Market Review 2019 ENERGISING - THE FUTURE - Petrol Retailers Association
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Market Review
2019
ENERGISING
THE FUTURE
As a leading UK fuel supplier, JET is proud to support the Retail Motor Industry Federation (RMI). JET is a brand of Phillips 66, one of the world’s largest oil refiners. In the UK we have more than 330 forecourts, supplying millions of consumers. With expertise in fuel retailing spanning over 60 years, JET is committed to the improvement of forecourt safety and standards. Call us on 020 7822 4900; what we offer might surprise you. E connect2jet@p66.com W jetlocal.co.uk T 020 7822 4900 journeywithjet @JETPetrol JETPetrol JETPetrol
Market Review
HELP US TO HELP YOU, THE INDEPENDENT CONTENTS 2019
FORECOURT RETAILER, BY SUPPORTING REVIEW OF 2018 4
YOUR TRADE ASSOCIATION NOW
POLITICAL
“Together we HOW DOES THE PRA DO IT?
A FRICTIONLESS BORDER, BY TANK STORAGE ASSOCIATION
10
16
are stronger” EVENTS
KEEPING IN TOUCH WITH THE PRA 18
TECHNICAL
EDGE PETROL ON HELPING YOU MAKE BETTER DECISIONS 20
RAY BLAKE ON THE ROLE OF THE PELG 22
E10 AND FUEL LABELLING 24
CAR WASH
CLEANING UP CAR WASHES, BY THE CWA 27
BRIAN MADDERSON
UNDERSTANDING EFFLUENT 28
CHAIRMAN
OIL MARKET OVERVIEW
M
arket Review 2019 is the fifth issue
S&G PLATTS DISCUSSES OIL SUPPLY 30
of PRA’s annual publication and I am
MARKET BY NUMBERS FROM EXPERIAN CATALIST 32
delighted that it continues to be well
ENERGY TRANSITION
received by so many across our industry and
THE ROAD TO POWER, BY BP 36
beyond. Readers include members, product
SERVING UP DIGITAL, BY ACCENTURE 38
and service suppliers, media (both national and
FUELLING CONVENIENCE RETAIL, BY SHELL 42
regional), governments and devolved national
BUSINESS
assemblies. This year we have also had positive
BUSINESS RATES UPDATE, BY MUA 46
feedback from overseas trade associations such as
PROPERTY NEWS FROM CHRISTIE & CO 48
the International Car Wash Association (ICWA) and
LEGAL UPDATE, BY MILS 50
the Belgian Car Wash Association (BBVR).
APG CASH DRAWER ON REDUCING CASH LOSSES 52
In September, we hosted a visit of 16 fuel
AI CORP ON FRICTIONLESS PAYMENTS 53
distributors and independent forecourt retailers
RETAIL
from South Korea who had downloaded Market
KEEPING CUSTOMERS COMING, BY IGD 54
Review 2018 from the PRA website. This involved
FORECOURT TRADER OF THE YEAR 56
an interactive Forum in London followed by visits to
MEMBERS
the impressive Rontec site on the A20 near Sidcup
FORECOURTS THROUGH THE YEARS 60
and to David Charman’s award-winning site at
ASSOCIATE MEMBERS 62
Parkfoot, West Malling. The visitors were amazed by
the scope and quality of the seven-day/week in-store
butchery which he operates.
Who’s who at the PRA
PRA MANAGEMENT TEAM Andrew Lawrence, Lawrence Garages
In 2019, PRA has a great programme of
Brian Madderson, Chairman (London) Ltd
Business Breakouts, Roadshows (with Thames 07768 608332 brian.madderson@rmif.co.uk John Ryeland, George Hammond plc
Communications) detailed on our website. These Gordon Balmer, Commercial Manager Hemant Tandon, Park Garage Group
cover all four home countries plus national events 07771 834073 gordon.balmer@rmif.co.uk PRA TECHNICAL COMMITTEE
Phil Monger, Technical Director Mike Garner, Chairman, The Garner Group
with the Forecourt Show at the NEC Birmingham 07831 327990 phil.psac@gmail.com Nick Brocklehurst, Westbridge Motors
from 8 to 10 April and the joint Forecourt Ray Blake, Technical Manager (Northampton) Ltd
Conference with ACS in early July. 07496 967269 ray.blake@rmif.co.uk Jon Brownsey, Fordingbridge Garage
Steve Coombe, Membership Manager Jill Howkins, F. Howkins & Son
With thanks to all the contributors for their
07831 373205 steve.coombe@rmif.co.uk Graham Lambert, St Michaels Garage Ltd
extremely valuable insights and to all advertisers for
PRA EXECUTIVE COMMITTEE Andrew Lawrence and Ben Lawrence, Lawrence
supporting the publication so generously. Brian Madderson, Chairman Garages (London) Ltd
Ashley Kay, The Kay Group Emma McVie, Southern Co-operative
Cover photos: main photo courtesy of Circle Sue Kembrey, Stanshawe Services Matthew Bellamy, Certas Energy
Mike Garner, The Garner Group Paul Suchodolski, Rontec
Brands, other photos courtesy of PRA members Graham Lambert, St Michaels Garage Ltd Margaret Erwin, Moto
(see page 60 for more details) Aziz Patel, The Brookfield Group
The Retail Motor Industry
Federation (RMI) is a leading
automotive trade body in the
Publisher: Simon Lewis UK, representing franchised car
PRA MARKET REVIEW is published by Editor: Tracy West and commercial vehicle dealers;
Lewis Business Media Ltd, Art Editor: Sarah Crowhurst independent garages; bodyshops; motorcycle dealers; petrol
Suite A, Arun House, Office Village, Sales: Rachel Hallett retailers; auction houses and cherished number plate dealers;
River Way, Uckfield, TN22 1SL Printed by: Stephens & George Print Group, who provide sales and services to motorists and businesses
Tel: 01825 983105 Goat Mill Road, Dowlais, Merthyr Tydfil, CF48 3TD across the UK.
