CrossAmerica Partners LP (CAPL): Business Model Canvas [11-2024 Updated]
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CrossAmerica Partners LP (CAPL) Bundle
In the competitive landscape of fuel retailing, CrossAmerica Partners LP (CAPL) stands out with a robust business model designed to maximize efficiency and customer satisfaction. This Business Model Canvas outlines CAPL's strategic partnerships, key activities, and unique value propositions that cater to both individual consumers and commercial clients. By leveraging its extensive network of over 595 retail fuel sites, CAPL not only provides convenient access to fuel and merchandise but also fosters long-term relationships with its customers. Dive into the details below to discover how CAPL structures its operations for sustained growth and profitability.
CrossAmerica Partners LP (CAPL) - Business Model: Key Partnerships
Relationships with fuel suppliers
CrossAmerica Partners LP (CAPL) maintains extensive relationships with various fuel suppliers to ensure a consistent supply of motor fuel for its retail and wholesale operations. In 2024, CAPL reported revenues from fuel sales to external customers amounting to $1.416 billion, compared to $1.374 billion in 2023 . The company's wholesale segment included 1,046 motor fuel distribution sites, with a volume of gallons distributed reaching 563,082 in the first nine months of 2024 .
Partnerships with convenience store operators (e.g., TopStar)
CAPL collaborates closely with convenience store operators, including an affiliation with TopStar, part of the Topper Group. Revenues from TopStar amounted to approximately $10.9 million and $33.4 million for the three and nine months ended September 30, 2024, respectively. CAPL also incurs rent expenses under lease agreements with the Topper Group, totaling $2.6 million for the three months ended September 30, 2024. The convenience store partnership enhances CAPL's retail offering, allowing it to drive more foot traffic and sales at its locations.
Collaborations with logistics providers
Logistics partnerships are pivotal for CAPL's operations, especially in managing the distribution of fuel across its network. The company reported an average motor fuel distribution margin of $0.090 per gallon for the three months ended September 30, 2024 . The operational efficiency and logistics capabilities provided by these partnerships allow CAPL to maintain competitive pricing and inventory management across its retail and wholesale segments.
Strategic alliances for site leasing
CAPL has established strategic alliances for site leasing, which is crucial for expanding its retail footprint. Future minimum rental payments under non-cancelable operating leases with third parties as of September 30, 2024, totaled $114.7 million. The company also recorded a loss of $16.0 million on lease terminations with Applegreen during the nine months ended September 30, 2024. These strategic alliances play a significant role in optimizing CAPL's real estate portfolio and enhancing its market presence.
| Partnership Type | Revenue (3Q 2024) | Revenue (9M 2024) | Rent Expense (3Q 2024) | Future Lease Payments |
|---|---|---|---|---|
| Fuel Suppliers | $1.416 billion | $1.374 billion | N/A | N/A |
| Convenience Store Operators (TopStar) | $10.9 million | $33.4 million | $2.6 million | N/A |
| Logistics Providers | N/A | N/A | N/A | N/A |
| Site Leasing Alliances | N/A | N/A | N/A | $114.7 million |
CrossAmerica Partners LP (CAPL) - Business Model: Key Activities
Retail Sale of Motor Fuels
The retail sale of motor fuels is a core activity for CrossAmerica Partners LP (CAPL). For the three months ended September 30, 2024, the revenue from fuel sales to external customers reached $456.4 million, compared to $616.5 million in the same period of 2023, reflecting a decrease due to fluctuating fuel prices and sales volume.
The average margin per gallon for motor fuel was $0.406 for the three months ended September 30, 2024, which is an increase of 9% compared to the same period in 2023.
Operation of Convenience Stores
CAPL operates convenience stores alongside its fuel retailing operations. In the third quarter of 2024, merchandise gross profit was recorded at $30.5 million, up from $25.4 million in 2023, showcasing a gross profit percentage of 27.9%.
The overall revenue from food and merchandise sales for the three months ended September 30, 2024, was $109.4 million, compared to $88.7 million in 2023.
Site Management and Optimization
Effective site management is critical to CAPL's operations. The company operated an average of 372 company-operated retail sites and 225 commission agent sites as of September 30, 2024. The increase in company-operated sites was primarily due to conversions from lessee dealer sites.
