The number of petrol stations in the U.K. has reduced over the last decades. What has caused this?
In the 90’s I managed a very busy petrol station in the middle of a city. Our turnover was just under £10 million per year (combining both wet and dry products). This was around the time that the hypermarkets and supermarkets were just starting to sell fuel.
I can remember reading the trade magazines (I didn’t buy them, they were sent to us by the fuel company – the one that put a tiger in your tank years earlier) and reading all of the jokes about the “grocers” selling fuel.
Fuel Price Wars
Trade was dropping off fast due to the “grocers” undercutting on prices, sometimes massively, yet the fuel companies did nothing about it. “Our promotion has been running for years, this will keep the loyal customers with us”, except that when the fuel in the “grocer’s” was 5p or sometimes, even more, cheaper, people would follow their wallet. It took a huge number of the smaller petrol stations going out of business for the bigger companies to wake up, in their old promotions, and then start price-matching the “grocers”. By this time, the damage was done and the rot had set in. People had become used to buying their fuel when they did their shopping. The only thing the fuel companies could do was to go into partnership.
This of course did not help the smaller sites as they could not use fuel as a loss-leader as many of the supermarkets were doing.