Almost all retailers are affected by driving decisions due to high fuel prices, but perhaps none so much as the convenience stores owned by Home Service Oil in Barnhart, Mo. With fuel conservation in mind, fewer fill-ups are common, which means a decline in purchases at Home Service Oil’s 10 Express Marts.
Add to that the recent turmoil in oil prices and the economy, and you’ve got a tough situation, to say the least. Still, David Mangelsdorf, president of the fuel distributor, has a plan to provide even better service to customers and keep the business running in the black.
In 1985, Mangelsdorf took over the business started by his father in 1953. Also in the business are his sister, Sandy Overberg, supervisor of retail operations, and nephew, Bryan Goforth, vice president of wholesale operations.
In ’85, the business was mainly distribution of heating oil, diesel fuel, and gasoline, with only two convenience stores. But Mangelsdorf saw the potential for these retail outlets and focused on building stores in every gas station location where the company owned the property. The company slowly built the Express Mart brand into a success, adding two or three stores every few years into the 2000s.
Today, the focus is on upgrading the stores’ systems to improve operations and provide better service. Mangelsdorf said the company is also migrating its 10 locations back to major oil brands from its independent brand. “We believe a brand like Phillips 66 or BP is helpful to us as a smaller marketer,” he said.
As part of the rebranding, the company is upgrading its POS system, bringing it in line with PCI data security standards. Mangelsdorf is excited about the new system because it will tie into the stores’ drop safes, making cashiers more efficient. “The newer safes can communicate with the POS system, keeping track of when cash needs to be dropped,” he said.
The upgrade includes a price book system that will allow pricing to be set from the home office. Mangelsdorf noted that some pricing decisions will now come straight from the vendor. “The new system will give us better control over item margins,” he said. “We’ll be able to adjust pricing more quickly and accurately.”
Making pricing and cash handling more efficient means store managers and cashiers can spend more time on the most important aspect of the business: customer service.
“The basics of business still prevail—having good people properly trained and giving excellent service,” said Mangelsdorf. “You can talk about new technology as much as you want, but it comes down to good people giving friendly service in nice, clean facilities that are attractive to the consumer.”
To that end, a great deal of thought and effort is put into training store employees. Mangelsdorf noted that although hiring good people can be difficult, even in this economy, it’s keeping turnover low that’s the real key.
Mangelsdorf and his team make sure employees have a solid introduction to the company, the store, and the systems before they begin work. After they’ve settled in, further training opportunities are made available in the form of interactive CDs. These contain modules on handling credit card transactions efficiently, handling customer complaints, and carding young people buying liquor or tobacco.
“They can learn at their own pace, and the training is consistent,” said Mangelsdorf. “We like that mode of training very much.”
Sales incentive programs are another way employees are encouraged to stay. For example, at locations with car washes, employees can receive compensation for increasing car wash sales.
The company plans to offer similar employee incentives as it rolls out a loyalty program in which customers can earn points from gas or merchandise purchases and turn them into future discounts. “We plan to offer an incentive to employees to sign up customers for the loyalty program,” said Mangelsdorf
He added that he favors short-term incentives over permanent ones, which tend to become overlooked after a while. “Tying it to a specific goal helps keep interest in the program,” he said.
Between increased efficiencies and satisfied employees, Home Service Oil is well positioned to ride out the current economic storm. Said Mangelsdorf, “I think the whole program, with the updated POS, price book, loyalty program, and cash management, will help us improve our operations significantly.