July 26, 2023 • 28 mins
Born Here, Raised Here! Coen Markets, Inc. is one of the oldest and largest convenience chains in the Pittsburgh region. We began serving the public in 1923, and today we have over 60 locations in Pennsylvania, Ohio and West Virginia.Our mission is to impress and satisfy our guests with every visit and make their lives simpler.We strive to provide the highest level of service, the best food we can make in kitchens, and the most comfortable retail environment for our guests to make Coen their preferred place to shop.Our premier sites offer a wide array of best-in-class amenities. Some of these amenities include; our full service, from-scratch Coen Kitchen, state-of-the-art coffee bars with fresh bean-to-cup coffee, dynamic product mixes, ice cold beer caves, dine-in seating, drive-thrus, free air and much more! Coen Kitchen features our signature items made fresh every day in our stores. These include Our Famous Chicken which is fresh, never-frozen, hand-breaded, transfat and hormone-free. You can taste the difference!We also serve our hand-cut jojos made from natural Idaho potatoes, made-in-store fresh baked pizza, our fan-favorite pepperoni rolls, freshly prepared deli sandwiches, homemade sides, hot meals and much more! Our extensive made-to-order beverage program includes; hand-crafted frozen lemonades, natural fruit smoothies, milkshakes and frappes.Stop by for a quality and convenient experience that we believe will make you want to return!
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Episode Transcript
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(00:05):
And welcome in. This is theCEOs You Should Know podcast. I'm your
host, Johnny Hartwell, let's sayhello to Charlie mcilvane, the chairman and
CEO of Cohen Markets. Thank youfor joining me, my pleasure. So
tell us everything we need to knowabout Cohen Markets. Cohen Markets is a
hundred year old company, restually ahundred years, one hundred years old this
(00:25):
year, Well, happy birthday,that's it. Nineteen twenty three was our
first location and we're found in Washington, PA. And it's got a very
rich history. So we are aborn here, raised here group. We
have nearly sixty locations in the picturePittsburgh metro Market, tri State Area,
West Virginia, Ohio, Pennsylvania,and were I think we're very connected to
(00:48):
our communities, in part because ofhow what we do for them every day.
Now, Cohen Markets seemed to growovernight over the last on a six
seven eight months or so. Thesewere Amico gas stations have kind of expanded.
It's kind of a rebranding. Likeevery company, we've evolved, and
I think we believe in evolution.We think it's important that we should evolve.
(01:10):
We've been a collection of some dealeroperated sites than some company operated sites.
We've been also a product of acquisitionswhere we've acquired small chains here and
there, and I think recently whatwe've done is able to put them all
under the Cohen banner for those sitesthat deserved that banner. And Cohen is
(01:33):
a name that has been around inthe market for quite some time. We've
had other heritage businesses that I thinkhad more recognition to that brand itself than
the director operating direct to consumer operatingretail businesses. We felt, as we
had our number of sites, itwas time for us to put that Cohen
banner on it. And the stagingof Amico, which you're alluding to,
(01:57):
our roots are in fuel. Ithink our roots going back literally to the
twenties, was fuel hauling at theadvent of whatever mechanized and motorized vehicles and
so, and we've had a richhistory and a wholesale fuel distribution business called
co and Energy historically, so fuelhas been part of whom what we are,
and so we made a very strategicdecision to brand the four courts these
(02:23):
same same brand with what we thinkis a superior product, and that allowed
us across our nearly sixty sites tohave a very consistent offer, and happens
to be that we're BP who ownsAmaco. We're their oldest customer in America,
North America, ASH and there ouroldest relationships, so we have a
(02:44):
very close association with them. Butbeyond I think those associations in the branding
feature of it, I think thevalue proposition, which is critical to our
guests is that our fuel has avery distinctive composition and profile. Amoco is
just like it is our food andour full food locations. It's made from
(03:06):
the best ingredients. It has thebest fuel out there. That is a
proposition for our customers. Is therereally a difference. There is a difference
in the additives, there is adifference in the performance. There's a difference
in the cleanliness that it creates inthe engines themselves, for example. And
it's a claim that has been statedand put out there. You know,
(03:27):
Amoco fuel you can get twenty fivemore miles per gallon or hank of gas,
and when you think about it inthat context, it runs cleaner,
it allows your vehicle to run ata more optimized level. And so that
is a value proposition, particularly whenyou think about retail price of fuel going
up, it's like any Like anythingan inflationary environment, a given consumer is
(03:53):
looking to say, Okay, howcan I stretch mind dollar more. In
the case of Amoco fuel, whichwe offer in our market area, You're
going to come to a Cohen,You're gonna get Amaco. You're gonna go
to an Amaco. You're going tobe at a Cohen. That's the way
it is around here in our particularmarket area. But when you do that,
you know that that the fuel thatyou're purchasing has that level of quality
(04:15):
and assurance and confidence and that youget a performance benefit from it. And
I think that is part of ourour statement to to our guests out there,
that what we're trying to offer themis as a point distinction, all
right. Do you think people areaware of that distinction. I think it's
a growing awareness and part we're TheAmaco brand used to be the number one
premium brand in the United States andin this market area, has a pretty
(04:40):
rich, strong heritage. And becausethe way things work in combinations in corporate
America, there was Peepers Petoleium tookover Amaco and they tried to have an
am a BP brand consistently recently broughtback the Amaco brand, which we felt
nestled in nicely in our market areaowing to the heritage and our ability to
(05:01):
actually prositize its benefits. And soI think part of our job as marketers
is to make our customers aware ofthe value proposition of what and how this
is. And so I think increasinglythat is the case. If you take
a look at our performance statistics,we're seeing people showing up at our sites.
Well, I think a lot oftoday's consumers. When you think of
(05:25):
oil and gas, you think ofTexas, and we forget about Pennsylvania's royal
city, rich history of oil andgoing back to nineteen twenty three, you
are part of that history, thatproud history of petroleum here in Pennsylvania.
