qwertyvenkyuiopasdfghjkluckyzxcvbnmqwertyuraginiiopasdfghjklzxcvbnmqwertyuiopaswathidfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyusantiiopasdfghjklzxcvbnmqwertejayuiopasdfghjklzxcvbnmqwertyuisaiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqweramanatyuiopasdfghjklzxcvbnmqwertyuiopasdfghaarikajklzxcvbnmqwertyuiopasdharamfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbadrukanmqwertyuiochandrashekarsirpasdfghjklzxcvbnerolacmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvb

A Study on Implementation of CRM in Retail Fuel Stations

by

ALLAMPURI BHARGAVA

“A STUDY ON IMPLEMENTATION OF CRM IN RETAIL FUEL STATIONS”

ALLAMPURI BHARGAVA

HALL TICKET No. 00808127

Project submitted in partial fulfillment for the award of the Degree of

MASTER OF BUSINESS ADMINISTRATION

by

Osmania University, Hyderabad -500007

DECLARATION

I hereby declare that this Project Report titled

__________________________________________ submitted by me

to the Department of Business Management, O.U., Hyderabad, is a

bonafide work undertaken by me and it is not submitted to any other

University or Institution for the award of any degree diploma /

certificate or published any time before.

Name and Address of the Student Signature of the Student

CERTIFICATION

This is to certify that the Project Report title

_____________________________________________

submitted in partial fulfilment for the award of MBA

Programme of Department of Business Management,

O.U. Hyderabad, was carried out by

________________________________ under my

guidance. This has not been submitted to any other

University or Institution for the award of any

degree/diploma/certificate.

Name and address of the Guide Signature of the Guide

ABSTRACTThe primary objective of this project is to provide the readers the insight

into CRM Practices followed in Fuel Retailing Industry, Behavior of consumers towards it and different opinions generated out of such practices.

Customer Relationship Management (CRM) can be widely defined as company activities related to developing and retaining customers. It is a blend of internal business processes: sales, marketing and customer support with technology and data capturing techniques. Customer Relationship Management is all about building long-term business relationships with customers.

SUMMARIZING CRM ACTIVITIES The CRM cycle is Learning from customers and prospects, (having in

depth knowledge of customer), Creating value for customers and prospects, Creating loyalty, Creating profits, Acquiring new customers.

FUEL RETAILING IN INDIA1976, India barred the private sector from participating in fuel retail and

nationalised the local businesses of international oil companies. In 2002, however, the government made a U-turn, allowing multinationals and other private players to re-enter the market.

THE NEED FOR CRM AT FUEL STATIONS IN INDIA This project is exclusively done on the leading petrol bunks in the city of

Hyderabad, Nizamabad, and on National Highway-9. The main reason for choosing this sector is that, there is not much of customer relationship is being maintained with the bunks & the end user as such. To bridge the gap between the customer & the dealers or the company so that an effort is being made to make a customer a brand loyal. Survey is conducted to know the customer needs and expectations. Suggestions, advices, and problems faced by the dealers are known by a personal interaction.

Analyzing all the facts and adding new possible ideas to make customer loyal to the brand this report is prepared, this includes bringing awareness about loyalty cards and extensive use of loyalty cards, loyalty benefits, customer drive in factors and etc…

ACKNOWLEDGEMENT

Throughout the course of study, as I analyzed and compiled this report,

innumerable people have given suggestions, encouragement, complaints and

opinions, all of which have been in some way or the other contributed to the

final report.

I think it is essential to thank all those who contributed to my

understanding of the subject and helped me through the duration of the project.

I thank Mr. C. CHANDRASHEKAR REDDY, under whose

supervision and guidance this report was completed successfully.

I would also like to thank my parents and friends who rendered their

whole hearted co-operation in the successful completion of the project work.

Finally, I am thankful to all the people who willingly responded to my

questionnaire and whose contribution has been invaluable. This project would

not have been completed without their participation.

PREFACE

The primary objective of this report is to provide the readers the insight

into CRM Practices followed in Fuel Retailing Industry, Behavior of customers

towards it, different opinions generated out of such practices, and new ideas that

can be implemented in order to improve customer loyalty

I hope that the report has made with the text which is interesting and

lucid. In writing this report, I have benefited immensely by referring to many

publications and articles in various books and online. I express my gratitude to

all such authors and publishers.

Any suggestions to improve this report in contents or in style are always

welcome and will be appreciated and acknowledged.

CONTENTS

INTRODUCTION TO CRM

EMERGENCE OF CRM PRACTICE

ARCHITECTURE OF CRM

OPERATIONAL

ANALYTICAL

COLLABORATIVE

KEY PRINCIPLES

WHO NEEDS CRM?

ADVANTAGES OF CRM

CRM RELATED SURVEY FACTS

STEPS TO SUCCESSFUL IMPLEMENTATION OF CRM

CHALLENGES IN IMPLEMENTATION OF CRM

SUMMARIZING CRM ACTIVITES

FUEL RETAILING IN INDIA OVERVIEW

PROMISING ROAD AHEAD

A GLANCE OVER INDUSTRIES IN PETRO-RETAILING

NEW COMPETITORS

RETAIL SITE HEADACHE

CRM PRACTISE IN FUEL RETAILING BUSINESS

RESEARCH SURVEY

QUESTIONNAIRE & FEEDBACK FORMAT

RESULT AND ANALYSIS

SUGGESTIONS

SPECIAL FOCUS ON CUSTOMER RELATIONSHIP

BIBLOGRAPHY

INTODUCTION TO THE PROJECT

When a customer enters the fuel outlet he purchases fuel and cannot

expect any other services. When we observe the outlets in other nations there

are many other service provided to the customers, non fuel services are not

priority in our country. Marketing says ‘customer is king’ but in Indian fuel

retail industry customer is not the king, he is not provided with anything more

than refueling, where he is availing many facilities in other retail sectors like

discounts, rebates, loyalty benefits and many more. The competition in the

market is increasing due to the extensive growth in automobile market and

private players entrance into this segment. So very soon the drive in factor shifts

from Quality and Quantity to other non fuel services. Hence customer relation

management becomes vital tool in the acquisition and retention of the

customers. When customer starts demanding services the change in their

behavior, expectation can be analysed using CRM. The company which takes

the initiative of implementing non fuel services before other companies will get

edge in customer acquisition. Hence this project focuses upon the customer

expectations and the need for CRM in fuel retailing.

NEED FOR THE STUDY:

Customers consider various factors for refueling at fuel stations. The

factors they consider are Quality and Quantity, other services and etc. It also

depends on need and travelling styles of the customer. Hence CRM strategies

become essential to get a competitive edge.

OBJECTIVE OF THE STUDY:

Main objective: The main objective of the study is to study the CRM

strategies being implemented and to find the factors that make customer drive-

in, improvising the organisational level CRM.

SPECIFIC OBJECTIVES:

1. To find the factors that drive in customers into the retail outlet.

2. To know whether the customer is expecting anything more from the

services in outlets.

3. To find respondents reason for refueling in the particular retail outlet.

4. To know the importance loyalty program and additional services effect

on customer.

5. To know the customer service satisfaction from the respondents.

6. To know the respondents opinion on the performance of their outlets.

DESCRIPTION OF THE RESEARCH DESIGN:

A research design is a logical and systematic plan prepared for directing a

research study it specifies the methodology and technique to be adopted for

achieving the objectives. It constitutes the blueprint for the collection,

measurement and analysis of data.

The main aim of the study is to evaluate the services and CRM activities

implemented. The study is descriptive in nature. Surveys are best-suited

method for descriptive research. So survey method is used for the study.

The preparation of a research plan for a study aids in establishing

direction to the study and knowing exactly what has to be done and how and

when it has to be done at every stage.

SAMPLING PROCEDURES:

Sampling is a systematic approach for selecting a few elements from an

entire collection of units (population) in order to make some inference about the

total population it is a small specimen or a segment of the whole population

representing its general qualities as far as possible.

SAMPLE SIZE:

The study is conducted on a sample of

1. One fifty respondents’ offsite.

2. Two hundred respondents’ onsite.

SAMPLING FRAME:

The population for the study consists of people of Hyderabad,

Nizamabad, customers on Shell (Uppal), Bharat petroleum (Tarnaka, NH-7,

Nizamabad), Hindustan Petroleum (NH-7) IBP (Nizamabad).

RESEARCH INSTRUMENTS:

An interview schedule is used to conduct the study.

SOURCES OF DATA:

PRIMARY METHOD:

Primary data are those, which are collected fresh and for the first time and

this happen to be original in character. In this study primary data was collected

by interview schedule method.

SECONDARY METHOD:

Secondary data are those, which are collected from existing data.

Secondary data for this study include appropriate material from newspaper,

Company Reports, Standard Text Books, and information from Internet has also

been acquired wherever necessary.

FIELD WORK:

The project involved a fieldwork of around 2 month 10 days where in the

survey was carried out of around different organisations and fuel stations.

The survey was conducted in different of Hyderabad, Nizamabad and

NH-7.

METHODOLOGICAL ASSUMPTIONS:

• The primary data has been collected by an interview schedule.

• All primary data collected is true and reflects the actual actions of the

Respondents.

• The data collected has been coded, tabulated and analyzed into logical

Statement using simple statistical methods, pie charts, etc.

SCOPE OF THE PROJECT:

The scope of the project is vast as the fuel retailing sector is expanding

very fast, the competition in the sector is very high with the entrance of the

private players. The Automatic price control mechanism of the government is

reducing the competition and giving edge to PSUs, where once subsidizing is

removed completely the services in fuel station play vital role in customers

drive in into the retail outlet. The CRM plays important role in increasing the

revenue and profits. Hence this project has wide scope in this sector.

INTRODUCTION TO CRM

Customer Relationship Management (CRM) can be widely defined as

company activities related to developing and retaining customers. It is a blend

of internal business processes: sales, marketing and customer support with

technology and data capturing techniques. Customer Relationship

Management is all about building long-term business relationships with

customers.

Different organizations define CRM differently. In today’s economy,

there is no single undisputed definition of CRM. Here is what we believe CRM

is:

“CRM is an alignment of strategy, processes and technology to

manage customers and all customer-facing departments & partners”

Any CRM initiative is and has the potential of providing strategic

advantages to the organization, if handled right. Most CRM initiatives begin

with a strategic need to manage the process of handling customer related

information more effectively. For beginners it could simply mean better lead

management capabilities or sales pipeline visibility. However, as organizations

mature in their CRM initiatives, they begin to look at CRM as tool to acquire

strategic differentiators. Despite the immense benefits that the CRM solutions

can deliver, they are not entirely without their share of problems.

THE EMERGENCE OF CRM PRACTICE

Looking back at a snapshot history of marketing, we can see the

following clear developments and progression over the last four decades:

1960’s – the era of Mass Marketing, when Gibbs SR toothpaste began the first

marketing of this kind with its black and white campaign.

1970’s – saw the beginning of segmentation, direct mail campaigns and early

Telemarketing (such as publishing).

1980’s – where Niche Marketing made millionaires of those who were best at

it.

1990’s – Relationship Marketing. The explosion of telemarketing and call

enters all set up to develop relationships with customers.

In recent years however, several factors have contributed to the rapid

development and evolution of CRM. These include:

The growing de-intermediation process in many industries due to the

advent of sophisticated computer and telecommunication technologies

that allow producers to directly interact with end-customers. For

example, in many industries such as airlines, banks insurance,

software or household appliances and even consumables, the de-

intermediation process is fast changing the nature of marketing and

consequently making relationship marketing more popular. Databases

and direct marketing tools give them the means to individualize their

marketing efforts.

Advances in information technology, networking and manufacturing

technology have helped companies to quickly match competition. As a

result product quality and cost are no longer significant competitive

advantages.

The growth in service economy. Since services are typically produced

and delivered at the same institution, it minimizes the role of the

middlemen.

Another force driving the adoption of CRM has been the total quality

movement. When companies embraced TQM it became necessary to

involve customers and suppliers in implementing the program at all

levels of the value chain. This needed close working relationships with

the customers.

Thus several companies such as Motorola, IBM, General Motors,

Xerox, Ford, Toyota, etc formed partnering relations with suppliers

and customers to practice TQM. Other programs such as JIT and MRP

also made use of interdependent relationships between suppliers and

customers.

