FORECOURT MANAGEMENT OF OIL RETAIL BUSINESS

1. FORECOURT MANAGEMENTOFOIL RETAIL BUSINESS MDPI/GIG OIL & GAS TRAINING

2. Forecourt Management This segment deals with the basic essentials for managing and maintaining forecourts (outlets) to achieve success MDPI/GIG OIL & GAS TRAINING

3. By the end of this segment, participants should gain core understanding about retail outlet management including: • Site facility management: Best practices – Fuels • Site facility management: Best practices – Shop • Management of care wash • On-site Health and Safety Matters Outcomes MDPI/GIG OIL & GAS TRAINING

4. Three types of forecourt business • CODO – company owned but dealer operated • DODO – dealer own and dealer operated • LDE – loan delivery equipment (partnership) • COCO – company own company operated MDPI/GIG OIL & GAS TRAINING

5. Critical factors before commencement of work Safety and housekeeping precaution • Check fire alarm system • Check extinguishers • Is first aid box present with adequate materials? • Is cell phones off sign displayed? • Check for punctuality – the station can be as good as its staff are prepared to make it particularly in respect of ability, loyalty, personal and collective determination to be better than competitors MDPI/GIG OIL & GAS TRAINING

6. Station Physical Appearance • Station manager goes round with station supervisor • What is the physical state of station building, premises and driveway? Any repairs needed? • How is the cleanliness of the station internally and externally? • Check for upkeep of flower lawns • Assign staff to any cleaning required Facility Management: Best practices - Fuels MDPI/GIG OIL & GAS TRAINING

7. Station Equipment • Check working condition of all pumps, compressors, and tyre gauge etc – any fault to be repaired? • Are all station lights working? Put on all switches to check • What is the position of previously reported faulty equipment? Facility Management: Best practices - Fuels MDPI/GIG OIL & GAS TRAINING

8. Facility Management: Best practices - Fuels Inventory Control • Reconcile stock situation daily – before and after work • Check tank inventory levels, pump readings and sales figures • Look for actuals and variance • Agree acceptable level of loss • Check adequacy of present stock of fuels, lubricants, LPG etc • Complete station stock and order form • Is there a problem with outstanding orders, diversion etc? MDPI/GIG OIL & GAS TRAINING

9. Facility Management: Best practices - Fuels Discharging of fuel • Prepare tank farm area for delivery bulk (vehicle) • Make sure the bulk parks on an even surface for at least 30 minutes • Check to make sure seals are not broken • What products were requested and how much of them are being delivered? • Do the dipping to verify quantity • Agree before and after discharging product quantity and shortages with driver • Report shortages to OMC • Make sure driver countersigns shortages on delivery invoice • Make sure hose put in the right tank to avoid cross contamination MDPI/GIG OIL & GAS TRAINING

10. Inventory control • The inventory process must guarantee no stock outs • Preferably use just in time delivery Facility Management: Best practices - Fuels MDPI/GIG OIL & GAS TRAINING

11. Facility Management: Best practices - Fuels Stock Losses – mitigate stock losses by: • Not discharging hot products- this can result in shrinkage • Avoiding poor supervision (spillage) • Avoiding tank turbulence at the time of delivery • Ensuring tank/line/valves do not leak • Not dispensing with poor pump • Addressing inadequate record keeping – poor business and staff discipline MDPI/GIG OIL & GAS TRAINING

12. Facility Management: Best practices - Fuels Station Record Keeping • Keep daily record book and all official station record books up to date • Ensure all official coupons are recorded and safeguarded • Compare last week sales to current week’s sales • What are the reasons for adverse variations – no of sales outages • Identify actions to boost sales • Ensure corrections on record books are effected on time MDPI/GIG OIL & GAS TRAINING

13. Cash Situation • Follow daily payment system strictly • Is cash withdrawal by operator within approved amount in working A/C? • Has any excess cash withdrawal been refunded by operator? • What is the present position of Authorised credit sales? • Is your account balance to date? Facility Management: Best practices - Fuels MDPI/GIG OIL & GAS TRAINING

14. Key Success Factors • Availability • Visibility • Replenishment Facility Management: Best practices - Shop MDPI/GIG OIL & GAS TRAINING

15. Essential Ingredient for Success • Sparkling cleanliness • Buying atmosphere – product location and spaces • Full shelve • Clear pricing • Appropriate category grouping – presentation • Good staff with product knowledge and keenness to please customers • Inventory management Facility Management: Best practices - Shop MDPI/GIG OIL & GAS TRAINING

16. Securing Successful Shop • Easy of parking • Fast and quick service • Short queues • Easy of shopping • Good mix of products and service • Well merchandising • Value for money and time Facility Management: Best practices - Shop MDPI/GIG OIL & GAS TRAINING

17. Core product range • Confectionary including ice cream and salt snacks • Cold and ambient drinks including alcohol • Convenience range including pastries, bread, essential grocery, chilled and frozen household hygiene items • Consumables including flowers, condoms etc • Cigarettes and tobacco • News and magazines Facility Management: Best practices - Shop MDPI/GIG OIL & GAS TRAINING

18. Secondary Range • Fresh fruit and vegetables • Pharmaceutical • Greeting cards • Gifts • Services like banking, catering, dry cleaning etc Facility Management: Best practices - Shop MDPI/GIG OIL & GAS TRAINING

19. Check list • Dedicate accountable manager • Ensure cleanliness of the bay and neat display of all tools • Ensure equipment and tool are in good working order and adequate • Record of number and adequacy of jobs done and sales of lubricants • Never subsidized washes • Staff training Lubricants and Washing Bay(highly profitable when well managed) MDPI/GIG OIL & GAS TRAINING

20. Common problems • Smoking • Mobile phone • Jump starting cars at pump islands Health and Safety Matters MDPI/GIG OIL & GAS TRAINING

21. Be a competent person and incident manager • Understand and manage risk assessment practices and procedures • Formal recording and reporting of all fuel related incident • Keep records of fuel related maintenance work • Protect the customer/public – have hazard notices posted in zoned areas to provide safe work place • is fire extinguisher(s) in working order Do all these to protect – people(1st), profit(2nd), property(3rd) Health and Safety Matters MDPI/GIG OIL & GAS TRAINING

22. Basic risk assessment on fuel handling activities • Deliveries • Storage • Transfer • Venting • dispensing Health and Safety Matters MDPI/GIG OIL & GAS TRAINING

23. Market analysisSuccessful forecourt management is a mix of entrepreneurial skills, spirit and instinct • Unlike E&P, retailing is and art, as oppose to science. Barriers to entry can be relatively low, capital and labour intensive, margins can be unattractive • Having constant, reliable information and superior analytical ability is essential to successful forecourt management. So a significant intellectual element to outlet management in the following areas is critical: • Understand market • Understand the customer • Understand factors impacting demand MDPI/GIG OIL & GAS TRAINING

24. Identify current and prospective competitors • Understand actions of competitors affecting station sales • Identify the SWOT of the outlet you operate Without such information and an understanding of it, the only certain thing is that you will make more bad decisions than good ones Competition/Competitors MDPI/GIG OIL & GAS TRAINING

25. Is the operator deviating from system controls? • Do you do things that are contrary to set standards? • Do you implement expert advise? • Which aspect of the business is growing and where is robust growth income streams coming from? Fuel, car wash, tyres, catering etc General issues MDPI/GIG OIL & GAS TRAINING

26. Case Study To be discussed in groups MDPI/GIG OIL & GAS TRAINING