Forecourt Trader - 30 years at the heart of the fuel retailing community

Space for Pace

06 September, 2006
The Pace brand is now establishing itself as a viable option for low-volume sites
Page 23 
It's nearly two years since Kuwait Petroleum GB was bought by Refined Holdings and became Pace Petroleum, prompting the demise of the Q8 signage on UK forecourts.
And it's a year since the quietly-spoken Pace marque - a small brand within the Q8 portfolio - developed a louder voice following its makeover and relaunch to a wider audience.It can't have been an easy task - to dismantle the long shadows of a name the size of Q8 to let the sunlight in to a small brand like Pace which, at the time of the acquisition in October 2004, was visible on just 30 dealer sites.But with a clear strategy now in place at Pace Petroleum's Staines HQ, the nurturing has begun in earnest, and the results are slowly beginning to show. There are currently 70 Pace dealer sites signed up to the brand, with the hope and expectation that a great deal more will follow. Meanwhile, there are still 82 Q8-branded dealer sites - down from 169 in '04 - but these are fast disappearing as the remaining dealer contracts expire.Leading the transformation of Pace Petroleum from an international, multi-layered oil company operation to the tightly-run confines of an independent retail and fuel distribution business, is general manager Brian Handley. Apart from the dealer business, he has responsibility for the company's 130 forecourts which have individual supply contracts with Texaco, BP, Total and Jet. Seventy of these came as part of the KPGB purchase, and had to be free of Q8 branding by June '05; 60 were bought from Texaco last year. Fuel and oil distribution to the commercial and home heating sectors under Fuelcare Ltd, is the third key part of the Pace business.Pace supplies dealers with around 150 million litres of fuel a year - which averages out at about 1mlpa per site. Across its entire business the company is budgeted to do one billion litres this year - about the same as under KPGB - which includes 500mlpa going through the company's owned sites.As far as the dealer supply business is concerned, Handley's mission is to grow the Pace network, which includes persuading existing Q8-branded dealers to sign up before being tempted by rivals. Initially after the Q8 sale, there was a significant loss of dealer sites, but this has now tailed off."Much of the fall in site numbers between '04 and '05 was in the main (about two thirds) a consequence of KPGB, prior to disposal, retrenching its geographic area of coverage, with dealers either having been released or alternative supplies arranged at the end of contracts," he explains."The remaining third was a mixture of competitor action, site closures or locations we ceased to supply for financial reasons. Until October '05 we were also not in the market for new business as our dealer strategy became defined. Yes, I would have preferred not to lose any sites I wanted to keep, but in the round the results are satisfactory. However, 20 million litres of new business is the target for '06/'07 and progress is being made - we've already signed five sites."== supply flexibility ==What should be good news for the smaller dealers who once feared getting left without a supply contract, is that competition to supply their sites is hotting up, with companies such as Gulf, Murco and Power making their presence felt. "Texaco is also coming down into the market as well," says Handley somewhat ruefully.Dististinguishing Pace from the pack is therefore a challenge: "We don't have a unique selling point that makes us hugely different - there is no magic word," says Handley. "Like others our deals are Platts-related; we don't offer a guaranteed margin. But we do have the Mobil Lubricants package; and much of what we can offer is to do with service, particularly in terms of transport. Delivery service is an important issue. We have 15 distribution depots and our own fleet of tankers, so we can deliver just about anywhere, with small or large loads to accommodate dealer requirements."If there is a spike in demand over a busy weekend and a dealer needs to get a delivery quickly, he can do so. He will have the mobile numbers of drivers at his local depot and can ask for an extra load. Some of our competitors don't have that flexibility. So that's where we score."Other features of the Pace offer include the fuel account card package, Liquidcard, which helps dealers retain their local accounts without all the associated credit risk and cash flow issues; the Pace loyalty card scheme; and the dealer shop support programme (details of which are available via the company's website [http://www.pacepetroleum.com]).After two years in the driving seat, Handley is satisfied that the Pace brand is making satisfactory headway. As an example of a dealer making a successful conversion to the brand he cites Mill Hill Garage in March, Cambridgeshire, which moved from Q8 to Pace last November, but which has maintained a 4mlpa fuel volume. "I think the Pace signage looks really smart, especially on the pole sign together with Mobil Lubricants, which is a familiar name that motorists recognise," he says. "A Pace rebrand is relatively low-cost when converting from Q8, as we have kept the dark blue background of the Q8 logo. That means rebranding the pumps, for example, is very straightforward."Handley's main target is dealers with volumes of up to 2mlpa, which he sees as a realistic threshold: "We're happy to supply bigger sites but we realise we'll be up against the majors. We're also happy to scrap it out with the best of them in the marketplace, but we're running a tight ship and are not going to do volume for volume's sake. We're not going for the top sites, but we aim to be the second-tier brand of choice."Pace is now accepted as a brand - there is no stigma about it. Dealers were concerned when the business was sold - Q8 was a strong brand compared to Pace - and some left us. But apart from the branding, there is continuity in the service we're offering. We're sweating the assets acquired by KPGB - and as a result, we're converting more dealers to Pace. "----=== Tates - focused on service ===Supporting the growth of the Pace brand is the long-established family-owned fuel distribution company Tate Fuel Oils, a distributor for Pace Petroleum. Based in the Leeds area - serving Yorkshire, Lancashire and Lincolnshire - the company was established in 1972 and has grown into a £60m/100mlpa business run by George Tate and his son Andrew, (both pictured above) who firmly believe in providing a first-class service to dealers on a personal first-name basis. "If a dealer rings up he can get straight through to a director to get an immediate decision - without any call centres or complex hierarchy," says Andrew. "We have a dedicated team which is fully focused on the independent dealer. We understand the problems and challenges an independent has to face every day as we also own and operate our own Pace-branded sites."And as evidence of the company's commitment to the independent sector, the Tates claim none of their dealers went dry during the fuel crisis of 2000 - Andrew even drove a tanker out himself.Having been a Q8 distributor since 2000, the company was happy to move across following its sale in 2004 and work with Pace Petroleum as it felt it was dealing with "like-minded people"."It's all about relationships," stresses George. "It's easy to be cynical about it in this business, but trust and loyalty is important. Our strategy is growth. We've got 30 dealers and want to push that up to 50. We supply a full mix from rural forecourts to sites on dual carriageways. We believe that if a dealer knows how to run the business leanly, profitably and efficiently it's a good business to be in. Most of our rural sites have kept going because they have ancillary businesses."The Tates say the Pace brand is being very well received by their existing Q8-branded dealers who are converting to Pace."We can offer a contract structured around the dealer," says Andrew. "Platt's or margin deals, full national branding, account cards and health and safety/risk assessment and so on, together with the fantastic Mobil lubes package which has superb brand awareness."



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Weekly retail fuel prices: 18 September 2017
RegionDieselLPGSuper ULUL
East120.75128.55119.84
East Midlands120.29128.81119.63
London120.7558.57130.05119.82
North East120.2059.90129.98119.40
North West120.52128.62119.81
Northern Ireland119.2369.90126.85119.03
Scotland120.60128.18119.75
South East121.03130.63120.24
South West120.75129.31119.96
Wales120.35127.44119.57
West Midlands120.4262.90130.69119.84
Yorkshire & Humber120.1971.90128.67119.59

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