Thursday, April 9, 2009

Meet the New Boss, Same as the Old Boss - Big Oil and Alt Fuels

Source Article: Oil Giants Loath to Follow Obama’s Green Lead | (article)


1) World still hungry for Hydrocarbon-based energy

2) Electric Transportation will require new infrastructure

3) Plug-in electrics have technical and cost hurdles to clear before becoming competitive

4) Oilco Capital better spent on immediate consumption needs

5) Liquid Bio (Renewable) hold better immediate promise


The Major Oil Companies apparent reluctance to invest in alternative energy plans to supplant the current dominant product class - hydrocarbon based fuels, is easy to understand.

Look at the ethanol business in the US. With much hype and great hopes going forward, most of the ethanol producers are in bankruptcy, victims of the volatility in Oil prices and the global economic downturn. Valero(NYSE:VLO) purchasing VeraSun's refining capacity after VeraSun filed for bankruptcy, announced a couple of weeks ago, is endemic of this situation.

Valero(NYSE:VLO) has announced they will use this capacity for their own blending needs. Instead of a potential large customer, they are now a producer with captive demand. It lead me to say in a prior article about green energy investments; "Meet the New Boss, Same as the Old Boss".

Valero(NYSE:VLO) will be one of the largest, and for sure the most economically healthy, ethanol producer in the US as of the completion of the sale. AND they got the assets at a large discount vs the development costs.

When it makes economic sense to invest in alternative and renewable energy, the Oilcos will do that. There just isn't a business case for it yet.
BP, ExxonMobil(NYSE:XOM), Total, Chevron(NYSE:CVX) all are doing research, but that's it for now.

While people don't understand why, the answer is simple; the best use of capital for an oil company is to produce more oil at this point in time. The world economy was built for and still thirsts for oil.

Plug-in electrics are a ways from being more than a "Special use" replacement for a conventional vehicle, whether gasoline fueled or some sort of hybrid and alt-fuel powered iteration of it. Electrical vehicles that aren't producing power onboard, like a pure plug-in, will need a whole new transportation "Sub-infrastructure" designed for it.

Liquid renewables seem to have the most development potential for fast adoption and economic viability, but the ethanol wipe-out for the corn-based producers shows there needs to be new technologies and feedstock found to make it a viable long-term model.

Until there are real government measures put in place to protect renewable fuel investments and resources, the Oil companies are better served to watch the "experiments" that are taking place begin to become commercially viable before jumping in.

This may not seem a very "Green" argument to make, but until there's "green (money)" in going green, don't expect more than research from the big Oilcos.

Waitrose brings Upscale Convenience to Hurried Consumers in UK

Source Article: Waitrose to open in motorway service stations | (article)

1) This format has worked well in the US

2) Foodservice component accelerates consumer acceptance

3) A good way to practice "Brand Extension" without getting too far from core offering


Waitrose testing two smaller-format stores based on Highway traffic / Petrol linked traffic as the primary driver is a very, very good idea. The idea of high-quality prepared foods and better fare than generally found in a "C-Store" setting is a winner when done correctly.

Whether in the US, UK or the rest of the EU, people are in hurry and feel rushed for time. The tradeoff of good quality "home time" with the family can still be a good offset to guide an expenditure decision, even with consumer confidence at a low.

As long as there's no discernable quality drop off in service and merchandise from the "traditional" Waitrose Stores, this should be a real winner.
We helped develop a store and Brand some 15 years ago that worked straight along the same thought processes- High Quality food in an upscale convenience setting, and it worked quite well and was very profitable. We were considered quite groundbreaking at the time with the “NexStore” concept developed and built when I was the COO for Knight Energy in Boca Raton FL.

Great Service, uncommon food offering prepared by Chefs, a few hours a day of full service fuel at no additional cost, selection of mid-priced and fine wines, frozen yogurt, it was a real frontrunner in it’s time and day.

The long-term success of concepts like this by Waitrose are all about execution. You can’t just “talk a good game” or look upscale, you need to deliver on those promises. If you do the payoffs are good and long-lasting. It's a good move fo the Brand

Wednesday, April 1, 2009

Eight Ways to Freshen Up your Store and Energize your Employees

This was written by Darcee Santicola and was the feature article in Volume 1, Issue 9 of Condevco's "The Meter" Newsletter, distributed on March 28th.

SPRINGTIME… A time reserved for the renewal of surroundings and spirit.

As a residential and commercial designer/space planner, this time of the year has always played an important role in the energizing of our client’s spirits along with their employees’ and customers’ as well. We all enjoy feeling refreshed after the winter months, especially with the economic times we’re living in. Change no matter how small creates excitement.
Here’s eight ways I feel will help start you on your way to achieving this goal.

1) Painting. A fresh coat of paint works wonders. Then there’s what I consider “creative painting”. Adding color be it to create customers purchasing excitement, enhancing designated areas of the store including restrooms, or to draw attention to specific promotional displays is always an inexpensive solution. Painting of graphics is one of a designer’s tricks in creating an illusion of spaciousness. Also, a change of scenery for employees has been proven to create an increase in productivity. If budget permits, having a professional work out a schematic especially designed for your store is well worth the investment, however if this is not possible, browsing through the trade publications such as Convenience Store News, CSP or NPN with a keen eye for inspiration can be helpful in achieving your goal.

2) Lighting.

A well lit store and canopy is essential. I’ve also found by adding a few specialty fixtures in featured areas creates warmth and a sense of quality for your customers. A wide range of pricing for these fixtures are readily available in accommodating your needs. It’s a quick way to give a modern update to a space.

3) Floor Rearrangement.

Rearranging shelving and cooler space from time to time is so important. Creating a new traffic pattern engages customer interest while providing longer store visits. It also helps to stimulate employee’s interests as well.

4) Special Promotional Decorating.

It’s all about creating excitement. Take full advantage of this opportunity. Have fun with this and really go for it.


5) Employee Image.

Providing new uniforms or uniform shirts is a great morale booster. Sometimes just a change of color or style modification is all that’s needed.

6) Employee recognition and incentives.

Sometimes it’s very easy to become complacent when it comes to our employees. They are the backbone of the convenience store business and needs to be recognized for their efforts. Also, having “fun“ contests is a good way to achieve this.

Here’s one of our favorites: “Boss for a Day” . A contest using management created criteria for customer service personnel runs for a short period of time. Winner is determined by contest rules. He then switches places with the Manager; in which the employee becomes the manager for the day while the manager works employee’s position. This fosters teamwork and an appreciation of each others positions. A win-win situation.

7) Promotional sales leader.

When putting together a special promotion, having a friendly competition among the staff or the staff of other branch stores is an added production achiever. Many options are available to managers as to what the prize and or award could be.

8) Customer service.

Providing a “paid” training session is extremely productive. In these economic times it’s more important than ever to give exceptional customer service especially with your regulars. Having a staff show a special recognition to them means so much. When a customer was greeted by their name or an having their customary purchase remembered they became loyal customers for a long time to the point of making special trips just to receive such treatment. Employees need a refresher on company policies dealing with customer service. Again, there’s added and updated data and manuals available to owners by Condevco and others for just this purpose.

Let’s make Spring a happy, positive and profitable season by using some or all of the above suggestions.

Darcee Santicola