Image Conscious

Certified Oil begins rollout of its new store design, emphasizes foodservice

COLUMBUS, Ohio -- Certified Oil has begun the process of converting about 40 outlets to a new design scheme by the end of 2009. An old brand has a new look in time for its 70th birthday, Columbus, Ohio-based Certified Oil, with 86 convenience stores and about 600 workers, is redesigning its outlets to put a greater emphasis on food sales, as previously reported in CSP Daily News.

The changes are part of a broader trend in c-stores as companies try to get gasoline customers to step inside and buy items with high profit margins, such as soft drinks and candy.

Peter [image-nocss] Lacaillade, the chief executive, told the Columbus Dispatch he wants his stores to have a consistent, inviting look, which he hopes will lead to greater customer loyalty.

"There's so much competition out there. We're just wanting to give a reason for a person to return," he said.

Click hereto read CSP Daily News' previous coverage of the reimage program.

Since its founding in 1939, privately held Certified has had only two chief executives. The founder, Carlyle Baker, bought his first station in Piqua, Ohio. He ran the company until his sudden death in 1998. The company then turned to Lacaillade, Baker's son-in-law, who had been vice president at an investment firm in Boston.

Certified had been humming along at that point, with 130 stations and an aversion to debt. But the stations were behind the times. They didn't have scanners for cash registers, and there was little design consistency from store to store.

Lacaillade began to sell underperforming stations and started a $30 million investment in upgrades. The two decisions shrank the company's regional footprint, with about 80% of its stores now in central Ohio. The remaining stores got new equipment, such as pay-at-the-pump credit-card scanners.

Those investments put the company on solid footing heading into this year's wild fluctuations in gasoline prices.

"I can tell you this was an extremely challenging year," Greg Ehrlich, Certified's chief operating officer, told the newspaper.

The redesigned stores have the red, white and blue color scheme, but they have a new logo, with a red check mark inside a white "C." Inside, the walls will be decorated with what the company calls "lifestyle photography," images intended to make the stores comfortable places to shop.

One of the new products is an exclusively branded coffee named after the founder, called Carlyle's Cup.

The stores' new image is similar to what has been done at other convenience-store chains, such as BP's use of the ampm brand to boost in-store sales.

"I think consumers are at the point where they expect the Wal-Mart price, the inventory and the Disney experience," Jeff Lenard, spokesperson for NACS, told the newspaper.

A study from NACS shows c-stores got 71% of sales from gasoline last year, but only 34% of profit. Lenard said this shows that food and other items inside the store are the key to profitability.

Ehrlich, who had no cost estimate for the redesign, said about 10 of the stores will have the new look by the end of this year. By the end of next year, he hopes the number will be up to about 30.

The gradual approach is in keeping with the company's tendency to complete projects with cash, rather than debt.

Lacaillade said the lack of debt means the company is under relatively little strain from the current economic downturn, putting it on solid footing for the future. "We're very happy these days," he said.