Business Plan Gas Station

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Introduction
This report demonstrates an idea for the business plan of a gas station, which will be operating the
region of California and will serve as the new service provider for the area with respect to gasoline.
Although there are already two existing gasoline stations in the locality that are providing similar
services, but the price they are charging is high and are not fulfilling the needs of the customers
completely.

The major location of the gas station will be Hammer Lane and Highway 99 in Stockton which
indicates that the capacity of the locality is quite attractive and there are nu7mber of vehicles that
pass through this route on a daily basis. Through researches it has been identified that targeting this
area will be best opportunity and has a reasonable population to achieve attractive financial gains.

This report analysis the opportunity and the entire business plan framing all the necessary
regulations and documentations that are essential to operate in this region. Besides that the EAP
regulations, the regulatory constraints, the strategic analysis, the marketing plan and the financial
plan will also be presented in the report.

The major goal of the report is to assess the opportunity present in the region and to highlight the
basis on which a new gas station can be established or not. Besides that, as stated, that Shell and
Chevron are already present in the area, but are providing expensive services which is why the new
gas station will be competitive in this regard and will provide price penetration in the region to attract
customers.

Overview
The main focus of this new gas station will be on assessing the latent needs of the target market that
are still unmet and will facilitate those customers in meeting those needs which will result in
customer satisfaction. The major products of a gas station include the gasoline and the diesel that
accounts for the majority of the revenue that is generated from the gas station.

However, this new station, which will be a franchise of Shell, will be operating a separate owner who
has a different objective. The owner wants to provide customer satisfaction to the customers in the
target market by meeting their needs and demands explicitly. However, the gas station will also
assimilate the services that are rendered at a gas station.

Every gas station provides inspection and repair services which will be part of this gas station as
well, but the customers can avail these services without any cost until or unless there is as some
major use. However, services like air filling in tires will be free as there will be free air pumps readily
available at the gas station.

On the other hand, the convenience store is also there which will facilitate and serve the customers
in a different manner and with different products. The reason to provide such services along with
gasoline and diesel is because to give consumers an option to fuel up as well while fueling their
cars, bikes, or any other vehicle.

The product offerings and the services that will be offered will be uniquely delivered at the station will
have self-service and will also have a full service station. However, there will be no extra cost that
will be charged from the customers for these services.

The prices will be kept competitive in order to provide the target customers full range of services at
low cost and also to attract new customers. However, the customers that will be purchasing 5
gallons or less will be charged with extra prices and may suffer an increase in the price. The majority
of pumps, in the station will be providing gasoline, but there will be a proportion that will serve diesel.
The ration 1:3 which means that for 1 pump of diesel there will be 3 pumps of gasoline.

At the gas station will be operating as a franchise for Shell, which is why the color scheme of the
station will be yellow and red which is the traditional color scheme of Shell. On the other hand the
logo will be of Shell, which will play a vital role in attracting customers. Besides that the employees
of the staff will be wearing jerseys of Shell, which clearly indicates that the station will be operating
as a franchise of Shell.

The major aim is to deliver quality service and a variety of products, but also to offer a compelling
environment for the employees as well in order to make their working environment attractive. The
area at which the station will be operating is catering multiple segments, but the station will cater the
segments that are residing in the society and are coming into the city and the majority of the
attention will be invested on motor riders.

The strategic analysis of the station will be conducted in order to assess the internal and external
environment for the gas station, which will be sufficient in designing the marketing mix for the gas
station. However, the paper will also illustrate the regulatory constraints and the EAP regulations that
the gas station will have to encounter in order to proceed with the decision. Secondly, the permits
and the documents that are essential to operate the gas station will be discussed in the paper.

Mission Statement
The mission statement of the gas station is quite clear and concrete and provides a clear statement
to the people and clearly exhibits the main objective of the owner of this new gas station. The main
aim is to cater the motorists who visit the city or are already residing in the city with the best gasoline
and automotive services. Besides that the services that are being offered must be delivered ay
reasonable and affordable prices. Thus the main aim is to [provide best quality at affordable price to
the target market.

However, the mission statement also caters the employees that are working for the station and the
objective of the mission statement describes that while providing all the above stated objectives the
environment or the people working or the employees will also be taken care of. The environment
needs to present a professional outlook and also provides an entertaining working environment.