Fax: 01825 983108 ©Lewis Business Media Ltd 2019 201 Great Portland Street, London W1W 5AB
Email: kay@lewisbusinessmedia.co.uk All rights reserved. Tel: 020 7307 3598 • Fax: 020 7307 3406 • www.ukpra.co.uk
www.ukpra.co.uk 03
REVIEW OF 2018
Market Review 2019
Salim and Mumtaz Patel’s
forecourt at Shell Crown
Services in Brighouse, West
Yorkshire, is one example of a
rebuild undertaken in 2018
2018: A YEAR OF CHURN
PRA and CWA chairman Brian Madderson looks at the ‘churn’ static grocery market, their successes
have been at the direct expense of the
affecting our industry through 2018 and beyond
‘Big 4’, whose combined share has
collapsed from 76.3% to 69.3% while
T
his year has undoubtedly been backdrop for our lobbying challenges, margins have been hammered.
dominated by the strident but reinforced by Pepper Public Tesco responded by trialling a new
voices of industry (especially Affairs’ professional advice and discount format ‘Jack’s’ in East Anglia
the automotive manufacturers and communications, significant progress last summer but previous attempts by
their component suppliers), media has still been achieved (see pages 10 the ‘Big 4’ to move into the discount
moguls and politicians all wishing to to 14). space, such as Sainsbury’s with Danish
record their differing but well-meaning The German discounters, Aldi and brand Netto, were not financially
views on Brexit as our Prime Minister Lidl, continue to snap at the heels of successful.
conducted negotiations with the EU. the UK’s established grocery retailers One of the principle commercial
The extraordinary feature has been with their combined growth of over ‘churns’ resulting from the Aldi/Lidl
the ‘churn’ in political appointees, 80% in the last five years. Aldi emerged attack has been the agreed £15bn
whether by sacking for their contrary onto our shores in 1992 and today merger of Sainsbury’s with Walmart’s
views, resignation for actual or alleged operates 762 stores with a target of Asda, which is currently being
misdemeanours and resignation as a reaching 1,000 by 2022. Their lean closely examined by the Competition
matter of personal conscience. In this model comprising the same size & Markets Authority (CMA). This
term of office, the Conservatives have building layout, limited car parking and proposed retailing behemoth would
presided over a change of Cabinet reduced product range enables them not only surpass Tesco to become the
Minister every six weeks, with even to offer above industry-average wages UK’s number one grocery seller with
more frequent changes to Junior and very low prices. They now have a over 31% market share, it would also
Ministers and Parliamentary Private market share of 7.3%, easing ahead become the largest fuel retailer with
Secretaries. Likewise, the Labour Party of the Co-op. Lidl has 700 stores and 18% share, overtaking BP, Shell and
has witnessed no fewer than 106 aims to open between 40 to 50 new Tesco – hence the criticality to our
changes to its front bench team in just stores every year, growing sales by 9.1% sector.
the last three years. and taking its market share to 5.4% The merger has alarmed the CMA
This has provided a most difficult – ahead of Waitrose. In a relatively and Government with concerns that ▹
04 www.ukpra.co.uk
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In 2018 we won more new business with independent dealerships than any of our competitors. Going places together With more than 20 supply locations, 500 in-house drivers and 24/7 support from our dedicated UK team, we have what it takes to ensure your business succeeds. To find out more about our winning formula, call our Territory Managers. 020 7404 7700 www.greenergy.com/dealer WE ARE THE BRANDED WHOLESALER FOR ESSO NATIONALLY
REVIEW OF 2018
Market Review 2019
▹ consumers may have to pay more,
have less local choice and experience
a poorer shopping experience. Already
Westminster’s self-styled Mr Petrol, the
Rt Hon Robert Halfon MP, has written
to the CMA and grabbed headlines
in the red top papers claiming that
Asda’s low fuel pricing policy could be
threatened to the detriment of many
motorists. The CMA has responded by
asserting that fuel prices would form a
special part of their investigation.
Sainsbury’s CEO Mike Coupe has
promised 10% price cuts by leveraging forecourt ownership. The largest
cheaper prices from suppliers….will consolidation arose from MFG’s
this include fuel? As volume market surprise £1.3bn bid through US private
leader, will it attract even lower prices equity stakeholder CD&R for MRH
from refineries desperate to sell fuel in in January 2018. The management of
a declining market. MRH had been well briefed to launch
Rumours abound, including one a £1.5bn IPO (Initial Placement Offer)
that the CMA has identified nearly 130 in the London markets but stakeholder,
locations where existing Sainsbury’s US private equity fund Lone Star, must
and Asda stores are in close proximity have been advised that markets were
and one store should be subject to difficult and a ‘bird in the hand’… One
disposal. Asda has already mentioned has only to look at the plight of Aston
a possible 2,500 job losses. The Martin’s IPO to appreciate this may
Government has apparently intervened have been sound advice.
to ensure that there are no actual However, the acquisition was also
store closures as the local impact investigated by the CMA under a Top: EG Group’s witnessing the forecourt wheel being
multi-million pound
on employment and service/product Phase 1 Inquiry. This resulted in MFG new-to-industry turned full circle with oil companies
providers would be untenable as we having to dispose of the freehold (or Frontier Services and national distributors returning
Above: The Kay
face our Brexit outcome. One former leasehold) of 38 forecourts unless Group’s new-to- to the UK retail market. Could these
Asda senior executive is said to be it wanted to succumb to a Phase 2 industry Castlewood oil companies with reputedly deep
site
inviting European grocery retailers Inquiry. It was expected that bids would pockets become the next big spenders
and private equity fund managers to have been scrutinised and settled and keep forecourt asset values high
establish a vehicle for purchasing any ahead of Christmas, but no firm news after the private equity funds have
such disposals. More to be revealed by had emerged at the time of writing. moved onto their next fashionable
the CMA this year. Further key ownership changes sector?
A commercial ‘churn’ impacting included Harvest Retail’s acquisition of In terms of brand ‘churn’, BP has
dealers has been the recent back- 63 sites from HKS, the emergence of lost 74 sites whereas Esso/Greenergy
to-back announcements from oil Australian equity fund Stratford Retail has added over 100 with Shell also
companies regarding loyalty cards. as a stakeholder with Essar in MPK positive at plus 24. At Jet there was no
Firstly, BP wrote to advise that they change and Texaco was down by five.
were dropping Nectar and replacing We have also seen brand ‘churn’
it with a bespoke loyalty scheme “Perhaps the forecourt with the new owner of Topaz Energy,
sometime this year. Then Esso advised Circle K, taking firm steps to roll-out its
dealers that they were relinquishing wheel is now being own brand across the Irish land mass.