Customer expectations are changing almost on a daily basis. Newly

Empowered customers who choose how to communicate with the

companies across various available channels. Also nowadays

consumers expect a high degree of personalization.

Emerging real time, interactive channels including e-mail, ATMs and

call centre that must be synchronized with customer’s non-electronic

activities. The speed if business change, requiring flexibility and rapid

adoption to technologies.

In the current era of hyper competition, marketers are forced to be

more concerned with customer retention and customer loyalty.

As several researches have found out retaining customers is less

expensive and more sustainable competitive advantage than acquiring

new ones.

On the supply side it pays more to develop closer relationships with a

few suppliers than to develop more vendors.

In addition several marketers are concerned with keeping customers

for life than making one time sale. There is a greater opportunity for

up selling and cross selling.

The globalization of world marketplace makes it necessary to have

global account management for the customers.

ARCHITECTURE OF CRM

There are three parts of application Architecture of CRM:

1. OPERATIONAL - automation to the basic business processes

(marketing, sales, service).

2. ANALYTICAL - support to analyze customer behavior, implements

business intelligence like technology.

3. COLLABORATIVE - ensures the contact with customers (phone,

email, fax, web, sms, in person and Post).

OPERATIONAL CRM

Operational CRM means supporting the "front office" business processes,

which include customer contact (sales, marketing and service). Tasks resulting

from these processes are forwarded to resources responsible for them, as well as

the information necessary for carrying out the tasks and interfaces to back-end

applications are being provided and activities with customers are being

documented for further reference.

Benefits of Operational CRM:-

• Delivers personalized and efficient marketing, sales, and service through

multi-channel collaboration.

• Enables a 360-degree view of your customer while you are interacting with

them.

• Sales people and service engineers can access complete history of all

customer interaction with your company, regardless of the touch point

ANALYTICAL CRM

In analytical CRM, data gathered within operational CRM and/or other

sources are analyzed to segment customers or to identify potential to enhance

client relationship. Customer analysis typically can lead to targeted campaigns

to increase share of customer's wallet.

Examples of Campaigns directed towards customers are:

Acquisition: Cross-sell, up-sell

Retention: Retaining customers who leave due to maturity or attrition.

Information: Providing timely and regular information to customers.

Modification: Altering details of the transactional nature of the customer’s

relationship.

COLLABORATIVE CRM

Collaborative CRM facilitates interactions with customers through all

channels (personal, letter, fax, phone, web, e-mail) and supports co-ordination

of employee teams and channels. It is a solution that brings people, processes

and data together so companies can better serve and retain their customers. The

data/activities can be structured, unstructured, conversational, and/or

transactional in nature.

Collaborative CRM provides the following benefits:

Enables efficient productive customer interactions across all

communications channels.

Enables web collaboration to reduce customer service costs.

Integrates call centers enabling multi-channel personal customer

interaction.

Integrates view of the customer while interaction at the transaction level.

CRM is based on the premise that, by having a better understanding of

the customers’ needs and desires we can keep them longer and sell more

to them.

KEY CRM PRINCIPLES

DIFFERENTIATE CUSTOMERS

All customers are not equal; recognize and reward best customers

disproportionately. Understanding each customer becomes particularly

important. And the same customers’ reaction to a cellular company operator

may be quite different as compared to a car dealer. Besides for the same product

or the service not all customers can be treated alike and CRM needs to

differentiate between a high value customer and a low value customer.

What CRM needs to understand while differentiating customers is?

Sensitivities, Tastes, Preferences and Personalities.

Lifestyle and Age.

Culture Background and education.

Physical and psychological characteristics.

MAXIMIZING LIFE TIME VALUE

Exploit up-selling and cross-selling potential. By identifying life stage

and life event trigger points by customer, marketers can maximize share of

purchase potential. Thus the single adults shall require a new car stereo and as

he grows into a married couple his needs grow into appliances.

INCREASE LOYALTY

Loyal customers are more profitable. Any company will like its

mindshare status to improve from being a suspect to being an advocate.

Company has to invest in terms of its product and service offerings to its

customers. It has to innovate and meet the very needs of its clients/ customers

so that they remain as advocates on the loyalty curve.

WHO NEEDS CRM?

Putting it simply, CRM is ideally embraced by that organization which

besides making and retaining clients also makes serious effort to optimize their

revenue potential. This organization is one that aims at organizational growth

through sharp focus on CUSTOMER RELATIONSHIP MANAGEMENT.

ADVANTAGES OF CRM

• Provide better CUSTOMER service.

• Increase CUSTOMER revenues.

• Increase CUSTOMER Lifecycle Value.

• Discover new CUSTOMERS.

• Cross Sell/Up Sell products more effectively.

• Help sales staff close deals faster.

• Make call centers more efficient.

• Simplify marketing and sales processes.

Many companies are turning to customer-relationship management

systems to better understand customer wants and needs. Customer

Relationship Management applications, used in conjunction with data

warehousing, E -commerce applications, and call centers, allow companies to

gather and access information about customers' buying histories, preferences,

complaints, and other data so they can better anticipate what customers will

want and how to best retain them.

The adoption of Customer Relationship Management is being fuelled

by recognition that long-term relationships with customers are one of the most

important assets of an organization, providing competitive advantage and

improved profitability.

CRM helps businesses use technology and human resources to gain

insight into the behavior of customers and the value of those customers & boost

their business efficiency, thereby increasing profit and revenue generation

capabilities. In most businesses, the cost of acquisition of customers is high. To

make profits, it is important to keep the customer longer and sell him more

products (cross sell, up sell, etc) to him, during his lifecycle. Customers stay, if

they are provided with value, quality service and continuity. CRM solutions

enable’s to do that.

THE SURVEY FACTS

Growth Strategies International (GSI) performed a statistical analysis of

Customer satisfaction data encompassing the findings of over 20,000 customer

surveys conducted in 40 countries by Infoquest.

The conclusions of the study were:

A Totally Satisfied Customer contributes 2.6 times as much revenue to a

company as a Somewhat Satisfied Customer.

A Totally Satisfied Customer contributes 17 times as much revenue as a

Somewhat Dissatisfied Customer.

A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8

times what a Totally Satisfied Customer contributes to a business.

By reducing customer defection (by as little as 5%) will result in increase in

profits by 25% to 85% depending from industry to industry. An important facet

of CRM is “customer selectivity”. As several research studies have shown not

all customers are equally profitable (In fact in some cases 80% of the sales

come through 20% of the customers). The company must therefore be selective

and tailor its program and marketing efforts by segmenting and selecting

appropriate customers for individual marketing programs. In some cases, it

could even lead to “outsourcing of some customers” so that a company better

utilize its resources on those customers it can serve better and create mutual

value.

CAN CRM DRIVE REVENUE?

The important considerations of any organization looking forward to

incorporating a CRM are understandably, more business related than technical.

All the different objectives that are fulfilled through CRM, by default; revolve

around increasing the top line revenue.

CRM is not just a guarantee for quicker growth and bigger revenues but

also a means to keep up with competition. Through CRM, you can determine

the Customer Lifetime Value or in other words, the present and projected

business worth of a customer to your organization. This once known, acts as

the basis on which you can formulate marketing strategies targeting customers

individually.

Customer intelligence and CRMs predictive analysis capabilities help’s

to generate a highly accurate demand forecast which leads to better and more

informed inventory management, thus, curtailing significantly, the internal

costs through new and efficient processes.

Further, the simplification and streamlining of the sales process,

significantly reduces the time spent by sales reps on their paperwork and

administrative engagements, and lets them focus on selling instead. The ROI

gained out of implementing a CRM is what makes the experience worthwhile. It

is best measured by comparing the past and the present customer acquisitions,

enhancements in customer value/worth, long-term customer retention, etc, all

of which contribute to the organizations revenues.

5 STEPS TO SUCCESSFUL IMPLEMENTATION OF CRM

Many organizations have burned their fingers trying to implement the

technology and manage costs. To successfully undertake CRM initiatives it is

essential to

1. Clearly define the management objective & strategy.

2. Evolve the right process around it.

3. Identify the right software solution for implementation.

4. Understand the hidden costs and hurdles.

5. Back it up with good training and support.

CUSTOMER RELATIONSHIP MANAGEMENT is a strategy, not a

specific software or hardware; but it encompasses the technology and strategy

needed to completely integrate a business in order to get a holistic view of

customers and their relationship to the entire enterprise. The software that links

the back office to the front office, the technology needed to make the call centre

customer-friendly, and integrating each component seamlessly with the

customers' point of contact, web-based or other means, are all part of Customer

Relationship Management.

There are many technological components to CRM, but thinking about

CRM in primarily technological terms is a mistake. The more useful way to

think about CRM is as a process that will help bring together lots of pieces of

information about customers, sales, marketing effectiveness, responsiveness and

market trends.

KEY CHALLENGES IN IMPLEMENTING CRM SOLUTIONS

Companies around the world have leveraged CRM strategies to gain

competitive advantage. As more and more companies rush to implement CRM,

precautions must be taken to do it right. It is approximated that 50-70% CRM

implementations fail, depending on the Industry vertical. Hence, it is essential to

identify the key challenges, address risks and build a strategy that can make

your CRM successful. CRM is full of talk about strategy, but at the end of the

day, someone has to lead the way and implement, even if operations report that

the network is operating perfectly and services are running normally, your

customers may not be happy, leading to revenue shortfall and increasing levels

of churn.

UNLOCKING THE VALUE OF CUSTOMER SATISFACTION SURVEYS

In today's business environment companies cannot afford to lose a single

profitable customer. By effectively leveraging results from a customer

satisfaction survey an organization can respond to their customer's needs in

ways that increase revenue as well as improve customer and employee,

satisfaction and loyalty. Many companies perform customer satisfaction

surveys, but don't receive full value from their investments to administer the

program. Too often survey results are used simply for monthly reporting on

"how we did last month". GAP MODEL

There is a gap because of which a market goes up or come down. What

the company perceives and what the customers perceives is different. It is this

gap which identifies a product of the company as product centric. The customer

has different point of view. He may focus on the price.

SUMMARISING CRM ACTIVITIES

The CRM cycle can be briefly described as follows:

Learning from customers and prospects, (having in depth knowledge of

customer).

Creating value for customers and prospects.

Creating loyalty.

Creating profits.

Acquiring new customers.

FUEL RETAILING IN INDIA

OVERVIEW

1976, India barred the private sector from participating in fuel retail and

nationalised the local businesses of international oil companies. Brands

commonly seen at petrol stations elsewhere in the world - Shell, Esso and

Caltex -disappeared from the Indian market. Shell, for instance, became Bharat

Petroleum and Esso metamorphosed into Hindustan Petroleum.

In 2002, however, the government made a U-turn, allowing multinationals

and other private players to re-enter the market. The policy shift sparked a rush

of service station openings as both private and public companies positioned

themselves to sell to the nation’s growing, increasingly mobile middle class.

While the private sector welcomed the liberalised market, in practice it came

with several strings attached. Private players were required to invest at least 20

billion rupees (around $500 million) in refineries, pipelines or other energy-

related assets in the country, limiting the number of new entrants. And although

the government abolished formal controls on fuel prices, it continued to dictate

them indirectly through the pricing policy of India’s national oil companies

(NOCs). These factors have slowed the evolution of the sector – at least for the

moment.

NEW COMPETITORS

For almost 30 years the government strictly controlled public-sector

companies, dictating prices, and directing the expansion of their dealer

networks. While these companies had retained the infrastructure of the

nationalised multinationals, their reason for being changed dramatically.

Objectives such as job creation had taken precedence over purely commercial

goals, including profitability when running the business. The move toward

liberalisation brought a sudden shift in priorities as the public-sector companies

prepared to face the new competition. “We’ve actually grown more in the last

four years than we had in the last 30,” says Tejbir Singh Sanghvi, Deputy

General Manager of Highway Retailing at Hindustan Petroleum. “The

government has given us more flexibility in terms of expanding our dealer

network. We’ve also had to develop a lot in order to compete. There are new

initiatives, new physical standards and new technologies. Fuel retail used to be a

seller’s market. Now the focus has shifted to the consumer.”