The Location
The location at which the gas station will be operating is the Hammer Lane and Highway 99,
Stockton, California. This location is selected due to the presence of Chevron and Shell and the
immense need of competitive gas station for motor riders. This location is considered as a premium
location as it is located at the south and the only competition is in the west, which is very far away
and the gas station will have an entire target market to exploit easily.

Target Market
The target market for the gas station is divided into primary and secondary target market with
different demographic features. The gas station will be running under the brand name of Shell but
will serve as the franchise and will cater the need of these two target markets efficiently. The defined
target markets are partially different from each other, but possess the same set of needs.

Primary Target Market

The primary target market of the company consists of motorists who are roaming in the city or are
coming into the city as tourists. Besides these motorists the primary target also includes people from
the professional background who are working and have their own cars. The demographics of this
target market suggest that they are either late adults or family person with newly married or having
one kid. The age bracket of this target market is around 25-45 and has an average income of around
$30,000-$40,000. The core product that these people will utilize from the gas station will be fuel and
car wash services.

Secondary Target Market

The secondary target market of the gas station consists of people who are the residents of the city
and are usually filled up their tanks either once a week or twice a week and are seeking car wash.
Besides that these people also make purchases from the convenience store and a 24/7 convenience
store is a major attraction for such people. The age group of these people is around 25-60 and the
income bracket ranges from $25,000 to $50,000.

Services and Products Overview

The gas station will not only providing gasoline services but will also facilitate the target market with
the repair services as well. The major revenue generating products will be gasoline and diesel, but
on the other hand, repair services will work as a support service. Besides gasoline, diesel and
automotive services, the station will also possess a convenience store which will offer a variety of
products to the people visiting the station. The extensive variants that this convenience store will
offer to the customers include, the ready-made food, ready to eat meals, beverages, packaged food
products, different type of food items and bottled beverages, toiletries etc.
Methods of Business
As stated above that the locality already has a Shell gas station and Chevron Gas station, which are
the two major competitors, but in order to settle in the region it is required to adopt the method of
franchising. The suggested approach is to involve in a franchise agreement with Shell and hold the
rights of the Shell gas station.

This agreement will be at a state level agreement as the franchise will seek the franchiser to run a
similar business by imitating the business model and operations of the company. In this regard or
according to this agreement the owner of the gas station will buy the right form Shell in the form of
franchising by offering the services that the gas station is currently providing.

In this case the control of the gas station will be under the new owner’s hand, but the owners’ equity
will remain under the possession of Shell. However, the new owner will have to pay an annual fee
and also some part of the income generated. The shell will also serve as the major supplier of the
gasoline and diesel while the automotive services and the convenience store will be run separately.
However, immense focus will have to generate towards setting the price at a competitive level in
order to achieve the objective stated in the mission statement.

Funds Required
As indicated the owner will generate $80,000 as initial investment and will seek $140,000 as a loan
from the bank. The utilization of these funds will be done in the manner which is shown in the chart
below. The total start-up cost that is estimated is around $220,000 which is divided as initial lease
payments which will be around $30,000, the working capital which will be around $80,000and
furniture, fixtures and other equipment will be around $30,000. Since the new owners purchasing the
franchise, which is why the entire cost will occur at his end. The leasehold improvement, security
deposits, opening supplies, marketing budget, rent, and other miscellaneous expenses are all part of
the budget that is required initially.

Sales Forecast
The sales forecast as shown in the tables below indicate that the company will have to divide sales
in four categories. The first category is the sales generated from the assumed amount of $50 with
which car wash is free. It is assumed that this sale occurs four times a day, which makes it $200. On
the other hand, the sales 2 refer to the unprecedented sales, which are expected to be around $300
on a daily basis. Next is the sales 3 which refer to the sales of the convenience store while the sales
4 refer to the sales of the automotive services as shown below.

The sales forecast shows that per day sale of the gas station is assumed to be around $620 which,
when multiplied by 360 days provides annual sales around $223,200. The five days are left due to
uncertainty and the growth rate is assumed to be 10% for the next 3 years. The operating cost is
taken around 60% of the total sales that will be generated in a year and the growth rate is assumed
as 10% for the next 3 years. The earnings before income tax and depreciation and amortization are
calculated by taking the difference of annual sales and operating cost. The other costs or the fixed
cost takes 15% of the annual sales while the tax is assumed as 30%.

