The rise of electric vehicles (EVs). “If the trend towards on-site retail is already strong, EVs will put it on steroids,” says Erik Fairbairn, founder and chief executive of the Pod Point EV charging network. The last four years have seen a big surge in demand for electric vehicles in the UK, with new registrations of plug-in cars increasing from just 3,500 in 2013 to more than 137,000 by March this year.
Some estimates suggest there will be more than one million EVs on the roads by the end of 2022, while others predict the growth will accelerate massively over the following decade. “There’s a very good argument that says 90% of new vehicles could be electric by 2030,” says Fairbairn.
In line with this trend, there has been an explosion in the number of charging points. Manufacturer Nissan suggested recently that the number of points would overtake the number of petrol stations in the UK by the summer of 2020. There are now 4,100 public EV charge points in the UK, it says, against nearly 8,500 traditional forecourts.
The Retail’s Best Forecourt & Convenience Partners event which included a panel discussion on the likely effect of electric vehicles on the forecourt market, chaired by Michael O’Loughlin, managing director of forecourt operator Motor Fuel Group said.
“We’ve got to stop thinking about fuelling cars and think about feeding people,” O’Loughlin told retailers, pointing out that while the average person needed to fill up their car once a week, they needed to eat 21 times.
Panel member Fairbairn said advances in technology would mean EVs could be rapid-charged in just 10 to 15 minutes “in the near future”, bringing about subtle changes to the approach operators would need to take towards their retail stores. “You’ve got a captive audience there. They are going to do their top-up shopping at the same time they are topping up their electric vehicle.
They won’t be stood by their car for 10 to 15 minutes, so the opportunity is there to drive the retail side from your EV charging.” Other speakers pointed out that different businesses, such as pubs, hotels and big supermarkets would also be installing charge points. “You all regard the shop down the road as your competition,” said Steve Rodell, managing director for retail at property agent Christie & Co. “You also need to regard the hotel or restaurant, or anywhere else people are sitting down and charging their vehicles, as competition.”
David Wilson, strategy and fuel supply director at forecourt chain MRH, said: “The underlying bit most of us are working on at the moment is bolstering that retail offer. It’s all about growing that retail piece. As we move close and closer towards electricity, the thing that’s going to pull [customers] on to your site rather than to others is the retail offer. What the vast majority of us are doing to bolster that retail offer is what’s going to drive margins in the future.”
O’Loughlin advised delegates: “Invest in your sites, invest in your customers. That doesn’t mean just offering them a sausage roll, it means getting imaginative and chasing their business. You have got to improve and invest in your premises.” This was especially true when it came to attracting female customers, he said, who accounted for only 25% of current forecourt shoppers and were often put off by traditional sites. “Women want a better retail experience.”
But some delegates remained sceptical about whether they should invest in EV charge points, with questions remaining over the likely speed of uptake of alternative-fuel vehicles in the UK, the future cost of electric charging, and even the ability of the national grid to cope with the increased demand for electicity. “You are committing to today’s technology in a market that is evolving so quickly, no one can keep up with it,” said Wilson. “If you own one or two sites, investing in each store is a considerable amount of money.
Most of us have sites that are space-constrained. If you’re driving your retail offer, space is at a premium, so dedicating a parking space to a charging point that at the moment might only be used every other day just doesn’t stack up.” O’Loughlin admitted that his firm had put in some charge points and, in one or two locations, they had never been used.
Rodell said the decision would hinge on whether operators were taking a short-term or longer-term approach. “You need to decide if you’re in for the next five years. If you’re just in for the short term, my advice would be to do nothing. If you’re in it for the medium term, then you need to think about how you drive your retail offer. If you’ve got an EV charging point on your forecourt, it’s a huge opportunity to attract customers.”
Fairburn admitted that investing in charge points would not be the right decision for all operators at the moment, but he added: “If the rapid growth in EVs comes between 2020 and 2030 and you don’t understand this, then that’s going to be a painful time for you.” Forward-thinking retailers should look to test the water, he argued. “It’s time to start putting a few charging points in and start learning – then you will be ahead of the curve.” ■