As shoppers become increasingly time-pressured, convenience is a growing necessity, and South Africa's forecourt stores have positioned themselves effectively to meet this need, says Trade Intelligence.

Understanding the dynamics of this channel has thus become fundamental for FMCG suppliers and manufacturers wishing to capitalise on this growing sector, Trade Intelligence adds. 

A Growing Sector

According to the report, an interesting paradox is playing out in forecourts; while fuel sales are declining, sales in their retail stores are growing.

The Trade Intelligence report found the following:

  • South African fuel sales have dropped 7.6% in 2022 / 2023 versus 2018 / 2019
  • Forecourt retail sales grew 8.5% in 2023 to R33-billion versus 2022 at R30.7-billion
  • Fuel forecourt footprint has increased 14.5% over the last five years; 582 net new forecourts have opened since 2019, indicating that fuel retailers are ramping up their focus on forecourt retail to supplement revenue.

"As fuel sales continue to decline, non-fuel retail offerings are gaining prominence in the forecourt sector," says Sandy Sutton, retail analyst at Trade Intelligence.

Sutton says that, as such, the forecourt retail market remains a growing opportunity, with most fuel retailers expanding their footprint and in-store offerings and some new players entering the space. 

An exception is Shell, which recently announced its plan to divest some of its South African assets, including its 600+ service stations, according to the report.

This decision is not limited to South Africa and is in line with a shift in Shell's global strategy to divest retail fuel stations. It is still unsure how it will play out exactly, but the 600+ forecourt stores will end up in new hands.

Fuel Retailers Expanding Partnerships with Food Retailers 

"Forecourt convenience stores have evolved into one-stop shops, with an increasing breadth of products, quick service restaurants and value-added services, often in collaboration with specialist retailers and suppliers," says Sutton.

The report shows that the retail partnership forecourt footprint has increased 69% over the last five years, with FreshStop (Food Lover’s Market) having the highest number of partnership locations at 348 within Astron Energy forecourts.

But what Drives the Shopper to a Forecourt?

"Forecourt stores are increasingly associated with meeting immediate needs for on-the-go shoppers," adds Sutton. Ease of shop and location are hygiene factors, but customer service can be a critical differentiator. When it comes to driving fuel choice, rewards programmes dominate, with most fuel retailers now offering both proprietary and partnership loyalty programmes. 

Another prominent focus is fast food, says the report. Sixty-eight percent of forecourt shoppers buy takeaways and the fast-food brand available is a big drawcard, with 66% of shoppers noting that the fast-food brand is important to them.

The Trade Intelligence report concludes that for those who do not shop at forecourt retail stores, their biggest complaint is that it is too expensive. Overall, most shoppers perceive forecourt prices to be reasonable and many now expect good promotions at their local petrol station store. 

Individuals are encouraged to read the full Trade Intelligence SA Forecourt Retail Report here.

For more information, visit www.tradeintelligence.co.za. You can also follow Trade Intelligence on LinkedIn, X, or on Instagram. 

*Image courtesy of contributor