Brand changes bring additional revenue in Michigan

In this blog we look into one site just outside of Grand Rapids, Michigan, and how an analysis into the “right” brand led to an increase in monthly in-store sales. 

Choosing the right brand (or brands) to fly is just one of many decisions gas station owners face. In January 2021 we wrote about how “the right brand can make or break a gas station” and how to identify the right brand, approach them, and choose the best deal.  

In this blog we look into one site just outside of Grand Rapids, Michigan, and how an analysis into the “right” brand led to an increase in monthly in-store sales. 

The site was already operating as a gas station, with a popular c-store and a well known QSR brand. The owner didn’t want to change the c-store, which was already performing well against the local convenience competitors, but was curious to see if he could improve on fuel volumes at the site.  Changing the facilities was not an option for him at this time, but he was considering flying another fuel brand and wanted to understand the impact this could have on his site.  

He requested a Single Site Analysis to discover:  How would a change of brand impact revenue? 

Kalibrate’s Single Site Analysis allowed the gas station owner to simulate changes to the site and understand the impact on overall site volumes.  

As part of the Single Site Analysis, Kalibrate modeled four different scenarios. All site characteristics remained exactly the same across each scenario, but in each case the fuel and QSR brand combination was changed to work out which brands would yield the best revenue results.  

What did the analysis reveal?  

 

The analysis showed that changing to another fuel brand at this site could lead to a decrease in gas sales of between 4.8% and 14.5%, as well as a 1,000 gallon per month decrease in diesel sales.

In fact, from the scenarios that were projected, the owner already had the optimal fuel brand for the local market area. 

As the existing c-store was already performing well a re-brand was not included in these scenarios, but a change in QSR brand was analyzed.

Changing to a well-known donut chain was shown to yield an additional $5,000 a month at this site, increasing the overall in-store revenue projection by 3.5%. 

By running this analysis on his site, the gas station owner was able to validate his proposed site changes with data, find the best solution for this specific site, and make more profitable decisions. He was able to secure an additional $5,000 per month and mitigate the risk of potentially changing to a less favorable brand that could have resulted in a loss of 18,000 gas gallons per month. 

In the gas station and c-store industry, every change has such a high dollar value that gut feel is no longer enough to base your decisions on. A Single Site Analysis from Kalibrate will provide you with a full analysis of any site’s local trade area, competition, and customers — as a well as fuel and store projections based on your suggested scenarios. Drive better decision making with data. 

Request a Single Site Analysis sample today.  

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