A Harvard Business School professor on the valuable lesson businesses can learn from a gas station chain
- Laura Huang is the MBA Class of 1954 associate professor of business administration at Harvard Business School.
- The following is an excerpt from her book, "Edge: Turning Adversity into Advantage."
- In it, she describes how a road trip through Texas opened her eyes to the wonders of local gas station chain Buc-ee's.
- Buc-ee's does incredible business and has an overwhelmingly positive reputation because it excels at the basic goods it sets out to provide - gas, clean restrooms, and ice.
- A strong business needs to determine what its basic goods are, and then excel at delivering them.
- Visit Business Insider's homepage for more stories.
Two years ago, my husband and I took our kids on a road trip through Texas, starting off in Houston, then continuing through Austin, San Antonio, and other parts of the state. Before we left, my mother-in-law shouted to us, "Don't forget to stop at Buc-ee's!" I looked confused, so my husband side noted to me, "Buc-ee's is a gas station." But what was so special about Buc-ee's, a gas station?
Lo and behold, a couple hundred miles into the trip, we saw a Buc-ee's and my husband decided to stop for gas. I was blown away. The place was a sight to be seen. A sovereign kingdom to be bowed down to. The restrooms were immaculate. Tons of fountain drinks and mountains of ice to refill our coolers. Walls of its branded snacks, including delicious beef jerky and caramel popcorn. I could have browsed for hours. And of course, there were rows and rows of gas pumps so that we wouldn't have to wait. I was amazed, feeling like I was in some magical place.
What Buc-ee's did for me - and what it does for thousands of weekly visitors - is to truly and deeply enrich. Without a doubt, Buc-ee's created an incredibly enriching experience for me. It did so by excelling at its few, basic goods. In no way is "basic goods" meant to be, well, basic. Rather, it resembles Buc-ee's solid sense of its value-add, its core competencies, and its ultimate superpowers. It may seem strange to call immaculate bathrooms and endless gas pumps superpowers, but they are.
Captivated by my first visit to Buc-ee's, I spent the next part of our car ride researching and reading about this glorious company. I wanted to know how its story started and how Buc-ee's came to define its basic goods. I discovered that the first store was opened in 1982 in Lake Jackson, Texas by cofounders, Arch "Beaver" Aplin III and Don Wasek. Aplin and Wasek focused on just two things: cheap ice and clean restrooms - indeed, their basic goods. What they determined is that people go to gas stations for the gas, the restroom, and the ice for their Dr Pepper. And so Aplin and Wasek made sure that Buc-ee's had gas - that was a must. Once that was figured, they then focused on providing clean restrooms and inexpensive ice. That, ladies and gentlemen, is how they made Buc-ee's into not just any road trip destination, but a delightful and enriching experience.
And it has endured. Buc-ee's ability to enrich continues to impress to this day. Its basic goods indubitably lead to incredible business and reputational success.
Take, for instance, how the Buc-ee's in Texas City has 33 urinals for the guys alone. That means there is rarely a wait. In fact, Buc-ee's has won awards for having the best public restrooms. Customers marvel at how clean the facilities are, even at four a.m. And it's not just one location of the company that impresses. The New Braunfels Buc-ee's has no fewer than 120 gas pumps and a store footprint of 67,000 square feet. Meanwhile, the location in Katy, Texas holds the record for the longest car wash conveyor belt. Ultimately, Buc-ee's has more than 30 locations across Texas and is expanding to Florida and Alabama, with additional locations in development.
Though Buc-ee's began as a gas station, these days, only 60% of the company's revenue actually comes from gas sales. An impressive 40% comes from convenience store items, including high-margin brand items. Buc-ee's has changed the way consumers think of the phrase "rest stop" because of the value it brings. In addition to gas, providing pristine bathrooms and cheap ice became the travel center's superpowers. And that allowed it to become "America's Best Bathroom," with customers bragging, "Buc-ee's is like an adult amusement park!" and "What's not great about Buc-ee's? Nothing!"
Buc-ee's ability to enrich through basic goods or "superpowers" is truly magical. It successfully enriches by focusing on excelling in the few areas that make it singular. There's nothing terribly complicated about big restrooms, lots of gas pumps, and plentiful ice. But there's absolutely everything to be won in providing reliably extraordinary experiences for customers.
For any growing business, any entrepreneur, or any manager forging a path forward - this lesson from Buc-ee's is invaluable. Know your basic goods or the basic goods of the organizations you are leading, because they are what you will come back to, time and time again. They're the key elements that will ensure your survival, your subsistence, and your ability to truly enrich. For Beaver Aplin III and Don Wasek, the basic goods were gas, ice, and clean bathrooms. With that strong foundation, Buc-ee's has been able to diversify to sell food, gifts, and clothing. But it's still the basics that get people coming back. What will your basic goods be? Knowing this will help you figure out what your ability to enrich is, and, most importantly, where you can create an edge.
Laura Huang is the MBA Class of 1954 Associate Professor of Business Administration at Harvard Business School and the author of "Edge: Turning Adversity into Advantage" from which this essay is excerpted.