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The changing face of fuel station forecourts

28 January 2021

With the first of 100 planned electric charging forecourts set to open in the UK this week as part of a £1 billion development programme, forecourts are set for major changes in their look and feel, and the way customers use them. To paraphrase Star Trek’s Leonard H McCoy, the Enterprise’s chief medic – “It’s a forecourt Jim, but not as we know it …” Eva Jones, Head of Product Development and Innovation at Suresite, shares her insight on how times are changing for our forecourts.

Take a good look at the garage forecourt you use, because times are changing – and over the next few years you might not recognise the place you go to refuel. The reason is contained in recently released Department of Transport figures showing that during 2019, 79,747 ultra-low emission vehicles (ULEVs) were registered for the first time in Great Britain, an increase of 26 per cent in 2018. ULEVs made up 2.7 per cent of all new registrations in 2019, and although it’s taken 10 years to get to this position the government is increasing the pressure on transport to switch to zero emission vehicles. The primary focus of this drive, being on electric vehicles (EVs), despite some questions on the National Grid’s capacity to provide sufficient power to meet demand.

Forecourts serving a local community will install first-generation charging systems rated up to 150 kilowatts (kW), to charge EVs, but the future lies with new ‘retail hubs’ providing faster charging technology – 300kW plus, coupled with combined café / shop/ workspace infrastructures to service customers interested in optimising the time they spend ‘refuelling’. Such installations are major investments requiring on-site electrical sub-stations to provide necessary power.

EVs are already having an impact on forecourts – it’s no longer a less than five minute stop to fuel your vehicle. With EVs on a typical retail forecourt, it takes about 35 minutes to deliver enough juice to provide a 100-mile range for your EV – significantly longer than a liquid fuel refill. The EV charging unit must also be located at some distance from petrol / diesel pumps, which means service stations must have a large enough footprint to accommodate ‘parked’ vehicles.

Can fast-to-refuel Hydrogen be a viable renewable contender to EV?

What about Hydrogen Fuel cell vehicles? Although the technology is proven, there aren’t many hydrogen fuel stations currently in the UK, compared with normal petrol stations. There are limited trials and production of such vehicles, although they do have a similar range to normal petrol and diesel cars and the fill-time is the same, making them much more compatible with existing service station infrastructures. The current rate of adoption, however, puts them firmly behind EV uptake.

Why increasing time spent could equate to spending more

You can already see more food and beverage offerings – for example retailers like Subway, Costa Coffee and Starbucks, are seeing the new-look forecourt as an opportunity to exploit this extra dwell time into sales. Whilst long established in motorway or trunk road service stations – these retail sites are much less prevalent in urban and suburban fuel sites. There’s also an increase in co-locator supermarket alliances like Shell / Waitrose, and BP / Marks & Spencers, where customers can do their weekly groceries shop while waiting for their vehicle to charge. Convenience is king and time is money, so customers want to make efficient use of their time, making their visits to forecourts ‘multipurpose’ instead of the traditional ‘fuel and go’.

The impact of this longer dwell time will be a change in consumer spending patterns, moving from ‘grab and go’, to destination shopping. With the expansion of convenience retail growing eight per cent year-on-year, other opportunities will present themselves. For example, providing a place to work – so-called work pods – soundproof booths with Wi-Fi access. Margin share will shift from fuel products to non-fuel products with oil giant Shell having set an ambitious target of reaching 50 per cent non-fuel retail (NFR) profit by 2025. This will see forecourt operators investing heavily in their NFR offer and making trade-offs to facilitate a broader offer, to cater to a broader set of customers.

With price and location typically the primary drivers for customer selection of a fuel station – we’re seeing a growing trend in forecourt operators focusing on additional footfall drivers such as customer experience, loyalty programs and the quality of the NFR. Insights in these areas are key to facilitating a differentiated offer which sets one forecourt apart from another.

Location, location, location

One problem with the demand for these extra facilities could be issues with site planning and location. The power grid cannot manage home charging in congested, urban areas, so there’ll be a need for local charging centre hubs. The current standard urban/suburban forecourt could have, say, eight fuelling positions. Since customer turnaround is relatively quick – 3-4 minutes per customer depending on whether it is ‘pay at the pump’ or pay at the till, a site might be limited to managing 48 customers per hour. A similar site with eight EV recharging stations will handle less than 16 customers per hour. Another question is urban sites’ ability to manage the demand. The many engineering restrictions on EV charging installations, especially when combined with those for petrol/diesel installations – means EV charging units will primarily be located on motorway service stations and hypermarket car parks where there is sufficient space.

Not that long ago, garages were seen as dirty, oily, and smelly – a place to buy oil and wiper blades whilst you filled your car with petrol. The new fuel formats invasion of local and large motorway service station forecourts will see continued growth of convenience retail with significantly more products stocked – food and beverage brands for example. Customers will want and expect clean places to sit, places to work, as well as alternative ways to pay – like ‘pay in car’, ‘pay at the pump’, together with automated pay options for charging their vehicles. Until recently there were signs in forecourts saying “Do not use mobile phones’. These may reduce as mobiles become increasingly used as a method of payment.

Fuel stations will become ‘service’ stations in a true sense of the word, a ‘one-stop-shop’ destination point, where customers can fulfil multiple purposes in a single trip. The customer experience will be key, and they’ll want convenience, quality of choice and safety above all else. As carbon footprint awareness grows, customers will want to see more eco-friendly layouts and oil companies seriously committing to reducing their carbon footprint.

Written by Eva Jones, Head of Product Development and Innovation at Suresite.

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