What Can Couche-Tard Learn From Statoil?
Two key strategies emerge from Canadian company's due-diligence visits
LAVAL, Quebec -- With every acquisition comes an opportunity to learn best practices from the company being acquired. For Alimentation Couche-Tard, parent company of the Circle K convenience-store chain in the United States, its pending purchase of Statoil Fuel & Retail represents a two-way street for sharing retailing strategies.
(See Related Contenet below for previous CSP Daily News coverage.)
One the one hand, Statoil is well-respected for its fresh-food sales. Also, as a percentage of gross profit, Statoil fuel sales are more than double Couche-Tard's.
"Their [profit] split is different than ours," CFO Raymond Pare said this past week. "Their road transportation fuel represents 51% of the gross profit of the entity, where in our case, the road transportation fuel represents only 25%."
The difference, he said, provides opportunity for Couche-Tard to learn new strategies to marketing fuel in North America, while offering the prospect of bringing its in-store sales tactics overseas to Statoil's retail network across Scandinavia, Poland, the Baltics and Russia.
"They are very good with the fresh foods, and we feel we can help with the other products," Pare said.
In presenting the news of the likely acquisition to Statoil employees last week, Couche-Tard CEO Alain Bouchard included among the highlights of the deal the opportunity to "leverage experience from the North American convenience-store market to enhance Statoil Fuel & Retail's customer proposition."
"We will try to grow the inside sales; that's the message here," Bouchard said.
Added Pare, "We hope to use the strength of our benchmarking in 14 divisions [in North America] to help Statoil grow a little faster."
Working in the other direction, Pare expects the North American divisions of Couche-Tard to learn the most from Statoil's foodservice offer, perhaps even more than it they could have learned if a previous takeover attempt had been successful.
"Their foodservice is very strong," he said. "We looked at that when we were looking at Casey's [General Stores], and here [at Statoil] is it arguable stronger."
Added Bouchard, "We visited over 200 Statoil stores. … We have tasted a lot of products in the stores. We did eat some sandwiches, some hot dogs, and we found out there are good ideas we can bring [back to] our stores in Canada and the U.S. So that's going to be a great addition for us. … It's important that everybody take other ideas within our company."
Laval, Quebec-based Couche-Tard announced its intention to purchase Statoil Fuel & Retail for $2.8 billion on March 19. A June 2012 closing of the deal is expected.
Statoil Fuel & Retail ASA is a leading Scandinavian fuel and convenience retailer. It has a broad retail network across Scandinavia, Poland, the Baltics and Russia with approximately 2,300 full-service (fuel and convenience) or automated (fuel only) stations.
Alimentation Couche-Tard Inc. is the leader in the Canadian c-store industry. In North America, Couche-Tard is the largest independent c-store operator (whether integrated with a petroleum corporation or not) in terms of number of company-operated stores. As of Jan. 29, 2012, Couche-Tard had a network of 5,817 convenience stores, 4,225 of which include motor fuel dispensing. At the same date, the corporation had agreements for the supply of motor fuel to 338 sites operated by independent operators. Couche-Tard's network consists of 13 business units, including nine in the United States covering 42 states and the District of Columbia, and four in Canada covering all 10 provinces.