Inventory Management
The gas station has to keep inventory for gasoline and diesel and as there will be a convenience
store in which managing inventory is also necessary there. The inventory management system that
will be applied is about holding on to more inventories in terms of perishable items for the
convenience store, but a maximum of 10 days inventory will be maintained depending upon the sale
ability and the permissibility of the items.

The inventory will be visited over 7 days and according to the demand of the locality and the
predicted sales the inventory levels will be maintained. This will be done or will be mentioned in the
franchise contract between the owner and the Shell, who will be the main supplier of gasoline and
diesel. As the supplier is Shell who will be providing the inventory in the form of gasoline and diesel
which is why agreement with the company on maintain the maximum or minimum inventory levels is
important.

However, managing or maintain the levels of inventory also depends on the capacity of the USTs
that are installed with the capacity. The maximum capacity of the USTs will be maintained in order to
fulfill demand a strong back up will be established by tying strong relationships with the company.
This will allow meeting the uncertainty in demand rapidly and maintain the levels of inventory which
is necessary.
The reason to maintain or to hold on to extra inventory is to cut off the challenge posed by the
uncertainty in demand. Furthermore, the inventory levels will have to be maintained after gaining
permission from the national, state and local levels. On the other hand, the EAP regulations and the
guidelines are also supposed to be catered while maintaining the inventory levels otherwise penalty
can be faced. The visits will be after every 7 days in order to check the level of inventory and the
need that is there to be fulfilled.

On the other hand, the inventory levels for the convenience store will also be following the method of
holding on to more inventories. The reason is the location which is far from the center of the city and
it will take a sufficient to make the delivery of the perishable items and other food and beverages.
Therefore, holding onto more inventories will help in facilitating the demand easily.

However, there are two methods of inventory management that will be followed for the convenience
store. The first method, mentioned above will be holding on to more inventory which will be followed
for less perishable items and for the most saleable items. Identifying the most saleable items is a
difficult task, but in order to identify that the sales of the last month will be evaluated. This will help in
identifying the most saleable items and will guide in managing their inventory effectively.

Furthermore, the perishable items will also be identified which are easily identifiable and a weekly
visit will be made in order to check the status of the inventory. Usually an inventory of perishable and
saleable items will be maintained around 25 days, which is sufficient to carry inventory and prepare
a backup. This method will allow in maintaining inventory effectiveness and will be suffice to manage
the demand.

On the other hand, the perishable items another method of inventory management will be adopted
which is very effective and popular. This method is known as just in time inventory management
system. This method will allow the operations to flow easily and do not put the burden on the
inventory. To implement this strategy a weekly visit will be made to anticipate the need and after
accessing and evaluating the demand the levels of inventory for the perishable items will be
maintained.

This method will allow obtaining certain benefits which will be very effective in many regards to the
gas station. Since perishable items have small life and damage to the items can create financial
pressure, which is why this method is adopted to overcome the cost of obseclecne. Besides that this
method will allow to maintain the flow of inventory without pressurizing the inventory.

Thus, more focus on non-perishable items and more saleable items can be made which is very
important. However, in order to identify the most saleable items immense focus will have to be made
towards the sales forecast and sales evaluation. This will make it easier to identify the most saleable
items from the sales evaluation conducted for the past 30 days. However, the numbers can change
or vary from month to month, which is why this will be done after 6 months of operations.

The reason for this strategy is that it will allow overcoming the uncertainty and also identifying the
average amount of saleable items that have to be maintained in the inventory. Thus the inventory
management is quite effectively planned and various methods that are being implemented globally
are adopted.

Holding to more inventory will allow managing demands for saleable and non-perishable items while
just in time will make room for nonperishable and saleable items. A weekly visit will allow checking
the levels of inventory and an inventory for at least 25-30 days will be maintained in order to manage
the demand and inventory levels effectively.

Strategic Analysis
This section will incorporate different analysis in order to grab a better understanding of the business
and conduct a more rapid and thorough analysis. This section will first highlight the environmental
factors that will allow better understanding the political, economical, social and technological factors
and their impact on the business.