Newcomers to the Indian market face several challenges. For one, the

government has an indirect hand in pricing policy through its national oil

companies. The policy takes into account factors such as inflation and the

proximity of upcoming elections. For example, between 2002 and 2006 the

price of petrol in the international market increased one and a half times. During

the same period the retail price of petrol in India only rose by about 50%.

The government subsidises India’s NOCs to compensate for below-market

prices. Between April, 2005 and March, 2006 subsidies totaled approximately

$3.6 billion, according to a government advisory committee report. Since state-

owned oil companies command some 80% market share, private-sector

competitors must match their artificially-low prices to stay in business.

“It was assumed that after the APM (Administered Pricing Mechanism) was

dismantled in 2002, there would be a genuine free market in India for

transportation fuels,” says manager of shell. “But the APM never really faded

away in practice, thanks to political reality.”

PROMISING ROAD AHEAD

The Indian market for transportation fuels holds a lot of promise. The

country’s aspiring middle class, recently estimated at 40 million households by

consultancy McKinsey, is becoming increasingly motorised. Small towns are

expanding at a rapid pace, sparking investment in roads and other infrastructure.

Automobile sales, which today number just over a million vehicles a

year, could reach 20 million a year by 2030, predicts US-based consultancy

Keystone, making India the third-largest automobile market in the world after

China and the USA.

Moreover, the fact that many of India’s service stations are poorly

designed and congested leaves a natural opening for newcomers who offer a

better alternative. Typical old-fashioned Indian service stations feature long

queues, cars jockeying for position, oily forecourts and hand-operated petrol

pumps that may not accurately measure the volume of each sale. They also lack

convenience stores or other facilities.

Liberalisation prompted Indian companies such as Reliance and Essar to

aggressively enter the fuel retail market. Reliance, for instance, expanded its

network rapidly, with plans for up to 6,000. However, Reliance stopped at

around 1,300 stations when it started to lose money, due to the government’s

policy of influencing prices.

Shell is so far the only international oil company to enter the Indian retail

market. The company’s development of a liquefied natural gas terminal and

regasification facility at Hazira allowed it to meet the government’s call for

investment. Today Shell operates 35 stations in southern India.

A VIEW ON INDUSTRIES IN PETRO- RETAILING SECTOR

Bharat Petroleum Corporation Limited (BPCL):-

It is one of India's largest PSU companies, with Global Fortune 500 rank

of 287 (2008). Its corporate office is located at Ballard Estate, Mumbai. As the

name suggests, its interests are in petroleum sector. It is involved in the refining

and retailing of petroleum products.

Bharat Petroleum is considered to be a pioneer in Indian petroleum

industry with various path-breaking initiatives such as Pure for Sure campaign,

Petro card, Fleet card etc.

BPCL's growth post-nationalisation (in 1976) has been phenomenal.

One of the single digit Indian representatives in the Fortune 500 & Forbes 2000

listings, BPCL is often referred to as an “MNC in PSU garb”. It is considered a

pioneer in marketing initiatives, and employs “Best in Class” practice.

History

The 1860s saw vast industrial development. A lot of petroleum refineries

came up. An important player in the South Asian market then was the Burmah

Oil Company Ltd. Though incorporated in Scotland in 1886, the company grew

out of the enterprises of the Rangoon Oil Company, which had been formed in

1871 to refine crude oil produced from primitive hand dug wells in Upper

Burma.

The search for oil in India began in 1886, when Mr. Goodenough of

McKillop Stewart Company drilled a well near Jaypore in upper Assam and

struck oil. In 1889, the Assam Railway and Trading Company (ARTC) struck

oil at Digboi marking the beginning of oil production in India.

While discoveries were made and industries expanded, John D

Rockefeller together with his business associates acquired control of numerous

refineries and pipelines to later form the giant Standard Oil Trust. The largest

rivals of Standard Oil - Royal Dutch, Shell, Rothschilds - came together to form

a single organisation: Asiatic Petroleum Company to market petroleum products

in South Asia.

In 1928, Asiatic Petroleum (India) joined hands with Burmah Oil

Company - an active producer, refiner and distributor of petroleum products,

particularly in Indian and Burmese markets. This alliance led to the formation

of Burmah-Shell Oil Storage and Distributing Company of India Limited. A

pioneer in more ways than one, Burmah Shell began its operations with import

and marketing of Kerosene. This was imported in bulk and transported in 4

gallon and 1 gallon tins through rail, road and country craft all over India. With

motor cars, came canned Petrol, followed by service stations. In the 1930s,

retail sales points were built with driveways set back from the road; service

stations began to appear and became accepted as a part of road development.

On 24 January 1976, the Burmah Shell Group of Companies was taken

over by the Government of India to form Bharat Refineries Limited. On 1

August 1977, it was renamed Bharat Petroleum Corporation Limited. It was

also the first refinery to process newly found indigenous crude Bombay High, in

the country

Products

Bharat Petroleum produces a diverse range of products, from

petrochemicals and solvents to aircraft fuel and speciality lubricants and

markets them through its wide network of Petrol, LPG, CNG Stations, Kerosene

Dealers, LPG Distributors, Lube Shoppes, besides supplying fuel directly to

hundreds of industries, and several international and domestic airlines.

Refineries

BPCL has Refineries at Mumbai and Kochi(Kochi Refineries) with a

capacity of 12 Million Metric Tonnes (MMT) and 7.5 MMTPA respectively for

refining crude oil. BPCL's subsidiary at Numaligarh has a capacity of 3 MMT.

Brand ambassador

Mahendra Singh Dhoni signed on as the Brand Ambassador for BPCL in

2006. Narain Karthikeyan is one other Brand Ambassador for BPCL.

International rankings

1. BPCL is a Fortune Global 500 company as per the ranking of 2008. It was

ranked at position 287. It was ranked at position 325 as per the ranking of 2007.

2. BPCL was featured on the Forbes Global 2000 list for 2008 at position 967

Offering World Class Fuels

Since 2002, they have introduced new generation branded fuels Speed, Hi

Speed Diesel and Speed 97, being the pioneers to introduce premium fuel

brands in the Country. Speed brand of petrol contains multi-functional fuel

additives that prevent formation of harmful deposits and help clean existing

deposits, thereby improving vehicle performance. Speed has been the market

leader in the branded fuels category. BPCL has also introduced a high-end

Octane 97 variant Speed 97 catering to the requirement of vehicles at the upper

end of the tier. To meet the growing needs of the diesel passenger car segment,

we introduced Hi-Speed Diesel which is a blend of diesel and world-class multi-

functional additive which uses the internationally renowned Green Burn

Combustion Technology. This multi-functional additive enables the high

performance vehicles to deliver their designed outputs.

Making a Difference through Innovative Retailing

Bharat Petroleum is providing added value to its customers in fuel and

non-fuel areas. The Corporation offers products and services that have been

designed to meet the need gaps of its customers. They have introduced several

pioneering offerings in Indian Petroleum retailing scene.

Servicing the Customers Need

Recognizing the customer need for pure quality and correct quantity of

fuel for their vehicles and launched the flagship initiative of Pure For Sure

(PFS) offering the guarantee of pure quality and correct quantity of fuel to our

customers. The petrol pumps displaying a prominent ‘Pure For Sure’ signage

have become landmark destinations as the movement has gained momentum

across our Retail Network.

Bharat Petroleum now offers a robust and automated network of retail

outlets, which leverage technology to deliver the assurance of quality and

quantity promise, ensure integration of payment with fueling and improves the

service efficiency at the forecourt of the petrol pump.

Fostering Loyalty

Sharing rewarding relationships with customers and building loyalty has

been a center of focus. Recognizing the need of customers to make life more

convenient and rewarding and introduced the first loyalty-cum-rewards

program, PetroBonus. Equipped with Smart Card Technology, the Petro Card

program combines convenience in payment along with an inbuilt rewards

program that rewards the customer with Petromiles every time he fuels. A

similar program, Smart Fleet was launched for Fleet Owners privileges such as

cashless transactions, vehicle tracking, Credit Option for Fleet Owners and Cash

Management System.

Delivering Convenience

Bharat Petroleum has pioneered the concept of Convenience Stores in the

Country. The In &Out Convenience Stores are the largest network of stores

spread across the BPCL network. The offerings range from convenience

products, ATMs, Music, Greeting Cards, Movies / Entertainment Tickets, etc.

The network also has a good spread of Fast Food destinations throughout tie ups

with Mc Donald’s, Café Coffee Day, Subway, Pizza Hut and other leading retail

chains.

Caring for Vehicle’s Needs

It also aim to provide service centre facilities through our V-CARE

(Vehicle Care) Centres across the urban network. The V-Care Centres provide

customers with reliable, transparent and value for money services for the basic

vehicle care needs.

Partnering Highway Journeys

On the highways they offer a home away from home to the truckers and

the tourists in the form of the Generation Next OSTSs/OSTTSs (One Stop

Truck cum Tourist Shop) branded as GHAR. These outlets are built on a

minimum of 3 to 5 acres plot sizes and house dedicated and fully automated

MS/HSD petrol/ diesel Fuelling facilities to fuel all kinds and sizes of vehicles

besides the specially designed offerings for the highway travelers, that include a

Food Court for Tourists and a Dhaba for truckers, a dormitory with beds, a Safe,

Secured and Spacious parking for trucks and cars, a vehicle wash facility,

Bathing facilities, dedicated toilets for Truckers and dedicated toilets for

Tourists, Children’s Play area, Amphitheatre for entertainment, Health care

centre, Smartfleet Customer service centre ,Sanjha Chula for self cooking and

captive power generation.

HPCL (Hindustan Petroleum Corporation Limited):-

It a Navratna PSU of the Government of India, is a Fortune 500 company

of India listed at number 311 in the global 500 rankings, with an annual

turnover of over Rs. 1,16,428 Crores and sales/income from operations of Rs

1,31,802 Crores (US$ 25,618 Millions) during financial year 2008-09, about

20% Marketing share in India and a strong market infrastructure. Corresponding

figures for financial year 2007-08 are: Turnover- Rs 1,03,837 crores, and

sales/income from Operations- Rs. 1,12,098 Crores (US$ 25,142 Million).

HPCL operates 2 major refineries producing a wide variety of petroleum

fuels & specialties, one in Mumbai (West Coast) of 5.5 Million Metric Tonnes

Per Annum (MMTPA) capacity and the other in Vishakapatnam, (East Coast)

with a capacity of 7.5 MMTPA. HPCL holds an equity stake of 16.95% in

Mangalore Refinery & Petrochemicals Limited (MRPL), a state-of-the-art

refinery at Mangalore with a capacity of 9 MMTPA. Another Refinery of 9

MMTPA is under construction in Bathinda, Punjab by HMEL, a Joint Venture

with Mittal Energy Investments Pte.Ltd.

HPCL also owns and operates the largest Lube Refinery in India producing

Lube Base Oils of international standards. With a capacity of 335 TMT. This

Lube Refinery accounts for over 40% of the India's total Lube Base Oil

production. Presently HPCL produces over 300+ grades of Lubes, Specialities

and Greases.

The marketing network of HPCL consists of 13 Zonal offices in major

cities and 90 Regional offices facilitated by a Supply & Distribution

infrastructure comprising Terminals, Aviation Service Facilities, LPG Bottling

Plants, Lube filling plants, Inland Relay Depots, Retail Outlets (Petrol Pumps)

and LPG & Lube Distributorships.

HPCL has, over the years, moved from strength to strength on all fronts.

The refining capacity steadily increased from 5.5 million metric tonnes in

1984/85 to 13.00 million metric tonnes (MMT) now.

History

1952: The Company was incorporated in the name of Standard Vacuum

Refining Company of India Limited on July 5, 1952

1962: On 31st March,1962 the name was changed to ESSO Standard Refining

Company of India Limited.

1974: Hindustan Petroleum Corporation Limited comes into being after the

takeover and merger of erstwhile Esso and Lube India Undertaking

1976: Caltex Oil Refining Ltd. is taken over by the Government of India and

subsequently merged with HPCL in 1978.

1979: Kosan Gas Company, the concessionaries of HPCL in the domestic LPG

market, are taken over and merged with HPCL.

HPCL thus comes into being after merging four different organisations at

different points of time.