Pittsburgh is and has been attached toenergy. As you point out, oil
(05:48):
was found in Oil City, Pennsylvaniain Quaker State is a preeminent was a
preeminent brand and formative brand there.And it's not just oil in this part
of the world. We're particularly largein natural gas. If you go to
right south of Pittsburgh and South Point, it's the energy capital of the East.
(06:09):
Of course, there's other aspects ofenergy in this particular region too,
including coals. So it's very energyrich and so you know that's part of
that's part of our background. Sowhat is the background. What is the
history of Cohen, the brand,the company? So in in nineteen twenty
three's founded um a guy named RaymondRoss. It was in World War One.
(06:30):
He got a World War One bondwar bond after the war, and
he recognized the mechanization or motorization ofAmerica and on the front end of that
felt, you know what we cancreate. I can create a business which
would cater to that. So oneof our first locations was called First Chance,
(06:51):
Last Chance. It was on Rootforty in Washington, PA. Root
forty was now is called Chestnut Streetnow and it was First Chance. When
you came towards Washington on Route fortygoing I guess it would be whatever the
direction is into town, that wasthe first chance for you to get fuel.
And as you left town that wereat last chance awesome and it sort
(07:12):
of sprung from there. In addition, he created he had a wholesale fuel
distribution business where he would be takingfuels, oils and other greases and petroleum
products to those who needed them,and the proliferation of petroleum into how what
we do and from an industrial basisand a consumption basis. He was on
(07:34):
the front end of that curve,and so he built that business up.
He had a guy he brought infrom Saint Mary's, West Virginia who had
worked at a Quaker state plant,as he says, carrying water for ten
cents a day up on the hill. And his name was Charlie Cohen.
(07:56):
Charlie Cohen came up and became astrong illustrator for Raymond Ross and ultimate became
a partner and equity owner and becamea you know, an executive leader.
Uh. And they married sisters,so they had that feature too. And
Charlie Cohen happens to be our grandfather, my brother Andy, myself's grandfather,
(08:18):
our mom's dad, and he happensto be also our hero. And my
name is Charlie and my middle name'sCohen. I really didn't realize this isn't
a real family. It is.Wow, we're you know, we would
be considered third generation. That said, my brother Andy and I got into
business in two thousand and um.We when we came into the business,
(08:43):
it's not what it is today.So we we have a history. We
built up a series of different divisionswhich became separate companies and we operated them
separately. We grew them, andfor for example, we had we had
we started dabbling in direct operating retailand in the late two thousands and around
(09:07):
in a little before a little afteraround two thousand and ten, and then
we started making acquisitions. So wemade an acquisition in two thousand and two
one on eleven one to twelve oneand thirteen, a small one on fourteen
and then we as we divisionalized thebusinesses, each of them grew up.
So for example, CO and Energywas a wholesale fuel distributor and energy field
(09:30):
services business. In addition, wehad CO and Transport, which hold fuel
and in two seventeen we we soldthat business to Spray, which was a
larger public company, and we feltthat it put that business in the hands
of a larger operator which could cansustain it and grow it further still.
And then in two eighteen we boughtthe Cocos business, which has a heritage
(09:50):
brand in Pittsburgh from the sixties andallowed us at that point aggregating specifically relative
to Cohen Market enough critical masks wherewe were able to put the Cohen brand
on the buildings themselves and create whatwe think is a chain that can speak
(10:13):
to our guests with one image,one voice, and we ultimately create a
base offer. And today our businesshas full in terms of Cohen Markets,
has our full kitchen stores where wehave what we think is a very distinctive
food offer in our mark on ourmarket which is largely made on premise,
and we have the heritage sites whichhave more limited food offer and the more
(10:37):
typical convenience items of snacks and beveragesand what have you. So, inasmuch
as we were talking about fuel,I think convenience for our guests is a
is a broader umbrella offer that isnot just fuel but the other items as
well. I'm happy to go intoany kind of feature of that. But
that's a pretty real feature of Americanconsumer public concerned. So this is this
(10:58):
is something that has been brewing fora long long time. Can you give
us the genesis and where where doyou want to take Cohen Markets? What's
the future? Yeah? So Ithink, like we mentioned before, evolution,
I think we as a as achain that Cohen Markets are evolving.
And uh, not only is thatdeal with our physical footprint, but it
(11:18):
deals with our imagery and our communication. It deals with our offer. And
we just got done talking about that. Um. As we've grown, we've
we've developed our full food offer,which we have these full kitchen sites and
when you come to Cohen Markets thathas its full kitchen sites, we have
um fresh never frozen handbread at ourown recipe and trans fat free, hormone
(11:41):
free chicken. Long winded way ofsaying, it's really freaking good. I
was going to ask about the evolutionof the chicken, but yeah, I
want to know, really good whoserecipe? This is a family business?
Was this? Uh, well,that that would add to some of the
allure to it, admittedly, butbut but the truth is that we act.
(12:05):
Let's let's make up a lie.Well, let's make up a real
fabricated story that would make it reallyfascinating, very attempting. We did acquire
a business that had a chicken offerand really put us in the food business,
and we wound up scaling it fromthere. Actually, the relevance here
is that as we evolved as asa convenience industry, evolves. You know,
(12:26):
are are our propositions important to toour consuming public, particularly when the
historical you know, feature around conveniencewere the proverbial quote unquote cokes and smokes
and uh. And so one ofthe things that we think is important is
how do we stay relevant to ourour consuming public and our guests and our
and our customers. Um and andif Food for Us has a central role
(12:48):
in that. So you can comemorning, noon or night to our stores
and have a full breakfast offer.Well, uh. In terms of our
kitchen stores where a lot of thoseproducts are made on site. We are
not in a central warehouse creating productsand in an industrial fashion freezing them,
sending them out with high fat,high salt content, nukim put them in
(13:11):
a pretty bag and saying here yougo with a smile. In fact,
we're making a lot of these productson site, and it shows up in
terms of taste, it shows upin terms of a customer experience. So
our breakfast offer is as such,including our bean, a cup, coffee,
and so and so forth. Andwe have we've branched out on that,
one of which is one feature whichis chicken. I mean, like
(13:33):
any kind of group you've got tohave some type of hero feature to you,
to your offer to who you are. And part of ours is association
with our famous chicken. In additionto that, we make pizza on site.