Tesco’s Clubcard and replacing it with
the Nectar programme but, again, turned full circle” Will Applegreen’s ‘low prices
always’ policy soon be featured on
no specific dates. One wonders what GB motorways in addition to those
customers will be offered at Esso- in Northern Ireland or does the
branded Tesco Express sites? Nectar Garages, the bold move by Applegreen incumbent Shell brand with added
or Clubcard, or both, or neither? As to buy a majority holding in 38-site V-Power still sway the consumer?
Esso owns the majority of freeholds, it Welcome Break, the surprise return of During the year, the Co-op has
could sell these to Tesco to continue Phillips 66 to the retail scene by buying removed remaining oil company
but with Tesco brand fuel? Terminate NJB Services, and Certas Energy buying brands from 50% of its national and
with Tesco and bring in Sainsbury’s small dealer groups in Lancashire and regional estates and replaced them
Local with Nectar? Many more ‘churns’ South Wales – all indicate that healthy with an updated version of its original
possible….? returns from our sector will continue in-house brand. This change has
More ‘churn’ is taking place in for some time. Perhaps we are now been reflected in the market analyses ▹
www.ukpra.co.uk 07
REVIEW OF 2018
Market Review 2019
▹ produced by Experian Catalist (see being discussed for replacing these tax of Asda adding automated facilities
pages 32-34) with a reduction in dealer revenues when Government has forced onto existing store car parks, such that
numbers and a consequent increase all fossil fuel vehicles off the road. they now have 65% share but with only
in supermarkets. Any other brand Convenience shopping growth may two opening this year the attraction
changes imminent? Probably a major have peaked but continues at a useful to motorists may be dwindling. Gulf,
refresh of Jet and perhaps the relaunch 3% compound and food-to-go (FTG) Costco, Sainsbury’s and Tesco make up
of an international brand may be under is now a better growth opportunity the 35% balance.
consideration at over 6%. One only has to visit the Despite all the Governmental
Fortunately, the UK petrol retailing multi-million pound new-to-industry pressure to forge a new, cleaner era
industry has been immune so far to the development, Frontier Services, for road transport there has been no
surges of Brexit negativity sweeping recently opened by EG Group on the great interest in buying pure electric
across the country, with both daily outskirts of Blackburn, to appreciate vehicles in 2018 than the previous
fuel and shop demands continuing the FTG sector. The UK’s first dual lane year. Purchases are up by only a few
at a high level. Latest Government drive-thru KFC facility cost in excess hundred vehicles to 13,894, giving
retail fuel data for the year to 1H/18, of £1.25m and employs 35, across the a new registrations market share of
compared to the previous 12-month car park is a drive-thru Starbucks open 0.6% which did not even register on
period, confirmed a very small overall all hours and with 27 staff, while the the motoring Richter scale! Consumers
increase of around 0.5%. With demand large Spar brand store also houses a cite concerns over high initial vehicle
for diesel slowing to a 2.6% increase separate 24-hour Greggs and a 16-hour costs, range anxiety over the current
and petrol building back with the trend Subway with a sit-down area for eating battery technology, lack of charging
decrease now just 1.4%. Volumes and drinking. points and unknown trade-in prices.
have been maintained at 18bn litres
of retail diesel plus 10bn litres for
commercial use and 17bn litres of
petrol. Overall the 45bn litres/year
“The Government can certainly point to
provides the Treasury with some £34bn success on the ‘demonisation’ of diesel”
annual tax receipts from fuel duty and
VAT. Yet there are still no firm plans
Overall forecourt numbers show that Until the consumer wholeheartedly
Philips 66 made a return to the the freefall decline, especially dealers, adopts the concept and performance/
retail scene with the purchase
of NJB Services has been arrested with just 82 closures price envelope of electric vehicles,
plus six from oil companies and Governments will struggle to force the
supermarkets. This has been largely change. It does not help
offset by 45 new-to-industry and 25 when one Department (Transport)
return-to-industry openings (see box), presses for zero emissions by 2032
so a net reduction of 12 sites in 2018. in the very same week that another
There has certainly been a large Department (Treasury) cuts the
number of complete knock down and funding for new EVs.
re-builds undertaken by both dealers Changes to personal taxation policy
and oil companies but there are no have driven UK motorists to opt for
A year of churn: at a glance statistics available to quantify these hybrid vehicles, given such a window
investments. So far as dealers are by their employers to the extent that
New-to-industry sites: +45
concerned, it is heartening to note that the UK is now the largest EU market
Company: +7 (BP 3; Applegreen 2; Certas 2)
even singleton operators like Salim and for such models. How long will this
Hypermarket: +22 (Asda 12; Costco 3; Sainsbury’s 3; Mumtaz Patel at Shell Crown Services persist until the Treasury strikes again
Tesco 3; Morrisons 1) in Brighouse, West Yorkshire have the and makes an about turn in tax policy?
Dealer: +16 (EG 7; Kay 3; Others 6) confidence to borrow money to create The Government can certainly
Return-to-industry sites: +25 a superb new forecourt and Nisa shop point to success when it comes to
after many years serving their local the ‘demonisation’ of diesel as new
Company: +6 (BP 3; Go 2)
community. Mid-size group dealers registrations confirm a near 30%
Hypermarket: +1 (Morrisons) including Penny Petroleum, George collapse year-on-year, which has proved
Dealer: +18 (EG 2; Others 16 inc 1 MRH; HKS, Valli, Hammond, Fraser’s Retail, Kay Group, difficult for manufacturers to cope with
Penny) Refuel & Go, Creightons of Belfast and in the short-term. There has been an
Closures: -88 many others are re-investing heavily in increase in petrol engine sales but only
Company: -5 (Shell 4)
their businesses, so confirming future by 9%, so the market is clearly fragile,
prospects. even before adding any Brexit fears.
Hypermarket: -1 (Co-op)
The UK is seeing steady but slow The future looks EV, with maybe a
Dealer: - 82 (Unbranded 37; Texaco 9; Certas 15; Murco growth in unmanned sites with 17 new hint of hydrogen on the horizon, but
3; Essar 2; others 16)
forecourts in 2018 making the total the tsunami-style change to our vehicle
Source: Experian Catalist
240. This had largely been the preserve park still feels a very long way off.
08 www.ukpra.co.uk
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POLITICAL
Market Review 2019
HOW DOES THE voice heard. Consequently, there have
been significant changes in public policy,
which will benefit petrol retail outlets.
