While the practice is common in such a competitive business, it has become more frequent since the April 20 offshore rig explosion and spill that tarnished BP's image and led some customers to go elsewhere for gas, the [image-nocss] owners told the news agency.
"The door was opened when the Gulf leak happened, and people will play on those emotions," said Randy Meffert, who together with his brothers owns, operates or supplies 52 stations in southcentral Wisconsin. All but eight fly the BP flag.
BP is expected to detail its strategy to repair its brand when it meets with hundreds of fuel distributors next week in suburban Washington. The meeting comes at a critical juncture. Sales have rebounded, but are still down at some stations that saw sharp declines after the spill, even though BP offered incentives to help them get through it, said the report.
BP owns just a fraction of the more than 11,000 U.S. stations that sell its fuel, mostly under the BP banner. ARCO, a BP affiliate, is predominant in the West. Most BP-branded stations are owned by local people whose primary connection to the oil company is the logo and a contract to buy gasoline. Those contracts can range from several years to more than 20, and BP would not tell AP how many are up for renewal this year.
It also would not say what it plans to announce at the meeting with distributors, the news agency said. But two members of a trade group that helped organize the meeting told AP that, among other initiatives, BP will offer to pay for $10 gift cards for stations to give customers who buy a certain amount of gasoline, and it will fund a program for stations to donate to local charities. The members asked not to be identified because the details are supposed to be confidential until announced.
It is not clear if a name change suggested several months ago by some station owners will be on the table. The idea continues to percolate, but has not resonated with a majority of owners.
When contacted for comment by CSP Daily News, BP spokesperson Scott Dean would only say, "The BP brand stays."
(Click here for previous CSP Daily News coverage.)
(And in a CSP Daily News editorial titled "Whither BP?", guest columnist Gerald Lewis recently asked readers for their thoughts on the idea of BP possibly changing its U.S. brand name back to Amoco. Click here to read the editorial, as well as the reader response and expanded CSP magazine coverage of BP and the aftermath of the oil spill.)
Jeff Miller's company owns, operates or supplies approximately 56 BP-branded stations, primarily in southeastern Virginia. He said stations that he supplies but does not own are telling him they are considering switching to another brand when their contracts to sell BP gasoline are up. "There may be a Shell or Chevron and they will go to the BP [station] and say, 'If you want to get rid of BP, we can put Shell in there,'" Millerpresident of Norfolk, Va.-based Miller Oil Co. Inc. and the new National Association of Convenience Stores (NACS) chairman--told AP. "That is occurring on a fairly regular basis."
Such discussions are not unusual, but Miller said that the competition now has more ammunition. "Any of our dealers dissatisfied with the BP brand with everything that's going on, now they are saying, 'What other brands do you have to offer, Miller, because I got these guys from Shell and Chevron calling me?'"
Bob Juckniess, president of Hinsdale, Ill.-based RWJ Management, which owns 10 BP-branded stations in the Chicago area, said the approaches from other companies are "rampant right now."
"I think it started with the disaster that happened in the Gulf, but I think it was followed very strongly by how BP handled the situation," he added.
He said he wants to see BP commit to changing its corporate culture from one he believes is focused on profits to one focused on safety. "If they do not realign the corporate culture from the top down, then they are bound to make the same mistakes that they have in the past," Juckniess said.
Some distributors and owners are not ready to dump BP, and they are trying to encourage their peers to stick it out, the news agency said.Among them are Bill Tome, whose company supplies BP gasoline to stations in the Charlotte, N.C., area, and Max Alvarez, whose Sunshine Gasoline Distributors is one of the largest suppliers of BP-branded gasoline in Florida.
Tome told AP that he understands the hesitation of some station owners and suppliers to continue to carry the BP banner. He said he hopes those who attend the conference at least hear the company out.
Alvarez said that as long as BP remains competitive, it will keep its brand intact. "I think people who really understand and look at this situation would have a positive feeling about BP simply because they had an accident, they accepted it and they never turned their back on it," he told AP.
BP's Dean told AP that the company is committed to its independent business partners who sell BP-branded gasoline. "We continue to meet regularly with our customers and believe they will reserve judgment on BP until our response and restoration work is done."
About 600 people will attend next week's conference, including distributors, top BP officials and vendor partners, according to John Kleine, the executive director of the Savannah, Ga.-based BP Amoco Marketers Association (BPAMA). Media will not be allowed to attend.
Kleine told AP that given the fallout from the oil spill, this year's gathering will probably be the most important since the BP-Amoco merger in the late 1990s.
"Why?" Kleine asked. "You go back to the trust, confidence and commitment. It has to be demonstrated."
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