It's from scratch. We have ourown recipe of pepperoni rolls, very
pittsburgh Ian, and we think oursare pretty dog gone good. And again
(13:56):
extends from there. So I think, I think when we consider how what
we are doing for our customers,we think that's a very relevant feature to
the what's your feedback from the customerswho have had your chicken and your pizza
and your your breakfast fare? Areyou are you? Are you happy with
the progress that you made with withthat? Yeah, er, well absolutely
(14:16):
we are. I mean, thisis a business that's capital intensive. Convenience
is a capital intensive business, andso um, you know, your best
feedback is are you getting a customeraccount? Are you getting repeat usage?
Of course you can get the commentsback, you know, we see it.
(14:37):
I mean, if you go inand you listen to some of the
opinion formers and some of the voicesout there in the Pittsburgh market, light
to Pittsburgh Dad, here what hesays or hear what the other fellow says
the gas station guy. Whatever itis, those testimonials, in addition to
actual consumers themselves, are real.But we're also seeing it numerically, financially,
(15:00):
fiscally. People are coming back toour stores because we're offering something they
like and care about. You're gettingfeedback from their wallets. That's correct.
And I think inconvenience generally in ourin our location and our locations and our
our in our chain. Uh istrue of this too. I'd say about
eighty percent of our customer customer basedor repeat customers, big number. What
(15:22):
is Charlie's background? Uh? Mybackground is I have three other brothers.
I'm one of four. Our momand dad still are around. They're awesome.
Who who's mom and Dad's favorite?Uh? Uh, I'm a Leo
one in July. What do youthink? The answer is? Um?
(15:45):
But there's there is a there isa relevant segue here taking that that I'm
actually in business with one of mybrothers. I'm number two, he's number
three, And we have our olderbrother who is a patent attorney, very
long dated successful patent turn hear Yungisberg'sattorney out in Colorado. So I think
it I think there's something important aboutbeing in business with a sibling, and
(16:11):
sometimes the ball can bounce on oneside or bounce on the other. Sometimes
it could be that there are nosocial barriers, and it's kind of could
be a nightmare, I'd like tothink. And maybe it'd be better if
my brother Andy were here having hisown voice against it. But I think
I'm pretty sure he said the samething, which is, neither of us
look at underneath the tree and seewho's got the bigger present under the Christmas
(16:33):
tree. Neither of us looks soto see is one one ear one's losing.
And I think that we're amused oneto the other. We actually have
different approaches in different styles, andI think that that is super complimentary.
So it doesn't work for everybody interms of siblings running a business, but
we treat you have complimentary philosophies.Philosophically complimentary, but certainly stylistically in skills
(16:57):
skills compliments. So back to thebackground point, my brother and I went
to the same undergrad which happens tobe Duke and Um I went and I
went to business school, so Igot an NBA, went I went to
Penn, I went to Wharton andhe got a low degree at Notre Dame,
(17:18):
so he was a lawyer and Iwas working investment banking and ultimate private
equity. And and I think we'veconverged back together when we bought the base
business in two thousand and then madethose acquisitions I alluded to earlier. And
it was probably in the last sixseven years that Andy and I had developed
(17:40):
a business as it is, asas it is actually was then, which
is these four divisions that we continueto grow up. And it just made
sense for us to both be togetherthere working on it. It justified it.
And as it happens to be,we're our offices are in the same
room, our desks are close toone another, and where there is no
you know, front door backdoor.If someone comes indoor office as they come
(18:03):
into one door and they leave inat one door, and we think that's
relevant too, but allows us,I think, to have those micro moments
of what about this, what aboutthat? And that's pretty additive. So
you can tell in our our ourprior professional backgrounds. As a compliment,
and I think there's a stylistic compliment, and I think it's pretty damn cool.
(18:23):
What's your biggest challenge as a business. As a business, um,
I think probably like anybody who's gota retail business, it's labor. I
think we've got a I mean,we could probably look at it from a
top down basis. But in theUnited States, our birthrates hunder two.
(18:45):
We have largely the fifty five andolder crowd has largely dropped out of the
workforce. We have baby boomers controllingwhatever it is, like seventy five of
the wealth and meaning that they's soI have to work and um, and
we have an immigration policy that isdifficult. So when you just look at
(19:07):
the end, actually another added feature, I think we're still like ten million
jobs open jobs in America. Ourunemployment rate is in the mid threes.
Mathematically, there's one answer. Weneed more people. So uh, and
we're feeling that in particular businesses likeretail, which have a turnover rate and
effect that we get these displacement riskswith other retailers and shifting back and forth.
(19:33):
That is a challenge. That's achallenge for any retailer. Do you
think you've successfully came up with ateam you're proud of? Oh, definitely,
I mean we're I mean we're talkinga little bit about Andy and myself
as titular leaders. But you know, there's a there's a team that runs
this business and it's a it's oursenior leadership team, and we're very focused
(19:59):
on and behaving and in a roundtable type format, meaning we don't have
somebody at an end of the table. We even talk in terms of like
flat Earth, where people need toengage I think on a level playing field
and strong encouragement of transparency and UHand partnership. And I think we've we've
(20:25):
we've added other team members that bringto us skill sets which we think advance
our efforts and accelerate our composition andUM, I think it's evident that that's
occurring. We want people to wantto be here. We want people who
are cited in the morning when theyget to work and kind of when they
go to bed at night, kindof look back on the day and say,
(20:48):
film what they understand have accomplished andif they can accomplish it, they
can collaborate with with our other partnersand team members to solve a problem.