PRA DO IT?
The PRA gets a lot done for its members. Here we outline the
FUEL DUTY FREEZE
For the ninth year in a row, fuel duty was
frozen for a further 12 months from April
2019. This follows lobbying of Treasury
work the Association has been involved in recently ministers and officials by the PRA. Total
annual savings for the average car driver
as a consequence of the nine-year freeze
C
orporate success in the fuel and are estimated to be over £1,000 and the
retail sectors can be affected, average van driver will save over £2,500.
for better or worse, by the PRA pointed out the potentially
decisions made over taxation and damaging effects on the economy and
regulation. PRA’s mission is to represent household budgets of even an inflation-
the interests of its members to people linked rise. We continue to press for fuel
in positions of power who make key duty to be cut to boost our economy
decisions. By putting a powerful case to and move the UK towards a level playing
ministers, PRA ensures its members can field with fuel duty levels in EU countries
continue to grow their businesses. as we head towards Brexit.
PRA chairman Brian Madderson
takes the lead on all lobbying activity, BUSINESS RATES RELIEF
advised and assisted by Adrian PRA was swift to obtain confirmation
Pepper and Damien Phillips, expert from the Treasury that petrol filling
political consultants at Pepper Public stations (PFS) will be included as one
Affairs. Their experience of working in of the eligible business categories for
the corridors of power in Holyrood, business rate relief for all companies
PRA has voiced
Stormont, Whitehall and Westminster concerns over with a rateable value of £51,000 or less.
gives PRA an inside track into how to the introduction Rates for these businesses will be cut
of E10 fuel in
influence Government policy. the UK by a third. PFS shops compete with
In 2018 we continued to make our numerous smaller businesses in the ▹
10 www.ukpra.co.ukWe’re looking for the best sites, in the best locations that are run by the best dealers. Becoming a BP dealer offers: • Strength of the BP brand • Expert advice and support from our • A major oil company that invests in field-based team innovation to help future-proof your site • Best in industry forecourt signage • Leading Ultimate premium fuel grades • A flexible deal that suits your needs • Nectar the UK’s largest • The BP Plus Fuel Card, used by over loyalty programme 340,000 customers in the UK Talk to our dedicated team today to find out how we can help your fuel retail business. Contact Simon James on 07717 361542 or email simon.james2@uk.bp.com
POLITICAL
Market Review 2019
▹ high streets such as convenience stores, ATM business rates both organisations. Alongside CWA in persuading the Environmental
pubs and cafés. and electric vehicle consultant Alexander Russell, Brian has Audit Committee (EAC) to conduct an
charge points are
just two areas that been working closely to coordinate the inquiry into the hand car wash sector
ATMS SAVED PRA has lobbied activities of numerous public bodies and in submitting oral and written
on extensively and,
Since 2010, PRA has been telling below, has joined to bring rogue hand car washes into evidence. The Government will be
Treasury ministers that the Valuation forces with the Car compliance with the law. The police responding to the EAC’s report in
Wash Association
Office has overstepped the mark by estimate that there are up to 20,000 January 2019 and CWA is meeting with
attempting to make PFS liable for a rogue hand car washes across the officials to persuade them to accept its
second set of business rates in respect country. recommendations to take strong action
of ATM machines installed on their A pilot Responsible Car Wash on rogue operators.
premises. Charging business rates on Scheme has been developed by the
ATMs makes them unviable in some Downstream Fuel Association along- FUEL RESILIENCE
areas, particularly rural areas. side the Gangmasters and Labour PRA works closely with the Energy
A recent ruling by the Appeal Abuse Authority (GLAA), police, the Resilience Unit at the Department for
Court backed up the PRA’s view that Health and Safety Executive, HMRC, the Business, Energy and Industrial Strategy
convenience stores and PFS should not Environment Agency and the CWA. This to ensure that in times of crisis, there
have to pay business rates on ATMs. is just a first step. The hope is that the will be enough fuel to enable key public
If the case is not subject to further licensing of compliant hand car washes services and sectors of the economy
appeal, the £300 million that has been will lead to the resources of public to continue to operate. The list of
paid in business rates will now have to bodies being freed up to tackle the real Designated Filling Stations (DFS) for
be refunded. The judgement applies to problem of rogue hand car washes. times of national emergency – be that a
England and Wales only. blockade of the ports, industrial action,
EAC REPORT ON COMPLIANCE terrorism or a major weather incident
HAND CAR WASH SCHEME CWA continues to highlight to – includes many hundreds of PFS
LAUNCHED politicians and the media the problems operated by PRA members. PRA’s voice
In 2018 we saw the incorporation of modern slavery and a lack of at the table ensures that all independent
of the Car Wash Association (CWA) regulatory compliance within the hand petrol filling stations are treated fairly in
into the PRA, with Brian chairing car wash industry. We were instrumental all circumstances.
THE ROAD TO ZERO
The PRA made representations
throughout the passage of the
Automated and Electric Vehicles
(A&EV) Act through Parliament. While
the Act gives the Government the
power to mandate the installation of
electric vehicle charge points in large
fuel retailers and motorway service
areas (MSAs) – which the PRA has
consistently argued as unreasonable
and unnecessary – ministers have given
assurances to the PRA that there are, at
present, no plans to use these powers.
Following Brian’s oral evidence to the ▹
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01204 282062POLITICAL
Market Review 2019
PRA wants a Brexit
deal that ensures
free flow of goods
and services between
Britain and the EU
▹ A&EV Bill Committee, he met senior checks, so that the orderly conduct of
officials at the Office for Low Emission business continues. PRA’s preference is
Vehicles (OLEV). PRA is asking that for a deal to be agreed which ensures
its members be entitled to grants for the free flow of goods and services
the installation of fast charging electric “The success of PRA’s between the UK and EU and which does
infrastructure on the same basis as the
existing Homecharge and Workplace lobbying in 2018 not compromise the UK’s ability to make
trade agreements with third countries
schemes. With demand for electric
charging points currently so low, PFS
demonstrates the value after Brexit.
need to be given significant incentives
to invest.
of having a dedicated SUSTAINING OUR SUCCESS
The success of PRA’s lobbying in 2018
STALLING E10 ROLL OUT
trade association” demonstrates the value to the retail
fuels sector of having a dedicated trade
PRA has been sitting on the FORECOURT CRIME association which can represent its
Government’s consultative committee As the police claim they do not have the members’ interests robustly.
considering the introduction of E10 to resources to prioritise fuel theft drive- The PRA consistently delivers
the UK. There are significant concerns offs, PRA has stepped up its lobbying of powerful, well-researched arguments
about introducing E10 in the near term, the Home Office to force action. to Government and devolved
not least that there are an estimated A publicity campaign is now being administrations.