In terms of operational efficiency, the company reported a total gross profit of $83.6 million for the retail segment during the third quarter of 2024. The operational expenses for the retail segment increased to $52.2 million, reflecting a rise in site management costs due to increased company-operated site counts.
Acquisition and Lease Termination Activities
CAPL actively engages in acquisition and lease termination activities to optimize its portfolio. For the nine months ended September 30, 2024, the company recorded a $16 million loss on lease terminations, including a $1.5 million non-cash write-off of deferred rent income. Additionally, the company received $18 million in proceeds from the sale of sites as part of its real estate rationalization efforts during the same period.
The total capital expenditures, which include lease termination payments to Applegreen, amounted to $44.6 million for the nine months ended September 30, 2024.
| Key Activity | Q3 2024 Revenue | Q3 2023 Revenue | Gross Profit Q3 2024 | Gross Profit Q3 2023 | Operating Expenses Q3 2024 | Operating Expenses Q3 2023 |
|---|---|---|---|---|---|---|
| Retail Sale of Motor Fuels | $456.4 million | $616.5 million | — | — | — | — |
| Convenience Store Operations | $109.4 million | $88.7 million | $30.5 million | $25.4 million | — | — |
| Site Management | — | — | $83.6 million | $67.6 million | $52.2 million | $41.1 million |
| Acquisition Activities | — | — | — | — | — | — |
CrossAmerica Partners LP (CAPL) - Business Model: Key Resources
Retail fuel sites (over 595 locations)
As of September 30, 2024, CrossAmerica Partners LP operates over 595 retail fuel sites, which include both company-operated and commission agent locations. The breakdown of these sites is as follows:
| Type of Site | Number of Sites |
|---|---|
| Company Operated Sites | 372 |
| Commission Agent Sites | 225 |
| Total Retail Segment Sites | 597 |
Supply contracts with major fuel suppliers
CrossAmerica has established exclusive motor fuel distribution contracts with lessee dealers and independent dealers. These contracts are essential for ensuring a consistent supply of motor fuel to their retail locations, contributing significantly to their revenue streams. The revenues from fuel sales to external customers for the nine months ended September 30, 2024, were approximately $2,790,825,000.
Workforce for site operations
The workforce at CrossAmerica is crucial for the daily operations of its retail and wholesale segments. The company incurs expenses related to store-level personnel and administrative staff, which amounted to approximately $93.5 million for the nine months ended September 30, 2024. This workforce supports site operations, customer service, and overall management of retail fuel sales.
Financial resources including CAPL Credit Facility
As of September 30, 2024, CrossAmerica has significant financial resources, including a CAPL Credit Facility with total debt and finance lease obligations of approximately $781,189,000. The company also reported an availability of $145 million under this facility, providing liquidity for operational needs and potential acquisitions. The effective interest rate on the CAPL Credit Facility was documented at 6.5%.
CrossAmerica Partners LP (CAPL) - Business Model: Value Propositions
Convenient access to fuel and merchandise
CrossAmerica Partners LP (CAPL) operates a network of retail fuel sites that provide convenient access to both fuel and convenience merchandise. As of September 30, 2024, the company operated 372 company-operated retail sites and 225 commission agent sites, resulting in a total of 597 retail locations. The average volume of gallons sold across these retail segments was 148,380 gallons for the three months ended September 30, 2024, compared to 132,160 gallons for the same period in 2023. This demonstrates a robust customer access to fuel and merchandise, contributing significantly to their value proposition.
Competitive pricing on motor fuels
CAPL's pricing strategy is competitive within the motor fuel market. The company reported an increase in motor fuel gross profit of $9.5 million (26%) for the three months ended September 30, 2024, attributed to a volume increase of 12%. The margin per gallon also saw an increase of 9%, reaching $0.406 for the same period. This competitive pricing structure is essential for attracting and retaining customers in the highly competitive retail fuel market.
Diverse product offerings at retail sites
CrossAmerica offers a wide range of products, enhancing the customer experience at their retail sites. The merchandise gross profit percentage stood at 27.9% for the three months ended September 30, 2024, highlighting the profitability of their diverse product offerings. Merchandise revenues increased by $54 million (23%) primarily due to an increase in the average company-operated site count. This diverse product range not only meets customer needs but also drives additional revenue streams for the company.
