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El Corte Inglés Confirms Forecourt Ambition

Petrol station operator Repsol has signed a strategic agreement with Spanish retailer El Corte Inglés. This will further expand the Supercor Stop&Go minimarket brand to its network, which currently reaches around 3,500 service stations across Spain. Meanwhile, El Corte Inglés will play the role of buying office for the network, giving the forecourt stores access to a wide catalogue of 35,000 food and 60,000 non-food products. Further, Repsol will allow customers to pay for fuel using an El Corte Inglés card, giving them the opportunity to earn rewards to spend within the retailer's various stores. 

Opinion

Will it Deliver?

"El Corte Inglés and Repsol create Spain's largest proximity and convenience store network" is how the two partners are advertising their move. If we assume each Repsol service station has the capacity to feature a Supercor Stop&Go, and that all franchisees are willing to invest in the project, then it might be true. It is a long shot, but feasible. Meanwhile, four years after its launch, the banner is currently limited to just 58 petrol stations. LZ Retailytics can confidently say that at this rate of expansion many years will be required (if not hundreds of years) simply to reach the scale of retailer Covirán’s minimarket network (ca. 3,000 minimarkets across the country). 

The ties between El Corte Inglés & Repsol date back nearly two decades, but the expected take-off never materialised, despite regularly reasserted common ambitions. Will this new configuration deliver? Perhaps, as it seems Repsol will enjoy more flexibility in rolling out the Supercor Stop&Go banner while El Corte Ingles backs it up with its strong retailer expertise. After all, the motivations are plenty: over one million customers visit the Repsol network each day, and LZ Retailytics data shows Supercor Stop&Go already enjoys one of the highest sales densities among minimarkets in Spain. 

It is a raw gem to exploit for both players, but we wonder whether there is the same sense of urgency on both sides of the table. El Corte Inglés suffered from the Spanish crisis and is longing for recovery, focusing on urgent matters at hand, such as improving its price image and turning around its hypermarkets. Meanwhile, Repsol is multiplying traffic-generating partnerships, as illustrated by its parcel collection service in conjunction with the Spanish Post, or even more recently with Amazon. Looking over its shoulder, there is not much cause for celebration. Its rival in Spain, service station operator Cepsa, has demonstrated more success with its partner, French giant Carrefour, as it closes in on the 250 minimarkets milestone. 

Partnerships between petrol operators looking to diversify their activity on the one hand, and retailers focusing on developing their small box proposition on the other, is becoming the standard across Europe. Each country provides numerous examples. As in every partnership, things can quickly turn sour when strategies diverge, and this can seriously dent retailer’s sales volumes. Example are plentiful but we can think of the recent case of petrol operator ST1 calling off its partnership with Norwegian retailer Reitangruppen for its stores in Sweden, to be effective by 2019. 

Topics: El Corte Inglés