Independent British Fuel Filling Stations Take Over Leading Positions from Petroleum Companies

Jul 14th, 2017

Over the past five years a small number of transactions has led to the price rise for gas filling stations in Britain. According to the Barber Wadlow report, since 2015 the prices of petrol stations in the UK have increased by 60%. Oil companies have long lost their monopoly on fuel sales among the national operators, which contributed to the dynamic development of independent operators.

In 2016 the largest operators were practically not involved in the sale or purchase of gas stations and finally have purchased only 3 out of 30 independent companies being engaged in the modernization and optimisation of existing gas networks. Sales dropped by 85%. In 2015 they sold over 1370 stations while in 2016 only 200 gas stations found their new owners.

Compared to large companies, independent owners take the time to sell their property. Therefore, the average value of assets has increased by 9%. For example, in 2011 the cost of filling stations was 750 thousand pounds, and in 2017 the same station costs 1.2 million pounds.

A low supply of filling gas stations for sale encourages the smaller players to build new ones. In the 1966-2014 timeframe, independent companies did not dare to think of expanding. Correspondingly, the number of stations was decreasing.

Not that long ago operators used to take a lease of gas stations, but now they prefer to buy the refills. However, some companies continue to lease stations. First of all, this behaviour is typical for fuel suppliers who are not strong in marketing.

British Petroleum, Esso and Shell are the key players in the retail market, although other operators are selling their fuel. Since it is not the main business of these brands, independent operators are more efficient in retail trade.

The leaders in fuel sales are those for whom gas stations are a non-core business. Prevalently, they are large commercial networks that own 1450 petrol stations. Therefore, supermarkets are the leaders in sales of fuel – 44% of all fuel sold in Britain.

Independent retail sellers of fuel are constantly improving service standards. Among the British fastest growing independent businesses the experts single out Euro Garages, Motor Fuel Group and MRH, which, in their opinion, in the short or medium term can compete with Tesco and Shell.