Should oil giants run convenience stores? Some say no. Exxon Mobil Corp. (NYSE:XOM) and ConocoPhillips Co. (NYSE:COP) have sold their thousands of shops and exited the business. And a few say yes. A year ago, when last we looked at the topic, Chevron Corp.'s (NYSE:CVX) ExtraMile Convenience Stores were
ranked No. 1 in the field by trade pub CSP.
But as you can tell from the experience of another company that has stayed in, BP plc (NYSE:BP), it takes a real commitment, and plenty of management attention, to be successful.
BP got a network of 1,800 or so stores when it bought Arco in 2000. In an
article in Knowledge@Wharton, Fiona MacLeod, president of BP Convenience Retail USA & Latin America, tells about a transformation that began in 2007 and involved a rebranding (they're now called ampm stores) and the conversion of 800 company-owned stores to franchises. This was a major project, part of a broader revamp at BP, and the company surely must have weighed it against a sale. But MacLeod sounds happy with the results, saying the effort freed up $1.2 billion in capital and focused the stores on their real mission, which is monetizing the gasoline made in BP's refineries.
So is a pure franchise model the only way to make this work? Not necessarily. According to CSP, Chevron uses a mix of company-owned and franchise stores.
- Kenneth Klee
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Juergen Lasowski
And the winners are...
The oppertunity to grow marketshare in the ready to eat ready to heat Grocerant niche is booming. BP like other in the sector are focusing more and more on improving the quality of thier Grocerant style food prodcuts and the results are clear. Sales are growing, frequecny up and consumer are happy.