Are You Following One Of These 7 Strategies For Your Site?
Here are 7 of the best strategies to follow at your site
You may look at the strategies below and think, "let's do all of them". The difficulty is there are never enough resources and time to do everything. And to do it well enough so it makes a remarkable difference in your volumes and turnovers. You need to really invest your focus and energy into the strategy.
You need to get past the easy, quick win elements of your strategy and get into the difficult parts. It's only when we do what most people are NOT willing to do that we get different results. Doing what everyone else does will only give you what everyone else gets.That's why it's often better to pick one and focus 110% of your time and energy on it for a specific period.
1. Convenience:
The basic principle is to focus on making it as easy as possible for your customers to buy your products and services. You must aim to remove every single obstacle and constraint in your customers path.
The entire visit, from driving into the site to the moment the customer exits, must be seamless.
E.g. if your focus is on convenience, queues in front of your cashiers are unacceptable.
2. Diversification:
The focus here is on developing businesses within the business. This means taking certain business units and treating them like a stand-alone business. You can't rely on one business unit subsidizing another. You also need accurate financial information for each business unit including stock values, margins, operational expenses, profitability, etc.
Another way to think about it is to say: "how would I plan, run, market and grow this business unit, if it was the ONLY business I had and it wasn't part of the service station"
E.g. Airtime, Food Offer, Car Wash, Shop & Forecourt are all examples of business units. That means you need to manage each of them as if it was the only business you had. You can't rely on one unit to subsidize another.
3. Fuel Accounts:
Fuel accounts can either be a great way to drive new volumes, but it can play havoc with your cash flow cycle. The intention here is to sign up new clients, who pay in advance, and to keep those accounts for an extended period of time
Basically you are a "key accounts manager". A key account manager's job is to sign up new accounts and keep existing account holders happy. That means personal attention, direct access, immediate response to issues, etc.
E.g. a key account manager will break an area into regions, profile the ideal type of client, and do cold calling and personal selling to get them signed up. And then provide individual feedback and attention to those clients.
4. Personal Relationships:
This strategy is often linked to a Dealer with a specific personality type. Building personal relationships with customers requires authenticity, genuine care and lots of time and energy.
The pay-off, if done right, is that customers will deliberately drive past competitors to visit your site, because of the working relationship they have with you. They know that you will recognize them when you see them, ask about their day and the challenges they face and genuinely care about them as a customer.
E.g. this often requires that the Dealer spend a lot of time outside of the office, especially during peak periods, and speaking with customers in the shop and on the forecourt. But, the difficulty is that the Dealer must do this consistently over an extended period of time so customers come to expect it.
5. Marketing:
Marketing is not just running a few promotions and putting up some posters. There is a misunderstanding that marketing is something you do TO your customers. Nowadays it's something you do WITH your customers. Having a marketing strategy means drawing up quarterly marketing plans and working hand in hand with your customers to build a community of supporters.
It also means that your entire team, from cleaner to manager, must play a part in your strategy and communicate with one voice to customers. The goal is to develop trust and it is one of the most difficult things to get right with your customers.
E.g. ask yourself what the 1 or 2 words are that customers say represents your site the best. That will either be something positive to build on e.g. excellent service, or it will be something negative to reverse e.g. rude staff.
6. Technologies:
There are a number of technologies we're using every day to run our sites e.g. PC's, smartphones, speed points, tagging, etc. New technology is changing so quickly that it can be difficult to keep up. And even more difficult to decide which technologies to implement on site.
Making technology a strategy entails using it to improve productivity and performance. This can be done through e-learning, health & safety support, back office management, financial reporting, and more.
E.g. health & safety has always been an area of major non-compliance for sites. New technologies make it possible to setup a full year's scheduling, audits, reminders, checklists and reports and sites simply have to follow the reminders every week.
7. Margin Optimization:
Making margin optimization a strategy may sound slightly odd. You might say that margin optimization is already part of daily operations. What we're talking about here is taking it to a whole new level. This typically means reviewing a lot more data about each product and service.
This strategy requires much more detailed financial information and intense review of every item being sold, its supply chain, its planogram, its sales frequency, its stock turn, its margin contribution and more. It's about getting every cent of potential margin out of every product and a detailed investigation of every expense.
E.g. this is not about cutting costs and lowering expenses, it's about taking a single product and making sure that you're getting maximum profit out of it in return for the space, working capital and attention you give it.
There are other strategies as well, but we believe these 7 are some of the most successful.
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3 financial pitfalls to avoid:
Cross subsidizing – This refers to one department or business unit's profits being used to keep another department or business unit afloat. If that is a conscious decision the Dealer has made and it benefits the site as a whole, that's fine. But, if the financials of each business unit isn't clear and you can't determine each business units profitability, that is a serious pitfall to avoid.
Making decisions based on old information – This refers to scenarios where the Dealer gets financial information a month or more late. E.g. the April management accounts are only available in June or later. Not only is this a high-risk scenario, but the Dealer will have to wait even longer to see if his/her decisions has had an impact on the financial results.
Not using system reports – This refers to scenarios where system reports are largely ignored. It can be because the Dealer is not aware of certain reports, or doesn't know how to draw them. There should be an equal "interrogation" of system reports just like there should be of the monthly management accounts.
The content in this article was provided by FUTURENT Consulting.
About FUTURENT Consulting:
FUTURENT Consulting is a management consulting company. We focus on Wholesale, Retail, Franchise and Industry Related Organizations. We follow a systems-based approach. We’ve utilized our decades of experience in the ownership and operation of a variety of businesses to develop, manage and implement projects for small, medium and large companies. We provide management consulting services in segments such as Fuel, Tyre Fitment, Retail, Government, Properties, Training, etc
For more information, contact:
Website: https://futurent.com/
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Email: info@future-ent.com