And when you do problem solution witha team, or you succeed as a
team or you're working together the team. It's vastly different and I actually think
we've created a version of that culture. I'm actually pretty psyched about it.
When it comes to marketing, Whatis your strategy, Well, it's got
(21:15):
multiple features to it, one ofwhich is because we have, in the
case of Cohen Markets, a physicalfootprint I think being called all the same
thing e Cohen as a pretty basicimportant feature too. And we also talked
about that our four Court as aconsistent brand a Amico, which we hope
(21:38):
and expect to translate into the highestquality fuel that's a customer can purchase from
US Visa the other offerings out there, and that when they go into a
Cohen Markets that they can also expecta certain experience, both in terms of
the physical environment, clean friendly instock as well as the actual products themselves,
(22:02):
in the case of our food,very distinctive. So our marketing strategy
not only has the physical locations withthe same name, feel and look,
we want them to have an experiencetoo that has that element consistency, which
by itself is a reinforcement at thebrand. In addition to that, we're
(22:25):
in a digital age to some degree, We're we're talking and this is a
digital product, and so I thinkwe recognize that our customers have that component.
They're daily lives. So there's anew term, it's called figital where
we're trying to extend our customers experiencebeyond our four walls, beyond our sites
(22:48):
to when they're not there, andhow we can interact with them in a
good connecting sense, which is calledwhich is basically digital. So it's our
loyalty platform, other social media features, it's other communication portals including text and
email, what have you, onan appropriate basis, because we don't want
to harangue our guests, and sothe best and most important thing that we
(23:14):
can do from a marketing standpoint isto state what we think our brand promises
and deliver on it, which iswhy clean friendly in stock is such a
major feature for what and how wedo every day. And then have that
be a continuing part of our dialogueand reinforcement with our guests, you know,
with with co Gooes, Amaco,BP, all positive facets of Pittsburgh.
(23:36):
But now that you it's under oneumbrella, that's that's what you're doing,
Yes and where and you and youknow, let's face it, the
rule number one in business is location. Location, location, and you have
some of the best locations in Pittsburgh. I mean, it is true that
retail has that location, location locationfeature to it because in particular, what
we're selling as convenience, Yes wehave our famous chicken. Yes we have
(24:00):
we think as the highest quality fuel. Yes we haven't experienced there, which
we'd like to think is distinctive oralso selling convenience. And by dint of
our our history because we are huntingyour old company, some of the locations
we've had for quite some time.Maybe they were operated by dealers at one
point in our in our life cycle, today operated by ourselves. So location
(24:21):
does matter. But I think youknow, we are a born here,
raised here, Pittsburgh derived family peoplecompany, including what we think is our
offer is very pittsburgh Ian down toyou know, our fuel, which has
a very strong heritage to it,and are you know, we want to
(24:41):
put it into Pepperoni world context.There you have it, Pitsburgers left Pittsburghers.
It is true. I mean,actually, you know, there's a
little funny feature to this, andmaybe it's super played, but Pittsburgh folks
can really relate to sportsm I mean, a lot of cities can a lot
of a lot of a lot ofcommunities can kind of relate to that.
(25:04):
I would say southwestern Pennsylvania in particularis a very big sports culture. Ohio
Valleys, the same panhandle of WestVirginia is the same and UM. And
when you think about sports, there'sthere's a few things associated with it.
One isum is a strong familial bond. People often, you know, see
(25:30):
a watch sports or participate in sportsdriven by or associated with a family connection
or reason, either your children oryour siblings or whatever cousins. Secondly,
I think this is a very communityminded part of the world. I mean
that sounds like it's so super distinctivefor the rest of America, but I
(25:51):
think it's I think there's some standoutfeatures to it, a lot of historical
features, which probably is a differenttype of podcasts. And third um,
which I think it's a kind ofa cool phrase. Happened to come from
a guy who's named Mike Ssewski,who was a basketball coach at too.
Of course we my brother and Ihave a coach towards that, but he
has said it's not his alone,but he said that people people really strive
(26:15):
to be part of something bigger thanthemselves. And in the case of Pittsburgh,
I think that's like, hands down, I think a major feature to
it. So similarly, you knowwhat we are, who we are,
how we speak to our guests,as being authentic is really important, and
and and and and being a hundredyear old company. And literally we can
(26:37):
show you photos from the nineteen twentiesthat weren't like doctored or whatever. Uh,
this is who we are. AndI think that we're we're we're we're
part of this community. What isthe your earliest memory of the company of
the business? Uh? Well,um, number one. We had a
(26:59):
coke from the twenties which had thosesmall little glass bottles that you pulled open
a vertical glass door to get.That was kind of cool. It was
like a treat to go get onefor whatever it was fifteen cents. And
by the way, I'm not pushinga walker here on the road to the
young dude. We just have tokeep that machine around quite a long time.
The other thing is we used togo up on the mezzanine in one
(27:22):
of the warehouses and all the airfilters and oil filters we were rearranged to
create forts and completely piss off thewarehouse managers. We just checked up their
whole organization organization system. It waspretty cool for it. I gotta say,
good for you. Are you Areyou proud? Are you proud of
this of your company? Well?Of course I am. Um. I
(27:42):
mean, I know this sounds alittle gushing. You'd expect somebody to say
this, but you know, Imean, you look, we go to
work for commerce. That's what peopledo. I mean, we're trying to
make a living for our families andwhat have you. But you know,
it's over third of what we doin a given day. And I think
there's another element, which is fulfillment. I'm really psyched about our team.
