With the number of fully automated fuelling sites rapidly increasing in certain Eastern European markets over the last three years, Benzina has become the latest company to add to the trend.
Given the cost benefits to be gained from unmanned networks, the move will provide Benzina with a strong position as competition increases and margins are squeezed. Benzina, the fuel retailing arm of Czech firm Unipetrol, is the latest example of a European fuel retailer expanding its unmanned network. The company has launched a new self-service refueling system for truckers, which will be operated by Kuwait Petroleum’s International Diesel Services (IDS). With its seven unmanned self-service sites, Benzina claims to be the first company in the Czech Republic to introduce the IDS refueling system and plans to further expand the relationship with IDS at other sites across the country. The launch of Benzina’s unmanned sites comes as growing numbers of fuel retailers expand their unmanned networks, especially in Eastern Europe. Although the penetration of unmanned service stations into the public refueling network is limited in the Czech Republic, growth has been high in neighboring markets.
Estonia has seen particularly strong growth with the number of unmanned sites increasing from 62 in 2004 to 125 in 2007, accounting for 24% of all public filling stations. This is the highest proportion of any Eastern European market. There has also been strong growth of unmanned sites in Poland, where the number of sites increased from 45 in 2004 to 82 in 2007. The main reason why unmanned service stations are popular with fuel retailers is, that they do not require any cashiers, and as such as they are cheaper to run. This means that fuel can be sold at a lower price. Furthermore, as unmanned service stations require less investment, it is viable for fuel retailers to provide a refueling network over a wide geographic coverage and serve customers in thinly populated remote areas.
The move to expand automated sites in Eastern Europe, in particular, is likely to be a shrewd move. As these markets mature over the next decade, margins will be squeezed, competition will become more fierce, and as a result the sector will consolidate. In such an environment, fuel retailers with a large proportion of low-cost unmanned sites will be in a strong position to fend off the competition and actually gain from the consolidation process. Benzina could therefore be one company that benefits as the market matures over the next few years. (Petrolplaza)