"Inaccurate fuel figures mask massacre of independents" – PRA

Surprising new data from Government confirms that Supermarkets now have a much higher share of the UK market for retail transport fuels than previously admitted. The latest combined total for petrol and diesel sees an increase to 46.5 per cent in 2012. This compares with the official total of just 39 per cent for 2011 quoted in the Deloitte study and also 39 per cent for 2012 stated in the Office of Fair Trading (OFT) report, such figures were clearly far from being accurate.

The statistical data on retail fuel volumes since 2008 has recently been revised on the Department of Energy & Climate Change (DECC) website, after gross reporting errors were uncovered by officials. Brian Madderson, Chairman of the Petrol Retailers Association, commented “5,000 forecourts have closed since 2000, another 175 closed last year and the independent retailers are continuing to get massacred by the aggressive discounting and below cost sales tactics by supermarkets.

“There was considerable complacency evident in the Deloitte and OFT reports which assumed that supermarkets’ volumes were levelling off and so the market was steady. However, we warned Government that the 2012 Christie study indicated that supermarkets are trying to open up to 50 new forecourts for each of the next four years.”

This data revision indicates that the average hyper sells 12 million litres per year and independents 2 million litres. Thus every new-to-industry opening by a hyper could suck up the entire fuel volume of 6 independent retailers in the local area and jeopardise the business of at least 10 existing forecourts every year if such expansion proceeded. This is will be bad for competition, bad for consumer choice, bad for jobs at local family firms and bad for rural communities.

Madderson advised, “This re-jigging of key market information underpins our members’ real concern that the UK’s energy resilience for retail fuels is at stake. If this situation is allowed to continue, there will be an inevitable acceleration in the number of site closures to more than 300 per year. Thus there will be a severe worsening of supply resilience from fewer sites with low stockholdings.  

“This should ensure that our request to DECC for a round table review of the independent forecourt industry will receive the full attention of Michael Fallon MP, Minister for Energy, in the coming weeks.”