 Petro-Logic, a subsidiary of industrial engineering group PSV Holdings
Limited (“PSV”), and a leading supplier of fuel dispensers and
maintenance services to the South African petroleum industry, has to date
completed about 75% of the modification or replacement of liquid fuel
dispensers which cannot display a price per litre over three digits for
its clients.
This year has seen the retail price of petrol in all pricing zones increase to a four-digit number. Certain of the liquid fuel dispensers cannot display a price per litre above R9.99, displaying only up to three digits. Herein lies the opportunity for Petro-Logic. “The modification and replacement of pumps will represent additional income for Petro-Logic and will also impact positively for the company in terms of upgrading and refurbishment contracts in the long term”, says Phillipe Pretorius, the newly appointed Managing Director of Petro-Logic.
At a stakeholder meeting held earlier this year at SABS Regulatory, owners of liquid fuel dispensers were advised to undertake an intensive campaign to modify or replace the affected dispensers and all modification or replacement of affected liquid fuel dispensers is to be completed by end 2008 to Approved SABS standards. Up to 18 000 hoses of liquid fuel dispensers are estimated to be affected. The petroleum industry is highly regulated and subject to regular spot checks for health and safety compliance and Petro-Logic is proud of its ability to meet the criteria.
The high price of fuel, leads the public to not drive as much, so there is strong competition between service stations. This means that stations are not able to have non-functioning pumps which translates into a key opportunity for Petro-Logic in terms of their refurbishment and replacement contracts. “We are able to supply interim replacement pumps for a client so that no business is lost”, says Pretorius.
The bulk of revenue received by Petro-Logic is from service contracts from large petroleum companies such as South Africa’s biggest oil company Engen, and other clients such as Total and BP. A service contract with Engen provides a Customer Service Centre for Engen dealers nationally.
“Our call centre facilitates highly responsive field intervention through our 54 technicians who are strategically situated around the country”, says Pretorius. Some sites also service outlying areas such as Lesotho which is serviced from Bethlehem. Calls are evaluated on a scale from “critical”, requiring a 2 hour response time, to low where the response time may be 72 hours. The Gauteng call centre is in the process of being moved to the PSV Holdings Head Office in Germiston.
As a value-added service Petro-Logic is also involved in point of sale software which manages and details sales, stock levels, as well as usage rates. In addition to these services Petro-Logic is involved in the service, maintenance, calibration and commissioning, refurbishment and installation of petrol station forecourts.
“To cope with the high demand we are planning to enlarge the pump refurbishment facility to be able to at least double the daily output”, says Pretorius. “We have had up to 50 accident pumps, those damaged by drivers, in a month”.
Petro-Logic is the main distributor of high end strategic Tokheim materials, and is the local manufacturer of Tokheim-branded equipment, and this remains the core activity of the company. Petro-Logic’s Tokheim distribution agreement includes the supply of parts and complete units to a number of other countries in Africa. “This is an important foreign currency earner for the company”, highlights Pretorius.
As a member of the PSV Group Petro-Logic is able to leverage the already existing realtionships up on the continent. “They will be able to use established offices from which to launch their own services and set up service centres”, adds PSV CEO, Abie da Silva. “Our strategy is to provide, for the customer, a one-stop shop for supply, installation, commissioning and maintenance, and to increase our share of the market and expand geographically” concludes Pretorius.
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