Thursday, June 7, 2007

MOL: targeting Romania's wealthy with new forecourt concept

Energy Business Review Online
6th June 2007
By Ricky Hill

MOL Romania has begun a project to build restaurants at some of its busiest service stations. Providing customers with restaurants equipped with internet access should enable the MOL unit to gain an advantage over its competitors. Nevertheless, given the developing nature of Romania, MOL should tread carefully and focus its efforts on the wealthier and busier metropolitan areas of the country.

MOL Romania has announced that it is to open restaurants at its most popular service stations in the region. The restaurants will operate under the Servus brand and will act as a separate entity from the company's petrol stations. The eateries will be open for 24 hours a day and will provide customers with hot food to eat in or take away, as well as access to wireless internet services.

Opening restaurants with wireless internet services will allow MOL to gain a competitive advantage as it will take the company's offerings one step beyond the simple forecourt shop, which has recently become a widespread phenomenon in Romania. In fact, the proportion of Romanian service stations with an on-site shop has increased significantly over the last few yeas, to the point that they can currently be found at over half of the country's sites.

Over the last few years, Lukoil, OMV, MOL and Agip have equipped all of their Romanian service stations with shops. Indeed, the number of shops at service stations increased six-fold between 2002 and 2006, and currently only two leading players, Petrom and Rompetrol, have shops in the minority of their service stations.

MOL's investment in restaurants should also be seen as a reflection of the company's aggressive expansion strategy in Romania and eastern Europe as a whole. For example, in December 2005, MOL took advantage of Shell's exit from the market by acquiring the oil titan's 59 Romanian sites.

The opening of restaurants that include internet services should be a profitable move for MOL, as it will meet current consumer trends, which have led to growing demand for higher-end products that can be received while on-the-go. MOL is also wise to focus on petrol stations with a high flow of customers, as, in a country where GDP per capita is among the lowest in Europe, the Servus restaurants are most likely to succeed in the richer and busier metropolitan regions.

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