Major functions

1. Refineries

2. Aviation

3. Bulk Fuels & Specialities

4. International trade

5. LPG - HP GAS

6. Lubes - HP LUBES

7. Retail

8. Exploration & Production

9. Joint Ventures

10.Alternate Energy

Refineries

HPCL has a number of refineries in India. Some are listed below:

1. Mumbai Refinery - 5.5 Million Metric Tonnes (MMT) Capacity

2. Visakhapatnam Refinery - 7.5 MMT at Visakhapatnam

International rankings

1. HPCL is a Fortune Global 500 company as per the ranking of 2009 and was

ranked at position 311.

2. HPCL was featured on the Forbes Global 2000 list for 2009 at position

1002

Recognition and Awards 2008

1. NDTV Profit Business Leadership Award

2. Reader’s Digest ‘Trusted Brand Asia Platinum’ Award

3. Golden Peacock Corporate Governance Award 2008

4. CIO 100 Award 2008

5. India Star Award

6. OISD Safety Award

7. National Award For Excellence In Cost Management

8. Greentech Environment Excellence Award 2008

9. Best HR Practices in ‘People Management’

Club HP

High - quality personalized "Vehicle and Consumer Care"

A part of HPCL's strategic retail marketing initiative that seeks to break

out of traditional fuel retailing, our new Retail Brand "Club HP" assures high -

quality personalized "Vehicle and Consumer Care" through a select set of

outlets.

Developed after an exhaustive research of over a year which included

collecting feedback from over 13,000 respondents in several key markets across

the country, the "Club HP" concept aims to provide the assurance of “Quick

Fills", "Expert, Personalised Service", "Total Vehicle Management" and

"Consumer Conveniences".

The "Club HP" concept also recognizes the fact that the consumer today

places very high importance on vehicle care and at the same time expects other

value added services from a fuel retail outlet that help him take care of diverse

activities under one roof and in the shortest possible time. The Club HP outlets

provide a distinct set of basic and value added offerings which include

"Efficient & Expert Service", "Quick Care Point", "Digital Air Towers",

"Vehicle Finance and Insurance related assistance", "Bills Payment facilities",

“Refreshments”, "HPCL - ICICI Credit Cards", "Club HP Smart 1 Cards” and a

host of other amenities.

To deliver the many conveniences and services, we have associated with

leading companies like Coca Cola India, ICICI Bank, Fed Ex, Western Union

Money Transfer, Café Coffee Day, US Pizza, Skypak and many more. They are

also forging service specific alliances with several automobile companies and

OEMs like Tata Motors to jointly identify "Club HP" outlets.

The roll out of "Club HP" began in a phased manner, initially targeting 85

outlets in the cities of Mumbai, Delhi, Bangalore and Kolkata. Encouraged by

the initial experience, the “Club HP” brand has been quickly expanded to cover

over 1000 outlets in all major cities and towns across India. The distinctive red

and blue Club HP logo is an all too familiar symbol inviting motorists looking

for a quick and refreshing fuelling experience.

"Club HP" outlets are categorized as Standard, Mega and Max depending

on the levels of services and amenities available.

Vehicle Care - The Club HP outlets have been carefully selected to ensure that

they can offer high quality vehicle care. Each Club HP Mega and Max outlet is

equipped with a service station. In addition, the outlets will also provide vehicle

consumable and accessories, all under one roof. More and more outlets will

progressively upgrade to “Authorised Service Stations” as part of our

association with various vehicle manufacturers.

Quick Care Points - Consumers are offered a free check up of vital elements

such as engine oil, brake oil, battery water, coolant, fan belt, radiator hose etc.

by the specially trained "Club HP" attendants. In addition, a quick inspection of

the tyres is done and recommendations given in case any immediate action is

required.

Digital Air Towers – The performance and safety of new generation cars

depend a lot on the correct air pressure maintained in the tyres. The specially

designed digital air pressure equipment not only ensures accurate air pressure in

the shortest time but also adds to the comfort and safety of travel.

‘Good Fuel Promise’ Towers - Consumers are offered the facility to personally

conduct simple tests with the help of specially designed standard apparatus. A

simple procedure booklet is also provided to help anyone check the quality and

quantity of fuel. The consumers are also invited to fill in the printed certificate

booklet which will be available at all "Club HP" outlets in order to record their

assessment. This feedback is regularly screened by the HPCL team to plan

remedial actions or service upgrades in accordance.

Vehicle Finance and Insurance Related Counsel - HPCL has tied up with

leading vehicle insurance and finance service providers for these activities

which include assistance towards issuance and renewal of policies as well as

extension of loans for purchase of new or second hand vehicles.

ATMs - HPCL has taken the lead in providing ATM facilities at its outlets in

association with leading banks and is targeting over 400 ATMs very soon.

Select Club HP outlets have already been equipped with ATMs.

Bills Payments - HPCL has tied up with Skypak Financial Services which is

providing "Drop boxes" at all "Club HP" outlets in a phased manner.

Consumers can utilize these drop boxes to pay bills relating to a variety of

service providers.

Communication Facilities - Each Club HP outlet is equipped with a pay - phone

for the convenience of consumers. In addition, select outlets will also provide

high speed internet browsing and e - mail facility.

HPCL - ICICI co - branded Credit Cards and the Club HP Smart1 Cards -

Customers visiting the "Club HP" outlets will be able to use the HPCL - ICICI

Credit Cards to reap the higher reward points offered by this unique product.

Basic Amenities - Each "Club HP" outlet will extend basic amenities such as

"safe drinking water" through water purifiers, hygienic rest room facilities, food

counters, basic medicines and first aid facility. HPCL has also tied up with Coca

Cola India to provide beverages and bottled water as well as snacks at all "Club

HP" outlets.

IBP (Indo-Burma Petroleum Company limited):-

It was originally founded by Abdul Karim Abdul Shakur Jamal under the

name of Jamal's oil Company limited and was renamed as Indo-Burma

Petroleum Company limited in 1909.

History

IBP Co. Limited got merged with its parent company 'Indian Oil

Corporation Limited' on 02-05-2007 under the Ministry of Petroleum & Natural

Gas, Government of India. The merger ends the history of 98 year old 'IBP Co

Limited', the oldest oil company in India.

IBP Co. Limited was born in the then undivided British India as “Indo-

Burma Petroleum Company Limited” a joint stock private company on 08-02-

1909 at Burma, presently Myanmar.

The developments that followed Second World War forced the company

change its head quarters to Kolkata permitting the British Government to

bombard and destroy its only refinery at Rangoon. Thereafter the company

joined hands with the then Indian Oil Company (Later formed as Indian Oil

Corporation Limited after merger with Indian Refineries Company Limited) and

carried out business in petroleum products at Mumbai and Kolkata.

Though it was initially taken over by IOC in 1970, it got separated and

formed as a public sector company in 1974 under the Ministry of Petroleum and

Natural Gas, Government of India. By this time all the foreign private oil

businesses were nationalized and made public sector companies. The Indo

Burma Petroleum Company Limited changed its name to IBP Co. Limited in

1983. During 2002, it was once again acquired by the IOC and became one if its

group companies.

Though predominantly an oil company, IBP diversified its activities in to

engineering and chemicals. The venture in to explosives by the chemical

division was, based on a suggestion from the Govt. of India when the country

faced acute shortage of explosives for mining industry following an accident

and strikes at the only major supplier viz IEL in India in 60’s. As the country

had to import huge quantities of explosives to meet consumption needs for over

six months, severe difficulties were faced in storage, handling and

transportation to mining areas. Finally, the Chary committee set up for the

purpose strongly recommended a company to be set up in public sector for

manufacture of explosives. IBP, waiting for a diversification in to chemicals,

readily grabbed the opportunity and commenced its business in manufacture and

marketing of industrial explosives.

The IBP’s first packaged slurry explosive manufacturing plant was set up

in Korba (then in MP now in Chattisgarh) in the year 1976 under the

collaboration from Ireco Inc. USA. The unit commenced its commercial

production in August 1977. Thereafter the chemical division has diversified its

business in to a unique technology ‘the bulk delivered slurry explosives’ with

the first ever plant of its kind set up in India at Kudremukh with a capacity of

5000 Tons per annum in 1980. The first ever supply of site-mixed bulk slurry

explosives took place on 20-12-1980 in a blast using 63 tons of this product.

Over the past 25 years, by 20th Dec 2005 it has completed supply of 64,695 MT

of SMS explosives to Kudremukh Iron Ore Project.

For IBP, the journey in bulk explosives commenced at Kudremukh

continued a long way with new plants set up in both coal and metal mining

sectors. The second plant came up at Singrauli (MP) in the year 1983 followed

by Block-II Dhanbad (Jharkhand), Ramagundam (AP), Rampur Agucha

(Rajasthan), Kusmunda (Chattisgarh) etc. In terms of volume, the production of

bulk explosives reached a peak level of 55000 MT, followed by 25000 MT of

packaged explosives.

Competitors

Over the years, the number of competitors in India grew from only two in

the beginning to more than forty today, adversely affecting the market share in

Industrial explosives of IBP from a high of around 30% down to 18%. Though

the installed capacity of the company is more than 1,25,000 tons, the capacity

utilization is only around 60% due to current price sensitive market and intense

competition from private players. Presently, IBP is the only central public sector

company servicing the market for industrial explosives. The business group

experienced very high profits in the beginning when there were only two

competitors (IEL and IDL) and progressively incurred losses from the late

nineties. However, a turnaround is expected in the business during the current

year owing much to the reorganization of the marketing department and the

required thrust planned and given by this department. This included significant

volumes and price from Coal India Limited besides the thrust in the non-coal

mining sector of the country that resulted in threefold increase in volumes.

New technologies

The advent of modern technologies in manufacture of explosives

including emulsions lead IBP to radically change the original technology from

Ireco Inc. and introduce new and cost effective technologies in both slurry and

emulsion products. However, the original Ireco’s slurry technology obtained in

80’s was modified through in house marketing and R&D efforts and made

superior to that of emulsion technology. Therefore, the superior techno-

economic advantages of site mixed slurry explosives over that of bulk emulsion

explosives were made available and the majority of IBP’s plants (9 out of 14)

continue to produce highly improvised bulk slurry explosives.

The site mixed slurry explosives, as the name suggests are manufactured

on site in a specially designed truck (called pumptruck) by carrying non-

explosive ingredients in separate chambers, mixing them in tailor-made

proportions and pumping them in liquid form directly in to bore holes. The

poured mixture acquires the characteristics of an explosive within about ten

minutes of pumping and solidifies slowly to the shape of the bore hole. Unlike

bulk emulsions, the SMS can be pumped in various densities ranging from 0.6

g/cm³ to as high as 1.20 g/cm³ and the energy can be varied to produce twenty

different types of chemically balanced explosive products to exactly the suit the

rock conditions and achieve techno-economic advantages for the customers.

The system eliminated the need for packaging, inventory, storage and handling

of various types of explosives and thus lowered direct costs to customers.

Expansion

The expansion phase of IBP in the field of explosives still continues with

plant-set up possibilities in the Cement Sector at Gulbarga, Bauxite mining

(NALCO, Orissa) Lignite (NLC, Tamilnadu) and Iron ore mining (NMDC,

Donimalai, Karnataka), Orissa & Rock phosphate mines of RSMM, Rajasthan

etc.

Indian Oil Corporation (IOC):-

It is an Indian public-sector petroleum company. It is India’s largest

commercial enterprise, ranking 105th on the Fortune Global 500 listing (2009).

It began operation in 1959 as Indian Oil Company Ltd. The Indian Oil

Corporation was formed in 1964, with the merger of Indian Refineries Ltd.

Indian Oil and its subsidiaries account for a 47% share in the petroleum

products market, 40% share in refining capacity and 67% downstream sector

pipelines capacity in India. The Indian Oil Group of Companies owns and

operates 10 of India's 19 refineries with a combined refining capacity of 60.2

million metric tons per year. On 30th June 2009 Indian Oil completed 50 years

of its existence and a series of events are being planned to celebrate its Golden

Jubilee Year

Overview Indian Oil operates the largest and the widest network of fuel

stations in the country, numbering about 17606 (15557 regular ROs & 2049

Kissan Sewa Kendra). It has also started Auto LPG Dispensing Stations

(ALDS). It reaches Indane cooking gas to over 47.5 million households through

a network of 4,990 Indian distributors. In addition, Indian Oil's Research and

Development Center (R&D) at Faridabad supports, develops and provides the

necessary technology solutions to the operating divisions of the corporation and

its customers within the country and abroad.

