In the great bagatelle of life, we all have to rely on certain assumptions to survive. When you’re driving your car you have to assume the guy coming the other way will stay on his side of the road. When you walk on a cliff path you have to assume the cliff won’t crumble beneath you. And when you’re sat in your house you have to assume that the roof won’t suddenly cave in. (I was going to say that when our sportsman are hyped up before an Olympics you can assume they’ll do crap, but I guess this time round I’ll have to confine my cynicism to Fabio’s Failures).
Anyway, as I was saying, we all know what we can rely on as we make our way on this mortal coil, and it’s no different in the forecourt trade. Keep your price reasonably competitive, offer a decent service, don’t go out of your way to antagonise your customers and you can rely on the punters to roll onto your forecourt.
Except someone’s gone and changed the bloody script!! When you first find that your volume is down 15% you scurry round the neighbourhood to find out what silly bugger is giving the stuff away. Then you search for roadworks. Then comes the realisation that, for a certain period at least, the fundamentals in life no longer apply. Reality has been suspended.
So the question is, what strategy do you now apply to your business? Do you try and become super competitive to at least pinch some business from someone else? End result, maybe, that your volume’s now only 10% down, your shop’s still got customers but your margin has gone to pot. Or do you say stuff it, if I’m not going to do the volume I may as well at least make some profit out of the stuff - and whack your price up?
Judging by the pole prices in my area over the past few weeks, it appears to me that most people are trying to hang onto their pence per litre, and I must admit that seems to me the most appropriate policy for anyone with a ’normal’ site. The one thing I don’t think you have to worry about is whether those of your customers that you lose will be so mad at you that they will never come back.
Harking back to my theme of a few months ago, loyalty on a forecourt is a pretty ephemeral concept. When the sun comes back out again, which I believe it will, if you’re the most convenient site most of your customers will return once you’re reasonably competitive again. And at least you will still have a forecourt for them to return to.
Of course there are some farsighted individuals who have structured their business so as not to rely on any income from fuel. When you hear of sites making £30k a year from their coffee offer, it reinforces the view that we are becoming an industry of haves and have-nots.
In the meantime, if I see another bloody statement from the AA about the motorist being ripped off, I’m going to scream. Firstly, saying that the fall in wholesale prices hasn’t been fully passed on makes the assumption that the prices we were selling at before the fall were ’correct’. Which we know they weren’t. And secondly, since when was the AA appointed the motorists’ guardian angel? Excuse me, but have they suddenly become some car owners’ charity? Have they ******!! If I didn’t have enough other things on my mind right now I might start getting some posters made advertising all the other breakdown providers, some of which may possibly be offering a more competitive service.
As I say, I have to believe that in the long run some form of normal service will be resumed. Our public transport is too expensive and inconvenient, and our laziness is too ingrained for that not to happen eventually. In the meantime, amid all the gloom and doom about volumes and credit card costs, there is just the consolation that maybe you might not have to re-pump for vapour recovery.
But I wouldn’t assume that for now!!