, Denver -Omelet or some of the intriguing new confectionery (think of cookies), I think that the food and things of consumers are looking for great, tasty and relatively affordable eating dishes.
Even if you have absolutely no idea who Guy Fieri is, you probably recognize his face and his association with delicious food. That will put people in their doors, and if the first wave of new menu items touches the place, look for the partnership to evolve over time.
Indeed, I think the managers of Couche-Tard have set their sights on the long game, with a long-term collaboration. Menu innovation and creativity are treated with Fieri on board. As marketing is, because he is perhaps one of the most recognizable faces when it comes to celebrities, with the spiky blond hair and skill of the man.
The Bottom Line
Even if the new menu items do not sell (I don’t see how they don’t, since they sound like food that people in a carnival food truck would stand for!), Couche-Tard really has nothing to lose here and everything to win, because it wants to get forward in the Food Race convenience shop. Eating is of the utmost importance when it comes to winning the supermarktrace in the following decade. And the Guy Fieri Partnership is a very strong step in the right direction. Anyway, I think Couche-Tard has a catalyst to get back to the bullish climb.
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