Subsequently, Indian Oil Technologies Limited - a wholly owned

subsidiary, was set up in 2003, with a vision to market the technologies

developed at Indian Oil's Research and Development Center. It has been

modeled on the R&D marketing arms of Royal Dutch Shell and British

Petroleum.

Products

Indian Oil's product range covers petrol, diesel, LPG, auto LPG, aviation

turbine fuel, lubricants, naphtha, bitumen, paraffin, kerosene etc. Xtra Premium

petrol, Xtra Mile diesel, Servo lubricants, Indane LPG, Autogas LPG, Indian

Oil Aviation are some of its prominent brands. Recently Indian Oil has also

introduced a new business line of supplying LNG (Liquefied natural gas) by the

cryogenic transportation. The branding called "LNG at Doorstep". Lng

headquarters are located in scope complex, Lodhi Road Delhi.

Refineries

Digboi Refinery, in Upper Assam, is India's oldest refinery and was

commissioned in 1901. Originally a part of Assam Oil Company, it

became part of Indian Oil in 1981. Its original refining capacity had been

0.5 MMTPA since 1901. Modernisation project of this refinery has been

completed and the refinery now has an increased capacity of 0.65

MMTPA.

Guwahati Refinery, the first public sector refinery of the country, was

built with Romanian collaboration and was inaugurated by Late Pt.

Jawaharlal Nehru, the first Prime Minister of India, on 1 January 1962.

Barauni Refinery, in Bihar, was built in collaboration with Russia and

Romania. It was commissioned in 1964 with a capacity of 1 MMTPA. Its

capacity today is 6 MMTPA.

Gujarat Refinery, at Koyali in Gujarat in Western India, is IndianOil’s

largest refinery. The refinery was commissioned in 1965. It also houses

the first hydrocracking unit of the country. Its present capacity is 13.70

MMTPA.

Haldia Refinery is the only coastal refinery of the Corporation, situated

136 km downstream of Kolkata in the Purba Medinipur (East

Midnapore) district. It was commissioned in 1975 with a capacity of 2.5

MMTPA, which has since been increased to 5.8 MMTPA

Mathura Refinery was commissioned in 1982 as the sixth refinery in the

fold of IndianOil and with an original capacity of 6.0 MMTPA. Located

strategically between the historic cities of Delhi and Agra, the capacity

of Mathura refinery was increased to 7.5 MMTPA.

Panipat Refinery is the seventh refinery of IndianOil. The original

refinery with 6 MMTPA capacity was built and commissioned in 1998.

Panipat Refinery has doubled its refining capacity from 6 MMT/yr to 12

MMTPA with the commissioning of its Expansion Project.

Subsidiary refineries

1. Bongaigaon Refinery (2.95 MMTPA),

2. Chennai Petroleum (9.5 MMTPA)

Group companies and joint ventures

Indian Oil Technologies Ltd: Indian Oil Technologies Ltd. is the

marketing arm for the entire range of technologies developed at the R&D

Centre of Indian Oil Corporation Limited. This website gives an

overview of the various technologies, products, quality services and

solutions, developed and tested to meet or exceed customer

requirements. These technologies are tailor made and meant to provide

competitive advantage. Indian Oil Technologies is built on the strength

of its credibility proven in its sister divisions.

Indian Oil Technologies Ltd. headquarters are located at Indian Oil

R&D Centre, Faridabad.

Indian Oil (Mauritius) Ltd.

Lanka IOC PLC - Group Company for Sri Lanka retail and storage

operations which is listed on Colombo's stock exchange. It was locked

into a bitter subsidy payment dispute with Sri Lanka's Government

which has since been resolved.

IOC Middle East FZE

Chennai Petroleum Corporation Ltd.

Bongaigoan Refinery and Petrochemicals Ltd.

Green Gas Ltd. - joint venture with Gas Authority of India for city-wide

gas distribution networks.

Indo Cat Pvt. Ltd., with Intercat, USA, for manufacturing 15,000 tonnes

per annum of FCC (fluidised catalytic cracking) catalysts & additives in

India, for catering to rising global demand.

Numerous exploration and production ventures with Oil India Ltd., Oil

and Natural Gas Corporation

International rankings

Indian Oil is the highest ranked Indian company in the prestigious

Fortune Global 500 listing, the 116th position(in 2008) based on fiscal 2007

performance.

It is also the 18th largest petroleum company in the world and the number

one petroleum trading company among the National Oil Companies in the Asia-

Pacific region.

IOCL was featured on the 2008 Forbes Global 2000 at position 303.

Loyalty programs

XTRAPOWER Fleet Card Program is aimed at Large Fleet Operators.

Currently it has 1 million customer base. XTRAREWARDS is a recently

launched loyalty program for retail customers where customers can earn reward

points on their purchases.

Competitors

Indian Oil Corporation has two major domestic competitors, Bharat

Petroleum and Hindustan Petroleum. Both are state-controlled, like Indian Oil

Corporation. There are two private competitors, Reliance Petroleum and Essar

Oil. And now shell.

Concerns

Indian Oil Corporation earned concerns about the state of affairs in its

marketing business when Shanmugam Manjunath, a marketing manager and an

MBA from prestigious Indian Institute of Management Lucknow, was murdered

in 2005 for sealing a corrupt petrol station in the state of Uttar Pradesh (U.P.).

The corporation's Mathura Refinery unit has also remained constantly in news

due to the threat of air pollution created by it.

Oil Industry Development Board

India has begun the development of a strategic crude oil reserve sized at

37.4 million barrels, enough for two weeks of consumption. Petroleum stocks

have been transferred from the Indian Oil Corporation (Indian Oil) to the Oil

Industry Development Board (OIDB). The OIDB then created the Indian

Strategic Petroleum Reserves Ltd (ISPRL) to serve as the controlling

government agency for the strategic reserve.

SHELL PETROLEUM:-

Royal Dutch Shell is the largest and most diversified international

investor in India's energy sector among all global integrated oil companies with

nearly US$1 billion invested already. It is the only global major to have a fuel

retail license in India. Besides being a major private sector supplier of crude,

products, chemicals and technology to public/private sector oil companies, Shell

also has key interests in lubricants, bitumen and LPG while operating an LNG

receiving and re-gasification terminal, as well as a significant Technology

center and now a financial shared services center. India has been a focus

country for investments from the global Shell Foundation, which has committed

resources across seven programs and has already spent over USD5.5 million to

date impacting more than 1,19,000 households and 195 entrepreneurs.

Set up in 1928, The Burmah-Shell Oil Storage and Distributing Company

of India Limited was a pioneer in more ways than one, and began operations

with import and marketing of Kerosene. It pioneered rural marketing by

reaching out to people even in remote villages to ensure supply of kerosene.

With motor cars, came canned petrol, followed by service stations which were

built in the 1930s.

JRD Tata's historic solo flight

On 15th October 1932, when civil aviation arrived in India, the company

fueled J.R.D. Tata's historic solo flight in a single engine de Havilland Puss

Moth from Karachi to Bombay (Juhu) via Ahmedabad.

Then, the company introduced LPG as a cooking fuel to the Indian home

in the mid-1950s. Besides selling bitumen, the company pioneered desert road

construction in India. In 1955 the company commissioned what was then

India’s largest refinery which was the first to process newly found indigenous

crude (Bombay High), in the country.

On 24th January 1976, the Burmah Shell Group of Companies was taken

over by the Government of India.

With nearly US$1 billion invested already, Shell is the largest and most

diversified international investor in India’s energy sector.

OIL PRODUCTS:

Lubricants

A state-of-the-art lube-oil blending plant at Taloja (outside Mumbai in

western India) – considered to be among the finest lube-oil blending plants in

Asia, manufacturing a range of branded lubricants focused on the automotive

and industrial sector

Bitumen

The first Shell polymer modified bitumen plant in India launched

December 2006 at Uluberia in West Bengal

To produce a range of products, emulsions, crumb rubber

modified bitumen and polymer modified bitumen.

Plant capacity is 50,000 tonnes per annum

LPG

Focused on Commercial and Industrial segments in Maharashtra,

Gujarat.

120 ktpa LPG import terminal at Pipavav and a filling plant at

Kheda, Guajrat

Retail

Only international company to be granted and actualise

Government of India approval to retail fuel in India till date.

License for 2000 fuel retail stations.

Won the “National Award” from President of India in Year 2007

for work with the disabled people as an employer

Technology Solutions

TSA with Reliance, CHT, and IOC.

Catalyst sales

Trading

Major Private Sector supplier of crude, products and chemicals to

public/private sector oil companies.

Gas and Power:

JV between Shell (74%) and Total (26%)

Hazira LNG receiving and re-gasification terminal.

Capacity 2.5 million tonnes of LNG per annum.

Bulk container port under development at Hazira

TECHNOLOGY

Located at Bangalore.

To deliver high-end technical studies, projects, and services for

Shell worldwide, plus supporting interests in India.

FINANCIAL SHARED SERVICES

Located at Chennai.

Start-up: mid-2008

CORPORATE SOCIAL RESPONSIBILITY

All Shell companies in India invest in community development as

a part of their commitment to Sustainable Development.

Shell aims that its business activities should contribute towards

benefiting communities.

The Shell India contribution to mainstreaming the disability

movement in India is widely recognized – creating role models in

this sector by means of the Shell Helen Keller Awards.

Shell in India is also active in the area of road safety.

THE SHELL FOUNDATION an independent UK based charity in India

Has committed USD7.5 million across seven programmes.

Current Impact – more than 1,19,000 households and 195

entrepreneurs.

Programmes undertaken include household energy and health,

energy access & sustainable livelihood programmes for poor

communities.

Breathing Space reduction in indoor air pollution through

smokeless chulhas in Maharashtra and Bundelkhand.

Trading Up organic farming and fair trade label practice to build

sustainable livelihoods in the Kutch district (Gujarat) Orissa.

Excelerate small medium enterprise program supporting barefoot

entrepreneurs in energy and transport.

Services provided apart from Re-fueling:-

1. Automation of Fuel Dispensers.

2. Establishing new Fuel Stations at Convenient Locations.

3. Introducing different brands of fuel.

4. ERP & CRM implementations at Company level.

5. Marketing for Brand Recognition.

6. Launch of New Products, Related Goods & Services.

7. Introducing windshield cleaning for four wheelers.

8. Free oil change for two wheelers on purchase of lubricants.

9. Introducing convenience stores in fuel outlets for the customers.

Reliance Petroleum Limited:

Reliance Petroleum Limited was set up by Reliance Industries Limited

(RIL), one of India's largest private sector companies based in Mumbai. RPL is

subsidiary of RIL, and has interests in the downstream oil business. RPL also

benefits from a strategic alliance with Chevron India Holdings Pte Limited,

Singapore, a wholly owned subsidiary of Chevron Corporation USA (Chevron),

which currently holds a 5% equity stake in the Company.

Jamnagar Refinery:

Refining activities of Reliance Industries Limited are carried out at the

Jamnagar refinery complex with refining capacity of 27 million tonnes per

annum (540,000 barrels per day).The refinery is able to process a wide variety

of crudes- from very light to very heavy (from 18 to 45 degree API) and from

sweet to very heavy (with sulphur content from 0 to 4.5%).

RPL commenced its crude processing on 25 December 2008. The

secondary processing units are commissioned and the entire refinery complex is

expected to attain full capacity shortly. With an annual crude processing

capacity of 580,000 barrels (92,000 m3) per stream day (BPSD), RPL will be

the sixth largest refinery in the world. It will have a complexity of 14.0, using

the Nelson Complexity Index, ranking it amongst the highest in the sector. The

polypropylene plant will have a capacity to produce 0.9 million metric tonnes

per annum.

The refinery project is being implemented at a capital cost of Rs 270,000

million being funded through a mix of equity and debt. This represents a capital

cost of less than US $10,000 per barrel per day and compares very favourably

with the average capital cost of new refineries announced in recent years. The

International Energy Agency (IEA) estimates the average capital cost of new

refinery in the OECD nations to be in the region of US $15,000 to 20,000 per

barrel per day. The low capital cost of RPL becomes even more attractive when

adjusted for high complexity of the refinery.

