What would you have done during the peak of the recession in 2008 if the coveted surrounding property of your convenience store/service station business in Costa Mesa, Calif., became available for purchase, but the business itself was rapidly declining?

Plaza Chevron owners Marylou and Mario Mendez completed the purchase of the property and made the "tough decision" to drastically convert the station – what many in the industry would have viewed as risky business in risky times. But that's not the way they see it.

"The risk is in staying idle," Marylou Mendez told Convenience Store News for the Single Store Owner. "Taking risks is important to success in this business because inactivity leads to failure. Three years ago, our service bay business was declining and we had an unsure future, but if we didn't do what we did, I wouldn't be sitting here talking to you. So for us, the real risk was in not doing anything."

What they did was bold by any standards – basically rebuilding and reformatting the entire business, discarding its 1960s roots of primarily a "service bay" or auto repair business; building a bigger c-store with the latest in modern equipment and technology such as LED lighting, energy-efficient equipment and environmentally sound water; plus adding in "ancillary centers" like a car wash and propane service.

"We not only leveled the business to the ground, we dug out from underground. Everything is new," said Mendez, who purchased the original business from her father in 1992. "With all the environmental issues in California, we're ready for whatever the future holds."

Their risk was possible thanks to a chance the city council took on them. "Even though it's worse today, financing was still very tough then," she recalled. "Initially, our plans were denied by the planning commission, so we had to then stand before the city council and plead our case, explaining why it was good for the city to let us go ahead with our vision. They took a risk on us and ultimately decided it was better to have the new, modern facility than the old one that existed."

Up until three years ago, the focal point of Plaza Chevron's offering was its auto repair business, popular as part of gas station service in the '60s and '70s. It wasn't until the '80s that the business even had a convenience store space. The store area was converted from the former waiting room of the service station, so it was only able to house a small variety of the typical departments: beer, wine, carbonated soft drinks, bottled water, cigarettes, candy and salty snacks.

Today, thanks to the total business conversion, the c-store portion has drastically changed for the better. In order for it to be well-received by its longtime auto repair customers, though, the owners had to prepare them for the changes that were coming.

Plaza Chevron is a family affair for Marylou and Mario Mendez and their sons Matthew (front) and Michael (back). Photos by Steve Giraud

"When you work on peoples' cars, you become intimate with them – everybody cares about their car, so we would have conversations with them when they dropped them off in the morning and picked them up after work," Mendez relayed.

Plaza Chevron differentiates itself by offering healthier alternatives, ethnic products, craft beer and a large wine selection.

"Once we knew we were going to make the changes, we told them what was going on along the way. At first, they were worried who was going to fix their cars, but we gave them good recommendations. And of course, everyone needs gas and their car washed and little c-store items, so the response from our customer base was all fantastic. We kept most of our customers and gained new ones, too, by giving them what they want."

Among the ways Plaza Chevron is keeping customers happy with the conversion are:

• Gourmet coffee with a loyalty program. Before the conversion, the owners couldn't even sell coffee; they gave it away as an advertising tool, Mendez reported. Now, Plaza Chevron offers gourmet coffee with a loyalty card program.

Customers are excited to get their cards stamped every morning and await their free java after five cups are purchased. On the weekends, there is even a double-stamp program because they noticed sales dipped then.

Marylou Mendez got her start in the c-store business in 1979, working for her father. Plaza Chevron runs a loyalty card program around its coffee. Customers get a free cup after their fifth purchase. Michael Mendez is learning the paperwork of the business, such as accounts receivables and payroll.

"We're encouraging those who come during the week to also come on the weekends because instead of one stamp, they'll get two, so they're going to earn their free cup quicker," she said. "It was an easy thing to do to increase traffic; it doesn't cost us anything."

• Healthier alternatives. Doing business in California might help push the issue, but for Plaza Chevron, "healthier alternatives are really big now," according to Mendez.

"Our First Lady is all about that and as a woman, when I go into a store looking for something to eat, I look for healthy. So, I'm always pushing my vendors for this – what's new in healthy, what do they have to offer," she said.

The store has brought in fresh fruit, salads, wraps, gourmet oatmeal, yogurt and even "brain berries," which are basically fresh blueberries in a convenient one-serving pack. Mendez recognizes there is the perishable factor to consider, so "we have to be careful not to over-order here. Otherwise, I'm making things like blueberry muffins at home."

• Special orders. If a Plaza Chevron customer can't find what they're looking for, Mendez will order it for them. Typically, this means ordering a certain brand of cigarettes or certain types of drinks, special flavors, etc.

• Ample cooler doors. Utilizing ExtraMile's flex space, Mendez opted for 14 cooler doors. "As many as I could fit to be able to offer my customers everything they want in packaged beverages," she said, pointing out that it's the highest-volume category in the store next to cigarettes. Of those 14 doors, four are devoted to beer and wine.

• Craft beer. Mendez is particularly proud of the store's merchandising strategy to offer a good selection of craft beer. "We really expanded this section because it's been on the rise like you can't believe," she stated. "And our c-store customers are looking for the new and unexpected all the time."

Chevron was rolling out its Extra Mile concept right around the time Marylou and Mario Mendez decided to make drastic changes to their business.

Plaza Chevron also has the advantage of the couple's millennial-age sons, who are employed in the business. "They have a lot of input. They tell me what's hot and what's not here," she added.

