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There is one main reason why customers will stop at your site and not another
In most cases, one service station is almost exactly the same as another.
Everyone sells fuel. Everyone sells cold drinks and chips and magazines and juice and chocolates. Everyone sells airtime and has an ATM. Everyone has forecourt attendants and cashiers and food handlers providing relatively good service.
So why would a customer deliberately drive to your service station and not go to one of your competitors? What would increase one site's capture rate above another?
You may have something that nobody else has, that's true. And that may be a very good reason why customers visit your site. But, we believe that it's not the main reason.
The main reason is convenience. Convenience means "the state of being able to proceed with something without difficulty". Convenience means:
- no queues
- no delays
- no questions
- all answers
- all information
- all services
- every time
- every day
- every customer
Some of you might say: "I know that". But, knowing it and doing it are 2 completely different things.
Here's the tricky bit: Is the convenience you provide obvious to your customers? Obvious means: "easily perceived or understood; clear, self-evident, or apparent".
Self-evident is the most difficult one. If it's not obvious to your customers, it won't affect their decision to stop at your site.
That means you may have some incredibly valuable reasons why customers should choose your site over that of the competitors. But, it may also be that only existing customers are aware of them.
Here are 2 examples:
- An "easy" example is where Service Station "A" is more convenient to access.
- Service Station "A" is in XYZ road. It has an entrance and exit into XYZ road and the competitor (Service Station "B"), which is only 100 metres further, has neither an entrance or exit in XYZ road.
- The customer has to turn the corner to enter Service Station "B". That's an OBVIOUS inconvenience for Service Station "B" and an OBVIOUS convenience for Service Station "A". You can see it just by looking down the road.
- The convenience of the entry and exit will definitely increase Service Station "A"'s capture rate of customers driving down XYZ road.
- But, there are still many customers who don't realise this. If Service Station "A" were to put up signage to make it even more "obvious", their capture rate will increase.
- Another example is where Service Station "A" has toilets, just like Service Station "B" has toilets.
- Service Station "A"'s toilets are cleaned every 30 minutes and you don't need to walk all the way to the cashiers to get the key (only to find out someone already took the key). The toilets are open, clean and monitored.
- Service Station "B"'s toilets are cleaned once a day, they remain locked and if you want to enter you need to get the key from whoever has it.
- If you are the Dealer of Service Station "A" you will immediately say that "A" is more convenient than "B". But, unless customers are told about the difference, it won't be an obvious convenience and it won't affect their decision to stop.
- What "A" needs to do is to communicate the convenience to customers as obviously as they possibly can.
- And, they need to communicate it to customers BEFORE they decide to drive into the site, not only when they are already on site.
- A third example is where Service Station "A" is committed to having a cashier at every till, throughout the day, because they know this reduces queues.
- Is this an obvious convenience? It is for every customer who is already on the site and already in the queue. But not to customers who are deciding if they should stop at Service Station "A" or "B".
- Anyone who frequently buys groceries at the supermarket knows the frustration you feel when there are many tills, but few are open. This can be interpreted as a sign that the supermarket CAN serve you much quicker, but have decided against it.
- If Service Station "A" where to advertise the fact that they are committed to shorter queues and faster payments by having cashiers at every till, all the time, it will probably improve their capture rate.
Here are some convenience areas we've spotted at sites:
- Some sites have a speedpoint available for each island so attendants don't have to run around to get one when you want to pay.
- Some sites allow you to pay with Zapper in half the time it takes to pay with a credit or debit card.
- Some sites have pre-packed the sauce, salt, pepper in a folded serviette so the food handler saves a few seconds when serving you.
- The supervisor stays on the forecourt to make sure attendants serve customers in the order they arrived and to make sure attendants work quickly.
- Promotions are pre-packed on the shelf e.g. 2 packs of chips with rubber band around them.
All these examples make the experience on site more convenient. BUT, in none of these examples was it communicated to the customer BEFORE they drove into the site. And in all these cases it wasn't even communicated once you had entered the site. It wasn't obvious.
The more obvious the convenience, the bigger its impact will be on your service station's capture rate. If you want new customers, you won't find them on your site. You have to find them as they drive by and give them a reason to choose your site above your competitor.
We believe one of the best reasons is convenience.
'tasklearn': Learn something new about ...
Stock turn is an indicator of how hard your working capital is working for you at your site.
For example, let's assume you carry R200,000 worth of stock in your shop and your shop turnover is R800,000 per month with cost of sales of R600,000. That means you are able to "turn" the value of your stock 3 times each month.
You calculate this as follows:
- Cost of Sales / Stock on Hand = Stock turn
- R600,000 / R200,000 = 3
The more frequently you can turn your stock, the harder your working capital is working for you.
A good stock turn for your convenience store is 2.5 or higher, excluding airtime, electricity and lotto.
'tasksafe': Health & Safety reminder ...
Whenever you dip tanks you will most likely handle the dipsticks and often get fuel on your hands and forearms. One way to reduce the risk of fuel getting in contact with your skin is to wear dipping gloves.
Dipping gloves are not disposable, or garden or household gloves. They should be chemical resistant. Typically these gloves are made specifically for handling hazardous chemicals like petrol and diesel and are normally thicker and made from nitrile, neoprene or PVC.
Refer to the Material Safety Data Sheets (MSDS) of the fuels you have on site and check under Personal Protective Equipment - hand protection.
The content in this article was provided by FUTURENT Consulting – a management consulting company focusing on Wholesale, Retail, Franchise and Industry Related Organizations.
For more information, contact:
Tel: 012 804 5066