It’s going to be a big year for Andrew MacDonald. After changing his Top 50 Indie company’s name from Sectorsure to Refuel & Go in October last year, the group is poised to kick-start some major forecourt projects for 2012.
This year has already seen the addition of a site in Holborough, Kent, bringing the group’s network up to 10; and another in Essex is due to join the fold imminently. Three forecourt shop rebuilds under the Mace brand; introduction of a class seven MOT centre at the company’s site in Croydon, Surrey; and progression of planning for a major redevelopment of a site in Rayleigh, Essex, are also in the pipeline.
Getting to where he is now has been a gradual process. Lake District-born Andrew moved to the South East in the late ’80s to manage a sports centre before becoming an area manager for a Shell dealer. He then went to Shell in the days of Shell Share before starting Sectorsure Ltd in 1990, with one site in Shepherd’s Bush, West London. By 1994 the company was operating three sites, but Andrew put any further growth on hold for nine years while focusing on other areas of business within the property-based Trevellyan Group of which Refuel & Go is a subsidiary.
Then in 2003, he opened Rayleigh, followed by another forecourt in Chiddingfold, Surrey, two years’ later. From 2008 expansion stepped up a gear, with additional sites coming on board every year.
After adding a BP site in Windsor, Berkshire, in 2011, Andrew decided that the company needed a new image. "Sectorsure didn’t mean anything to anybody so we decided on a new corporate identity to really tell people what we do," he explains. "When you have one or two sites it doesn’t really matter. But as you grow, you try to do things in-house that are the same on every site, and replicate something that’s successful across the network so you need a group identity. We hope to incorporate Refuel & Go into our shop fronts like Park Garage Group does with its Park and Shop brand."
Andrew is also on the lookout for more acquisitions. "There are a lot of opportunities now with market conditions the way they are. There isn’t a week that goes by when we don’t get a phone call from someone asking what our intentions are and whether we’re interested in a single site or a group of sites.
"Some people have reached a situation with their banking arrangements where they have to get out. Or some small group operators want to sell one site to ease cash and debt problems. Conditions are tough volumes are down, margins are falling and you’ve got competition from the supermarkets. The banks have pulled the plug on companies even though they’ve been trading well."
Andrew is counting himself fortunate that Refuel & Go’s volumes are fairly static across the group. "It’s important now more than ever before that dealers get their fuel supply deal right," he says. "That decision without doubt is the most important decision they make now."
And that’s exactly what Andrew has achieved. The biggest step change for Refuel & Go happened four years ago when the company left Jet to join Harvest Energy. "That was a turning point for us and gave us the ability to shape our future as a company," says Andrew. "Harvest Energy has a good, strong, fresh image and the company keeps things simple, which isn’t always the case in this industry. They do what they say they are going to do and one phone call tends to sort a problem out.
"We’ve got a clear idea now of which fuel brand works well at each location," he adds. "A lot of it depends on whether we want the fuel card business or not. If it exists at a particular location with a major brand, we’d be silly to turn our backs on it. In a town location on a main road and on a community site, Harvest Energy works well. We have a good tie-in with P&H’s Mace and that brand fits well with Harvest Energy."
Getting the shop offer right is just as important as getting the fuel supply deal right, adds Andrew. "The biggest single change in the industry since I started has to be the importance of professionally putting the shop offer across to the customer to ensure footfall. From day one we realised the value of the shop and I quite enjoyed the shop retailing side of the business in the early days.
"Previously we would go along with whatever the oil company initiative was, so we had Jet’s Jiffy shop. It was always a crackers name and they had some really strange ideas. It was the oil company man trying to understand how to sell coffee and Mar bars and it didn’t work well. It’s only since the link-up with symbol groups that that has changed."
Andrew says the ideal situation for any operator is to become a destination shop in the local community. "But that’s not easy to achieve," he says. "You have to put in an awful lot of work and you’ve got to get the right image for the community so they don’t just see you as a petrol station. We’ve got that with Harvest Energy and Mace, and BP Connect and Wild Bean Café. It’s very important to be professional in the shop it has to be clean; well stocked at all times; staff have to be friendly and smart; and you need a pricing policy that’s exactly right for the area. The days of over-priced petrol station shops are gone."
It’s not just shop pricing that’s important. As wholesale oil prices have soared and competition has multiplied, daily fuel prices have become something of an obsession for Andrew. "Any dealer will say that the first thing they do every day is look at pricing we live and breathe prices. We know what our competitors are doing and we know the relationship between our sites and the competition in terms of price and what the price difference will be. We know the balance to make sure we get the maximum profit and the right volume.
"The shop comes into it as well," he adds. "There’s no point selling fuel at a loss to get shop sales up and there’s no point making huge profit on fuel but not getting the footfall in the shop. It’s a balancing act we perform every morning."
Staffing issues are an additional pressure, but one that has eased slightly. "Staff turnover has been low in the past 18 months since there’s been more pressure on the job market. People are grateful to be in a stable job so that helps. We’re employing more older people now those who have been made redundant or are nearing retirement and that’s a great opportunity for us. They often work a lot harder, more conscientiously and more reliably than their younger counterparts."
Despite trading conditions and operational pressures being tough, Andrew is excited about the future as Refuel & Go goes from strength to strength. The Rayleigh rebuild project, which is currently in pre-planning stages, is particularly compelling, and will see Refuel & Go move in the direction of larger food-to-go operations.
The redevelopment will double the size of the Mace-branded shop to 2,600sq ft, adding two more pump islands and parking for 15 cars. Andrew’s family home, which is at the back of the petrol station, will be flattened to build a fast-food restaurant. "It’s not all doom and gloom," he says. "I know we are in the more affluent South East and volume remains reasonably stable, but for good quality operators there’s a good opportunity in petrol at the moment."
Retailer: Refuel & Go
Number of sites: 10
Fuel volume: 38mlpa
HQ: Tilford, Surrey
Site locations: Shepherd’s Bush, Cricklewood, Croydon, Rayleigh, Chiddingfold, Finsbury Park, Braintree, Bradwell, Windsor, Holborough
Fuel brands: six Harvest Energy; two BP; two Shell
Shop brands: Mace, BP Connect/Wild Bean Café