The major oil brands have come in for a bit of flack in this issue and you sense that the balance of power is shifting. The consistent message from independents is that they’re just not getting the kind of service that they need to develop their businesses.
They’re very put out at having to speak to a call centre in Manila or Budapest; and at rarely seeing their rep. They’re also fed up with not knowing when their tanker delivery will be arriving. And we’re not talking low-volume sites here, but forecourts such as Tanerdy Garage (Retail Focus, page 24), a long-established family business with a fuel volume approaching 6mlpa. The site has been supplied by Shell since the garage was first opened in 1928. But after 85 years the owners Stephen and Karen Smith have decided to go with Gulf, because of the increasing frustration they have felt with the service from Shell. It seems they found it surprisingly easy to break this long-standing relationship with the oil major, as they were so relieved to be free of an organisation that they felt was holding them back.
The Spar proposition for both the shop and fuel could also be incredibly attractive for many retailers (Industry Focus, page 21). If the fuel supply deal through Harvest Energy is as competitive as described, as well as being transparent without the extra costs associated with a major brand, what have dealers got to lose? Customers are used to buying their fuel from supermarkets and therefore trusting those grocery brands. The Spar brand is said to be trusted by 93% of the population in the UK. If the fuel price is right and it’s a well-run forecourt and convenience store, customers are not going to be concerned in fact they may be reassured by the presence of the Spar brand on the pump.
Spar has ambitious targets, with a very persuasive story. With a new grocery retailer waiting to enter the market (News Extra, page 10), could, as suggested in Money Talk (page 14) a fuel retailing revolution be on its way?