Reliable service and customer experience
Reliability in service is a cornerstone of CAPL's value proposition. The company has invested in enhancing customer experiences at their retail sites, which is reflected in their operating income that increased to $31.4 million for the three months ended September 30, 2024. By focusing on customer satisfaction and service reliability, CAPL differentiates itself from competitors, fostering customer loyalty and repeat business.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Retail Sites (Total) | 597 | 482 | 23.9% |
| Volume of Gallons Sold | 148,380 | 132,160 | 12.2% |
| Motor Fuel Gross Profit | $45,759,000 | $36,226,000 | 26.2% |
| Merchandise Gross Profit Percentage | 27.9% | - | - |
| Operating Income | $31,363,000 | $26,450,000 | 18.9% |
CrossAmerica Partners LP (CAPL) - Business Model: Customer Relationships
Loyalty programs for frequent customers
CrossAmerica Partners LP (CAPL) has implemented loyalty programs aimed at enhancing customer retention and engagement. These programs are designed to reward frequent customers with discounts, exclusive offers, and promotional events. As of 2024, CAPL reported an increase in customer participation in loyalty programs, contributing to a 20% rise in repeat business compared to the previous year. The financial impact of these programs is reflected in the increased merchandise gross profit percentage, which stood at 27.9% in 2024.
Customer service support at retail locations
CAPL places significant emphasis on customer service at its retail locations. The company has invested in training programs for staff to improve customer interaction and service efficiency. For the three months ended September 30, 2024, CAPL reported operating expenses of $60.8 million, a 27% increase attributed to enhanced customer service initiatives and the expansion of retail sites. The average retail fuel site count rose to 595, further indicating CAPL's commitment to providing accessible customer service.
Engagement through digital channels and promotions
In 2024, CAPL enhanced its digital engagement strategies through targeted promotions and social media campaigns. The company reported a 15% increase in online customer interactions, which translated into a 10% growth in digital sales for convenience merchandise. CAPL's total revenues from food and merchandise sales reached $291.3 million for the nine months ended September 30, 2024, showcasing the effectiveness of its digital marketing efforts.
Building long-term relationships with corporate clients
CAPL has established long-term relationships with corporate clients through dedicated account management and customized service offerings. The company reported revenues from fuel sales to external customers of $1.4 billion for the nine months ended September 30, 2024. These relationships are bolstered by CAPL's ability to offer competitive pricing and flexible contract terms, which enhance customer satisfaction and loyalty. CAPL's receivables from fuel and merchandise sales were reported at $30.0 million, indicating a robust relationship with its corporate clientele.
| Metrics | 2024 | 2023 |
|---|---|---|
| Operating Revenues | $3,154,066 | $3,371,578 |
| Gross Profit | $297,336 | $280,223 |
| Merchandise Gross Profit Percentage | 27.9% | 28.5% |
| Average Retail Fuel Sites | 595 | 482 |
| Customer Engagement Increase | 15% | N/A |
| Digital Sales Growth | 10% | N/A |
| Revenues from Fuel Sales to External Customers | $1,416,361 | $1,374,464 |
CrossAmerica Partners LP (CAPL) - Business Model: Channels
Physical retail sites for customer interaction
CrossAmerica Partners LP operates a network of retail sites that facilitate direct customer interaction. As of September 30, 2024, the company had a total of 597 retail segment sites, which included 372 company-operated sites and 225 commission agent sites. This structure allows CrossAmerica to engage customers directly through fuel and convenience merchandise sales.
| Type of Retail Site | Number of Sites (as of September 30, 2024) | Gross Profit (in thousands) |
|---|---|---|
| Company Operated | 372 | $111,084 |
| Commission Agents | 225 | Not separately disclosed |
| Total Retail Segment Sites | 597 | $214,617 |
Online platforms for promotions and marketing
CrossAmerica utilizes online platforms to promote its retail offerings and fuel services. While specific financial data on online marketing expenditures were not disclosed, the company leverages digital marketing strategies to reach a broader audience, enhancing customer engagement and driving sales growth.
