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MPK agrees Total-branded supply deal on eight former Rontec sites with GB Oils

17 September, 2012

MPK Garages Ltd, the UKs seventh largest independent forecourt operator, has confirmed that eight free-of-tie filling stations, recently purchased from Rontec Investments LLP, will be supplied by GB Oils under the Total brand.

MPK currently has a portfolio of 38 sites, situated predominantly within the East and West Midlands. By consistently reinvesting in its operation, the Leicester-based business has been able to expand its network and achieve strong growth, particularly in shop sales, despite the testing economic climate.

We continue to raise the profile of our sites and improve the retail offering through development of our forecourt shops, explains Paul Kershaw, director, MPK Garages. Two years ago we took the decision to work in partnership with Londis, which has proved to be good for the business. It is unlocking the potential within our shops; weve enjoyed double-digit growth year on year and are now poised to embark on the next phase of the programme.

A company such as Londis is living and breathing retail and understands and compliments the business at all levels. Sometimes, we do kid ourselves in petrol retailing that we are all shop experts, but MPKs experiences in the last two years supports our decision to recognise who the experts really are and let them take the lead.

In doing so we have improved the retail experience for the customer, increased profits by 20% and secured much healthier fuel-to-shop sales ratios. This re-balance has had a significant impact across the network. By strengthening our ability to cross-subsidise we now have increased flexibility in the way we price at the pumps. One recent example is a site that, before its shop redevelopment, was consistently priced in line with a local hypermarket. Now the shop has increased turnover three-fold which means that we dont necessarily feel the need to erode our fuel margins in quite the same way to chase volume.

Store sizes for the group range from 400sq ft up to 1500sq ft and reputable brands in the shop and on the forecourt are considered equally as important.

We have built our business on strong brands and good working relationships, continues Paul Kershaw. Thats why we had no hesitation in extending our current fuel arrangement with GB Oils, as well as adding an additional eight sites to the arrangement. The Total brand has served us well for a very long time and we value the relationships that have been built over many years. They continue to flourish under GB Oils with the same day-to-day personnel involved with our account.

GB Oils has made good progress in a short space of time. A core strength is its ability to deliver to market and the way it handled the recent contract negotiations demonstrated that it is serious about petrol retailing, the dealer market and our business. We received a very strong offer from a major but there were too many grey areas. In contrast, the GB Oils approach was straightforward, uncomplicated, and everyone worked well to conclude the deal within a challenging timescale. We shall now watch with interest GBs development of its flagship brand, Gulf. The UK market lags behind Europe in forecourt design and livery and there is big opportunity to hit the market with something refreshingly different.

The new agreement brings the MPK annual throughput now supplied by GB Oils to around 68mlpa.