forecourts - Neighbourhood Retailer

Petrol pricing is cause for concern: CMA warns

Linda Stewart — Fri, 08 Jul 2022 09:26:31 +0000

Petrol and diesel pricing will be investigated by the competition watchdog after it found “cause for concern in some parts” of the industry.

The Competition and Markets Authority (CMA) said it had discovered a sharp rise in prices once fuel had been processed by oil refineries.

It also found “significant differences in price” between forecourts in “many rural and urban areas”.

The CMA was asked to conduct an urgent review of the market by Kwasi Kwarteng.

The business secretary was concerned that a 5p fuel duty cut announced by the government in March was not being passed on to motorists. Both petrol and diesel prices have hit a series of records in recent weeks, fuelling the cost of living which is rising at the sharpest pace for 40 years.

Oil price volatility has worsened since February when energy giant Russia launched an assault on neighbouring Ukraine.

The CMA’s initial review found that “on the whole the fuel duty cut appears to have been implemented”.

However, the competition body will now begin an in-depth study of the market.

It said a main driver of rises was the growing gap between the price of crude oil before it goes into a processing plant compared to the price once oil refineries have processed it into petrol and diesel.

The difference between crude oil and the wholesale price of petrol and diesel had tripled in the past year from 10p to nearly 35p per litre.

“While there is no escaping the global pressures pushing up fuel prices, the growing gap between the oil price, and the wholesale price of petrol and diesel, is a cause for concern,” said Sarah Cardell, general counsel at the CMA.

“We now need to get to the bottom of whether there are legitimate reasons for this and, if not, what action can be taken to address it.”

She added: “On the whole the retail market does seem to be competitive, but there are some areas that warrant further investigation. These include finding out whether the disparities in price between urban and rural areas are justified.”

Welcoming the report and the commitment to a fuller market review, the RAC said it was pleased to see that the CMA acknowledged that the gap between wholesale and retail prices had been widening in recent weeks

RAC fuel spokesman Simon Williams said: “Regardless of the reasons for wholesale prices being what they are we continue to believe there is clear evidence, not least in the last week, that major retailers are incredibly slow to pass on falling wholesale costs, yet quick to pass on rising ones. The idea of allowing drivers to more easily pump prices near them may also prove beneficial.

“The question drivers may have, however, is how long the review will take and – crucially – when they might see a change to what they pay every time they fill up. As each day goes by and the cost-of-living crisis is felt ever more keenly, the need for retailers – especially the largest ones – to reflect wholesale prices fairly becomes ever more urgent.

“We urge the Government to ensure it’s in a position to scrutinise the relationship between wholesale and retail prices. And where issues are found, it must be able to take action that quickly leads to fairer prices.”

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North coast’s Moran’s Retail Ltd completes third phase of production kitchen

Linda Stewart — Tue, 21 Jun 2022 13:49:24 +0000

Husband and wife retail team John and Donna Moran have just completed the third phase of their production kitchen – allowing them to expand their food to go offer at Moran’s Retail Ltd.

The couple have been focusing on food to go for more than 20 years now in their three Musgrave SuperValu Centra forecourts close to the north coast, at Strand Road in Derry, Coleraine and Ballykelly, as they explain in a profile in our forthcoming edition of Neighbourhood Retailer.

“What we felt we needed to do was make it a point of difference,” Donna says.

“A lot of people were doing what we were doing as far as forecourt retailing was concerned, but we wanted to make a point of difference and we felt this was an opportunity to go down the road to producing our own homemade food.

“We’d been making our own sandwiches in-store since we opened the stores, but we were always wanting to improve our range and our product.

Made today, gone today

“Now we put our product – our sandwiches and our salads – on the shelves and we say ‘Made today – gone today’, in that they’re going to be sold within 24 hours, because we want to retain that quality.”

The couple have just completed the third stage of their production kitchen and are looking forward to developing their range even further.

“We had been making our sandwiches and salads in the shops and then we decided that the best way for us to retain our quality was to have one central distribution hub. So we built the first stage of our production kitchen in Ballykelly and now we have just completed the third stage of our production kitchen,” Donna says.

“It employs about 15 people for the production alone and we call it Bring Good Food Home – ‘From our Kitchen to Your Kitchen’ It produces our ready meals. ‘Moran’s Makes its Own’ is our mantra.

“We do all our own sandwiches, make all our own mixes, make all the food for the deli, so our production kitchen can supply each store with all our deli food and with all the sandwiches that we sell off the shelf as well as salad ranges and the likes of stews and curries.

Sunday roast

“We make all our Sunday roast dinners for deli customers to come and buy from the deli on a Sunday and we also have them to take home as well, which means we have the spider fridges filled, so you can just lift your dinner, bring it home and heat it.”

Donna says their chefs are constantly developing new lines.

“Developing the third stage of our production kitchen has led us to be able to expand our equipment and be able to produce more new lines,” she says.

“So we’ve a new healthy option coming out now, with four new products coming in our salad range. There are going to be a lot of different salads – it will go according to what the season is.

“We like to think that we’re taking the hassle out of mealtimes and promoting no pots, no pans, no washing – because all our dishes are all ovenproof and microwave proof.”

Read the June/July issue of Neighbourhood Retailer for the full story.

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Retailers fear cross-border exodus of customers as UK pump prices break new records

Linda Stewart — Thu, 10 Mar 2022 11:23:14 +0000

Northern Ireland’s fuel suppliers fear they will see a surge of customers crossing the border to load up on fuel as UK pump prices climbed to fresh records.