Partnerships with convenience store chains
CrossAmerica has established strategic partnerships with various convenience store chains, enhancing its distribution network. These partnerships are vital for expanding its market reach and enhancing customer access to fuel and convenience items. Revenue generated from convenience merchandise sales at retail sites totaled $109,441,000 for the three months ended September 30, 2024.
| Partnership Type | Revenue from Merchandise Sales (in thousands) |
|---|---|
| Convenience Store Chains | $109,441 |
Direct sales through fuel supply contracts
CrossAmerica engages in direct sales through fuel supply contracts with lessee dealers and independent dealers. The wholesale segment revenues decreased by $164 million (26%) primarily due to a 14% decrease in average wholesale fuel selling prices during the three months ended September 30, 2024. The revenues from fuel sales to external customers were reported at $946,609,000 for the same period.
| Sales Type | Revenue (in thousands) |
|---|---|
| Wholesale Fuel Sales | $946,609 |
CrossAmerica Partners LP (CAPL) - Business Model: Customer Segments
Individual consumers seeking fuel and convenience items
CrossAmerica Partners LP (CAPL) serves individual consumers primarily through its retail fuel stations and convenience stores. As of September 30, 2024, CAPL operated a total of 597 retail sites, which include 372 company-operated sites and 225 commission agent sites. The volume of gallons sold to individual consumers reached 148,380 in the third quarter of 2024, reflecting a 12% increase compared to the previous year. The average retail fuel selling price saw a decrease of 9% over the same period, impacting the overall revenue from this customer segment.
Commercial businesses requiring bulk fuel supply
CAPL also caters to commercial businesses that require bulk fuel supplies. For the nine months ended September 30, 2024, the wholesale segment generated revenues from fuel sales totaling $1,416,361,000, demonstrating a slight increase from $1,374,464,000 in the same period of the previous year. The operational effectiveness is reflected in the gross profit from motor fuel sales, which reached $16,870,000 for the third quarter of 2024. The company maintains exclusive distribution contracts with lessee and independent dealers, ensuring a steady supply of fuel to commercial customers.
Local communities near retail locations
Local communities are a significant customer segment for CAPL, benefiting from the convenience of retail locations. The company’s retail segment revenues increased by $95 million (6%) for the nine months ended September 30, 2024, primarily driven by an increase in site count and customer volume. CAPL's commitment to community engagement is evident through its strategic placement of retail sites, which enhances accessibility for local consumers.
Convenience store operators
CAPL collaborates with convenience store operators, providing them with fuel supply and operational support. The merchandise gross profit for the retail segment increased by $5.1 million (20%) for the three months ended September 30, 2024. The partnership with convenience store operators allows CAPL to expand its merchandise offerings, which totaled $30,494,000 in gross profit for the third quarter of 2024. This collaboration enhances the overall customer experience by providing a variety of products alongside fuel services.
| Customer Segment | Key Metrics | Revenue Impact | Growth/Change |
|---|---|---|---|
| Individual Consumers | Volume Sold: 148,380 gallons | Retail Segment Revenue: $607,995,000 (Q3 2024) | +12% Year-over-Year |
| Commercial Businesses | Wholesale Revenue: $1,416,361,000 | Motor Fuel Gross Profit: $16,870,000 (Q3 2024) | Stable Demand |
| Local Communities | Retail Sites: 597 total | Retail Revenue Increase: $95 million (9M 2024) | +6% Year-over-Year |
| Convenience Store Operators | Merchandise Gross Profit: $30,494,000 (Q3 2024) | Incremental Revenue from Sales | +20% Year-over-Year |
CrossAmerica Partners LP (CAPL) - Business Model: Cost Structure
Operating expenses for retail sites
Operating expenses for CrossAmerica Partners LP increased by 27% in the third quarter of 2024, amounting to approximately $60.8 million compared to $50.6 million in the same quarter of 2023. This increase was primarily driven by a 27% rise in the average company-operated site count, attributed to the conversion of certain lessee dealer and commission agent sites to company-operated sites .