Secondly, the industry analysis will be conducted in order to grab an in-depth knowledge of the
industrial factors impacting the situation. Lastly, customer analysis will be conducted to analyze the
customer and its preferences in order to decide on the strategy to be followed.
Environmental Analysis
Political
The political condition is pretty much stable and the country is on the verge of elections, which may
bring some distortions and changes in conducting the business. However, the overall scenario
explains that no rapid changes will occur in conducting the business associated with petroleum and
running a gas station. The political connection has a huge impact, though to shift the position of the
business from growth to decline.

However, in the US the political condition is somewhere between moderate and stable and is facing
a crisis to some extent as well. This condition is expected to change once the elections are over and
a more suitable and clear environment will be there for the business to proceed. The changing
political condition of the country is expected to bring a significant decline or incline in the purchasing
power and the fuel cost.

Besides that, the country is one of the strongest economies in the world and the political outlook of
the country is very much influential which is why it has to be in the position to sustain its image. The
past scenarios have explained that the political conditions of the US have impacted several
businesses, especially the one related gas and petroleum as it is in the major interest of the country.

Therefore, the new gas station must have to comply with the rules and regulations and must fulfill
every regal requirement and must show compliance in this regard in order to survive in the worst
case scenario. Besides that, it is also important to safeguard the business in the volatile political
condition.

Economic
The country is one of the most developed and strongest economic nations in the world and is
considered as the largest economy in the world. Besides that the company has a GDP of more than
$16 trillion, which is the proof of the financial and economic health of the country and signifies its
financial strength. Although, the country has suffered immensely from the economic crisis that
occurred in the last quarter of 2008 but the economy has done tremendously well to bounce back
and bring the economic outlook back on track.

By the end of last year the economy started to show signs of development and is on the verge of
becoming the strongest once again. The services and the manufacturing sector have a major role to
play in developing the economic health of the country. These two industries or sectors are highly
preferred and supported by the government. These two sectors have played a considerable and
important role in providing survival turmoil to the country’s economy.

This scenario exhibits a more stable and positive outlook for the gas station and hints that the
purchasing power of the consumer is quite healthy. However, the economic condition of the country
is still at risk due to the budget deficit that the country is facing and is hinting a serious drought in the
coming years. Therefore, this factor can be a concerning point before pursuing the business and
achieving the desired potential.

However, the overall scenario indicates that the political condition of the country is to some extent
moving in a positive direction but is also surrounded by the risk. The budget deficit can create
distortions in operating the business, but once survive the business can be run on smooth growth.

Social
Aging is one of the most significant issues in the country, unlike other developed nations which is the
basic social factor of concern nature. On the other hand, the country has another major issue in the
form of racism which is another concerning factor for those wanted to initiate busi9nesses or
become entrepreneurs. The country has some of the finest business sectors and is providing the
best medical and educational facilities.

However, aging will make the labor issue significant for the new businesses and finding young and
long serving employees is a concerning factor. Secondly, racism is an issue that can seriously
disrupt operations and it becomes essential to witness the location and make sure that the territory is
clear from such issues. Such issues may bring distortion in the earnings of the businesses that are
operating on a daily basis.
Technological
The country has command over adopting and assimilating innovation and new technologies and the
relationship with technology is quite old. New technologies have created new opportunities for
businesses in various sectors and in the [petroleum sector refining and digging has become easier.

Besides that the technologies installed at gas stations have also enhanced which is why the fixed
and operating cost has increased, but the efficiency of the machines and their salvage value have
enhanced. The country has professional possessing expertise in various fields that can be hired and
utilized in developing new and innovative technologies to further develop the technological strength
of the country in various sectors. However, the technological environment is quite favoring the
business plan of the gas station.

Industry Analysis
This will help in conducting an audit of the strategic business unit and will analyze the industry with
regards to the five forces that are helpful in shaping the strategy. This is an important aspect and will
guide in developing the marketing plan and strategy for the gas station.

Bargaining Power of Buyers

Buyers in the industry have multiple options to choose from and there is abundance of multiple gas
and petroleum products provider. Besides that the switching cost of the buyers is also very low
which is why they show less resistance in changing the brand or the gas station. Furthermore, the
brand loyalty is at the lowest side and is not a significant factor that can restrict the customers from
purchasing from a specific gas station. The purchase is dependent on the viability, availability,
accessibility and convenience of the customers. These factors are the major attractions of the
customers which is why the bargaining power of the buyers is quite high in the industry.

