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Looking to the Futura

01 November, 2005
C21 - a new name and a new type of flexible deal designed for independents
Page 25 

L-r: C-21 founders Steve Hawes and Roy Pegg, alongside Simon Davis, head of sales at Futura Petroleum

We’ve seen old brands reawakened from the dead – think Gulf and Regent – and low-profile brands thrust into the limelight – think Pace. But seldom – certainly not this century – have we seen an entirely new brand make its way onto the forecourt.
But that is the bold move intended by two stalwarts of the petrol retailing industry – Roy Pegg and Steve Howes – who officially launched their C21 Forecourt Services package to the world on October 27.We’ve seen old brands reawakened from the dead – think Gulf and Regent – and low-profile brands thrust into the limelight – think Pace. But seldom – certainly not this century – have we seen an entirely new brand make its way onto the forecourt.But that is the bold move intended by two stalwarts of the petrol retailing industry – Roy Pegg and Steve Howes – who officially launched their C21 Forecourt Services package to the world on October 27.Between them they have notched up more than 40 years in the industry, both having most recently worked for Kuwait Petroleum UK – Pegg as sales manager and Howe as dealer manager. Add in Paul Bailey who has just joined the company from Rix Petroleum, and you’re looking at the equivalent of 70 years experience in the retail dealer market. Not a bad foundation for a company hoping to build a national network of up to 300 dealers. And, to reinforce the fact, it even says in the company’s brochure: “we rely on a solid background of experience working in the retail dealer market and good old common sense, to ensure that we really do understand your business”.The backdrop to the formation of this new venture is the ongoing restructuring of the fuel retailing market, in which the number of dealer-owned sites is increasing against a fall in the number of company-owned sites. The C21 team sees a gap for a new entrant to support this growing dealer business.“Industry analysts forecast that within five years 80% of the downstream market could be dealer owned,” states Pegg. “But at the same time the major oil companies have raised their fuel volume thresholds, meaning the brand options for many dealers have diminished dramatically. Hence there has been a resurgence of smaller brands coming onto the market, such as Gulf. But there hasn’t been a new brand in the UK for as many years as I can remember.”Pegg and his colleagues believe the time is right for a new brand and a refreshing new approach to dealer business. They have come up with a deal which gives retailers what they want in terms of fuel supply, control over pricing and other benefits, without tying them up for several years in a restrictive contract.Instead of trotting out the traditional supply contract-type offer that has been knocking around since the year dot, they have thought long and hard about their potential audience and have come up with an offer they believe will suit both the pocket and the mindset of a certain sector of the independent dealer community.“There are currently around 6,500 dealer sites in the UK, of which 1,200 are unbranded, and 2,500 are below the majors’ threshold,” states Pegg. “We are targeting dealers who have just come out of a major oil company contract, a time when many lose a lot of volume through not having a strong brand on their forecourt. These are retailers with sites doing from 750,000 to 3m litres a year. We can give them a unique licensed forecourt brand that gives them a strong visual image and forecourt offer, but without the potential restrictions of a long-term solus supply agreement.”When putting the C21 concept together, a key discussion point centred on the main advantages to a dealer of having a long-term supply contract.“One is surety of supply,” says Pegg. “But everyone tells us we are awash with product – there is no shortage of distributors out there.“The other good reason for a supply contract with a major oil company is the benefit of a recognisable brand on your forecourt. But if it’s not a big brand, it doesn’t really matter to the general public one way or the other. Many people fill up at their local forecourt, whatever the brand. But it needs to look smart.”The C21 duo finally came up with what they describe as a unique licensed forecourt brand that removes the need for a long-term fuel tie, but still provides a strong visual image and forecourt offer – including lots of benefits normally only provided with contracted supply deals.“A licensed C21 dealer will keep full control of their on-site pricing structure,” says Pegg. “They can source supply from various local distributors or fuel companies on a supply-only basis. Or they may wish to take advantage of our association with Futura Petroleum, an independent fuels producer currently with 80% distribution coverage throughout the UK – effectively giving them wholesale prices, direct to their forecourt, without the usual corporate on-costs.“With C21 you simply purchase the most affordable level of site branding package you need – we can even arrange finance over an agreed period. Alternatively, in association with Futura Petroleum, it may be possible to fund the branding in exchange for a non-solus agreement, based on an agreed volume and ppl surcharge. And unlike most contracted deals, once the agreed volume target is attained, the ownership of the signage reverts to you.“The only other outlay is a low-cost annual licence fee for the use of the C21 brand image, which is payable by annual standing order. Annual renewal of the licence will allow you to retain the use of the branded image for as long as you wish and always at the same low cost, that never increases, year on year.”Depending on site volume and the level of branding chosen, Pegg says this equates to an average on cost (including the annual licence fee) of 0.5ppl: “Big savings and minimal costs – we believe that’s quite a reward for living outside the safe (but not always flexible) bubble of a contracted supply deal.“The C21 brand and forecourt package enables a retailer to retain what he values most – his independence. But being independent doesn’t have to mean alone. We aim to offer dealers a committed partnership that allows them to remain truly independent, and enables them to drive their business as they see fit.”WHAT THE C21 FORECOURT PACKAGE IS OFFERING:- A new, nationally available forecourt brand, at the right cost and without the need for a long-term fuel tie.- The freedom to source fuel supplies at the best available prices.- The opportunity to purchase fuel direct from an independent fuels producer. - A forecourt package and benefits that are normally only provided with a contracted supply deal:Licensed C21 branded imageC21 forecourt brand insigniaFreedom of choiceDirect fuels producer pricesFuel supplier sourcing schemePump maintenanceLubricants rangeLocal promotionsBusiness account cardsPolling packageCorporate membership to the Garage Watch schemeHealth & Safety packUnique shop offersC21 branded uniforms rangePersonal, friendly serviceTotal flexibilityFUTURA PETROLEUM:Futura Petroleum Ltd is the wholly owned UK subsidiary of Blue Ocean Associates plc. The Blue Ocean Group of companies claims to be probably the largest independent, non-refiner, manufacturer of road fuels in Europe and may be the largest worldwide. For the past 12 years Futura has been pioneering the development of environmentally friendly road fuels and markets these fuels to downstream customers in the independent retail and commercial sector. Futura was the first company to introduce City Petrol and City Diesel, the forerunners of PU50 and ULSD, into the UK.Simon Davis, head of sales at Futura Petroleum, who previously worked at Kuwait Petroleum, and in the retail fuel divisions of Safeway and Morrisons,says: “We currently supply a number of leading UK distributors and are looking to expand our presence in this sector. Our association with C21 enables us to support this exciting new brand in the UK downstream dealer market.”