In an industry where partnerships and franchising dominate, RaceTrac’s recent acquisition of Potbelly Sandwich Works is a strategic outlier. Rather than licensing or co-locating a brand within its c-store network, RaceTrac has opted for a full equity purchase—a move that raises both eyebrows and questions across foodservice circles.
Most gas stations and convenience store operators work with restaurant brands. RaceTrac is now aiming to own one. And that shift has significant implications.
Why Full Acquisitions Are Rare
The Potbelly deal is distinct because nearly all other foodservice integrations in the gas/c-store space involve:
- Franchising arrangements
- Smaller footprint, non-traditional units
- Licensing or co-branding within travel centers or c-store platforms
Examples include Krispy Krunchy Chicken’s store-in-store model, or Subway locations inside truck stops. These models allow c-stores to offer foodservice without shouldering the burden of brand management, culinary innovation, or franchise support.
RaceTrac, on the other hand, is acquiring all of Potbelly—including its franchising rights, operations, and brand equity—for approximately $566 million.
Potential Risks to the Brand
This type of vertical integration presents several brand risks:
Dilution of Brand Positioning
Potbelly has long occupied the “neighborhood sandwich shop” lane. Association with a gas station chain may disrupt consumer perception of quality or freshness.
Operational Consistency
Merging c-store operations with fast casual service expectations can lead to uneven customer experiences.
Cannibalization
Potbelly franchisees or operators may face internal competition if the brand proliferates through RaceTrac footprints.
Experience Mismatch
Fast casual brands depend on ambiance, customization, and service touchpoints that may be difficult to replicate inside c-stores.
Why It Might Work
Still, there are strategic reasons this could pay off:
Scale and Real Estate Access
RaceTrac has 800+ stores across 14 states. That’s instant expansion opportunity for Potbelly in underpenetrated markets.
Consumer Convenience Expectations
Consumers increasingly want high-quality, ready-to-eat meals in fast-moving, on-the-go environments—something c-stores are getting better at delivering.
Logistics Synergies
Shared distribution, real estate planning, and operational support could lower Potbelly’s overhead and streamline expansion.
Brand Sub-Segmentation
With proper brand architecture, Potbelly can preserve its core restaurant experience while developing c-store-only models.
Is This the Beginning of a Trend?
RaceTrac’s move reflects a broader convergence: the collision of convenience retail and elevated foodservice. As QSRs and fast casual chains face rising labor and real estate costs, and as c-stores step up their foodservice ambitions, we may see more direct acquisitions—not just co-locations.
But future success hinges on one thing: brand integrity. Whether consumers will continue to associate Potbelly with warmth, quality, and “neighborhood feel” may depend on how this integration is executed.
What We’re Watching
At FSIP, we’re closely tracking:
- How c-stores evaluate ownership vs partnership in foodservice
- Where these acquisitions succeed—and where they backfire
- What it means for food manufacturers looking to sell into this evolving channel
Expect more brand mashups. Just don’t expect them all to work.
See our recently released Convenience Store Foodservice Report or to learn more about FSIP’s Management Consulting Practice, click here.
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