Forecourts forecast


Motorists already know it. The modern forecourt is a far cry from the so-called filling station of the past – and it’s no longer just drivers who find their way past the pumps and into the store. SLR reviews the state of forecourt retailing, and considered the trends that will shape its future.

by Émer O’Toole

An increasing focus on the retail side of things has been the over-riding trend of recent years in forecourt management but while that development has opened up fresh revenue streams, it also means forecourt retailers are also exposed to the fierce competition in the sector. The market is tougher than ever before with forecourt operators having to work harder to attract and retain customers.

The first challenge is simply to entice customers onto a forecourt – often with with competitively priced fuel, a bright and welcoming livery, and high quality pumps and forecourt facilities. First impressions really do count, and with several symbol groups now offering own-brand fuel offerings, the fascias look more tightly linked to the sector. Jet has a brand partnership with Spar UK, which enables Jet dealers to choose from a range of retail support packages, from a standard Spar shop to a fully Jet and Spar dual-branded site. By leveraging the strength and combined services of both brands, Jet’s aim is to transform its forecourts into convenience destinations which maximise on both food and fuel sales.

Spar says its forecourts use innovations, such as wooden boxed displays for fresh produce, and shelving space for local manufacturers, alongside ranges of car care items to drive footfall. “Basic items are not forgotten in a successful forecourt operation,” says Terri Plummer from CJ Lang. “This can be the place where shoppers come to habitually, and, given that fuel is very much a price-driven product, capturing a loyal retail clientele is a must for any successful forecourt.”

Start with the basics

Before a forecourt can expand its services and range, it needs to ensure that it gets the basics right. It’s easy to overlook the fundamentals such as having clean fuel pump handles, visible rubbish bins, fully stocked hand towels and gloves – small things that can make a big difference to a consumer’s perception of the site and the retail offer, particularly if they are paying their first visit.

Meeting other motoring needs too can have a very positive effect, including clean and fault-free water, air, vacuuming and car washing equipment. They help ensure the forecourt becomes a destination for these services which in itself can encourage additional sales across the site as a whole. A customer is never going to trust a retailer for their fresh food if the retailer doesn’t keep the pump island clean, or provide good value with forecourt basics.

With the growing importance of fresh and food to go, forecourts can now also offer the convenience customer access to a strong range of products – be it fresh produce, protein or meal solutions supported by a wide grocery range that caters to their everyday needs. This in particular presents a real opportunity for forecourt retailers to drive overall spend and footfall, and attracts a much broader consumer profile.

Jet, for example, has introduced its Snack on the Go concept – an exclusive coffee and food-to-go offering with eXpresso Plus. The Snack on the Go display unit can be customised to fit the store’s available space (from a minimum of one square metre). As well as a Lavazza coffee machine, dealers can choose to add display areas for hot food, sweet treats and chilled items. Expert advice is available from Expresso Plus and Country Choice to ensure the products will appeal to each site’s customers. Display units can be branded and can be adapted at a later date if required. Jet says this helps its dealers to “stand out from the crowd, offer greater convenience choice and develop a loyal customer base.”

Forecourt crime

Forecourt crime will be at the top of the agenda for the Petrol Retailers’ Association this year.

Chairman Brian Madderson says he has been talking to the government about investigating hand car washes in Scotland.

“The whole thrust of this is labour exploitation. It is a really serious issue that has the prime minister’s attention. For once we are pushing on open doors with the government,” he says.

He also says that additional discussions will involve the Gangmasters and Labour Abuse Authority.

“We know that hand car washing can be better regulated. They need to pay their taxes and meet environmental standards, which many don’t at the moment. And they certainly need to avoid exploitation. We’re looking to do quite a big initiative on forecourt crime next year right across Scotland,” he adds.

While the top-up shopper is increasingly being lured into forecourts, it is arguably the food-to-go offer that can be a real success for forecourts. Impulse buys and little & often are two growing trends that the forecourt operator is ideally placed to capitalise on. Couple those with the demand for good quality coffee, and the forecourt becomes more of a place to linger, and therefore encourage upselling and mission buying. According to Jet research, 70% of UK forecourts now have a coffee machine in store. Time of day can influence ‘treat’ buying patterns too. CJ Lang says these are often sweet or savoury buys, between meals, bought as mood food, to make the shopper – usually drivers – feel emotionally better. The boost purchase is something of a mental pick-me-up, which could traditionally be a strong coffee or caffeine drink, which young adult shoppers tend to prefer. Visa research reveals the average commuter spends more than £10 a day on lunch, takeaway coffees and other food – that’s £2,500 a year on snacks. It’s easy to see why forecourt operators want to capitalise on the trend.

Over the years, forecourts have evolved significantly. Gone are the days of the small forecourt kiosk full of cigarettes, chocolate, crisps, soft drinks and car accessories. Now we have modern forecourts incorporating 2,500 sq. ft. convenience stores with fantastic fresh food offers, full grocery offerings, food to go and a wide range of additional services. According to Jet, 35% of forecourts in the UK have an in-store bakery and 29% have a microwave for customer use.

“Residential neighbourhood community-based forecourts are now in many cases becoming the main supplier for local daily provisions,” says Terri Plummer. “Here, we see a real mix of shoppers. Some arrive by car to take full advantage of the exclusive parking. Just as many customers arrive by foot, using the forecourt as their local convenience store, more so than the transient out of town location. It’s at these that shoppers are more likely to arrive by car to fill up their vehicle with fuel, but also expect to be offered body fuel with a real Food to Go offer meeting the needs of a completely different shopper.”

New tech

New technology is another area where fuel retailers can differentiate themselves from their competitors. Jet has reported decent results for its dealer network since it launched a three month trial of the popular mobile app, Waze.

Waze uses adverts that draw the user’s attention to a branded location pin which highlights each Jet site’s exact location. If the user taps on the pin, more information is presented and they can ask the app to take them directly to the site. With over four million views in just three months, it’s proving to be a great way to raise brand awareness and drive forecourt footfall.

There is a huge opportunity for independent forecourts in an increasingly competitive market place by using fuel as a key footfall driving element to their proposition, and to then expand their offering to ensure that it caters for the wide range of customers that could potentially use the site. To do this successfully, however, forecourts have to get the basics right first and build on the reputation that arises from that.

The days of forecourts focusing solely on fuel are long gone. Whether it’s grabbing dinner for that evening, posting a parcel, paying bills, collecting an online order, or even just picking up a cup of coffee and a snack for their commute, filling up with fuel is often a secondary reason for the visit. To make their forecourts more desirable, fuel retailers have to deliver in all of these areas.