• Wine selection and perks. Plaza Chevron maintains a specialty wine selection, which includes a lot of California wines between $10 and $20 a bottle. The c-store also carries some half-bottles. Customers who purchase two bottles get the perk of a free corkscrew, which caters to customers who often come in from the Hilton hotel next door.

"We actually look at their itinerary each weekend of all the meetings and seminars they have going on, and stock our wine and other beverages accordingly," Mendez explained.

She said one of the biggest crowds for wine and beer is a high school football coach seminar. "They especially clean me out of beer, so when we know they're coming, we make sure beer is in good stock."

In addition to carrying wine in the cooler, Plaza Chevron features 50 wine bottles up front on a wine tree display from its Kendall Jackson distributor. "It definitely catches everyone's eye," Mendez said.

They make sure customers are aware of the variety of wines they carry, such as La Crema. "These are brands you wouldn't expect to see in a c-store, so when they see it, they may not buy it that day, but they'll remember it's here and they're likely to pick it up from us on their way to an event."

Plaza Chevron also gives special wine gift bags to customers, provided by its distributor.

• Ethnic sprinklings. Mendez has learned a thing or two from observing the bigger convenience store chains, including adding a few ethnic offerings to the mix.

"I noticed a lot of big-box stores use a lot of their space to cater to different ethnic backgrounds, so I'm taking some top sellers and using my flex space to give some of my ethnic customers that familiarity," she said.

Some examples that Mendez mentioned are offering Asian Panda cookies and Takis tortilla chips, intermingled in their appropriate departments within the store.

• New item surprises. Mendez is always looking for the next hot c-store item, recognizing that single operators like Plaza Chevron have an advantage in this area.

"It's great that if I want to make a new-item decision today, I can execute it immediately. It doesn't take a week or a month," she said. "We have to always be looking out for new items. If we didn't, no one would have ever tried a Red Bull."

Right now, the store is having good success with electronic cigarettes, thanks to a nearby sports bar. "Customers are realizing they can still play pool and watch the games at the bar with an eCig," she said. "Of course, they also stand outside and smoke, so we sell them cigarettes, too."

Plaza Chevron also knows that keeping customers happy means keeping employees happy. Mendez happily reported that the business offers employees a starting pay well above minimum wage, as well as full-time employee benefits of medical, dental and even vision insurance. "I know that's something my competitors don't do," she said.

The single-store business strives to give its employees consistent work schedules and a guaranteed number of hours. There is additionally the benefit of working a shift with another person, sometimes, even three other people.

"They're never alone and that's a big perk in the business because there are a lot of others who leave cashiers by themselves," Mendez maintained.

Chevron's in Her Blood Marylou Mendez was introduced to the convenience store business when she accepted a position from her father, the late Lou Bacca, at his first Chevron fuel/service bay station in Costa Mesa, Calif., in 1979. Economic times were hard then, too. "I started during the gas shortage/oil embargo and was given no special treatment," she recalled. "I worked right on the pump block, started at the very bottom like everyone else." In 1985, her father bought a second Chevron location in the same town, and eventually, she worked her way up to become the manager of the limited, 350-square-foot c-store that her father opened as part of the business. Prior to that, the station was solely a fuel and service bay business. (See main story, "Shifting Into Gutsy Gears.") In 1992, Mendez and her husband, Mario, purchased that second "underperforming" location from her father, and in 2008, they made the bold decision to buy the surrounding land and eliminate the service bay business, making it a totally new facility formatted for modern times. Mendez said she looked at other service station programs, but chose ExtraMile without much hesitation. "Chevron has always had a place in my heart. I grew up with Chevron," she stated. Her father had a 20-year history with Chevron corporate. During the latter part of his long tenure with the oil giant, he taught prospects how to be a Chevron dealer. Then, he himself became an owner of several stations for the remaining 25 years of his career. "My father owned many stations when I was growing up, but they always bore the Chevron banner," relayed Mendez. "I learned from the Chevron guru and worked side by side with him for 25 years." Mendez also grew up alongside five brothers and sisters who all worked for her father's Chevron business in some capacity during their high school and college years. Four of the six even went on to become small-business owners. She and one brother remained in the fuel service/c-store industry. He, too, is a Chevron dealer, but in a jobber capacity. Regarding her most recent experience with Chevron, Mendez recalled that right around the time she and her husband decided to make drastic changes to their business, Chevron was rolling out its ExtraMile concept. "They came in with a great deal and their support team, and that was it. Now, looking back, I can say everyone involved, from the head of ExtraMile down to the category managers and my consultants through the years, seem to be genuinely interested in my success." She added that the Chevron support team is like an extended family. Now, Mendez and her husband continue to pass on the Chevron family tradition to their sons, as well as to other family members and friends. Their son, Michael, 23, is learning "the paperwork of running the business – accounts receivables, payroll and all that," according to Mendez. Their older son, Matthew, 27, also works for the business part-time. Two of Mario Mendez's brothers work as customer service reps, and through the years, nieces and other family members have come and gone. A former mechanic left on his own when Plaza Chevron was converted from the auto repair business. When his own venture didn't work out, he was re-hired, just as the new business opened. "We knew him, we trusted him. He's someone we could count on. We think of Tim as family," said Mendez. Tim's girlfriend, Amy, also works for the store. Through the years, the couple's sons have brought in their friends who needed jobs. "My kids do all my recruiting for me," she said.