Going the ExtraMile

Chevron talks retail expansion, rewards exemplary franchisees

Angel Abcede, Senior Editor/Tobacco, CSP

SAN RAMON, Calif. -- Chevron's plan to grow its ExtraMile convenience store concept is moving like clockwork, now reaching a 90% to 95% conversion rate for its company-operated stores and having franchisees "fill in" targeted markets up and down the West Coast, officials said.

Currently, the San Ramon, Calif.-based major oil company has more than 500 ExtraMile locations, of which 232 are franchisees, said Ian Noble, retail district sales manager for Chevron's ExtraMile program. He told CSP Daily News the conversions started in Oregon with Seattle and Portland and [image-nocss] northern California in the Bay Area including Sacramento, San Jose and the central coast area. They've since moved south into San Diego.

"We realize our strategy of having the right resources and support in place first is a strong one," Noble said. "Those resources being our training [infrastructure] with our business consultants and the capability of our partners in terms of supply chain and our advertising footprint where we need to have critical mass."

The company intends to add 60 to 100 locations in a given year, mostly franchises. Most of those locations will be existing Chevron-branded sites converting to ExtraMile, but many will be rebranding from other flags.

In addition to growth, the larger plan is to create a profitable network and develop a level of consistency that people expect when they walk into any ExtraMile location, Noble added, noting that for any franchised operation, consistency is a formidable challenge.

Earlier this year, the company rewarded a dozen of its most accomplished franchisees with a trip to Las Vegas, part of its "ExtraMile Stars Program." Set up somewhat like a mystery shop, but positioned more like a mentoring or "third set of eyes" scenario, a third-party team visits franchisee locations and reviews the site based on a set criteria.

"The goal is to drive consistency of execution," Noble said. "When the public or customers see the ExtraMile sign over the door, they know what they can expect from stores. And whether it's company owned or franchised, [the experience] should be seamless from the customers' point of view."

Rather than a way to pick out flaws, Noble said, the program is a tool to identify areas of improvement. As an example, he noted promotions. "We're trying to put them out there and communicate to consumers and generate footfall. These new promotions are supported by marketing, advertising and the [point of sale]. It's important to make sure everything's right at the site."

Ed Marszal, owner and operator of three Chevron ExtraMile franchises in northern California and whose Fair Oaks location was a winning franchise in the Stars program this year, has a positive perspective on the program. Where contention between franchisee and franchisor over how a business should be run is many times a given, Marszal sees the Stars program as a beneficial tool.

"One of the things I've notice over the years is that if you're in a store all day long or all week long, you end up having blinders on," Marszal told CSP Daily News. "You may not see a scratch here or there and a new set of eyes can focus on that."

Tim Skovensky, president of California Retail Management, Carmichael, Calif., the company that owns Ed's three ExtraMile franchise locations, said his experience with the ExtraMile staff and Chevron has been "anything but pushy. They understand their success is greatly determined by our success. Chevron doesn't dictate pricing We [also] saw how much work and effort went into their schematics. We're not so sure if we could do a better job in setting up our stores, for our demographic, for traffic flow, any better than Chevron has done."

When asked to comment on the trend of major oil companies leaving retail, Marszal said, "We're thrilled that Chevron stayed. They're an integral part of the system. It's good to have two of us working side by side, with the [company-operated] ExtraMile stores testing products and things they can then pass on to us."

By all accounts, Chevron has committed to growth downstream and with retail, having taken steps to pull out of branded marketing in many states to focus on their stronghold in West Coast markets.

"Every competitor is different," said Noble. "For us, for our capability, we're a West Coast company. This is our headquarters. We have infrastructure out here. We have the capability and a strong brand."

[Pictured (Left to right): Vida Karimi, Mousa Karimi, Victor Vazirian, Kiran Asher, Ed Marszal, Paul Dhaliwal, Godly Dhaliwal, Pal Dhaliwal and Harman Dhaliwal.]

Angel Abcede, CSP/Winsight By Angel Abcede, Senior Editor/Tobacco, CSP
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