The RAC said pump prices broke records once again on Wednesday.

Fuel spokesman Simon Williams said: “The average price of both petrol and diesel climbed to new records again on Wednesday.

“Unleaded is now 159.57p a litre while diesel increased by another 2p to 167.37p – making for a rise of more than 5p in two days. A tank of petrol is now almost £88 while diesel has now gone over £92.”

Diesel appears to be on a clear path to £1.70 a litre, he said.

“As this is an average price, drivers will be seeing some unbelievably high prices on forecourts as retailers pass on their increased wholesale costs,” he said.

“But there was a hint of better news yesterday on the wholesale market with substantial drops in both petrol and diesel which could lead, in a week or so, to a slight slowing in the daily pump price increases and records being broken less frequently.”

Retailers in Northern Ireland say they expect to see an exodus of thousands of customers heading across the border to fill up at cheaper forecourts following the Republic’s announcement of excise duty cuts of 20c per litre on petrol and 15c per litre of diesel.

Garry Jennings, of Jennings Fuels and Lubricants in Fermanagh border village Kesh, said people won’t buy fuel locally unless the system is radically overhauled.

“It’s 21% cheaper in the south as it is, so if they cut duty by 20% that’ll make it around 40% cheaper,” he said.

“The UK government needs to consider the revenue it’s going to lose. There will be no revenue coming from people in Northern Ireland filling their lorries and cars in southern Ireland.

“We’re in a crisis. People can’t afford it. The Treasury needs to do something about that now. It’s going to be too late in a couple of months when lorry men, the haulage industry and buses are all parked. In rural Fermanagh, we depend on the road.”

Mr Jennings said the government needs to consider the revenue they’re going to lose by not reducing VAT and duty.

“It’s a no brainer. If they don’t reduce the duty and the taxes, everybody will go to southern Ireland and they’ll get nothing.”

Meanwhile, John Donaghy, from Donaghy’s Filling Station in Muff, Co Donegal, said he expects more drivers from Northern Ireland to cross the border for fuel.

“The cut in fuel excise duty will lead to a bigger price differential so it’s likely that motorists will go to wherever is selling the cheapest fuel,” he said.

Levies and excise south of the border currently account for 47% of diesel costs and 52% of petrol. The Republic’s reduction will stay in place until August 31 and is expected to cost €320 million.

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Petrol Retailers Association on intensive visit to Northern Ireland following hectic media round at height of fuel crisis

Linda Stewart — Wed, 13 Oct 2021 14:30:13 +0000

The Petrol Retailers Association has topped off a busy few weeks with an intensive visit to Northern Ireland to industry reps and government departments.

PRA executive director Gordon Balmer told industry reps at its Business Breakout session at the Crowne Plaza hotel that the group has fielded more than 100 media interviews over the course of the fuel crisis, including outlets in Australia and the US.

During a visit to Northern Ireland with outgoing PRA chairman Brian Madderson, he explained the background to the fuel crisis and how confidential remarks at a Cabinet meeting were leaked to media, sparking a round of panic-buying.

He revealed that pump prices had hit their highest level since September 2013, with wholesale price rises of more than 4p/litre week on week during the height of the crisis, and warned against the wisdom of the Government increasing fuel duty in November.

Updates

Mr Balmer updated reps on the demographics of Northern Ireland’s market – of 571 sites, 61 are owned by the supplying oil company, 472 are dealer-owned and 38 are operated by multiples.

During the year, the PRA has been lobbying government over the Road to Zero strategy, ATMs and the future of cash and forecourt crime drive-offs.

This week, the PRA has been in a series of meetings with Stormont departments, discussing a variety of issues, including road fuels, organised crime, the introduction of E10, EV charging and the need to improve infrastructure, business rates and fuel laundering. The PRA also met with the PSNI to discuss forecourt crime.

Mr Balmer said the group had been talking to the DVLA and the government about the importance of being able to extract keeper’s details in a timely manner after a driver has left the forecourt without paying.

Many police forces don’t deal with this type of crime, so some UK forecourts have been working with Forecourt Eye – but their efforts are hampered if they can’t get timely details about the vehicle keeper and the crime may have to be written off.

Human trafficking

Meanwhile, Mr Balmer said the PRA had been talking to the Department of Justice about human trafficking and slavery and the issue of hand car washes.

The Car Wash Association is concerned about non-compliant hand car washes and has warned fuel retailers who allow a third party hand car wash to operate on their site of the steps they need to take to ensure that there will be no threat to their own reputation, including having a legally binding lease, planning consents including operational days and times, no labour abuse, and valid Right to Work documents.

Mr Balmer also discussed the latest business rates revaluation in Northern Ireland, pointing out that questionnaires are now available on line and responses must be back to LPS by the end of December.

Transformation

The pandemic has transformed UK forecourts, with fuel retailers increasing their focus on non-fuel categories, Mr Balmer said.

Fewer than 1 in 10 of their shoppers during the pandemic were there on a fuel mission, and the pandemic saw many forecourts operate as standalone convenience stores, with sales of ambient food and chilled ready meals key to that success.

Forecourts are ideal for price-marked promotions, and operators are now utilising apps, allowing them to get to know their customer base better, he said.

The meeting also heard from Adrian Tallant from Eurotank, comparing techniques for cleaning fuel tanks; Kristine Moore from Henderson Technology, who discussed the latest developments in PoS technology and how they can help stores, and Julian Eiers of Edge Petrol who revealed how the company can help forecourts to analyse their data to maximise their fuel pricing strategy.

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