800,000 vehicles that could not run on undertaken, with major newspapers Consequently, we have established
E10, that a tank of E10 has a lower range running stories about the way DVLA strong working relationships with
than a tank of E5 and that PFS do not and the police are shirking their ministers, officials in Whitehall, MPs
PRA’s voice at
have the available infrastructure to run Westminster ensures responsibilities in the fight against this and statutory bodies whose actions
E5 and E10 alongside each other. all independent form of theft, known as bilking. affect the sector.
petrol filling stations
are treated fairly The PRA has rejected the suggestion As a result of our successful lobbying
that our members install pay-at-the- programme in 2018, our members are
pump technology, as this undermines able to pay less in tax and provide more
their ability to sell goods in shops. One services to customers, from cashpoints
solution would be to give petrol retailers to food and beverages, to the installation
electronic access to the DVLA’s Vehicle of new automated car washes.
Keeper database, so they can pursue We do not underestimate the many
drive-offs through the civil courts and challenges we face this year – from the
ease pressure on the police. roll-out of the Licensed Responsible
Hand Car Wash Scheme, to the need
BREXIT for an orderly Brexit, the fight against
Our members need to be able to forecourt crime and the continuing
continue to import fuel and food importance of keeping fuel duty and
supplies from the EU without border business rates down.
14 www.ukpra.co.ukAdvertisement feature 2019
Valli Forecourts:
Cash Handling to Improve the Forecourt Experience
A
s one of the fastest growing convenience offering including Morrisons three steps to one and reconciling our till
forecourt companies in the UK, PFS, The Kay Group, ASDA, M&L points from 1 hour to around 20 minutes.
Valli Forecourts has 13 operational Richardson, NJB Services and many more With Volumatic, we feel we are moving into
sites across North Yorkshire and independent petrol retailers. a new era of the way in which we handle our
the Midlands with two more sites under After spending time understanding the cash!” , Area Manager, Waqas Aslam
construction. Valli Forecourts impress goals and specific requirements of Valli
through exceeding customer demands, Forecourts, Volumatic offered the CCi
providing 24/7 access and making available solution as it is efficient, cost-effective,
a diverse product and service offering. and simple to use. This was combined
In a constant bid to improve the customer with CashView Enterprise software which
experience in their forecourts, Waqas provides complete visibility of all of the CCis
Aslam, the area manager responsible for the from one central location, reducing three
sites, began researching how cash handling steps of reconciliation to just one.
could be improved to benefit both the team Following a successful trial, Waqas Aslam
members and customers. Valli Forecourts decided to roll out the solution across every
were experiencing issues with counterfeit single site of Valli Forecourts. Volumatic
notes and an inability to accept certain were there to ensure implementation went
currencies e.g. Scottish and Irish notes, smoothly, providing all of the necessary
leading to a drop in revenue and missed training to maximise the benefits of the
sales opportunities. solution.
Furthermore, inefficient processes, Staff at Valli Forecourts reported that
numerous safe drops and reconciliation the CCi is user-friendly and requires
of tills taking up significant time, Valli minimal effort to operate. Furthermore, the
Forecourts required a quicker, more CashView Enterprise software now allows
reliable and more convenient solution. management to oversee the activity, in real
A cash-handling solution that would not time, of each CCi unit at any location. This
only benefit internal processes but ensure provides access to convenient, scheduled
forecourt staff could provide customers reporting with accurate information that
with the time and attention required for further streamlines their cash handling
exemplary customer service. process.
After researching, Valli Forecourts came With further expansion of sites in the
across Volumatic. They read the the success pipeline; Waqas has made it clear that the
stories about their impressive track record. CCi will be an integral part of making all
For example, Volumatic has supplied future sites a success.
CounterCache intelligent (CCi) solutions “CCi, combined with CashView Enterprise, CCi (CounterCache intelligent)
to a number of petrol fi lling stations with a has taken our cash handling process from in action - Volumatic.
15POLITICAL
Market Review 2019
FRICTIONLESS
BORDER
Tank Storage Association executive Many businesses and industry
director Peter Davidson talks Brexit groups have stressed the need for a Peter Davidson, TSA executive director
frictionless border between the UK
and the need for a frictionless border and the EU to ensure that trade can as it is likely to struggle with the
continue unhindered and without any increased volume of transactions
A
t the time of writing (November additional financial burden. Failure carried out by the existing Excise
2018) European Union (EU) to do so may have a dramatic impact Movement and Control System
leaders had just approved the on logistical supply chains, which (EMCS).
agreement on the UK’s withdrawal are essential to ensuring a thriving Move the payment of customs
and future relations with it. The Tank economy and may also affect future duty and VAT from the border to
Storage Association (TSA) recognises investment decisions. when goods move to home use (as
that the agreement still needs to go The TSA reiterates its call for with excise duty).
through the UK Parliamentary process Government to engage more fully with Use commercial documents/self-
before it is approved, but cautiously industry. We again urge Government to assessment for transaction tracking
welcomes this positive progress. It is ensure that an end-to-end declaration and duty payments and audits for
essential for TSA members to ensure processing service is put in place compliance.
access to as frictionless a border with allowing the efficient passage of Remove restrictions placed on
the EU and the rest of the world as legitimate imports and exports to how goods are held in a customs/
possible following March 29, 2019. We and from countries outside the tax warehouse. Primarily, this would
do not believe this is possible without UK. Consideration should be given to mean allowing common storage and
a deal in place. the following suggestions as part of the co-storage of UK and non-UK goods
On the basis that a deal is agreed, development of such a system: in the same tanks.
the transition period will provide a Limit the use of the existing Simplify the process of gaining
limited window of opportunity to Customs Handling of Import and customs warehouse approval
discuss and implement detailed Export Freight (CHIEF) system and limit the need for warehouse
arrangements for how we import (and its successor the Customs guarantees (make extension to the
goods from, and export goods to, the Declaration Service [CDS]) to the tax warehouse approval).
