More convenience stores are concentrating on providing a greater variety of fresh, high-quality foods, and competition is mounting as stores strive to compete with fast-food restaurants. Technomic's Convenience Store Market Intelligence Report focuses on how convenience stores fit into the overall foodservice picture. Convenience-store foodservice is a $10.9 billion industry and a key area of opportunity for convenience stores across the country.

Fully 57 percent of consumers say they have purchased prepared foods from convenience stores. Roughly a third of consumers who visit convenience stores for fresh-food items purchase them at least once a week from convenience stores.

As meals and snacks continue to morph to interchangeable eating occasions, 7-Eleven, Inc. just added another small-snack, big-value item to its hot foods line-up. Chicken Dippers are pieces of 100-percent, high-quality white-meat chicken with no fillers that are lightly breaded in a tasty coating and served with a choice of Ancho Chipotle, Ranch or Honey Mustard dipping sauce. A cup-holder in the specially designed Dippers packaging helps keeps the sauce from spilling. Six “dippers” and sauce are value-priced at $1.99 at participating 7-Eleven stores.

“Since we launched hot foods nationally five years ago, our chicken breast tenders and wings have been top-sellers, so we know our customers love chicken,” said Kelly Buckley, 7-Eleven vice president of Fresh Food Innovation. “Chicken Dippers are flavorful, juicy and can satisfy those who are hungry for a snack or small meal.”

The new Chicken Dippers are part of 7-Eleven’s proprietary hot-to-go foods currently available in more than 5,200 of 7-Eleven’s 7,800 U.S. stores. They are heated in Turbo Chef ovens, just like the company’s whole and slice pizza, chicken tenders, chicken wings, mozzarella sticks and mini tacos.

Buckley added that consumers gave a “thumbs up” to the quality of the product and flavorful sauces. “The Chicken Dippers proved so popular during limited-time in-store tests that store operators asked to keep them at the conclusion of the trial period,” she said.

More c-stores are leveraging branded restaurants at their c-store locations. While Subway and McDonald's have locations built into some convenience stores, capitalizing on convenience and foot traffic, more progressive c-store chains are developing and integrating their own branded restaurants into existing stores, transforming the perception of purchasing prepared food at a convenience store.

"Prepared food is a growth opportunity for convenience stores willing to raise the bar on quality and key attributes sought by today's consumers," says Technomic senior director Donna Hood Crecca. "Consumers say they would visit convenience stores more often for prepared foods if those foodservice areas were improved upon. Customizing their offerings and a more appealing décor and atmosphere could enhance the experience."

Three-fourths of consumers (76 percent) who purchase prepared foods from convenience stores report that these locations provide a convenient option. Two-fifths of consumers say they would visit convenience stores for prepared foods more often if freshness and quality were improved.

Convenience stores top other types of retail locations for breakfast patronage, and convenience stores are the only segment to see a significant increase in breakfast patronage over the past few years. This is likely driven by coffee purchases. Entrées account for more than half of c-store menu items, with their share of the menu expanding significantly to 51 percent in the second quarter of 2013 from 47 percent a year earlier. Sandwich remains the top breakfast entrée.