Filling up fast

The announcement last month that farmers' co-operatives in Poland, under the auspices of an organization identifiable as KZRKiOR, were about to form the second largest fuel chain in the country, with 400-500 new stations, thus superceding giants such as Shell, BP, Statoil and Grupa Lotos, (but not PKN Orlen, by far the biggest chain) was designed to cause something of a stir in the market. The farmers were reportedly to sign agreements with financial institutions and investors some time this month, but not all of its potential competitors were that impressed. Whilst Shell acknowledged to Eurobuild that they would be "observing with great interest, the plans of the farmers' co-operatives to create a chain of fuel stations", they also insisted that the new player would not represent "direct competition to Shell's fuel stations in Poland". Torben Tratwal, Manager of the Retail Development & Investment Department at Statoil in Poland, was unperturbed at the move: "It's not a threat," he remarked.

The race is on

Aside from homegrown PKN Orlen's overwhelming presence in Poland, with 1,930 stations, (of which 620 are run by dealers), the rest of the pack currently jockeying for position behind, command around 200-300 stations each. But in the coming years, that figure is due to increase. The Polish Grupa Lotos, (formerly Rafineria Gdańska), the market's number two, has earmarked EUR 43.4 mln to develop its network of stations over the next two years and by the end of 2005, the number will have increased to around 600, from the present 340. As part of this strategy, the company will be constructing new COCO (company owned and company operated) stations, which will involve searching for new sites, via "both internal evaluation of individual proposals submitted to Grupa Lotos, as well as an active search with the help of agents/consultants", they informed Eurobuild. They will also be launching a new partnership programme called Rodzina Lotos, which will "aim to attract new DODO [dealer owned and dealer operated] stations to the Lotos network" and will add 100 new forecourts by embarking on a consolidation process with three southern Polish refineries: Czechowice, Glimar and Jasło. The first tender for the construction of the new service stations will be held this month.

To outsource or not

Grupa Lotos' policy of employing "several agents operating on the Polish market" to both locate attractive plots for stations and "identify possible candidates for acquisitions among existing petrol stations", is not shared by all the other operators. Shell go halfway between keeping things in-house and hiring outsiders. When looking to purchase plots, they rely on their own Network Planning Department but disposal of land is in the hands of Colliers International. The Norwegian Statoil, however, use their own in-house real estate experts, though their task to date has largely involved locating favourable sites. Torben Tratwal, explains his company's position: "You can't find the best specialists for this sector outside the company and it would be difficult to find any real estate consultant who has worked on forty stations, for instance, which is the case here at Statoil. Agents work in several fields: retail, office and warehouse. We just concentrate on one and that makes it easier to make judgments and estimates."

Location and size

Statoil's stations tend to be located near residential areas in big cities, because "market surveys have found that seventy per cent of drivers fill their tanks where they live" according to the firm's company magazine. The 163 COCO stations they run in Poland are dotted all around the country and unlike Statoil's networks in the nearby Baltic States for example, in Poland, the petrol station operation was set up entirely from scratch, so the real estate team has been kept busy since the company arrived here just after the end of Communism. In 2002, the company acquired all eighty-two stations belonging to Preem Polska (a subsidiary of the Swedish Preem Petroleum AB), which was withdrawing from the Polish market. Of the size of the average plot hosting a Statoil station, Torben Tratwal insists no real figure can be given. "It all depends on the shape and circumstances," he says, "you can't just tailor a plot according to your requirements. It could be 1,000, 3,000 or 5,000 sqm." Both Shell and Grupa Lotos, however, can come up with firmer estimates for their stations: the former states that the average plot area is approximately 3,500 sqm" but "up to 5,000 sqm or more for transit stations" and for the latter the average site is 3,500-4,000 sqm. The station buildings themselves are around 200 sqm and 300 sqm respectively. In Shell's case these will be located "along major transit lines and the largest urban areas".