Expansion:

Reliance petroleum is in the process of purchasing the downstream

business of Mobil in Australia. This will give them two more refineries and 800

service stations in Australia.

Retailing in India:

Reliance Industries Ltd has moved ahead with its petroleum retailing plan

and set up a network of 500 outlets by the end of 2003. The Company was

granted marketing rights for setting up 5,849 petrol pumps across the country.

The company has received close to 50,000 applications for land from

across the country for setting up retail outlets. The company had invited

applications in the month of August 2002.

The petroleum retail business of the company was put on a fast track after

the launch of Reliance Infocomm. The company was largely focusing on the

highways for opening its retail outlets.

The company had roped in overseas consultants Tattersfield Minale and

Flying J for designing the retail outlets.

As far as customer acquisition is concerned, the brand differentiation and

a fuel mix will played a key role in attracting customers in that a competitive

scenario.

"There would be acceleration in the non-fuel business in the retail outlets,

the overall impact of competition on the customers will be very good," said Mr.

Chaturvedi of RPL.

Initially the company got the sales which made the PSUs to worry about

the future of them in the sector.

Reliance petroleum came up with the slogan that private players should

also be given subsidies in order to provide fuel at the cost which PSUs sell.

But later on the company stopped its operations due to APM and

competitive subsidized prices of PSUs and other factors. Only some outlets in

different locations of the country are operating now.

RETAIL SITE HEADACHE

Securing prime retail sites is also a headache. Real estate prices remain

high and the process of acquiring real estate is mired in red tape. Moreover, land

titles in India tend not to be clear, leading to delays. And construction can be

challenging – schedules aren’t adhered to, quality needs to be closely

monitored, and safety consciousness has a long way to go.

However, the outlook for newcomers is starting to improve. Government

policies are becoming increasingly liberal and market-driven, and there is an

overall cultural shift towards greater professionalism in Indian business. While

there does not appear to be any imminent movement on the government’s

approach to fuel pricing, the economy in general is moving towards greater

deregulation. Tax reform promised in 2010 could significantly improve the

outlook for private players in the oil sector through a simplified indirect tax

structure. This could allow the government greater room to introduce free

pricing.

Meanwhile, fuel retailers in India are gradually adopting the practices

already used in international markets, which plays to the strength of newcomers

who are building their networks from scratch. Fuel retailing in other parts of

Asia, such as Singapore, has moved towards providing convenience stops for

customers, following the model that prevails in Europe and North America.

India is likely to follow in the same direction, especially in cities. However, the

pace of change and the speed with which newcomers gain a foothold in the

Indian market still depend largely on government policy. As long as market

forces do not determine prices and subsidies to NOCs continue, these

companies will have an advantage.

CRM PRACTISE IN PETRO- RETAILING BUSINESS

The definite answer would be NO. There has been no Customer

Relationship Management program followed at a Fuel Retail Station

anywhere in the world for various reasons, but a significant change has been

observed with Oil Companies which are into retailing going in for ERP & CRM

implementation in the organisation but restricted within the company,

connecting to suppliers and distributors but not at all the END CONSUMERS.

Reasons for NO CRM at Fuel Retailing Stations:

1. High Cost of Implementation.

2. Lower Margins on sales.

3. Huge Customer Base.

4. Geographically Widely Spread.

5. CRM a pretty new concept to be tested.

6. Few Driveway Attendant’s. (Western Countries Usually)

7. Customization not possible.

8. Sales Boost not predicted in developed countries.

THE NEED FOR CRM AT FUEL STATIONS IN INDIA

This project is exclusively done on leading petrol bunks in the city of

Hyderabad, Nizamabad and on NH-9. The main reason for choosing this sector

is that, there is not such of customer relationship is being maintained with the

bunks & the end user as such. To bridge the gap between the customer & the

dealers so that an effort is being made to make a customer a brand loyal.

CONSUMER’S INCREASING EXPECTATIONS

With growing competition in the petro-retailing sector, today’s consumer

is becoming more and more demanding. The emergence of new psychographic

segments in petro retail market bears the testimony to this fact. A closer look at

these segments tells us what exactly a consumer is looking for whenever he

goes to a fuel station to purchase fuel. He looks for-

Quality & Quantity assurance

Quick filling and efficient forecourt service

Rewarding loyalty

Premium fuels

Cashless transactions

Non-fuel services

NEW PLAYERS IN PETRO-RETAIL SECTOR

The deregulation of the marketing sector has led to the grant of marketing

rights to Reliance Industries (5,849), Essar Oil (1,700), ONGC (1,110), and

Shell (2,000). Anticipating the immense competition ahead in the petro

retailing, the existing oil marketing companies has geared up and the following

are the changes that have occurred in recent past since the deregulation of

downstream oil industry.

Shifting focus from the urban to highways and sub-urban areas.

More communication with the customers in the media and onsite.

Building PFS, Club HP, Q&Q as a brand.

From fuel dispensing to multi product selling.

From commodity selling to brand marketing.

From executive level sales management to intermediary supervisory cadres.

From direct controls to third party audits – these certifying agencies require

their own infrastructure.

From dealer proprietor to reputed companies from other sectors making

forays into petro-retail management.

Given today's open & competitive environment, oil marketing companies,

both existing and new entrants, are going full steam ahead to capture the largest

share of the pie. While the PSUs have added more than 3000 retail outlets to

their network in last three years since deregulation, the private players have

added only a little over450 retail outlets. However, we can say that with 30,000

petrol retail outlets expected in the next 5 years, up by 30% from today, there is

going to be a downward pressure on profit margins and revenues per outlet

which will push the industry to reinvent itself.

And in order to reinvent; the industry will either face cut throat

competition, Consolidation or a sure path to increase customer loyalty by higher

customer satisfaction & increasing brand value through future vision thinking.

INITIATIVES TAKEN SO FAR

Strict Implementation of Programs to avoid Fraud’s.

1. Automation of Fuel Dispensers.

2. Establishing new Fuel Stations at Convenient Locations.

3. Revamp of Old Outlets.

4. Introducing different brands of fuel (Power, Xtramile, Super, 91 octane).

5. ERP & CRM implementations at Company level.

6. Marketing for Brand Recognition.

7. Launch of New Products & Related Goods & Services.

8. Introducing windshield cleaning for four wheelers.

9. Free oil change for two wheelers on purchase of lubricants.

10. Introducing convenience stores in fuel outlets for the customers.

11. Vehicles wash and wheel alignment facility in some outlets.

12. Insurance renewal stalls.

13. Loyalty cards (not widely used).

14. ATM.

15. Bill payment drop Boxes.

16. Tie-ups with different stores and hotel.

17. Establishing new and remodeling old outlets on highways with food

courts, and all other necessary facilities.

It is believed that a true customer centric relationship can only be

accomplished by considering the unique perspectives of every single customer

of the organisation. Hence the pressing need is to put in place a technology

enabled CRM solution.

THE CRM ROAD MAP:-

CRM is viewed as a discipline as well as a set of discrete software

technologies, which will focus on automating and improving the business

processes associated with the customer – face –to-face, Call Centre, web,

telephone, sales associates, etc – so as to allow to carry out cradle-to-grave

customer management more efficiently. It should allow engaging in one-to-

one marketing by tracking complete customer life-cycle history. To begin with

it will automate process-flow tracking in the product sales process, and be able

to generate customized reports and promote cross selling. It will also enable

efficient campaign management by providing a software interface for

definition, tracking, execution, and analysis of campaigns.

From an architecture perspective, the enterprise-wide CRM solution

should seamlessly integrate non-transactional related customer information

housed in the front-office with the transactional information housed in the back

office.

IMPLEMENTING CRM

A very detailed and comprehensive CRM action plan was developed

based on the understanding that CRM will require enterprise wide

transformation.

Interviews with key individuals throughout the organisation helped

identify different initiatives that have been launched, all focused on CRM.

The next step in the planning process was a Gap Analysis. This analysis

essentially compared current stage against optimal relative to the five aspects of

business, to identify and specifically describe the gaps.

THE CRM BUSINESS CYCLE:-

1. Understand and Differentiate.

2. Develop and Customize.

3. Interact and Deliver.

4. Acquire and Retain.

Successful customer retention is based very simply on the organisations

ability to constantly deliver on three principles:

Maintain interaction; never stop listening to customers.

Deliver on customer’s value definition. Remember that customers change

as they move through differing life stages; be alert for the changes and be

prepared to modify the service and value proposition as they change.

Prioritizing Changes; because there might be many gaps, therefore many

changes that an organisation will need to make, prioritization is critical.

The evaluation of each of the strategies identified to resolve the gaps are

based on:

Cost to implement – including initial onetime costs, as well as anticipated

ongoing expenses.

Overall benefit – some changes may have higher impacts on an organisation’s

ability to increase customer value and loyalty.

Feasibility – based on the organisation readiness, data and systems support,

resource skill sets and a number of other factors.

Time Required – including the time necessary for training and addressing

“cultural” change management issues related to a specific strategy.

Creating an Action Plan-

The next step in the planning process is the development of a very detailed

action plan. While the complete plan might span three or more years, it is based

on three-month phases with clear deliverables that will demonstrate both

progress and quick hits or measures of success. The plan should identify

interdependent activities and should comprehensively detail the time and

resources required for each activity.

Another key factor for the planning process is the Leadership Action

Plan. Advancing on the CRM transformation map required significant

organisation change. This part of the action plan helped assess the drivers and

restraints of change and the organisation’s readiness to assess the change.

Selecting and Implementing a Technology Based Solution:-

The successes of the CRM initiatives were contingent on various

decisions pertaining to technology. Some of the key issues were:

Make or Buy: - The decision to buy was based on an evaluation of an identified

set of criteria. Some criteria were Functionality, Flexibility, Scalability, Fit with

existing architecture, etc. was decided to purchase an off-the-shelf CRM

solution and customize it to suit ICICI’s requirements.

From whom to buy: Some Criteria included were CRM expertise, Retail

Finance Experience, Credentials including financials, client list, life history, etc.

A detailed Request for Information (RFI) was sent to each of the shortlisted

companies. After receiving the RFIs, another round of evaluation was done.

After short listing two product vendors and system integrators, reference calls

were made to several of the past clients of all shortlisted companies.

PROCESSES:-

All processes are mapped on to product by understanding the details.

During the course of the process mapping, several opportunities for

improvement maybe identified and implemented.

LESSONS FROM THE OTHER COMPANIES EXPERIENCE:-

If CRM involves optimizing product, price, place of distribution,

promotion, sales and service, why are so many companies struggling? Hasn’t

anyone really mastered the art and science of CRM, and if not, why is it so

difficult?

CRM is difficult because it is an enterprise wide initiative:-

CRM is not a technology initiative- Many have confused CRM as a

technology initiative, and assigned the CRM implementation project to their

information system or information technology group. CRM conferences often

equate to technology exhibits and demonstrations. Technology is needed in

order to implement CRM – particularly the customization part – but technology

is not the driver of CRM, or the solution to successful CRM implementation.

CRM is not exclusively a marketing initiative- Many organisation have

merely equated CRM with customer focused marketing, or

data-driven/database marketing. CRM results in more effective, data driven

marketing efforts; CRM requires marketing experience. But CRM is strictly not

a marketing initiative.

CRM is not exclusively a sales initiative- Similar to marketing, CRM is often

lodged within the sales department. The sales-force, after all, is extremely close

to their customers understanding their needs and wants, and trying to fulfill

them. Sales, however, is just one functional area that can benefit from CRM,

and that is necessary for effective CRM.

CRM is not exclusively a service initiative- As with sales and marketing,

customer service is one functional aspect of successful CRM implementation.

But customer service is not the sole driver of the process. CRM involves

marketing, sales, service, and technology, as well as the other inner workings of

the organisation. Having even one “broken spoke in the wheel”, one area of the

organisation that is less than committed to CRM, can make the difference

between success and failure.

SURVEY

In order to get a real outlook regarding a need for CRM implementation

at Retail Fuel Stations, a lead of various Primary, Secondary Research &

Methodologies has been designed.

Some Parts of the Lead being:

Questionnaire.

Interviews.

Observation.

Feedback.

Enterprise Policies.

Statistical Tools.

Marketing Concepts.

