Don Cunningham: Why the Wawa Model is Good for the Lehigh Valley

By Don Cunningham on November 3, 2021

This column, written by LVEDC President & CEO Don Cunningham, originally appeared in The Morning Call and on the newspaper’s website on October 21, 2021. (Click here to read Cunningham’s previous columns.)

Don Cunningham

Don Cunningham

I remember when it was risky to eat a sandwich from a gas station.

The pre-wrapped items in the refrigerator case next to the cigarettes and motor oil were not guaranteed fresh.

My buddy Frank once lost the better part of a workday thanks to a tuna salad from a Mobil service station during our days of commuting to jobs in Harrisburg from Bethlehem.

I warned him against the selection.

He, however, was in full Clark Griswold-mode (the Chevy Chase character in the 1983 comedy classic National Lampoon’s Vacation, who declared, “I’m so hungry I could eat a sandwich from a gas station.”)

It’s different today.

The likes of Wawa and Sheetz have transformed the concept of gas for your vehicle and lunch for you — except now it’s breakfast, lunch, dinner, and anything else that you need in between.

In the era of pandemic worker shortages in fast food, Wawa rules.

On a recent late evening return from traveling, everyone in my car was hungry and looking for a quick chicken sandwich or a burger. Two of the nearby fast-food places were closed at 10 p.m. A third had the drive-through open, but a line of cars so long you’d think they were selling Justin Bieber tickets.

In no need of gas, it was off to the gas station where you could get a custom-made panini, a sandwich, a hoagie, a bowl of soup, a salad, a burrito or even a burger and spaghetti and meatballs ordered on a touch screen — or on your phone and picked up curbside.

Hey, I’m starting to think this is no longer a gas station.

I was behind a guy the other day who dropped $107 on a tank of gas, a few packs of smokes and lunch.

When I was growing up, there was no buying lunch out. Hoagies were from the youth association fundraiser. You made and ate lunch at home from deli meat bought at the butcher counter. My dad wouldn’t stand for blowing six bucks on a daily sandwich.

It’s different now. The flow of people ordering food at Wawa and checking out is endless and amazingly fast. The cash registers are sizzling.

In this period of labor and supply shortages, Wawa has managed to not be closed, backed up, or out of anything. President Biden should hire a bunch of Wawa managers for his Council of Economic Advisors.

In the Lehigh Valley, there are six new Wawa stores under development. The other day, I went through the drive-through at the bank branch closest to my office and my favorite teller told me it was likely to be the last time he saw me.

“The branch is closing,” he said. “It’s becoming a Wawa.”

The funny thing is that the location is about a mile from two other Wawa stores, and not on a commercial intersection, but tucked into an industrial park.

Soon, I’ll be able to get a bowl of macaroni and cheese every mile while it’s 10 miles between bank branches — which I must be one of the last people on earth to use. The only other business as prevalent at major Lehigh Valley intersection is health care.

Somewhere during the last decade dialysis, laser surgery, urinalysis, pain treatment, heart centers, knee replacements, MRIs, emergency care and a multitude of other specialized medical treatments became neighborhood businesses, the new Mom-and-Pops.

I expect in a few years to have this conversation with my wife:

“Hey, Hon, I’m going to run out and grab an angioplasty, a tank of gas and pick up some lunch, do you need anything? I’ll be back in a half-hour.”

I can’t help but to see the macro economic trends in the micro.

Worker wages are increasing, and workers have options and are exercising them. The labor shortage is primarily in low-wage, service or generally unfulfilling jobs that are repetitive.

Wawa and Sheetz advertise for careers not jobs, offer full benefit packages, opportunity for advancement, a 401k, and an employee stock ownership plan.

The more local or regionalized a supply chain is, the less affected it is during crisis, weather, or global issues like a pandemic.

Fast-food restaurants have national supply chains. Both Wawa and Sheetz are Pennsylvania-based companies with stores and supply chains in just a few states.

People have disposal income and are spending it on better quality.

Median wages in the Lehigh Valley have increased from $17 per hour in 2017 to more than $19 per hour in 2020, while median household income went from $59,989 to $66,865 during the same period.

Fast food is no longer fast and is pivoting to healthier options, while the Wawa/Sheetz model is built on a wide variety of selections for every consumer made fresh and fast.

Health care professions are the fastest growing and the single largest class of workers in the Lehigh Valley.

There are 58,533 health care employees in the Lehigh Valley, nearly double any other sector. Lehigh Valley Health Network and the St. Luke’s University Health Network are the first and second largest employers in the region.

The last few decades were the era of cheap consumer products for Americans. It was a time driven by global supply chains of low-cost transportation and cheap overseas labor at the expense of American jobs.

The pandemic has helped us understand the price we pay for it.

Smaller, regional supply chains are developing with a new emphasis on treating and paying employees better; call it the Wawa Model. This will be good for the Lehigh Valley and its people.

Best of all, my buddy Frank now can get a risk-free, quality sandwich anytime he stops for gas.

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