Small oil retailer to increase petrol stations to 100 this year.
Rayong Purifier wants to add 40 petrol stations this year to its current total of 60 but at a total cost of only Bt100 million.
"We set a small budget for the expansion, because our policy is to invest jointly in the stations with landowners," general manager Kanokporn Charukulvanich said yesterday.
The small oil retailer will spend Bt3 million to Bt4 million on each Pure service station, compared with Bt10 million to Bt20 million spent by other retailers on theirs.
The filling stands are smaller, making it convenient for sales of 200,000 litres a month. Other retailers have larger petrol stations that must handle 300,000-400,000 litres a month.
Rayong Purifier has reached out to the owners of more than 10,000 independent stations. The company will pay for the conversion of their stations to Pure outlets and operate them. Without putting up any capital or suffering management headaches, the landowners can enjoy profit-sharing of 5-6 per cent of total sales.
"This policy has been warmly welcomed by those independent station owners, who have experienced risks due to low marketing margins. Meanwhile, most of them don't want to get out of this business, and the joint-investment model is the answer to their problems," Kanokporn said.
As a newcomer in the business, Rayong Purifier would benefit from the customer networks that the independent operators have built up.
"The co-investment policy and our size and management capability can help us expand amid fierce competition," she said.
Already, 400-500 operators have approached the company to enter the programme, but only 80 have been selected for their locations and business potential.
Pure stations feature diesel, which make up 80 per cent of sales. They serve as a distribution channel for the company's refinery, which produces only diesel. Other types of fuel are purchased from other oil companies.
The Nation
Friday January 12, 2007
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