EU and the rest of the world. declaration of goods to customs, New customs arrangements will take
time to fully implement. Therefore,
Failure to ensure a these options need to be explored
frictionless border today – regardless of whether or not
may have a dramatic
impact on logistical a final solution has been reached and
supply chains regardless of any existing limitations
in legislation under the existing
Customs Union. Failure to be prepared
and failure to take advantage of the
opportunity to simplify and streamline
processes will result in a significant
impact on UK business.
We look forward to continuing to
work with Government to further
develop its plans for future customs
arrangements.
The TSA represents the interests of 50 member
companies engaged in the storage of bulk liquids
and the provision of products and services to the
sector. Collectively members operate over 300
terminals and distribution hubs in the UK and
have over 8.5 million cubic
metres of storage capacity
in the United Kingdom (UK)
and Republic of Ireland
(ROI). Members provide and
support an essential interface
between sea, road, rail and
pipeline logistics for many
different substances including
16 www.ukpra.co.uk“turnkey solutions for your business”
• Services • POS/BOS
• Tokheim Dispensers • CCTV
• FM • EV Charging Solutions
• Tank Maintenance • Karcher Vehicle Valeting
• Construction • Tank Gauges
• Small Works • Media
• Payment Solutions • Payment
+44 (0) 1162 437 476
Email: sales.uk@tokheimsolutions.uk
Visit: www.tsg-solutions.com/ukEVENTS
Market Review 2019
TALK TO US
The PRA works best when we all stay in touch – and there are plenty of ways to do that
I
n the fast-changing world of retail, Breakouts and five Roadshows, stories of interest in our well-
it’s vital to keep abreast of the latest in conjunction with Thames established fortnightly members’
developments. Communications. e-magazine Petrol Heads-Up, which
The PRA works closely with the At these events, you will be updated recently celebrated its 100th edition.
Government and key decision-makers on the latest developments on subjects This has proven to be very popular with
and is frequently asked to appear on ranging from The Road to Zero to our members, one remarking: “It’s the best
TV and radio to speak on your behalf. activity to bring the car wash industry thing the PRA has done recently.”
In fact, the PRA took a delegation of back to a level playing field. You will If you have any stories or news you
members to meet the Department of also have the opportunity to speak with would like to share then please email
Transport to present views on the E10 either Phil or Ray, our technical team, our editor Anne Bruce at annebruce@
proposals. This is why it’s vital that we on any technical issues you may have. rocketmail.com
stay in touch with you. Members who are within 40 miles We also continue to produce the
The PRA has a number of ways in of the Business Breakout venue can Market Review, which is now seen as
which we can engage in dialogue. The expect to receive an emailed invitation, the industry handbook encapsulating
first, and best, is face-to-face at our so please don’t forget to check your all the aspects of roadside retailing.
events. Each year, the PRA team travels spam folder! In addition to this we Our website has been well received
across the UK for its 10 Business publicise these events in Forecourt and has a link to our Twitter account
Trader, Petrol Heads-Up and on our which lets members know immediately
website. what is going on. We also have the
In 2018 we had support from members’ website, which can be
innovators in our industry, including accessed by using the postcode of
CBE, Chargemaster, EdgePetrol, your head office as your username
Forecourt Eye, GripHero and Instavolt. and your membership number as your
Members also heard interesting password.
presentations from well-known From time to time we also ask for
companies in our industry, including members’ feedback via our email
Christie and Co, Global MSI, Jackaman address memberfeedback@rmif.co.uk
Insurance, LCM, S&P Global and which can also be used for members
Winckworth Sherwood. We have also to email us with any questions
been well supported by fuel suppliers or assistance. You also have the
BP, Certas Energy, Maxol and Topaz. members’ hotline 0845 305 4230 if you
We hope to see you at one of our require to speak to someone.
events in 2019, please keep an eye on With all this, your PRA has never
our website to see when we will be been more accessible – please contact
near you. us or speak to one of the team at our
In addition to all this, we publish shows, we are here to help you.
2019 SPRING PROGRAMME
The PRA will be putting on the following events this spring:
BUSINESS BREAKOUTS
• Wednesday 27th Feb Sandy Park, Exeter
(in conjunction with CTC Tradeshow)
• Thursday 7th March The Historic Dockyard, Chatham
• Thursday 28th March Crowne Plaza Hotel, Shaws Bridge, Belfast
ROADSHOWS
• Thursday 14th March Knutsford
• Wednesday 1st May Scotland
We would be delighted to see you at one of these events.
For further details please refer to www.ukpra.co.uk
18 www.ukpra.co.ukRevolutionising Forecourt Hand‐Protection
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Offer Eco-friendly materials
Reduce waste by dispensing one piece at a time
Reduce your refill-run routine
Transform customer care and convenience
18ATEX0328
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info@griphero.com 01837 811035 .COM2019 Advertisement feature
Gaining an Edge-ucation
EdgePetrol entered the petrol market as the new kids on the block, but with the help of
retailers they have learned their trade.
I
n September 2017, EdgePetrol launched
their web app to help UK retailers
make better and quicker pricing and
procurement decisions every day. After
working with forecourt owners for over a
year to understand the challenges they face,
launching the product was still just the
beginning of learning the petrol retail market.
“We learned early on that retailers
are always focused on maximising their
profitability, whilst staying fair to the customer
to maintain their volume and dry stock sales.
By taking the time to understand what daily
actions they took to achieve this we were able
to make the data driving these actions more
visible, more timely and more accurate.” Says
Gideon Carroll, CEO.
