Forecourt retailers should club together to extract greater value from their supply deals, urged Graham Sims, BP’s erstwhile UK retail director in a colourful and rousing speech at the inaugural ’Top 50 Indies’ dinner held at the Crowne Plaza Hotel in Birmingham last month.
Describing the 160 or so independents gathered in the room as an "incredible force", he said their strengths were the fact they were independent, and as such, the most important sector in the industry.
"It is a sector that everyone listens to if they have any sense in them at all. I’ve certainly learned more from the independent dealers in BP than within BP itself... that is the influence you have," he said. "Overall I believe the indies have a great future if they adapt and continue to do what they are great at. Even considering the oil partners they have the scale, experience and skills second to none. With courage and creativity, flexibility and a business focus, they will survive and prosper."
He warned that the market would continue to be volatile; that retailers should watch their cash flow and credit status; advised them to broaden their offer as far as possible, moving away from their reliance on fuel; and get more support from suppliers. "Think about collegiate infrastructure clubs," he said. "Big is best."
Looking through the Top 50 Indies listing, published in a supplement with last month’s Forecourt Trader magazine, he concluded that the average throughput of everyone in the room was better than the best oil company site.
"You run 7% of the nation’s sites and have about 8% of the volume. Your collective shop turnover is equal to the sales of JS Local and site average is greater than Spar or Londis.
"If the indies gathered in this room were one company they would be number six in terms of fuel market share and the number one convenience and car-wash company in the UK. See what I mean by impressive?"
As evidence of what he had been trying to achieve in his five years as UK retail director at BP, Sims noted that 33 of the indies had BP sites - while 10 had Esso, 12 had Shell, 20 had Total and 19 had Texaco.
"I know I am unorthodox but my focus has been to try to return our industry to a more profitable place against all the pressures of the market and the competition. The greatest challenge hasn’t been indies versus oilies, or oil versus oil brand, I have been focusing on new formats, whether it is through a differentiated offer, better convenience or better overall value - certainly better returns, sales and improving the overall customer offer."
Graham Sims still retains his directorships within BP for now, but the role of UK retail director was lost following a restructure which saw 2,000 jobs go in BP’s European retail operations. The senior manager for BP Retail in the UK is Stephen George, retail director for the combined retail operations in the UK, the Netherlands and Poland.