Alimentation Couche-Tard, parent of Circle K convenience stores, has signed lease agreements for three new Midwestern distribution centers that are expected to be operational by late 2025, the company announced on Thursday.
These centers — located in Otsego, Minnesota; Lockbourne, Ohio; and Hazelwood, Missouri — will support 1,600 Circle K and Holiday convenience stores across 14 states. Each location is about 266,000 square feet and will supply stores with national and private-brand packaged snacks, candy, beverages, tobacco and other convenience items not normally supported via direct store delivery.
Although each location will have between 140 to 230 employees, Couche-Tard plans to contract all the warehouse and distribution operations at these centers to third-party logistics companies. This “hybrid distribution model” aims to help Couche-Tard create a more flexible supply chain that ensures the right products are available in the right locations at the right time.
This isn’t the first time Couche-Tard has used this type of distribution strategy. The hybrid model has been successfully implemented at Couche-Tard’s other two U.S. distribution centers in Texas and Arizona, Trey Powell, senior vice president of global merchandising for Circle K, said in the announcement.
“Expanding this hybrid distribution model into the Midwest will materially improve the control we have over key parts of the supply chain, enable further differentiation of retail programs and improve our inventory management processes and capabilities,” Powell said. “In addition, it will unlock further opportunities to optimize and enhance food service programs.”
Once the three new centers are up and running, Couche-Tard will have five of these hybrid distribution centers supplying more than 2,600 company-owned c-stores in the U.S.
A spokesperson from Couche-Tard declined to share financial details of these lease agreements.
