01 March 2010

The Petrol Station as Sundry Shop, and More

At a petrol station, a signboard hangs, strictly prohibiting the sale of cigarettes to children below the age of 18. The signboard hangs next to another, which prohibits smoking on the premises. This is a strange pair of signboards: If smoking is prohibited on the premises, why are cigarettes permitted to be sold at petrol stations? Could permitting the sale of cigarettes be an invitation to light up a cigarette on the premises? Surely, the management of the petrol station is not hoping that an explosive event take place at the petrol station?

But the scene is not as strange as it appears at first sight. Selling cigarettes is simply part of the economic activity of a petrol station. Condoms are sold at petrol stations, but surely the sale of condoms is not in itself an invitation for the patron to indulge in sexual activity on the premises. Chewing gum is also sold at petrol stations, but neither is it an invitation to the patron to stick the chewed gum on the premises indiscriminately. (Civic consciousness, and the careful disposal of exhausted chewing gum, on the other hand, is likely to be welcomed.)

It was not too long ago that petrol stations began their transformation into sundry shops. They began with canned drinks and newspapers, and then expanded to everything else. Today, petrol stations hawk a variety of goods and services. They have become convenience stores, on steroids. A petrol station at Port Dickson sells roll-up mats and mini barbecue grills, presumably to cash in on the happy campers at the beach, which is within walking distance. Some petrol stations have ventured into delivering hot cups of coffee and donuts on their premises. Some petrol stations have taken that a step further and had a link up with fast food restaurants. Driving to the Karak Highway from Batu Caves, two petrol stations on the left side of the road proudly announce their partnership with fast food giants McDonald's and Burger Kings. It's the ultimate win-win situation: The fast food restaurants have their fill of customers, the customers have their fill of food, and the spillover for the petrol stations comes when customers fill their cars with petrol. Some customers withdraw cash at the ATM for a few quick purchases: a loaf of bread, today's newspaper, a can of Coca-Cola. A few customers buy e-coupons to top-up their prepaid mobile accounts.

Petrol stations seem to have worked out a winning formula: Work in synergy with those who provide ancillary services, and you both stand to benefit. In the old days, before petrol stations became more aware of strategic, uniform branding, owners of individual petrol stations would think of creative means to generate more income. Some of them invited mechanics to work on their premises; others have installed automatic car washes. Yet others allow small manual car washes to be set up on their premises: These usually trump their "automatic" counterparts by managing to provide extra services, such as interior vacuuming and exterior wax polishing. At one point, ProJET petrol stations were quite popular with the midnight crowd, serving hot coffee and snacks, over a convenient drinks bar, where patrons could sit and chat the night away, or slog through their work, unnoticed. That, unhappily, has become a thing of the past, ever since ProJET sold the entire franchise to Shell, which now focuses only on selling petrol at the pumps. The formerly bright and cheerful interiors are now actual convenience stores, operated by 7-Eleven. It seems that the operation is more successful, commercially, but has lost some of the warmth of the former management.

How have various petrol companies in Malaysia chosen to reconcile this hybrid of petrol sale at the pump with convenience store profitability? How has this revelation that there is profit to be made, been digested and converted into money-making endeavours?

Esso and Mobil

Esso and Mobil have convenience stores called "On The Run", "Esso Tiger Marts" and "Mobil Marts". Here is an extract of the blurb on the "On-The-Run" stores from Exxonmobil's official site.

On-the-Run is a world-class retail store concept housed within our service stations; its motto: “Fast, Fresh, Friendly”.

We launched our On-the-Run stores in Malaysia in 2003, beginning with an outlet in Kuala Lumpur’s East-West link, and later expanding to key market areas in the Klang Valley, Penang and Johor.

Malaysian drivers know that they can take advantage of quick, convenient shopping ‘on-the-run’, where a range of products from food items to everyday necessities are sold in a pleasant shopping-mart environment. On-the-Run stores also include cafes serving both hot meals and cold fare for dine-in and take-out customers. Coupled with well-lit carparks, wide aisles and friendly staff, the On-the-Run store promises to make each visit a delightful experience. Complementing the On-the-Run stores are Esso Tiger Marts and Mobil Marts, smaller stores which offer convenience and great value.

A 2004 press statement from Exxonmobil regarding the nationwide launch of the "On The Run" stores can be found here.


Petronas operates a convenience store known as Mesra. It has many branches all throughout the country. Petronas accomplishes this through Petronas Dagangan Bhd, an arm of Petronas. In July 2009, Petronas issued a statement that it expected to build 20 new Mesra convenience stores by 2010. (Ref: The Star, 29th July 2009. 30 new Petronas stations by 2010.) Not only that, Petronas has actually taken the step of setting up a standalone convenience store at Universiti Teknologi Petronas, at Tronoh, Perak. (Ref: Ibid.) Pictures and news regarding the standalone convenience store can be found at the official website for UTP. Petronas is also touted to have created the first drive-through convenience store in Malaysia. (Ref: The Star, 8 October 2008. Convenience redefined for drivers.)


Shah Jehan said...

This concept of petrol station and sundry shop is very convenient for consumers. Fits the style of living on the fast lane. Most things under 1 roof. I just hope the prices of the goods sold are not ridiculously more than the normal sundry shops. The inconvenient part is when petrol stations close at 12 midnight. Only selected few keeps their pumps flowing after midnight.

nice1link@yahoo.com said...

Convenient, yes; competitive no. Due to g’ment controlled pricing (automatic pricing mechanism) which doesn’t allow for market force to function, oil companies do not see the need to be competitive in terms of fuel pricing. To attract customers they make their station bigger and add more services. Right now, to build a petrol station, you need to have at least an acre of land. Just imagine the capital and operating expenditure required to run this kind of petrol stations. How is this going to benefit lower income groups? I’ve been promoting no-frill petrol kiosk since 2005 with no avail. Fuel price is going up but sadly g’ment is not changing their policy to encourage competitive pricing.


Kevin Koo said...

Dear friends,

Thanks for dropping by. And thanks for your comments.

Anonymous said...

For me, the convenience of having readily available parking space is the main drive to visit a petrol station shop. Some have taken it further. The PETRONAS station on Pesiaran Kewajipan, USJ 20 has a drive-in counter.

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