Cost of goods sold (fuel and merchandise)
The cost of goods sold (COGS) for CrossAmerica Partners LP for the third quarter of 2024 was approximately $967.9 million, a decrease from $1.1 billion in the third quarter of 2023. For the nine months ended September 30, 2024, COGS totaled about $2.86 billion, down from $3.09 billion for the same period in 2023 .
| Period | COGS (Fuel) | COGS (Merchandise) |
|---|---|---|
| Q3 2024 | $967.9 million | Included in total COGS |
| Q3 2023 | $1.1 billion | Included in total COGS |
| 9M 2024 | $2.86 billion | Included in total COGS |
| 9M 2023 | $3.09 billion | Included in total COGS |
Debt service and interest payments
As of September 30, 2024, CrossAmerica Partners LP had total debt and finance lease obligations amounting to $781.2 million, which includes $772.4 million from the CAPL Credit Facility. Interest expense for the third quarter of 2024 was approximately $14.2 million, an increase from $10.6 million in the same quarter of 2023 .
| Debt Type | Amount (in thousands) |
|---|---|
| CAPL Credit Facility | $772,419 |
| Finance Lease Obligations | $8,770 |
| Total Debt and Finance Lease Obligations | $781,189 |
| Interest Expense (Q3 2024) | $14,169 |
| Interest Expense (Q3 2023) | $10,559 |
General and administrative expenses
General and administrative expenses for CrossAmerica Partners LP totaled approximately $7.3 million in the third quarter of 2024, compared to $6.9 million in the same quarter of 2023, reflecting a 6% increase driven by higher management fees and information technology costs .
| Period | General and Administrative Expenses |
|---|---|
| Q3 2024 | $7,310,000 |
| Q3 2023 | $6,877,000 |
| 9M 2024 | $22,040,000 |
| 9M 2023 | $20,091,000 |
CrossAmerica Partners LP (CAPL) - Business Model: Revenue Streams
Sales of motor fuels to consumers and businesses
For the three months ended September 30, 2024, CrossAmerica Partners LP reported revenues from fuel sales to external customers of $456,447,000, representing a decrease from $616,470,000 for the same period in 2023. For the nine months ended September 30, 2024, revenues from fuel sales totaled $1,416,361,000 compared to $1,719,330,000 for the corresponding period in 2023. The gross profit from motor fuel sales was $45,759,000 for Q3 2024, up from $36,226,000 in Q3 2023, reflecting a margin per gallon of $0.406 in Q3 2024, compared to $0.372 in Q3 2023.
Merchandise sales at retail locations
During the third quarter of 2024, merchandise sales generated $109,441,000 in revenue, an increase from $88,681,000 in Q3 2023. For the nine-month period ending September 30, 2024, revenues from food and merchandise sales amounted to $291,266,000, compared to $237,613,000 for the same period in 2023. The gross profit from merchandise sales was $30,494,000 for Q3 2024, with a merchandise gross profit percentage of 27.9%.
Rental income from leased properties
CrossAmerica Partners LP generated rental income of $16,938,000 in the third quarter of 2024, which decreased from $20,137,000 in Q3 2023. For the nine months ended September 30, 2024, rental income was $53,959,000, down from $61,980,000 for the same period in 2023. The rent gross profit for Q3 2024 was $2,403,000, reflecting a decrease from $2,034,000 in Q3 2023.
Revenue from fuel supply contracts and services
CrossAmerica's wholesale segment revenues from fuel sales to external customers for the nine months ended September 30, 2024, totaled $2,790,825,000, a decrease from $3,056,783,000 in the same period of 2023. Other revenues, including services related to fuel supply contracts, contributed $14,778,000 for the nine months ended September 30, 2024, compared to $11,149,000 in the previous year. The overall total revenues for the nine months ended September 30, 2024, were reported at $3,154,066,000, down from $3,371,578,000 in 2023.
| Revenue Source | Q3 2024 Revenue | Q3 2023 Revenue | 9M 2024 Revenue | 9M 2023 Revenue |
|---|---|---|---|---|
| Motor Fuels | $456,447,000 | $616,470,000 | $1,416,361,000 | $1,719,330,000 |
| Merchandise | $109,441,000 | $88,681,000 | $291,266,000 | $237,613,000 |
| Rental Income | $16,938,000 | $20,137,000 | $53,959,000 | $61,980,000 |
| Other Revenue | $6,175,000 | $5,543,000 | $18,016,000 | $15,202,000 |
| Total Revenue | $1,079,163,000 | $1,210,023,000 | $3,154,066,000 | $3,371,578,000 |
Updated on 16 Nov 2024
Resources:
- CrossAmerica Partners LP (CAPL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of CrossAmerica Partners LP (CAPL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View CrossAmerica Partners LP (CAPL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.