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India is the second most populated country in the world with over 1.1 billion people and is the sixth largest consumer of petroleum products in the world. In 1978 Indian oil companies were nationalized which led to an environment devoid of competition, with limited market penetration in rural areas and only a concentration in cities and highways.
Essar was the first private oil company to enter the fuel retail market in 2003. Currently there is increased competition due to the entry of private oil companies but diesel prices, which account for 80% of Indian fuel use, remain regulated.
India has seen rapid growth in the number of fuel service stations increasing from 19,500 in 2002 to 41,000 in 2010. Currently, public sector units such as Indian Oil own 93% of the service stations.
Ajit Mishra, Zonal Head of Essar Oil’s Marketing Division, gave PETROLWORLD Business Forum delegates a compelling insight into fuel retail in India during his presentation commenting that “Essar Oil currently have 1,390 retail units across India and aim to increase this to 1,700 by March 2011. "Essar Oil has 70% network market share on highways and in rural areas and operates primarily on the franchisee format. Essar service stations also offer non-fuel retail products and services including telephone and Internet products, convenience retailing, agricultural and finance products in order to generate additional revenue streams.” Ajit Mishra, Zonal Head of Essar Oil’s Marketing Division Business forum delegates also had the opportunity to experience live demonstrations by Pro Sales Pty Ltd, an APPCO Group company. Pro Sales offer fuel retailers a fascinating & profitable model which sees them rent a small amount of space at the service station from the retailer. Here they demonstrate a revolutionary way to wax and wash cars that results in greater customer satisfaction and return, higher spend in shop and better brand differentiation. LIVE UPDATE: Here is what our delegates had to say about their first day:
"It is now obvious that there are new dynamics at play in the branded marketing sector of the industry. Today we had the opportunity to meet with and gain understanding of these branded marketeers - and explain the value of Gilbarco products to them." Sankhe Swapnil, Marketing Manager, Gilbarco Veeder-Root.
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