This learning curve delivered results
quickly. As of December 2018 - just over one
year after launch - EdgePetrol had over 350
signed sites and was growing at an average
of two clients and five sites a week. Despite
this success, ambitions are high and Edge
continues to work hard to stay ahead of the
curve. Manage your forecourt from anywhere. EdgePetrol gives you instant access, to live volumes, margins, and profit
“We had meetings with over 150 retailers across your entire portfolio.
spanning over more than 3500 sites and
learned something from every single one of new information to their pricing strategies to Toby Butterworth, Edge’s VP of Product,
them. The first version of the product offered make sure they are hitting the numbers they commented “We decided to open our roadmap
retailers the opportunity to see a live gross need before it’s too late to make a change.” to the market in order to make sure the petrol
margin across their portfolio with no manual Furthermore, Edge’s in-house data science industry community continues to shape the
entry. By working closely with site owners we team are is now accurately forecasting site future of Edge. We are relying on retailers
have been able to develop this much further volumes. Edge looks at your sites’ sales
volumes to keep presenting us with challenges and
than we could have imagined.” behaviour over the past weeks, whilst also opportunities.”
adapting to changes in the current environment Features that Edge have already committed
Lessons learned and the launch of new features to provide a forward view of tank levels for each to building include setting your pole sign from
New 2018 features included the incorporation grade at each site. This means that a retailer head office and live gross profit indicators.
of bunkering and fuel cards, paving the way for is able to see what their tank volumes will be Development of a dry stock module is also in
a live ‘net margin’ to be displayed that applies up to a week in advance, so they know exactly the works, which tells retailers what average
the relevant fuel card fees to each transaction. when to take the next tanker of fuel. This drives basket spends and conversion rates are for each
Users are now able to see the real impact that down purchasing costs and eliminates the risk grade so they can better set an optimum fuel
fuel cards have on their margins and respond of stock-outs. price. Smart notifications will present users
accordingly in their pricing strategies. with opportunities to maximise profitability on
“We were discussing margin during our Opening the roadmap their site.
meetings and fuel cards kept coming up. The This success has led to Edge opening their
problem was that retailers were only finding product roadmap to the market. This means Integrated with key industry services
out their impact at the end of the week or that everyone can see what is being considered, It’s not only the edge features that are
month and “This was giving them a bill what is currently under development and benefiting from this process. On the advice of
shock” when fuel card levels were higher than what has been completed. Those viewing the retailers, Edge has also teamed up with other
expected. By showing them the live impact of roadmap are able to submit their own ideas to forward-thinking industry players. For example,
fuel cards, retailers are now introducing this drive product development to suit their needs. connections to wet-stock managers like Suresite
provide more frequent dips and therefore give a
more accurate and up to date margin.
Retailers can also view their Catalist
competitor pricing data directly in the app,
as this is part of the daily pricing decision.
The possibilities of third-party connection is
endless, as Edge is totally agnostic and will
connect with any data source.
Toby summed up: “The product is never
finished; therefore, we are never finished
learning. We are excited to continue to bring
market-driven features to the Edge platform in
2019 and beyond.”
+44 203 865 8689 www.edgepetrol.com
The team behind EdgePetrol
20Not having EDGE,
can leave gaps in your
KNOWL _ _ _ _
EdgePetrol gives you real-time
visibility of your portfolio from
anywhere in the world.
edgepetrol.comTECHNICAL
Market Review 2019
THOUGHTS OF months, if not years, which covers:
The filling of customer-owned LPG
cylinders from autogas dispensers.
CHAIRMAN RAY
Paying for fuel using mobile
devices.
New categories for the unmanned
operation of petrol filling stations
The PRA’s Ray Blake talks us through the role of the PELG and appropriate control measures.
The obvious hot topic that we are
B
y the time you are reading this I that in the main, the enforcers are addressing at PELG and other forums,
will be at least halfway through not satisfied that the new regs ensure including the Energy Institute Service
my two-year tenure as the first the same level of control and safety. Station Panel, is the question of how to
‘industry’ chairman of the Petroleum However, when challenged, they were safely combine the charging of electric
Enforcement Liaison Group (PELG). unable to substantiate their beliefs. My vehicles (EVs) with the dispensing of
In brief, PELG, supported by view is that the change in legislation traditional hydrocarbon fuels. Some
the Health and Safety Executive, coincided with the huge cuts in local guidance on the installation of EV
issues guidance to both Petroleum authority resources. This resulted in a charging on petrol forecourts has
Enforcement Authorities (PEAs) significant majority of the experienced already been published. However,
and the operators of petrol filling enforcers taking early retirement there is more being drafted covering
stations on ‘managing the risks of (myself included). different aspects depending on the
fire and explosion’. The guidance is I inherited the PELG chairmanship remits of the forums involved. As I
in the form of the Red Guide and at a time when it seemed to be losing write, PELG is compiling guidance on
supplementary documents known as impetus, at least partly due to the loss the responsibilities of petrol forecourt
PETELs, free to download via https:// of these experienced participants. I operators when they install and
knowledge.energyinst.org/search/ am trying to raise the profile within operate EV charging and the legislation
record?id=110259 both the enforcement and forecourt that they must comply with.
I have been participating in PELG operators’ communities, as with there A further innovation to the supply
for the past 12 years. The first nine of being less expertise available at a local of petrol that may or may not fall
those as an enforcer, while head of level, PELG becomes the obvious within the remit of PELG (dependent
petroleum at the London Fire Brigade. forum for issues relating to the safe upon a legal definition currently
During that time I, along with a core operation of petrol forecourts. being sought), is the intention by a
group from PELG and the HSE, was The main aim of PELG is to
involved in formulating the rationale identify changes in the operation of
for the new petroleum regulations
introduced from October 2014. I was
petrol stations and issue appropriate
guidance. The changes can be brought
“The main aim of PELG
also sponsored by the Better Regulatory
Delivery Office (now BEIS) to give
about by a range or combination of
factors such as innovation, viability of
is to identify changes in
training seminars on the transition from
the old licensing regime to the current
petrol stations due to market forces
and availability of new technology.
the operation of petrol
certification scheme. As chairman, I have already pushed stations and issue
As I write, the HSE are undertaking through the publishing of guidance
a ‘Post Implementation Review’ of the (within Section 8.5 of the Red Guide) appropriate guidance”
new Petroleum Regulations. It seems that had been pending for many
couple of companies to offer to fill
your vehicle with petrol at your home
or workplace from a van containing
a large container/tank and a typical
metered fuel dispenser. Customers
PELG has become can already use an ‘app’ to request
the obvious forum for and pay for diesel to be delivered in
issues relating to the
safe operation of petrol this manner, but the legal position and
forecourts appropriate standards/guidance for
petrol are yet to be decided. The HSE
has approached PELG for their views.