(28:06):
I'm really psyched about where we've comefrom, and I'm psyched where we are
and where we're going. I thinkwe're realists and we try to problem solve
and it just I think it feelsgreat, like if you can win as
a squad. I know this soundslike gushy things, but it's true.
(28:27):
Olly, this has been fun.Thank you, my pleasure. Charlie McIlvaine,
chairman and CEO of Cohen Oil Companyand Cohen Markets and a CEO you
should know. Thank you so muchpleasure. This has been the CEO you
Should Know podcast, showcasing businesses thatare driving a regional economy, part of
iHeartMedia's commitment to the communities we serve. I'm Johnny Hart. Well, thank
(28:47):
you so much for listening.
And welcome in. This is theCEOs You Should Know podcast. I'm your
host, Johnny Hartwell, let's sayhello to Charlie mcilvane, the chairman and
CEO of Cohen Markets. Thank youfor joining me, my pleasure. So
tell us everything we need to knowabout Cohen Markets. Cohen Markets is a
hundred year old company, restually ahundred years, one hundred years old this
(00:25):
year, Well, happy birthday,that's it. Nineteen twenty three was our
first location and we're found in Washington, PA. And it's got a very
rich history. So we are aborn here, raised here group. We
have nearly sixty locations in the picturePittsburgh metro Market, tri State Area,
West Virginia, Ohio, Pennsylvania,and were I think we're very connected to
(00:48):
our communities, in part because ofhow what we do for them every day.
Now, Cohen Markets seemed to growovernight over the last on a six
seven eight months or so. Thesewere Amico gas stations have kind of expanded.
It's kind of a rebranding. Likeevery company, we've evolved, and
I think we believe in evolution.We think it's important that we should evolve.
(01:10):
We've been a collection of some dealeroperated sites than some company operated sites.
We've been also a product of acquisitionswhere we've acquired small chains here and
there, and I think recently whatwe've done is able to put them all
under the Cohen banner for those sitesthat deserved that banner. And Cohen is
(01:33):
a name that has been around inthe market for quite some time. We've
had other heritage businesses that I thinkhad more recognition to that brand itself than
the director operating direct to consumer operatingretail businesses. We felt, as we
had our number of sites, itwas time for us to put that Cohen
banner on it. And the stagingof Amico, which you're alluding to,
(01:57):
our roots are in fuel. Ithink our roots going back literally to the
twenties, was fuel hauling at theadvent of whatever mechanized and motorized vehicles and
so, and we've had a richhistory and a wholesale fuel distribution business called
co and Energy historically, so fuelhas been part of whom what we are,
and so we made a very strategicdecision to brand the four courts these
(02:23):
same same brand with what we thinkis a superior product, and that allowed
us across our nearly sixty sites tohave a very consistent offer, and happens
to be that we're BP who ownsAmaco. We're their oldest customer in America,
North America, ASH and there ouroldest relationships, so we have a
(02:44):
very close association with them. Butbeyond I think those associations in the branding
feature of it, I think thevalue proposition, which is critical to our
guests is that our fuel has avery distinctive composition and profile. Amoco is
just like it is our food andour full food locations. It's made from
(03:06):
the best ingredients. It has thebest fuel out there. That is a
proposition for our customers. Is therereally a difference. There is a difference
in the additives, there is adifference in the performance. There's a difference
in the cleanliness that it creates inthe engines themselves, for example. And
it's a claim that has been statedand put out there. You know,
(03:27):
Amoco fuel you can get twenty fivemore miles per gallon or hank of gas,
and when you think about it inthat context, it runs cleaner,
it allows your vehicle to run ata more optimized level. And so that
is a value proposition, particularly whenyou think about retail price of fuel going
up, it's like any Like anythingan inflationary environment, a given consumer is
(03:53):
looking to say, Okay, howcan I stretch mind dollar more. In
the case of Amoco fuel, whichwe offer in our market area, You're
going to come to a Cohen,You're gonna get Amaco. You're gonna go
to an Amaco. You're going tobe at a Cohen. That's the way
it is around here in our particularmarket area. But when you do that,
you know that that the fuel thatyou're purchasing has that level of quality
(04:15):
and assurance and confidence and that youget a performance benefit from it. And
I think that is part of ourour statement to to our guests out there,
that what we're trying to offer themis as a point distinction, all
right. Do you think people areaware of that distinction. I think it's
a growing awareness and part we're TheAmaco brand used to be the number one
premium brand in the United States andin this market area, has a pretty
(04:40):
rich, strong heritage. And becausethe way things work in combinations in corporate
America, there was Peepers Petoleium tookover Amaco and they tried to have an
am a BP brand consistently recently broughtback the Amaco brand, which we felt
nestled in nicely in our market areaowing to the heritage and our ability to
(05:01):
actually prositize its benefits. And soI think part of our job as marketers
is to make our customers aware ofthe value proposition of what and how this
is. And so I think increasinglythat is the case. If you take
a look at our performance statistics,we're seeing people showing up at our sites.
Well, I think a lot oftoday's consumers. When you think of
(05:25):
oil and gas, you think ofTexas, and we forget about Pennsylvania's royal
city, rich history of oil andgoing back to nineteen twenty three, you
are part of that history, thatproud history of petroleum here in Pennsylvania.
Pittsburgh is and has been attached toenergy. As you point out, oil
(05:48):
was found in Oil City, Pennsylvaniain Quaker State is a preeminent was a
preeminent brand and formative brand there.And it's not just oil in this part
of the world. We're particularly largein natural gas. If you go to
right south of Pittsburgh and South Point, it's the energy capital of the East.
(06:09):
Of course, there's other aspects ofenergy in this particular region too,
including coals. So it's very energyrich and so you know that's part of
that's part of our background. Sowhat is the background. What is the
history of Cohen, the brand,the company? So in in nineteen twenty
three's founded um a guy named RaymondRoss. It was in World War One.
