The Garrulous Jay – Forecourt Conclusion

Publish date

11/06/21

“Five pounds of four-star, please!” Readers of a certain age may remember making such a request of a garage attendant, or at least hearing their parents doing so. I can recall sitting in the back of my mother’s Mini Clubman whilst an obliging gentleman in grubby overalls would then busy himself fulfilling these instructions, before proffering a greasy mitt through the driver’s side window to collect her clutch of one pound notes.

The garage forecourt has come a long way since those days of attended service, when they were little more than a couple of petrol pumps and a dark mechanics shop. Nowadays relatively basic garages offer all manner of hot and cold food, often from a leading supermarket chain, as well as newspapers and car accessories.

You could actually spend your summer holiday at some of the larger motorway service areas without wanting for much, not that I would recommend it.

But the future of the garage forecourt looks bleak. A fascinating piece on BBC Business Breakfast last week (https://www.bbc.co.uk/programmes/w3ct1jnk) explored the potentially terminal impact the proliferation of electric vehicles may have on the traditional petrol station. If you can “fill’er up” overnight at home, why would you stop anywhere else to pump energy into your car?

The availability of charging points is likely to rise exponentially in the next few years, even for those that cannot easily plug in at home, and the distance cars will be able to cover between charges will also increase. These twin trends will dramatically reduce the need to make a trip to a destination on the outskirts of town or the edge of a main road to pick up a coffee, a few basic provisions or 5 litres of washer fluid.

What lessons can we learn from the forecourt’s dark future?

Businesses need to be constantly alive to the ways in which future trends may impact their profitability, or even their viability. Management need to anticipate how changes in consumer behaviour, products and services could threaten, or indeed provide opportunities, for their own companies.

I wonder, for example, whether the success of M&S Food at service stations may evolve into a challenge sooner than the company expects. Or how wise it is for Starbucks to be investing so much in building coffee shops adjacent to garages.

Maybe Zuber and Mohsin Issa have seen the writing on the wall. The billionaire brothers from Blackburn co-own EG Group which operates over 5,900 petrol stations globally. But in October last year they launched their biggest acquisition to date: Asda. I think that could be seen as a £6.8bn vote of no confidence in the long-term prospects for their core business.

Companies that fail to adapt can end up running on empty.