Ronél Fester Fuel retail sector continues to grow in spite of the relatively sluggish economic growth in South Africa. According to the South African Petroleum Industry Association (SAPIA) , this sector contributes 8.5% to the South African Gross Domestic Product (GDP). “There are more than 4,600 service stations in South Africa and a collected annual turnover in excess of R324 billion. This industry has been gradually increasing over the past three years and we expect it to continue in the same trajectory over the next coming years,” says Ronél Fester, FNB Franchise Industry Specialist. She shares five key insights that continue to characterize this important sector. Biggest contributor to the bottom line: Fuel is still the main driver in this industry – the comparison ratio between money coming from a convenience store and fuel is about R1.20 to R1.40 per liter sold on the petrol station. Alternative Profit Opportunities (APOs):   Consumers enjoy convenience. As a r...

By: James Noble, Business Development Manager: Fuel Industry, Absa Business Banking The South African fuel retail industry has grown considerably in recent years. In fact, it is one of the few sectors to weather the downgrading, rand volatility and negative growth rates recently experienced. Fuel retail specifically is a highly specialised sector, with operating margins that are affected by a multitude of factors such as oil prices, labour costs, exchange rates and regulations, to mention a few. In the current economy, only a small number of industries can claim to be recession proof. The fuel retail sector has proven to be just that; showing healthy profits in times of slow growth cycles. Growth Indicators Service stations in South Africa have a combined annual turnover in excess of R200 billion. The country remains the biggest consumer of fuel on the continent, claiming more than 20% of the market share. Satellite sectors create multi-channels of employment that generate ...