SAMPLE SIZE:

1. Off site survey: 150.

2. Onsite survey: 200.

CUSTOMER FEEDBACK

OFF – SITE CUSTOMER SURVEY(As part of my M.B.A curriculum this project is done)

1. Which Fuel Station do you usually go to get your vehicle refueled? _______________________________________________________________

2. Do you visit?

a) Only One Fuel Station. b) More than One less than Five.

c) Any fuel station.

3. What is the reason for selecting the Fuel Station?

a. Close/ on the way to your Residence / Office. b. Have Loyalty Card.

c. Quality of Fuel. d. Driveway Attendants. (Service Rendered).

e. Vehicle Water Servicing. f. Other Services (IF, THEN WHAT___)

g. All the Above.

4. What all services do you like to avail at the Fuel Station?

a) Only Vehicle Refueling. b) Tyre Air Pressure Check.

c) Vehicle Oil. d) Convenience Store.

e) ATM. f) Vehicle Water Servicing.

g) General Clean Up . h) Insurance renewal.

i). Pollution certificate. J) Food Court

k) Rest Rooms L) If any other, Specify______________

5. What is the usual Mode of Payment?

a. Cash b. Credit / Debit Cards

c. Special Credit cum Loyalty Cards d. Petro Cards

6. Do you trust upon the Fuel Quality & Quantity purchased by you at Fuel Station of your Choice?

a) YES b) MAY BE

c) NO d) Does not Matter

7. Do you prefer any other services to be provided in the petrol station?

a) YES b) NO

c) No Idea

8. Do you find any difference in the Quality of Fuel at different Fuel Stations?

a) YES b) NO

9) Do you think there is necessity of changing any service or the infrastructures of the retail refueling stations please say in few sentences

10. Prioritize your Needs for Selecting a Fuel Station? (From 1 to 10, 1 Being Top Priority)

a. Quantity & Quality of Fuel.

b. Driveway Attendants.

c. Convenience of Location.

d. Convenience Store.

e. ATM.

f. Provision of Loyalty Benefits.

g. Free Glass Clean Up.

h. Vehicle Water Servicing.

i. Variants of Fuel.

j. Other related Products & Services {Oil, PUC, Tire Air Pressure Check etc.}

k. Others (Please Specify and Rate) _______________________________

PERSONAL INFORMATION:-

NAME: EDUCATION:-

Profession: Govt. Service/ Pvt. Service/ Self employed

Vehicle Held: Avg. Predicted Age Group:

Avg. Fuel Consumption per Month:

ON SITE CUSTOMER SURVEY

SHELL STATION (Uppal), BHARAT PETROLEUM (Tarnaka),

BHARAT PETROLEUM, IBP (NIZAMABAD), HP, BP (NH-7).

1. Do you often Visit this Fuel Station. How many times per Month?

2. Why do / did you visit this petrol station?

1. Quality & Quantity of Fuel. 2. Brand Name.

3. Convenient Location. 4. Driveway Attendants.

5. Refuel was required on priority. 6. Others_____________

3. Are you satisfied with the services that are rendered to you here?

a) YES b) NO c) Partly satisfied

4. Do you believe in the Quality & Quantity of Fuel that is provided in here?

a) YES b) NO c) Can’t Say

5. Do other services like Car wash, Convenience stores, Good Drive way Attendants, Other facilities attract you towards this station?

a) YES b) NO c) MAY BE

6. Any suggestions to improve the facilities here?

________________________________________________________________

________________________________________________________________

________________________________________________________________

________________________________________________________________

QUESTIONNAIRE TO THE MANAGER

1. What is the Station’s major Factor making customer drive in?

2. What extra services do you provide for your customers?

3. How much usual storage of extra fuel is always there at station?

4. What is Max Storage of Fuel at the station?

5. Does customer come here only for refueling or any other service?

6. Do you maintain complaint book?

7. Do you think additional services or Value added services attract customers?

8. Do you think implementation of CRM will bring change in the Sales?

9. What are your strategies to attract customers and make them drive-in?

INTERVIEW

MANAGER

TARNAKA FILLING STATION

IMAGE NOT

AVAILABLE

MANAGER

“The margins in this sector are very low so implementation of customer satisfaction programs is less. In our outlet we provide cold water, air cooled driveways in summer along with air filling, vehicle wash and wheel alignment.

Good ambience, visibility from distance results in drive in. we have customers who are loyal to our fuel station one of them get services from us since 31 years.

If company starts implementing the CRM that would give much more advantage to the outlets”

“The margins in this sector are very low so implementation of customer satisfaction programs is less. In our outlet we provide cold water, air cooled driveways in summer along with air filling, vehicle wash and wheel alignment.

Good ambience, visibility from distance results in drive in. we have customers who are loyal to our fuel station one of them get services from us since 31 years.

If company starts implementing the CRM that would give much more advantage to the outlets”

“Artificial price monitoring of the government in public sector oil companies is giving tough competition to us, our fuel is not subsidized hence cost is little more than them.

We are providing much better service than other competitors and customers are receiving that, our fuel is high quality.

Once this price monitoring is removed we will provide many more services to our customers, our key factors are spacious outlets, quality of fuel, convenience stores, good drive way attends.”

“Artificial price monitoring of the government in public sector oil companies is giving tough competition to us, our fuel is not subsidized hence cost is little more than them.

We are providing much better service than other competitors and customers are receiving that, our fuel is high quality.

Once this price monitoring is removed we will provide many more services to our customers, our key factors are spacious outlets, quality of fuel, convenience stores, good drive way attends.”

SHELL FUEL STATION, UPPAL

Bhadur singh Truck driver

Ram Das

Vehicle Mechanic

A. Venkateshwar Rao

Sanitary Inspector, NMC.

“We travel away from home to different places across India, we rest, cook and bath in places like petrol bunks or dhabas.

Good facilities in petrol bunk for cooking, bathing, and safe parking place makes us enter petrol bunk as now a day we see many truck steal incidents.

Companies should introduce card which functions across India in all stations so that we need not carry cash for fuel”

“We travel away from home to different places across India, we rest, cook and bath in places like petrol bunks or dhabas.

Good facilities in petrol bunk for cooking, bathing, and safe parking place makes us enter petrol bunk as now a day we see many truck steal incidents.

Companies should introduce card which functions across India in all stations so that we need not carry cash for fuel”

I being mechanic deal with different vehicles, fuel is the important factor that determines vehicles performance and life.

Customers ask us for better fuel stations but that cannot be suggested easily, fuel quality should be improved in outlets.

We purchase lubricants from dealers not fuel stations because they offer at discount prices but not in fuel stations if some tie up system is available in outlets we obviously purchase from outlets.

Lubricants and coolants should be made available in highway outlets because they are required in emergency.

I being mechanic deal with different vehicles, fuel is the important factor that determines vehicles performance and life.

Customers ask us for better fuel stations but that cannot be suggested easily, fuel quality should be improved in outlets.

We purchase lubricants from dealers not fuel stations because they offer at discount prices but not in fuel stations if some tie up system is available in outlets we obviously purchase from outlets.

Lubricants and coolants should be made available in highway outlets because they are required in emergency.

I am employ in Municipal Corporation which is a government department, our vehicles get refueled in local petrol bunks through local tie ups. The payments are on credit basis will be paid per month.

The fuel station depends upon the local department and influences, if there is tie up with the company across the state same companies outlets are used and also payment will be directly from central head office.

My department uses nearly 75 ltrs a day, being a small office and town it is much more in big cities.

I am employ in Municipal Corporation which is a government department, our vehicles get refueled in local petrol bunks through local tie ups. The payments are on credit basis will be paid per month.

The fuel station depends upon the local department and influences, if there is tie up with the company across the state same companies outlets are used and also payment will be directly from central head office.

My department uses nearly 75 ltrs a day, being a small office and town it is much more in big cities.

Mahender Yadav

Shop owner

I refuel my vehicle daily and quality differs from outlet to outlet I like to refuel my vehicle at IBP amberpet as I trust the quality there I refuel in same bunk since four years.

Air check and other facilities are not properly maintained properly in outlets, toilets and drinking water should be provided compulsorily in outlets.

I refuel my vehicle daily and quality differs from outlet to outlet I like to refuel my vehicle at IBP amberpet as I trust the quality there I refuel in same bunk since four years.

Air check and other facilities are not properly maintained properly in outlets, toilets and drinking water should be provided compulsorily in outlets.

B. Nagaraju

Sree Transport Co.

Karthik Rao. J

Software Engineer

I am the owner of a transport company, my trucks travel across India. I got some fleet cards or loyalty cards, which are not extensively in use.

My trucks need to be refueled in different parts of the country if cards are provided by a company which may be prepaid or credit basis using which my trucks can be refueled in the outlets of the company, it would be better and convenient to us.

Also there should be something which says where the nearest outlet is maybe a route can be planned and outlets in the route are given or a call centre to assist.

Loyalty benefits should be provided and should be attractive

I am the owner of a transport company, my trucks travel across India. I got some fleet cards or loyalty cards, which are not extensively in use.

My trucks need to be refueled in different parts of the country if cards are provided by a company which may be prepaid or credit basis using which my trucks can be refueled in the outlets of the company, it would be better and convenient to us.

Also there should be something which says where the nearest outlet is maybe a route can be planned and outlets in the route are given or a call centre to assist.

Loyalty benefits should be provided and should be attractive

When such good offers are provided in other retail sector why not in fuel retailing. There is nothing like improvement in this sector except number of outlets and the colourful outlets.

Many more services can be provided in outlets, the driveway attends should be trained to be polite and customer friendly.

Cashless service should be provided and outlets should be designed such that a person can do other works apart from refueling. (ATM, Convenience stores…).

If CRM is implemented in fuel stations or companies that will be fetching for companies and also helpful for customers.

Insurance renewal, PUC services should be provided and renewal should be intimated.

When such good offers are provided in other retail sector why not in fuel retailing. There is nothing like improvement in this sector except number of outlets and the colourful outlets.

Many more services can be provided in outlets, the driveway attends should be trained to be polite and customer friendly.

Cashless service should be provided and outlets should be designed such that a person can do other works apart from refueling. (ATM, Convenience stores…).

If CRM is implemented in fuel stations or companies that will be fetching for companies and also helpful for customers.

Insurance renewal, PUC services should be provided and renewal should be intimated.

CUSTOMER FEEDBACKOFF – SITE CUSTOMER SURVEY

(As part of my M.B.A curriculum this project is done)

1. Which Fuel Station do you usually go to get your vehicle refueled?

ANS) Not particular but nearby home or office, some are particular about

(quality)

2. Do you visit?

a) Only One Fuel Station. (37) b) More than One less than Five.(74)

c) Any fuel station. (39)

3. What are the reasons for selecting the Fuel Station?

a. Close/ on the way to your Residence / Office.(49) b. Have Loyalty Card.(36)

c. Quality of Fuel. (104) d. Driveway Attendants. (Service Rendered).(43)

e. Vehicle Water Servicing.(10) f. Other Services (IF, THEN WHAT_)(none)

g. All the Above. (52)

4. What all services do you like to avail at the Fuel Station?

a) Only Vehicle Refueling.(62) b) Tyre Air Pressure Check.(127)

c) Vehicle Oil. (27) d) Convenience Store. (39)

e) ATM.(78) f) Vehicle Water Servicing. (28)

g) General Clean Up .(67) h) Insurance renewal.(44)

i). Pollution certificate. (78) J) Food Court.(32) highway

k) Rest Rooms (7) L) If any other, Specify__(none)

5. What is the usual Mode of Payment?

a. Cash. (98) b. Credit / Debit Cards. (22)

c. Special Credit cum Loyalty Cards. (11) d. Petro Cards (19)

6. Do you trust upon the Fuel Quality & Quantity purchased by you at Fuel Station of your Choice?

a) YES. (94) b) MAY BE. (38)

c) NO. (10) d) Does not Matter. (8)

7. Do you prefer any other services to be provided in the petrol station?

a) YES. (132) b) NO. (8)

c) No Idea. (10)

8. Do you find any difference in the Quality of Fuel at different Fuel Stations?

a) YES. (128) b) NO. (22)

9) Do you think there is necessity of changing any service or the infrastructures of the retail refueling stations please say in few sentences?