(06:30):
He got a World War One bondwar bond after the war, and
he recognized the mechanization or motorization ofAmerica and on the front end of that
felt, you know what we cancreate. I can create a business which
would cater to that. So oneof our first locations was called First Chance,
(06:51):
Last Chance. It was on Rootforty in Washington, PA. Root
forty was now is called Chestnut Streetnow and it was First Chance. When
you came towards Washington on Route fortygoing I guess it would be whatever the
direction is into town, that wasthe first chance for you to get fuel.
And as you left town that wereat last chance awesome and it sort
(07:12):
of sprung from there. In addition, he created he had a wholesale fuel
distribution business where he would be takingfuels, oils and other greases and petroleum
products to those who needed them,and the proliferation of petroleum into how what
we do and from an industrial basisand a consumption basis. He was on
(07:34):
the front end of that curve,and so he built that business up.
He had a guy he brought infrom Saint Mary's, West Virginia who had
worked at a Quaker state plant,as he says, carrying water for ten
cents a day up on the hill. And his name was Charlie Cohen.
(07:56):
Charlie Cohen came up and became astrong illustrator for Raymond Ross and ultimate became
a partner and equity owner and becamea you know, an executive leader.
Uh. And they married sisters,so they had that feature too. And
Charlie Cohen happens to be our grandfather, my brother Andy, myself's grandfather,
(08:18):
our mom's dad, and he happensto be also our hero. And my
name is Charlie and my middle name'sCohen. I really didn't realize this isn't
a real family. It is.Wow, we're you know, we would
be considered third generation. That said, my brother Andy and I got into
business in two thousand and um.We when we came into the business,
(08:43):
it's not what it is today.So we we have a history. We
built up a series of different divisionswhich became separate companies and we operated them
separately. We grew them, andfor for example, we had we had
we started dabbling in direct operating retailand in the late two thousands and around
(09:07):
in a little before a little afteraround two thousand and ten, and then
we started making acquisitions. So wemade an acquisition in two thousand and two
one on eleven one to twelve oneand thirteen, a small one on fourteen
and then we as we divisionalized thebusinesses, each of them grew up.
So for example, CO and Energywas a wholesale fuel distributor and energy field
(09:30):
services business. In addition, wehad CO and Transport, which hold fuel
and in two seventeen we we soldthat business to Spray, which was a
larger public company, and we feltthat it put that business in the hands
of a larger operator which could cansustain it and grow it further still.
And then in two eighteen we boughtthe Cocos business, which has a heritage
(09:50):
brand in Pittsburgh from the sixties andallowed us at that point aggregating specifically relative
to Cohen Market enough critical masks wherewe were able to put the Cohen brand
on the buildings themselves and create whatwe think is a chain that can speak
(10:13):
to our guests with one image,one voice, and we ultimately create a
base offer. And today our businesshas full in terms of Cohen Markets,
has our full kitchen stores where wehave what we think is a very distinctive
food offer in our mark on ourmarket which is largely made on premise,
and we have the heritage sites whichhave more limited food offer and the more
(10:37):
typical convenience items of snacks and beveragesand what have you. So, inasmuch
as we were talking about fuel,I think convenience for our guests is a
is a broader umbrella offer that isnot just fuel but the other items as
well. I'm happy to go intoany kind of feature of that. But
that's a pretty real feature of Americanconsumer public concerned. So this is this
(10:58):
is something that has been brewing fora long long time. Can you give
us the genesis and where where doyou want to take Cohen Markets? What's
the future? Yeah? So Ithink, like we mentioned before, evolution,
I think we as a as achain that Cohen Markets are evolving.
And uh, not only is thatdeal with our physical footprint, but it
(11:18):
deals with our imagery and our communication. It deals with our offer. And
we just got done talking about that. Um. As we've grown, we've
we've developed our full food offer,which we have these full kitchen sites and
when you come to Cohen Markets thathas its full kitchen sites, we have
um fresh never frozen handbread at ourown recipe and trans fat free, hormone
(11:41):
free chicken. Long winded way ofsaying, it's really freaking good. I
was going to ask about the evolutionof the chicken, but yeah, I
want to know, really good whoserecipe? This is a family business?
Was this? Uh, well,that that would add to some of the
allure to it, admittedly, butbut but the truth is that we act.
(12:05):
Let's let's make up a lie.Well, let's make up a real
fabricated story that would make it reallyfascinating, very attempting. We did acquire
a business that had a chicken offerand really put us in the food business,
and we wound up scaling it fromthere. Actually, the relevance here
is that as we evolved as asa convenience industry, evolves. You know,
(12:26):
are are our propositions important to toour consuming public, particularly when the
historical you know, feature around conveniencewere the proverbial quote unquote cokes and smokes
and uh. And so one ofthe things that we think is important is
how do we stay relevant to ourour consuming public and our guests and our
and our customers. Um and andif Food for Us has a central role
(12:48):
in that. So you can comemorning, noon or night to our stores
and have a full breakfast offer.Well, uh. In terms of our
kitchen stores where a lot of thoseproducts are made on site. We are
not in a central warehouse creating productsand in an industrial fashion freezing them,
sending them out with high fat,high salt content, nukim put them in
(13:11):
a pretty bag and saying here yougo with a smile. In fact,
we're making a lot of these productson site, and it shows up in
terms of taste, it shows upin terms of a customer experience. So
our breakfast offer is as such,including our bean, a cup, coffee,
and so and so forth. Andwe have we've branched out on that,
one of which is one feature whichis chicken. I mean, like
(13:33):
any kind of group you've got tohave some type of hero feature to you,
to your offer to who you are. And part of ours is association
with our famous chicken. In additionto that, we make pizza on site.