Remember, the PRA’s influence on
PELG and in other forums enables us
to be at the forefront of changes within
the industry and to help our members
deal with any issues that
they encounter.
22 www.ukpra.co.ukSix ways to maximise volume without lowering price.
Too many retailers today rely on lowering prices to grow volumes. Intelligent, data
driven capital and operational investment decisions can result in a significant
volume uplift without having to sacrifice margin. Before changing your prices,
focus on these six volume magnets to unlock hidden value:
1 Brand. 2 Location.
There’s a general opinion that certain brands
A location’s potential can be
will always outperform others regardless of
realised by analysing local demand
the situation. Don’t rely on assumptions. Make
and traffic data. When acquiring,
sure you gain a deeper understanding of the
consider the size of the market, local
effect each brand has on both fuel and non-
market characteristics, and your potential
fuel performance.
customers.
3 Market. 4 Facility.
Spend time learning about your competitive
Deciding how to spend a limited budget can be
landscape. Once you know this, you can tailor
incredibly difficult. Pay-at-pump technology? A
your marketing strategy to best fit with your
franchised restaurant? Achieve the best ROI
customers’ needs.
by identifying how each option would affect
both your fuel and non-fuel revenues.
5 Merchandising.
It is important to understand the
6 Operations.
sociodemographic profiles of the customers
who visit your site. This information will help Service quality is a key factor of repeat
you tailor your promotions and offerings to business. Acknowledging and responding to
entice people into the convenience store customer perceptions can help improve this,
and optimise sales. and lead to increased customer loyalty.
When examined in unison alongside price, these 7 Elements will help you make
optimal decisions and lead you to sustainable and incremental improvement.
But how do you begin to understand how the 7 Elements are affecting your
business performance?
Kalibrate collects market data and uses complex data modelling to
simulate how individual site and market characteristics influence
performance. This helps retailers around the globe accurately
predict retail fuel, convenience store, car wash, and quick
service restaurant sales at any site.
Email solutions@kalibrate.com to learn more
or visit kalibrate.com/single-site-analysis.TECHNICAL
Market Review 2019
E10 AND FUEL describe the fuel that should be placed
on the fuel dispenser at petrol filling
stations.
LABELLING
The standard sets out the format
and scale of graphical identifiers for the
three grades of transport fuel:
Circle, for petrol-based fuels
Technical director Phil Monger talks us through where we are Square, for diesel-based fuels
Diamond, for gaseous fuels.
with the introduction of E10 and new fuel pump labelling Within the identifier, a standard
text format differentiates the various
I
had hoped to provide definitive Transport for a frank discussion on the fuels. For petrol and diesel fuels, this
advice on the new fuel labelling DfT proposals, with evidence of how is generally a letter that refers to the
requirements and the Government the move would impact the industry. biofuel blended into that fuel and
proposals on the introduction of E10 DfT gave assurances that they would a number specifying the maximum
petrol but, at the time of preparing this not be introducing anything that would percentage volume of that biofuel
update, the draft legislation for either is mean digging up forecourts and that as according to the relevant fuel standard.
still not in the public domain and with the consultation was a call for evidence For gaseous fuels this is an abbreviated
the focus squarely on Brexit, it seems the meeting proved very helpful. The text to refer to the fuel. AFID makes
unlikely to be with us in the near future. PRA is supportive of E10 but only if similar requirements for vehicle
However, it might be helpful to explain its introduction is formally mandated manufacturers that will apply to all
the current situation. by Government. It would need to be a new cars from the date that the new
replacement for 95 Octane E5, leaving regulations come into force.
E10 PETROL Super Grade as the protection grade at The aim of the new labels is to
At the end of July 2018, the Government E5 to satisfy the few remaining cars not ensure that consumers can select the
published its consultation calling compatible with E10, many of which correct grade of fuel for their vehicle
for evidence on their proposals for are not compatible with E5 either. There regardless of where they refuel. The
introducing E10 petrol to satisfy the would even be some benefits in raising fuel identifiers must be placed near the
on-going need to decarbonise the the amount of ethanol in petrol as the filler cap of new vehicles and on the
traditional road fuels used by the vast risk of phase separation reduces with dispensers of all filling stations selling
majority of existing vehicles. The most the increase in ethanol content. to the public.
controversial of the proposals was to The introduction of E10 as a Where petrol filling stations
require two grades of 95 octane petrol, replacement for E5 would be as are found to be non-compliant an
E5 and E10, from forecourts with an simple for retailers as changing the enforcement notice will be issued with
annual turnover of three million litres dispenser labels. BS EN228 allows a likely 28-day period to rectify. If that
of fuel, if they had four storage tanks for up to 10% ethanol but does not is not met a fine of up to £500 will be
or more. Not only did we respond specify a minimum. Selling E10 does levied. In the case of vehicle non-
explaining the impracticality of such require an additional label stating ‘Not compliance a fine of up to £100 may be
a proposal, we also took a delegation suitable for all vehicles, consult vehicle levied against the dealer.
of six members to the Department for manufacturer before use’. There is a Under the Directive, member
proposal to change that from negative states were obliged to introduce
to positive, stating ‘Suitable for most the requirements by October 12,
vehicles, consult vehicle manufacturer’. 2018, but upon hearing that other
EU countries were also not going to
FUEL LABELLING make that date, the UK decided to
Following the introduction of the risk infraction proceedings and delay
Alternative Fuel Infrastructure Directive until spring 2019. The Low Carbon
(AFID) and the subsequent publication Vehicle Partnership LowCVP, working
of the EU Standard EN16942 Fuels- with industry, has prepared a publicity
Identification of vehicle compatibility, campaign with posters, information
the British Standards Institute (BSI) brochures and a dedicated website
subsequently published the UK specific in advance of the compliance date.
standard, BS EN 16942. This sets out Several members have asked whether
harmonised labelling requirements for they should change the labels now
marketed liquid and gaseous fuels. It when new equipment is being installed.
requires fuel identifiers to be placed on My advice has been not to precede
fuel nozzles at filling stations, on new the publicity campaign, as delays on
vehicles and in their manuals as well the forecourt would be inevitable as
as in vehicle dealerships. The standard motorists try to interpret the labels.
also includes larger labels incorporating More information will be provided in
the identifier and extra information to Petrol Heads-Up as details emerge.
24 www.ukpra.co.ukYou can also read
