The actual business of selling fuel to motorists, it turns out, is kind of a loss leader for the Royal Dutch/Shell Group-and, one supposes, most diversified oil companies. The Anglo-Dutch energy giant's retailing unit, in fact, only just broke even last year, according to a recent briefing by Malcolm Brinded, the group's UK country chairman, following the announcement of Shell's full-year results.
To make the business profitable, Shell is launching a 3-year campaign to chop retailing costs at its 1,100-strong chain of stations by £100 million while hooking up with British supermarket chain Sainsbury's to bring in more revenue from the station forecourts.
Shell's strategy, according to independent market analysts Datamonitor PLC, picks up on a "one-stop shop" trend taking root in stations across the UK for different reasons-but mainly for a share of a £5.5 billion annual forecourt food market.
A shopping experience
"In less than a year, the petrol station fill-up will have changed from a chore to an all-encompassing shopping experience, as petrol becomes no more than an additional product in a plethora of goods and services," predicted Datamonitor oil analyst Shon Loth. "The purchase of petrol itself will become one of the lesser motivations for visiting a station."
Beyond the food and flowers that will now be rung up with a full tank, Loth says, on-site dry cleaning, photograph developing, banking, and video club services will all be commonplace in stations by next year.
This sort of convenience-driven consumerism is necessarily a slippery slope. BP's new concept stores, which are introducing on-site internet cafés in a bid to bring in customers, will soon inspire imitators, says Loth, because they are answering the need of "time-stretched consumers to surf the net when they are on the move and, in many cases, on a 24-hr basis."
Nor does it stop here. "Drop-zones" to alleviate the "stress" of using the internet and waiting for home-delivery of mail order will lead to an arrangement where ordered goods could be delivered to a designated petrol station, letting customers collect them whenever they choose.
Changing consumer needs
All this is apparently down to "changing consumer needs." The top of this list, it seems, is fast food, for there are some 8,000 service stations across the UK selling some variety of the ready-to-eat, a number doubtless growing by the day. More than 600 have bakeries.
Loth comments, "The look and feel of UK petrol stations is changing for good. Before long, buying petrol for their cars will be an add-on service, on top of a great consumer experience."
As a man who grew up in Canada and logged hundreds of thousands of kilometers driving its streets and highways, there is no denying the very real "need" for a large coffee on occasion, a sandwich even. But rarely was there a time that I-except to defy long-haul fatigue-allowed myself to be kept from reaching my destination longer than necessary.
Worth noting too, that nowhere in Datamonitor's report is there mention of parking for the masses who have stopped to pick up their dry cleaning, surf the net, check their bank balance...