It's from scratch. We have ourown recipe of pepperoni rolls, very
pittsburgh Ian, and we think oursare pretty dog gone good. And again
(13:56):
extends from there. So I think, I think when we consider how what
we are doing for our customers,we think that's a very relevant feature to
the what's your feedback from the customerswho have had your chicken and your pizza
and your your breakfast fare? Areyou are you? Are you happy with
the progress that you made with withthat? Yeah, er, well absolutely
(14:16):
we are. I mean, thisis a business that's capital intensive. Convenience
is a capital intensive business, andso um, you know, your best
feedback is are you getting a customeraccount? Are you getting repeat usage?
Of course you can get the commentsback, you know, we see it.
(14:37):
I mean, if you go inand you listen to some of the
opinion formers and some of the voicesout there in the Pittsburgh market, light
to Pittsburgh Dad, here what hesays or hear what the other fellow says
the gas station guy. Whatever itis, those testimonials, in addition to
actual consumers themselves, are real.But we're also seeing it numerically, financially,
(15:00):
fiscally. People are coming back toour stores because we're offering something they
like and care about. You're gettingfeedback from their wallets. That's correct.
And I think inconvenience generally in ourin our location and our locations and our
our in our chain. Uh istrue of this too. I'd say about
eighty percent of our customer customer basedor repeat customers, big number. What
(15:22):
is Charlie's background? Uh? Mybackground is I have three other brothers.
I'm one of four. Our momand dad still are around. They're awesome.
Who who's mom and Dad's favorite?Uh? Uh, I'm a Leo
one in July. What do youthink? The answer is? Um?
(15:45):
But there's there is a there isa relevant segue here taking that that I'm
actually in business with one of mybrothers. I'm number two, he's number
three, And we have our olderbrother who is a patent attorney, very
long dated successful patent turn hear Yungisberg'sattorney out in Colorado. So I think
it I think there's something important aboutbeing in business with a sibling, and
(16:11):
sometimes the ball can bounce on oneside or bounce on the other. Sometimes
it could be that there are nosocial barriers, and it's kind of could
be a nightmare, I'd like tothink. And maybe it'd be better if
my brother Andy were here having hisown voice against it. But I think
I'm pretty sure he said the samething, which is, neither of us
look at underneath the tree and seewho's got the bigger present under the Christmas
(16:33):
tree. Neither of us looks soto see is one one ear one's losing.
And I think that we're amused oneto the other. We actually have
different approaches in different styles, andI think that that is super complimentary.
So it doesn't work for everybody interms of siblings running a business, but
we treat you have complimentary philosophies.Philosophically complimentary, but certainly stylistically in skills
(16:57):
skills compliments. So back to thebackground point, my brother and I went
to the same undergrad which happens tobe Duke and Um I went and I
went to business school, so Igot an NBA, went I went to
Penn, I went to Wharton andhe got a low degree at Notre Dame,
(17:18):
so he was a lawyer and Iwas working investment banking and ultimate private
equity. And and I think we'veconverged back together when we bought the base
business in two thousand and then madethose acquisitions I alluded to earlier. And
it was probably in the last sixseven years that Andy and I had developed
(17:40):
a business as it is, asas it is actually was then, which
is these four divisions that we continueto grow up. And it just made
sense for us to both be togetherthere working on it. It justified it.
And as it happens to be,we're our offices are in the same
room, our desks are close toone another, and where there is no
you know, front door backdoor.If someone comes indoor office as they come
(18:03):
into one door and they leave inat one door, and we think that's
relevant too, but allows us,I think, to have those micro moments
of what about this, what aboutthat? And that's pretty additive. So
you can tell in our our ourprior professional backgrounds. As a compliment,
and I think there's a stylistic compliment, and I think it's pretty damn cool.
(18:23):
What's your biggest challenge as a business. As a business, um,
I think probably like anybody who's gota retail business, it's labor. I
think we've got a I mean,we could probably look at it from a
top down basis. But in theUnited States, our birthrates hunder two.
(18:45):
We have largely the fifty five andolder crowd has largely dropped out of the
workforce. We have baby boomers controllingwhatever it is, like seventy five of
the wealth and meaning that they's soI have to work and um, and
we have an immigration policy that isdifficult. So when you just look at
(19:07):
the end, actually another added feature, I think we're still like ten million
jobs open jobs in America. Ourunemployment rate is in the mid threes.
Mathematically, there's one answer. Weneed more people. So uh, and
we're feeling that in particular businesses likeretail, which have a turnover rate and
effect that we get these displacement riskswith other retailers and shifting back and forth.
(19:33):
That is a challenge. That's achallenge for any retailer. Do you
think you've successfully came up with ateam you're proud of? Oh, definitely,
I mean we're I mean we're talkinga little bit about Andy and myself
as titular leaders. But you know, there's a there's a team that runs
this business and it's a it's oursenior leadership team, and we're very focused
(19:59):
on and behaving and in a roundtable type format, meaning we don't have
somebody at an end of the table. We even talk in terms of like
flat Earth, where people need toengage I think on a level playing field
and strong encouragement of transparency and UHand partnership. And I think we've we've
(20:25):
we've added other team members that bringto us skill sets which we think advance
our efforts and accelerate our composition andUM, I think it's evident that that's
occurring. We want people to wantto be here. We want people who
are cited in the morning when theyget to work and kind of when they
go to bed at night, kindof look back on the day and say,
(20:48):
film what they understand have accomplished andif they can accomplish it, they
can collaborate with with our other partnersand team members to solve a problem.
And when you do problem solution witha team, or you succeed as a
team or you're working together the team. It's vastly different and I actually think
we've created a version of that culture. I'm actually pretty psyched about it.
