This article published October 2017. For latest news THIS MONTH'S ISSUE
Maxol is on a roll. The fourth-generation family business has repositioned its brand and offer to appeal to today’s modern consumer and has a raft of new initiatives in the pipeline.
Recognised in the 2017 NACS Insight International Convenience Awards - highly commended in the large format category for its M3 Mulhuddart Services site in Dublin - the Maxol repositioning has been to both positive and winning effect.
“Getting the award from our industry peers is fantastic recognition, particularly bearing in mind that it’s on a global stage,” says Maxol CEO Brian Donaldson. “Before, we were a fuel retailer selling convenience. Now we have moved to become a convenience retailer selling fuel. The accolade has given us the confidence that we are moving in the right direction.” Donaldson chooses his words carefully. “Have we got it right? No, we haven’t. Mulhuddart was a concept store and there’s still work to do,” he concedes.
What Mulhuddart did introduce to the Maxol business was a food court proposition offering healthy food from Chopped, fast food with Supermac’s, coffee from Insomnia and convenience and top-up shopping through Mace; all under one roof.
Donaldson reports that the team was able to share the Award success at one of the Group’s regular ‘town hall meetings,’ where the business considers new opportunities and seeks to generate new ideas. “Getting that accolade gave us a big boost in the arm,” he says. “It also gives us confidence when we are sitting down with our owners, the McMullan family, because site development is very capital intensive - €6m for a M3 type store.”
Maxol has subsequently moved on from M3 Mulhuddart and is implementing the learnings.
“We are trying to create destinations, not just for fuel but for food and convenience,” Donaldson says. “We need to create offers for the morning, lunch and evening and a place where families can come and have a break with their children.” Children’s play areas are being considered, for instance, Donaldson adds.
Two further food court sites have since opened - Ballycoolin Services in Dublin and the A26 Tannaghmore Services in Northern Ireland and Donaldson reports Maxol is eyeing other offline motorway, highly transient locations. “We are looking at the offer,” he says. “There have been great learnings from the larger scale developments which will help us refine and improve our offer across our entire network.”
But there’s been no letting up either. Hot on the heels of the new multi-proposition site openings, Maxol has completed a root and branch review of all of its business divisions: retail, B2B fuel cards and lubricants. The fuel cards operation is one of the largest on the island of Ireland and is run out of Belfast. “It gives us complete control and means that we can tailor the offer and the products that we have,” Donaldson says. It’s aimed at fleet cars, HGVs and anyone looking for a fuel offer, which can be channelled through Maxol’s 235 site network. It’s a symbiotic relationship with the retail division since the more customers Maxol can generate through its card base, the more customers it attracts to its site and can sell on further services and in-store goods.
The lubricants business is the largest in Ireland and spans motor, industrial, agricultural and food tech/manufacturing sectors. Given Ireland’s wealth of engineering, it’s an important division, especially from an export perspective since lubricants leave Ireland as a base product, already in the engine. The division enjoyed a brand refresh at the same time as the retail business and is performing very well, Donaldson reports.
The business review involved 16 members of the Maxol management team plus consultants and covered every aspect of how the business is run but with a ‘bottom up’ approach. “We’ve looked at what we do well, what we don’t do so well and identified opportunities for growth in our core business divisions,” Donaldson says. It’s created a new strategic plan for 2020, although Maxol has also considered where the business will be beyond 2025, given new technology and developments around the world.
It includes some ambitious plans, not least in retail where the business has identified 62 projects including full knock down and rebuilds, extensions and store refreshes. “There’s a massive amount of work to do,” Donaldson says, with Maxol taking the learnings from Mulhuddart, Ballycoolin and the A26 sites and introducing food franchise partner brands to other new locations. Work has already begun in terms of training and expertise for the execution stage. It’s a very exciting time for the business,” says Donaldson, who reveals that the CapEx will be in excess of €100m. “The (McMullan) family is willing to invest in the retail side of the business to maximise the return and not just for shareholders, it will benefit our retailers, suppliers and everyone involved in The Group,” he says.
There are four key pillars to the strategic plan: people, processes, customers and results.
Donaldson reports there is a big push on investing in people, that includes direct employees as well as retailer partners and their staff - to improve training and provide better opportunities for career advancement.
