MELBOURNE, Australia – The Australian convenience store sector could soon experience a major transformation with a recent deal between BP and Woolworths, reports The Australian.
The news source writes that fuel companies in the country are investing more on the retail side of the business, as more consumers demand better food and in-store merchandise along with their fuel purchases. After a six-month process, Woolworths is selling its 527 service stations to BP, “an agreement to build a network of more than 200 Metro at BP convenience sites” and provide more fresh and ready-to-eat foods.
“That BP, whose global revenues have been slashed by low oil prices, is prepared to spend big money acquiring and developing more Australian sites is an indication of the potential that the petrol station owners see in the convenience business,” writes the news source.
The news source also notes that Woolworths CEO Brad Banducci toured BP sites with c-store partnerships in Britain, Germany and South Africa, which sealed the deal for a new BP and Woolworths venture in Australia. “We have a great record in getting into partnership with really good food retailers,” said Andy Holmes, president of BP Australia, who accompanied Banducci on the tour. “People are short of time, they want it easy, they want it fast, they want good quality and a great range, and we know when we get that right with a great partner, we can grow in a highly distinctive manner,” Holmes added.
In Australia, Holmes told the news source that there is potential to transform the market: “The playing field is more open here compared to Europe because of the way the market has developed—there is a lot of unfulfilled need here in the sense of an easy, fast, quality range.”
BP is planning to rebrand the Woolworths locations, which currently sell Caltex-branded fuel, while continuing with Woolworths’ loyalty programs.
“This is highly strategic for Woolworths; they see a great future in convenience, a lot of growth, and together we are going to be able to grow,” Holmes told the news source.