When it comes to marketing, Whatis your strategy, Well, it's got
(21:15):
multiple features to it, one ofwhich is because we have, in the
case of Cohen Markets, a physicalfootprint I think being called all the same
thing e Cohen as a pretty basicimportant feature too. And we also talked
about that our four Court as aconsistent brand a Amico, which we hope
(21:38):
and expect to translate into the highestquality fuel that's a customer can purchase from
US Visa the other offerings out there, and that when they go into a
Cohen Markets that they can also expecta certain experience, both in terms of
the physical environment, clean friendly instock as well as the actual products themselves,
(22:02):
in the case of our food,very distinctive. So our marketing strategy
not only has the physical locations withthe same name, feel and look,
we want them to have an experiencetoo that has that element consistency, which
by itself is a reinforcement at thebrand. In addition to that, we're
(22:25):
in a digital age to some degree, We're we're talking and this is a
digital product, and so I thinkwe recognize that our customers have that component.
They're daily lives. So there's anew term, it's called figital where
we're trying to extend our customers experiencebeyond our four walls, beyond our sites
(22:48):
to when they're not there, andhow we can interact with them in a
good connecting sense, which is calledwhich is basically digital. So it's our
loyalty platform, other social media features, it's other communication portals including text and
email, what have you, onan appropriate basis, because we don't want
to harangue our guests, and sothe best and most important thing that we
(23:14):
can do from a marketing standpoint isto state what we think our brand promises
and deliver on it, which iswhy clean friendly in stock is such a
major feature for what and how wedo every day. And then have that
be a continuing part of our dialogueand reinforcement with our guests, you know,
with with co Gooes, Amaco,BP, all positive facets of Pittsburgh.
(23:36):
But now that you it's under oneumbrella, that's that's what you're doing,
Yes and where and you and youknow, let's face it, the
rule number one in business is location. Location, location, and you have
some of the best locations in Pittsburgh. I mean, it is true that
retail has that location, location locationfeature to it because in particular, what
we're selling as convenience, Yes wehave our famous chicken. Yes we have
(24:00):
we think as the highest quality fuel. Yes we haven't experienced there, which
we'd like to think is distinctive oralso selling convenience. And by dint of
our our history because we are huntingyour old company, some of the locations
we've had for quite some time.Maybe they were operated by dealers at one
point in our in our life cycle, today operated by ourselves. So location
(24:21):
does matter. But I think youknow, we are a born here,
raised here, Pittsburgh derived family peoplecompany, including what we think is our
offer is very pittsburgh Ian down toyou know, our fuel, which has
a very strong heritage to it,and are you know, we want to
(24:41):
put it into Pepperoni world context.There you have it, Pitsburgers left Pittsburghers.
It is true. I mean,actually, you know, there's a
little funny feature to this, andmaybe it's super played, but Pittsburgh folks
can really relate to sportsm I mean, a lot of cities can a lot
of a lot of a lot ofcommunities can kind of relate to that.
(25:04):
I would say southwestern Pennsylvania in particularis a very big sports culture. Ohio
Valleys, the same panhandle of WestVirginia is the same and UM. And
when you think about sports, there'sthere's a few things associated with it.
One isum is a strong familial bond. People often, you know, see
(25:30):
a watch sports or participate in sportsdriven by or associated with a family connection
or reason, either your children oryour siblings or whatever cousins. Secondly,
I think this is a very communityminded part of the world. I mean
that sounds like it's so super distinctivefor the rest of America, but I
(25:51):
think it's I think there's some standoutfeatures to it, a lot of historical
features, which probably is a differenttype of podcasts. And third um,
which I think it's a kind ofa cool phrase. Happened to come from
a guy who's named Mike Ssewski,who was a basketball coach at too.
Of course we my brother and Ihave a coach towards that, but he
has said it's not his alone,but he said that people people really strive
(26:15):
to be part of something bigger thanthemselves. And in the case of Pittsburgh,
I think that's like, hands down, I think a major feature to
it. So similarly, you knowwhat we are, who we are,
how we speak to our guests,as being authentic is really important, and
and and and and being a hundredyear old company. And literally we can
(26:37):
show you photos from the nineteen twentiesthat weren't like doctored or whatever. Uh,
this is who we are. AndI think that we're we're we're we're
part of this community. What isthe your earliest memory of the company of
the business? Uh? Well,um, number one. We had a
(26:59):
coke from the twenties which had thosesmall little glass bottles that you pulled open
a vertical glass door to get.That was kind of cool. It was
like a treat to go get onefor whatever it was fifteen cents. And
by the way, I'm not pushinga walker here on the road to the
young dude. We just have tokeep that machine around quite a long time.
The other thing is we used togo up on the mezzanine in one
(27:22):
of the warehouses and all the airfilters and oil filters we were rearranged to
create forts and completely piss off thewarehouse managers. We just checked up their
whole organization organization system. It waspretty cool for it. I gotta say,
good for you. Are you Areyou proud? Are you proud of
this of your company? Well?Of course I am. Um. I
(27:42):
mean, I know this sounds alittle gushing. You'd expect somebody to say
this, but you know, Imean, you look, we go to
work for commerce. That's what peopledo. I mean, we're trying to
make a living for our families andwhat have you. But you know,
it's over third of what we doin a given day. And I think
there's another element, which is fulfillment. I'm really psyched about our team.
(28:06):
I'm really psyched about where we've comefrom, and I'm psyched where we are
and where we're going. I thinkwe're realists and we try to problem solve
and it just I think it feelsgreat, like if you can win as
a squad. I know this soundslike gushy things, but it's true.
(28:27):
Olly, this has been fun.Thank you, my pleasure. Charlie McIlvaine,
chairman and CEO of Cohen Oil Companyand Cohen Markets and a CEO you
should know. Thank you so muchpleasure. This has been the CEO you
Should Know podcast, showcasing businesses thatare driving a regional economy, part of
iHeartMedia's commitment to the communities we serve. I'm Johnny Hart. Well, thank
(28:47):
you so much for listening.
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