Automatic fuel dispensers should be installed in every bunk, Ambience should

be good, Drive ways should be good avoiding muddy ways, Drive way attends

should be polite, Air filling and PUC should be in every bunk, Fuel shortage

should be avoided, Convenience stores and ATM’s in necessary places, Wind

shield cleaning and other services. Hygienic toilets, clean drinking water,

Cashless service, First aid Kit, STD PCO. (Different suggestions of customers)

10. Prioritize your Needs for Selecting a Fuel Station? (From 1 to 10, 1 Being Top Priority)

a. Quantity & Quality of Fuel. (95)

b. Driveway Attendants. (40)

c. Convenience of Location. (74)

d. Convenience Store. (30)

e. ATM. (53)

f. Provision of Loyalty Benefits.(67)

g. Free Glass Clean Up. (34)

h. Vehicle Water Servicing. (46)

i. Variants of Fuel. (10)

j. Other related Products & Services {, PUC, Tire Air Pressure Check etc.} (78)

k. Others (Please Specify and Rate) Insurance (3) Ambience (45)

Depending upon the first, second and third order of preferences the weightage is assigned to the above preferences. The option which gets 1st, 2nd, or 3rd preference is given one point.

ON SITE CUSTOMER SURVEY

SHELL STATION (Uppal), BHARAT PETROLEUM (Tarnaka),

BHARAT PETROLEUM, IBP (NIZAMABAD), HP, BP (NH-7).

1. Do you often Visit this Fuel Station. How many times per Month?

ANS) min- 5 to max- 10, some only once.

2. Why do / did you visit this petrol station?

1. Quality & Quantity of Fuel.(180) 2. Brand Name. (40)

3. Convenient Location. (73) 4. Driveway Attendants. (22)

5. Refuel was required on priority. (35) 6. Others_____________

3. Are you satisfied with the services that are rendered to you here?

a) YES (79) b) NO c) Partly satisfied

4. Do you believe in the Quality & Quantity of Fuel that is provided in

here?

a) YES (164) b) NO (4) c) Can’t Say(32)

5. Do other services like Car wash, Convenience stores, Good Drive way

Attendants, Other facilities attract you towards this station?

a) YES (178) b) NO (7) c) MAY BE (15)

6. Any suggestions to improve the facilities here?

Loyalty benefits should be provided, Customer benefit programs should be

conducted, and Service should be faster.

QUESTIONNAIRE TO THE MANAGER

1. What is the Station’s major Factor making customer drive in?

A) 1. Quality and Quantity, service (shell)

2. Quality and quantity, easy approach, visibility from distance, quick

service, good ambience, response to customer immediately. (B P Tarnaka)

3. Quality and quantity, service, parking facilities, highway services,

attached food court. (B P Medchal).

4. Quality and quantity, Parking. (H P Medchal).

5. Quality and Quantity, Location. (IBP Nizamabad)

2. What extra services do you provide for your customers?

A) 1. Convenience stores, free air check up, four wheeler windshield cleaning,

two wheeler oil check and change free.(Shell)

2. Pure drinking water, wheel alignment, air check, cold drinking water, air

cooled driveways (in summer), petro-card, credit card, fleet card, V-care.

3. ATM (B P Medchal).

4. Pure drinking water.

5. None. (IBP Nizamabad)

3. How much usual storage of extra fuel is always there at station?

A) 1 ½ days (B P Tarnaka), Confidential (others).

4. What is Max Storage of Fuel at the station?

A) 3 days (B P Tarnaka), Confidential (others).

5. Does customer come here only for refueling or any other service?

A) Yes (all)

6. Do you maintain complaint book?

A) Yes (all)

7. Do you think additional services or Value added services attract customers?

A) Yes (all)

8. Do you think implementation of CRM will bring change in the Sales?

A) Yes (all), but companies should take initiative.

9. Any more measures taken to increase customer satisfaction at your fuel

station?

A) Campaigns for safety, kids and etc... (Shell). None (others).

ANAYLSIS

Analysis of customer loyalty towards Fuel stations:-

Depending upon the second question in the offsite survey the answer are quantified and represented in graphical format.

1. Customers are loyal to the retail outlet but when the case of the people who travel extensively is considered many of them are using less than five outlets, these people can be made loyal to the brand or company.

2. Outlets should be available at all major locations or periodically at some distance.

3. The above graph clearly shows that the customers are loyal in good number and can be made loyal and retained with good strategic efforts.

Analysis of the reason for choosing a fuel outlet:-

Depending upon the third question in offsite survey and second question in onsite survey the answers are quantified and represented in graphical format.

1. The major factor that influences customers drive into the fuel station is quality and quantity (Q&Q). Hence Q&Q should be maintained properly across the outlets compulsorily.

2. Second factor is convenient location to them i.e. nearby office or home etc... setting up an outlet at every location is costly but care can be taken so that outlets are in periodical interval.

3. Loyalty cards play vital role in driving in customers but awareness about loyalty cards and its use is less. So loyalty cards should be promoted and good loyalty benefits should be provided.

4. Behaviour and response of driveway attendants is important as customers directly interact with them. Polite and kind behaviour of driveway attends attract customers.

5. Non fuel services like water wash, PUC, ATM, convenience stores, insurance renewal, etc also play important role as customer can get many works done at same place. Possible services can be provided.

Analysis on services expected by customers in fuel stations:-

Depending upon the fourth question in offsite survey and fifth question in onsite

survey the analysis is done.

1. This graph clearly says that customer expects many non fuel services

from the fuel stations.

2. Tyre air check up is expected to in outlet by major number of customers.

3. Next priority is given to ATM, General cleanup, PUC to be in the outlet.

4. Then comes convenience stores, and insurance renewal in the priority

these should be made available in selected outlets, convenience stores

should be placed in highway outlets majorly.

5. Next priority is for vehicle lubricants, vehicle wash, food court where

vehicle wash and lubricants should be made available in cities, on

highways lubricants and food courts can be placed.

Analysis of the payment modes of customers:-

Depending upon the fifth question of offsite survey the answers are quantified

and represented graphically.

1. Major payment mode is cash in the fuel stations.

2. Next place is of credit and debit cards, customers growing intrest in

cashless tractions is resulting in this change. Companies tie-ups with

banks also boosting this transactions (HP- ICICI Bank). This transactions

will increase in future.

3. Payments with loyalty cards and petro-cards is less because awareness

about them is less. Their service is available only in few outlets.

Analysis about the trust on the quality of the fuel:-

Depending upon the 4th and 6th question in onsite and offsite questionnaire the analysis is done

1. People trust on the Quality and Quantity of the fuel provided.

2. Hence we can say that it plays important role in retention of customers.

3. Companies and Outlet dealers should assure Quality and Quantity.

4. The primary need of a customer in fuel outlet is refueling so it should be

provided with good quality.

5. Quantity is major issue in the fuel outlets the dispensers are tampered

and altered, this should be strictly avoided and companies should take

care and inspect.

6. Quality is other issue in outlets where petrol and diesel are contaminated

by kerosene and some time thinning solvents, this should be avoided.

7. Customers are loyal to outlet or a brand for its Quality and Quantity.

Analysis about the priorities in selecting fuel stations:-

Depending upon the 10th question in the offsite question paper analysis is done

1. According to above chart it is seen that quality and quantity play

important role.

2. Then location, PUC and air check, play important role.

3. ATM, Glass cleanup, ambience also play key drive in factors.

4. Now a day’s all the companies are providing Quality and Quantity

assurance so now all the other factors in the list come into picture and

will constitute to the drive in factors.

INFERENCE FROM THE SURVEY

SUGGESTIONS

TO THE OIL RETAILING FIRM & RETAILERS: FUTURE VISION

1. Shift from retail outlet branding to corporate branding.

Ever since the market was deregulated, the oil companies are busy in

bringing the branding concept in petro-retailing which was a commodity market

for years with no differentiation. However, consistent efforts make them taste

success with the advent of branded fuels such as Speed, Xtrapremium etc. Also,

at the same time Retail Outlet branding was initiated and PFS (Pure For Sure),

Club HP and Q&Q outlets came into existence. But still the oil companies have

not found the way how to make a customer say pointing towards a Retail Outlet

that as this outlet belongs to a particular company, it will be the best in Q&Q

and others concerns. In other words, corporate branding is what on the cards in

the future of petro-retailing.

2. Offer of range of premium branded fuels.

Today, there are so many branded fuels of different oil companies in the

market like Speed (BPCL), Turbojet (HPCL), Xtrapremium (IOCL) etc. But

these fuels are more or less same with slight variations in the chemistry. Also,

there is a lack of product assortment in this business of branded fuels. There is

not much options to choose among. However, with high investment in R&D,

things are not going to remain same and very soon we will see a full range of

premium branded fuels like 93-octane petrol, 97-octane petrol, 125-octane

petrol etc.

3. Emergence of non-fuel services as a major activity at retail outlets

The dismantling of APM has removed the privilege of assured returns

from the PSUs and thus, it has increased pressure on their margins, as to

compete with the private players, who are with deep pockets, it is imperative to

make huge investment in the services being offered at the Retail Outlets. Since

the base product is same, the differentiating factor would be the non-fuel

services. Also, the changing face of the Indian consumer is one of the main

reasons behind the non-fuel services in petro-retailing. Today, he is looking at a

one stop solution to all his needs – buying groceries, withdrawing cash from his

bank, making utility payments, renewing his insurance cover, grabbing a quick

bite, obtaining Pollution Under Control Certification and of course filling fuel in

his car. On the other hand the driver on the highways is seeking a clean and

hygienic place to relax and freshen-up, service his vehicle and have a good meal

at the restaurant in the pump.

4. Loyalty programs an integral part

The immense competition will make loyalty programs an integral

program of the day to day functioning of petro-retailing. Of course, right now

many such loyalty programs are being run by the petro-retailers like Smart Fleet

(BPCL), Xtrapower (IOCL), Drivetrack (HPCL), Transconnect (Reliance),

Petrocard (BPCL) and others. However, these programs are mainly focused at

the bulk consumers and the small consumers are left unnoticed more or less. But

in future, there won’t be such differentiation and loyalty programs will be there

for every segment of consumers.

5. Attempt by all players to drive volumes to retail sites

In order to saturate the market before the private players can consolidate

network, the PSUs are vigorously setting up new outlets. In the last three years,

the PSUs have added more than 3000 outlets to their network. However, it will

reduce the throughput per Retail Outlet in long run. Hence in order to maintain

the throughput, all players will strive to drive volumes to their retail sites.

6. Leveraging automation and communication for enhanced offerings

In the wake of the increased customer’s expectation, in future, retailing of

petroleum products is going to be very sophisticated and highly modernized. In

the pipeline, there is a slew of automation infrastructure solutions ranging from

integrated point of sale terminals, aggregated data management system, fuel

delivery management and fleet management systems that help customer self-

service, dynamic pricing, network planning, demand forecasting and so on.

7. Competition on price

Price was till recently not a differentiating factor in Indian market

because prices were same for all the companies. However, with private players

coming into the market, the picture has changed. Essar & Shell is a glaring

example of this. In the future when the market determined pricing mechanism

will come into full effect, we will see the focus of competition shifting from

Q&Q to price.

8. Adoption of New Retail Skills

In the changed scenario, petro-retailers will have to take a look into the

retail skills they have and accordingly have to make adjustments in that.

Network optimization, Proposition/Brand Management, Dealer Management,

Site Operations Management, Partner Management, Customer Relationship

Management etc. are some of the skills that should be incorporated to succeed.

9. Alternate sources of Revenues

The growing competition will increase pressure on margins and therefore,

the retailers will seek for alternate sources of revenue, taking examples of

foreign experiences. To taste success in this, retailers need to develop a

sustainable non-fuel model which should synergize with core fuel business and

not detract. However, strategic foresight is one thing but what matters most is

the superior execution of those strategies and this is the factor which shapes

core competency for a company that is hard to replicate by the competitors.

BIBLOGRAPHY

1. www.shell.com

2. www.google.co.in

3. www.e-retail.com

4. www.managementparadise.com

5. www.wikipedia.com

6. www.businessline.com

7. www.ril.com

8. www.bharatpetroleum.com

9. Ministry of Petroleum & Energy.

10.University of Petroleum & Energy Studies, DELHI.

11. Managers at HP, SHELL, IBP, BP & IOC Fuel Stations.

12.Whole Hearted Response of Customers.