BPCL's Petrol Pump Retail Revolution
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Details
Themes : Retailing
Period : 1995-2001
Organization : BPCL, IOC
Pub Date : 2001
Countries : India
Industry : Energy & Utilities
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Case Code : MKTG016
Case Length : 6 Pages
Price: Rs. 200;
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The Retail Initiatives - Phase II Contd...
The company closely monitored the performance of these retail outfits and through customer feedback. Based on its findings and the recommendations of consultants Dhar & Hoon, BPCL realized that it needed to further modify and improve the 'Bazaar' stores. BPCL's research on these outlets across the country revealed that most of the customers arrived between 8 pm to 11 pm, usually on their way back from work. So, the company decided to keep the stores open till at least 11 pm. BPCL realized that a lot of the products being stocked, like soft toys were not really selling. As a result, the company reduced the range of products being carried and focussed on impulse products like chocolates and essentials like milk.
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In January, 2001, BPCL further upgraded the 'Bazaar' stores and, a month later, launched the 'In & Out' stores at around 40 outlets in Bangalore, Mumbai, Delhi, Kolkata and Chennai. A BPCL spokesperson said that the stores intended to offer all the 'top of the impulse' items to customers. The company planned to convert the complete 'Bazaar' network into this new and larger concept in a phased manner. Around 600 outlets were targeted in the first phase of expansion. After the metros, BPCL planned to launch these stores in north Indian cities like Chandigarh, Amritsar, Ludhiana, Jammu, Jaipur, Udaipur, Lucknow, Agra and Meerut. |
These companies were all given counters within the stores for selling their services. The 'In & Out' stores remained open till around midnight and reopened around 4 am. The company was closely watching the traffic at each outlet and was planning to extend the working hours if needed. The 'In & Out' outlets offered Internet browsing facility, along with assistants to guide the customers with their online shopping. BPCL also proposed to use the Internet facility to deliver products to consumers in a timely and cost-effective way.
While products could be sent to the customer's geographical area easily, it was not always easy getting them to their houses when the customers were home to receive the goods. BPCL proposed to use the solution developed by a US based company Peapod, which used the local petrol pump as a delivery point. The products were delivered to a BPCL outlet so that people could come and collect them. The customers could even call the outlet when they were home for the goods to be delivered. Thus, the petrol pump acted as a convenient channel between the companies and the customers.
One of BPCL's innovative plans concerned the distribution of LPG cylinders. A company source said, "For couples who are both out of the house on work, getting the gas cylinder delivered is a big problem." This prompted the company to implement a Fixed Time delivery system, where arrangements were made with the local dealer, or even over the Internet, to have the cylinder delivered at a particular time, rather than in the course of the delivery man's rounds.
With an investment of around Rs 6,00,000-9,00,000 per 'In & Out' store, BPCL expected the convenience stores to break even by February 2002. The company was expecting daily revenues of Rs 25,000-30,000 from the bigger stores and Rs 8,000-10,000 from the smaller ones. BPCL's rivals, IOC and HPCL, had also begun refurbishing their petrol pumps - IOC's stores called 'Convenio' were running very successfully across the country. The one who gained the most from this new found retail focus of the oil companies, was the customer.