Combating Ice-Inflation: How Pricing Hikes From Conventional DSD Bagged Ice Suppliers Fall to C-Store Owners and Customers to Absorb

To C-store owners and operators, navigating economic challenges is nothing new. But for C-stores relying on conventional Direct Store Delivery (DSD) bagged ice suppliers, the significant pricing increases combined with system-wide, sluggish response to supply chain issues are forcing tough choices between balancing profitability or passing costs on to customers — a dilemma we can all understand and appreciate. What factors contribute to the exponential price increases from the traditional DSD ice distribution model? How can C-stores combat this ice-inflation and take control of their ice sales and profits?

Conventional DSD Bagged Ice: C-Stores Paying Significantly More Per Pound 

5.5% - 22.2% Increase in Cost Per Pound
C-Store Average Cost Per Pound of Bagged Ice

Across the country, stores and customers felt the chill of accelerating ice prices beginning in 2021. Several factors contribute to the pricing increases in the traditional bagged ice industry, and C-store owners and operators should be aware of these dynamics. The primary culprits include:

Energy Costs

Energy Costs

The production of bagged ice is energy-intensive, requiring substantial electricity for ice-making machines and refrigeration. Fluctuations in energy prices significantly impact operational costs, and suppliers pass these increases on to C-stores and customers.

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Transportation Challenges

The conventional bagged ice supply chain relies heavily on transportation, from manufacturing facilities to distribution centers and finally to C-stores. Rising fuel costs and driver shortages have contributed to elevated transportation expenses, passed on in price increases.

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Green Initiatives

As sustainability initiatives gain momentum, the bagged ice industry is investing in eco-friendly practices and equipment. While these initiatives contribute positively to the environment, they often result in higher production costs, further influencing the pricing dynamics of bagged ice.


Climate-Related Issues

Unpredictable weather patterns can disrupt production and increase costs. Climate change and extreme weather events have the potential to impact the availability of raw materials for traditional bagged ice production.

But increases in ice prices only tell part of the story. The traditional DSD bagged ice industry, responding to the rising production and distribution expenses, has opted for strategic product downsizing to manage costs, replacing the standard 10-lb bag of ice with a 7-lb bag. This shrinkflation creates an optical illusion that shields the full impact of price hikes from customers. But what does this really mean for customers? A stealth price increase that equates to paying more for less. And for C-stores? A higher cost per pound price poses a challenge to profit margins. Maintaining a competitive pricing strategy while absorbing these additional costs is a delicate balancing act for C-store owners and operators.

Conventional DSD Bagged Ice: Paying More for Less

The Shift from a 10 lb bag to a 7 lb bag of ice
19% Increase in Cost Per Pound

10 lb Bag

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7 lb Bag

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Inflation and rising prices paint a troubling picture for both businesses and customers. For C-store owners and operators, it’s not surprising that many feel trapped in a no-win scenario — relying on traditional DSD ice suppliers that appear to hold all the cards. But there is a way to fix this — and it starts by working with partners who can implement programs to help curb the impact down the chain and combat ice-inflation.

Quick & Pure’s innovative on-site replenishment eliminates the dependence on traditional ice supply chains and severs the link between profits and external price spikes. By leveraging Quick & Pure’s technology, C-stores produce and sustainably package fresh,10 lb bags of ice on-demand, taking control of ice sales and profits.

Quick & Pure Ice Stations generate ice using minimal energy and space. Machines are configured to optimize production, storage, and capacity, enabling cost-effective in-house capacity that scales to real demand. Quick & Pure unlocks the full potential of C-store ice sales and profits without handcuffing retailers to an unreliable legacy distribution system. Taking ownership over replenishment allows stores to satisfy customer demand while protecting profitability. The future of combating ice-inflation lies in on-site, automated ice replenishment.

Combat Ice-Inflation With Quick & Pure