As regards internal processes, the focus will be on ensuring Maxol does things “smarter and better,” Donaldson adds. That’s coupled with a keen desire to see the plan through. “People say that, like any strategic plan, after a year it will gather dust - that’s not our intention,” he asserts.
The customer piece involves seeing the business through the eyes of the customer and will encompass a greater segmentation of the Maxol store network. Stores will be organised along general, key themes but the retailer plans to explore regional differences to optimise sales too.
A key initiative in the customer pillar for 2018 will include the launch of Maxol’s own convenience brand, replacing Mace. Donaldson reports the company is working with the Irish agency Tap Creations on this project and BWG Foods will be its supply chain partner. “It’s a massive project and will introduce our own private label into high turnover goods such as milk and bread etc. - it will extend our brand into people’s fridges as well as their cars,” he says.
According to Donaldson, the new proprietary convenience brand will also be used for coffee and foodservice throughout the store. Work is already underway behind the scenes and the business is looking to support the new brand, in conjunction with BWG Foods, with more fresh food advisors and a greater input in merchandising, planogramming and promotional cycles. “Everything needs to filter in so that we deliver a very slick, meaningful offer,” Donaldson says.
The first pilot is scheduled for January 2018 but there will be “rigorous market research before we hit the button”. “It’s not for the faint hearted and is one of the most exciting projects we have. It will be a bit of a game changer for us but market research shows that people perceive Maxol as a quality retailer and we want to resonate that brand image, outside of fuel, in the immediate future.”
On the forecourt meanwhile, Maxol’s review recognises that the site of the future will look very different to how it does today, due to disruptive technology including electric vehicles. “We’ve heard from Volvo, BMW and Jaguar Land Rover that up to 40% of their portfolios will be hybrid or electric by 2020. That’s why many companies need to be looking at where their business will be.”
Forecourts, like Maxol, will need to consider the positioning and space for electric chargers and how sites can capitalise on the extra customer dwell time. “Already that thinking is in progress. We would not want a network of unmanned service stations but we need to have a plan of where we will be in 2025,” Donaldson says.
In terms of financial performance, Donaldson reports that Maxol invests 80% of its time optimising the return from existing business foundations and 20% from areas where it can future proof business. “We have ambitious growth targets in where we want to see the business,” he says.
In total there are 17 master projects that will help Maxol deliver its overall strategic plan and the business is putting the building blocks in place in order to succeed.
“We are continuing to look for different talent and bring people in with the right skills,” Donaldson says. The company anticipates recruiting further employees in the process, having already integrated 18 new recruits into the workforce in the last two years.
Modernising ways of working is a central strand to this process too - the business no longer operates a reception area for example. Instead there’s IT to self-check in; while a customer service co-ordinator has been appointed to jump on customer issues and deal with them very quickly.
Maxol also sets great store in properly integrating new employees but recognises that this doesn’t necessarily happen overnight. “Culture is everyone, not an individual,” Donaldson maintains.
The business is also excited by the future, albeit one lined with disruptors. “We see those as opportunities and ways to strengthen the business,” he says.
Technology is a big enabler and can improve the customer experience, he adds. Maxol, for example, is looking at mobile payment and AI for fuel pricing. “Used in the right way it can create a point of difference,” Donaldson says.
Wisely, the company is looking to the next generation too. Donaldson reports the company has teamed up with local colleges to offer bursaries to students in their marketing departments for students who can suggest ways the business could be using technology more effectively.
“It’s tapping into that next generation but those are the people we need to appeal to,” he says.
Meanwhile, Maxol’s new head of marketing, Caroline Burton, is developing a new marketing strategy for the group too, which will evolve the way it communicates to customers from promotions through to sponsorship.
The business wants to continue to strengthen its community links, Donaldson reports. This will demand it “rolls up its sleeves and engages with the community” on meaningful projects.
With nearly 100 years under its belt, Maxol is not showing its age but rather that it’s an agile business that’s evolved and will continue to do so.
“There’s a vast amount of energy coming through the organisation, from long-serving employees to the newest recruits. Accolades like M3 Mulhuddart help in giving us confidence for the future,” Donaldson says.
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