Fast-food restaurants are losing breakfast customers to convenience stores.
Morning meal traffic to fast-food chains rose 1% in the three months ended in July, while visits to food-forward convenience stores climbed 9% in the same period, according to market research firm Circana.
“Over the long run, convenience stores have taken share, really at foodservice overall, but the morning meal has been their strong suit,” David Portalatin, Circana senior vice president and foodservice industry advisor, told CNBC, noting the trend has largely been driven by what the group calls “food-forward convenience stores.”
For decades, McDonald’s and its rivals have tried to lure consumers away from home to eat their early morning offerings, betting that convenience and unique items will win over diners.
While fast-food chains have made some inroads, 87% of what consumers eat and drink in the morning comes from their own refrigerators or pantries, according to Portalatin. That leaves plenty of opportunity for fast-food chains — and anyone else who wants a slice of the breakfast pie.
Before the pandemic, fast-food chains started seeing a new rival for their breakfast customers: convenience stores. Regional chains like Wawa in the Northeast and Casey’s General Store in the Midwest were expanding their reach and investing in their foodservice options, taking pages from the fast-food companies’ own playbooks.
For a time, lockdowns and the shift to hybrid work reversed those market share gains. But in the three months ended in July, food-forward convenience stores once again gained the upper hand in the battle to serve consumers breakfast, according to Portalatin.
Circana separates food-forward convenience stores like Buc-ee’s and Sheetz from the broader industry, although more chains may soon fit under that umbrella. 7-Eleven, the biggest convenience, or c-store, in the U.S., is planning to invest more in its prepared foods business, inspired by the success of its Japanese business. C-store chain RaceTrac on Wednesday announced that it’s buying Potbelly for about $566 million, although it’s unclear what its plans for the sandwich chain include beyond expanding its footprint.
In recent years, more diners have been watching their budgets, conscious of rising menu prices and a tight job market.
Year-over-year morning traffic to fast-food chains has fallen every quarter for the last three years, according to data from Revenue Management Solutions, which advises restaurants on how to increase sales and profits. In the second quarter, fast-food breakfast visits fell 8.7%.
To see the struggles, look no further than McDonald’s, which dominates the quick-service breakfast category.
″The breakfast daypart is the most economically sensitive daypart, because it’s the easiest daypart of a stressed consumer to either skip breakfast or choose to eat breakfast at home,” McDonald’s CEO Chris Kempczinski said on the company’s earnings call in late July. “And we, as well as the rest of the industry, are seeing that the breakfast daypart is absolutely the weakest daypart in the day.”
McDonald’s morning visits accounted for 33.5% of its traffic in the first half of 2019 but fell to 29.9% in the first half of 2025, according to Placer.ai data. To try to drum up traffic, the chain has included breakfast items in its new Extra Value Meals, including a deal for a Sausage McMuffin with Egg with a hash brown and a small coffee for $5.
To reverse breakfast’s slide, fast-food chains are taking hints from their competition. After years of convenience stores looking to fast-food chains for ideas on how to grow prepared food sales, from installing ordering kiosks to new menu items, the dynamic has flipped.
″[Quick-service restaurants] are looking at late-night sales and early morning sales, and they are directly looking at convenience stores and saying, ‘What is working? How can we bring that to our stores?’” National Association of Convenience Stores spokesperson Jeff Lenard told CNBC.
Prepared foods have offered a lifeline for convenience stores as demand for gasoline, tobacco and lottery tickets has fallen over time. The industry’s overall foodservice sales reached $121 billion in 2024, according to data from the NACS.
Most customers visit the gas pump during the morning and evening rush hours, on their way to and from work, presenting the perfect opportunity for c-stores to sell them breakfast or dinner. This year, 72% of consumers surveyed by InTouch Insight said they saw c-stores as a real alternative to fast-food chains, up from 56% a year ago and 45% two years ago.
Broadly, the c-stores that have focused on fresh food have been winning over more customers.
For example, Wawa has seen its customer base grow by 11.5% since 2022, while fast-food chains McDonald’s, Burger King and Wendy’s have seen their combined customer base shrink 3.5% in the same time, according to data from Indagari, a transaction data analytics firm.
The majority of 1,170 respondents to an InTouch Insight survey for CNBC said that they have purchased made-to-order breakfast from a c-store in the morning in the past three months. Forty-eight percent of respondents said that when they choose breakfast from a convenience store, they are replacing a visit that they might otherwise make to a fast-food restaurant like McDonald’s or Dunkin’.
Buying coffee and breakfast from a c-store likely won’t be cheaper than making it at home. But consumers perceive it as “good bang for their buck,” according to Sarah Beckett, vice president of sales and marketing for InTouch Insight.
Plus, c-store customers get a wider breadth of options. In addition to coffee, gas stations sell energy drinks, protein shakes and yogurt smoothies. And customers can pick up a granola bar or banana to accompany their breakfast sandwich. Fast-food chains lack that kind of variety.
But above all, what matters to consumers is the food itself.
“While [a] convenience store broadly does have some tailwind from being a lower price point, the ultimate differentiator, and what’s really going to set apart the winners from losers, is that quality aspect of it,” Circana’s Portalatin said.
Brady Caviness, a 33-year-old account executive at Bailiwick who lives in Minneapolis, told CNBC that he indulges in a breakfast pizza from Casey’s General Store when he’s traveling. If he’s back home, where there isn’t a Casey’s nearby, he’ll stop by McDonald’s, Dunkin’ or Starbucks if he’s in the mood to buy his breakfast.
The Iowa-based chain is the country’s third-largest c-store chain and claims to be the fifth-largest pizza concept based on its number of locations. Casey’s reported same-store sales growth of 5.6% for its prepared food and dispensed beverages for the three months ended July 31.
Like Taco Bell’s Mexican Pizza, Casey’s breakfast pizza, topped with cheese, scrambled eggs and a choice of bacon, sausage or vegetables, has grown a cult following since its launch in 2001.
“I think Casey’s is kind of a unique thing,” Caviness said. “My whole life, I’ve had the Egg McMuffins.”
