With a network comprising around 1,500 service stations in Portugal and Spain, retail is responsible for approximately 30 per cent of sales to direct customers. In the Iberian Peninsula, Galp Energia sells almost 3.6 million tonnes through its distribution network.
In 2010, our market share in the Portuguese retail market based on sales volume was 34 per cent and 6 per cent in the Spanish retail market.
Integration of Agip and ExxonMobil
At the end of 2008, Galp Energia acquired the service stations of Agip and ExxonMobil in the Iberian Peninsula, and achieved similar sales volumes in Portugal and Spain. At the end of 2010, the network of Galp Energia stations in Spain reached 620 filling stations and covers the whole Spanish territory.
Both acquisitions are part of Galp Energia's strategy. They foster an increase in the size of our Iberian operations: our main market for oil products.
Operation models of service stations
Galp Energia has a multifaceted management strategy of filling stations, which are classified in four categories:
CoCos (Company-Owned-Company-Operated)
CoCos are service stations owned and managed by Galp Energia. Located in large cities and on highways, their annual sales volumes generally exceed 5,000m3. CoCos offer a broad range of services, such as shops, car repair shops, car wash services, hotels and fast food restaurants. CoCos are the first service stations to promote Galp Energia's new services and products.
CoDos (Company-Owned-Dealer-Operated)
CoDos are service stations owned by Galp Energia but explored by resellers. Generally, CoDos have annual sales volumes between 3,000m3 and 5,000m3 and offer a smaller range of non-fuel products. CoDos are usually located in small and medium-sized cities.
CoFos (Company-Owned-Franchise-Operated)
CoFos are service stations owned by Galp Energia and managed under a franchising model. In 2009, six new service stations began being managed under franchising, totalling 88 service stations in the Iberian Peninsula. This model, which we will develop in the retail segment of marketing oil products, will help increase profitability in this business.
DoDos (Dealer-Owned-Dealer-Operated)
DoDos are service stations owned by resellers and explored by resellers. Located in small cities and in the country, DoDo’s annual sales volumes are generally lower than CoCos. The offer of non-fuel services depends on the owner. DoDos help sell products and promote the Galp brand in areas with low sales by offering a small range of non-fuel services.
In Portugal, most stations are managed under the CoDo model. With around 800 service stations in Portugal, almost 100 are CoCos.
Offer of the retail segment
Fuel
Currently, Galp Energia offers three fuel lines to its clients: Galp Gforce (fuel with high-performance additives – diesel, gasoline 95 octane and gasoline 98 octane), Hi-Energy (normal fuel with additives), and LPG Auto or Autogás (fuel composed of propane gas).
The offer of the Galp service stations reflects the Company's investment in the premium segment. This involves introducing a higher product line for each base product. Our unique strategy in the Portuguese market reflects that innovation is at the heart of our business.
Sales strategies
To increase customer loyalty, Galp Energia developed several innovative programmes, including the Fast Galp programme of points saving, which is valid in Spain and Portugal.
The fast cards award points to customers every time they buy fuel or non-fuel products in service stations. Customers may use these points to receive discounts in shops, cinemas, car rental services and other commercial establishments, or win gifts available in service station shops.
With over one million active users, the Fast Galp programme is currently the largest customer loyalty programme of its kind in Portugal.
The Galp Frota cards are credit cards aimed at corporate clients with car fleets. The Galp Frota cards also provide discounts on consumed volumes.
Galp Energia and Sonae have a partnership entitled Promoção Vice–Versa 5+5 (5+5 Vice-Versa Promotion). The promotion gives customers of Galp service stations and Continente and Modelo (two large supermarket chains), discounts on shopping in the supermarkets and Galp fuel, this discount represents up to €0.10 per litre.
This partnership is the largest discount programme in the Portuguese filling station market. It accounts for a volume of 275,000m3 sold in more than 390 filling stations that participated in this initiative.
The non-fuel business
Increasing sales of non-fuel products has been one of the main catalysts of growth in our fuel distribution business. The increase has also mitigated the effects of the general fall in oil product sales within the distribution market of oil products. Galp Energia has expanded its store network, Tangerina, as well as washing services, car repairs, hotels and restaurants. This range of non-fuel products is supported on strategic partnerships with Sonae and Midas (car repair service).
The new Tangerina concept, launched in 2008, aims at refurbishing store spaces and renewing its product range. Galp Energia consistently adapts this range to meet most recent convenience needs. Our work involved decreasing the product range within the grocery category, and reinforcing impulse shopping categories by launching new products. Streamlining the range involved removing almost 2,000 products, which equates to 60 per cent of the previous offer.
At the same time, Galp Energia reinforced its offer in high-potential segments by offering books, CDs and telecommunications. We achieved this by establishing partnerships with relevant operators in those businesses.
Galp Energia made service and a cafeteria offer strong features of change, and created Tangerina Caffé. The Tangerina Caffé is a new brand within the Tangerina offering, featuring an exclusive concept and design of the cafeteria space and the food service.
Galp Energia's filling stations offer other services through partnerships with renowned hotel chains, fast-food restaurants and car maintenance and repair services, such as Ibis Hotels, McDonald´s, Burger King, Pizza Hut and Midas. Agreements with these companies follow several models, from partnerships to rents that vary in line with revenues.