June 29, 2010 / 8:06 PM / 9 years ago

Convenience stores go after fast-food diners

* Convenience stores add more food, challenging fast food

* 2009 U.S. sales up 1.5 pct, excl inflation-report

LOS ANGELES, June 29 (Reuters) - U.S. convenience stores like 7-Eleven (3382.T) are challenging fast-food restaurants with expanded food and drink offerings, foodservice consulting firm Technomic said on Tuesday.

“Convenience stores are investing in prepared foods, which is putting increased competitive pressure on quick-service restaurant chains,” Technomic executive vice president Darren Tristano said.

The move helped U.S. convenience store sales grow 1.5 percent in 2009 to about $10.4 billion, excluding inflation, Technomic said.

Long-term unemployment hits U.S. fast-food chains like Burger King BKC.N, Arby’s [WEN.UL], Sonic SONC.O and Jack in the Box (JACK.O) the hardest and “trading down” to convenience stores is becoming an increasingly common option for some cash-strapped diners. [ID:nN25255677]

7-Eleven stores, which sell everything from hot dogs and coffee to beer, last fall started offering take-away pizzas and individual slices at more than 1,000 units, Technomic said.

Privately held Cumberland Farms is offering prepared food like sandwiches, pizza, baked goods and salads as well as drinks like milkshakes and iced coffee at its newest stores.

Convenience store chains with the most U.S. units include 7-Eleven, Alimentation Couche-Tard’s Circle K and Sunoco Inc’s (SUN.N) APlus brand, Technomic said. (Reporting by Lisa Baertlein; Editing by Bernard Orr)

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