Besides that the service quality and the availability of the supported material like convenience store
and other facilities can be of an important nature. The role played by these services can be
significant and can attract people from the neighborhood, thus generating a significant consumer
base. However, these factors are of an important nature, but do not impact the overall; bargaining
power of the buyers.

The bargaining power depends upon the dependency over the station and low switching cost and in
this case, these two factors are totally opposite. Therefore the buyers have multiple options to
choose at a lower switching cost which is why they are enjoying a high power to bargain.

Bargaining Power of Suppliers

Vertical interrogation is being followed in the industry, which is why the dependency over the
suppliers is minimized or diminished and gives very low power of bargaining in regards to suppliers.
The suppliers in the industry have every minimal role to play. However, in regards to the gas station
the supplier is the company providing the refined gasoline and the price is what is demanded by the
company. However, in the case of licensing and franchising, the business is smooth and power has
no impact as the relationships are well established.

Threat of New Entrant

Starting a new business related to gasoline and petroleum is a risky task and to some extent hard to
achieve. The reason for this factor is the high entry barriers as the new entrant will have to invest
heavily in the initial capital requirements. Besides that acquiring new gas pipeline and facility will be
challenging.

Furthermore, meeting the government requirements and fulfilling every aspect is a breathtaking task.
On the other hand, establishing strong relationships with the government to get the permit is also a
hectic task. Besides that the government has some established player with which the benefits are
distributed which makes it difficult for the new comers to achieve economies of scale.

The taxes, the volatile business condition, the changing prices, the legal constraints, and other
regulations are all proving hint to the new comers and discouraging them to enter into the business
and operate freely. Therefore the entire scenario exhibits that the environment and the business
opportunity is not viable for the newcomers and they are deeply discouraged to enter. Thus, the
threat of new entrants is very low.
Threat of Substitutes
The threat of substitutes is to some extent moderate as there are some substitutes available for
gasoline but the availability is not rapid. The substitutes present offer same functioning, but the
efficiency and the productivity to the same extent is doubtful. The products that are available that
can serve as the replacements for gasoline are not readily available and are not being used
frequently.

The experts and the users also not recommend the usage of the substitute product despite being
cheap. It has been quite evident that with the transformation in technology and rapid research
activities have allowed the scientists to develop alternative ways to fuel the engine of the cars and
the bikes.

Therefore, cars running from solar energy and electricity are also major substitute products that are
not readily available but environments; frequently as well. These substitutes are of moderate threat
as the availability is not easy along with the expensive nature is also a concern along with the hybrid
cars that are becoming quite attractive.

Competitive Rivalry
The rivalry in the industry is quite high as there are a number of players that are operating globally
and the gas stations running under the brand name of Shell will have the advantage of being strong
players. However, the overall rivalry in the industry is intense due to some major global players that
are operating in large territories and have significant advantages that allow them to seek benefits in
various forms. The product differentiation is low and the price is almost competitive which is why the
rivalry is intense, but the collaborative effort is adopted instead of competing with each other in the
industry.

Customer Profile
The customers that the gas station will acquire are the already established clients of the gas station.
Since the gas station is acquired through licensing this is why the brand name, the outlook, the
location and the customer base will remain the same. However, with the services being offered by
the gas station, it is assumed that the customers will be mostly bikers and the family residing in the
neighborhood. Besides that the people travelling inside the city or the tourists coming inside the city
are the major customer that are mostly occupied and having their own business.

These people have short families or they are newly married, but can be bachelors as well as the
bikers are mostly unmarried. Furthermore, these customers have a child as well and they will prefer
to utilize the convenience store once they stop by. On the other hand, the services provided at the
gas station will be targeting middle income people with white collar jobs. The consumers are not
brand loyal or the one that will stay loyal in the hard times as the services are readily available with
low switching cost. Therefore the customers that prefer visibility and accessibility are preferred and
will be targeted by the gas station.

Competitive Analysis
The competitive analysis suggests that the gas station has only one competitor of Caltex but it is in
the opposite direction and the area is not quite threatened by competition. Therefore, the gas station
has the advantage of being the prime location with the busiest route which also caters the people
from inside the city and also those entering the city. However, the competitor is also quite attractive
and has the advantage of being in the city and catering the population living in the city.

Caltex itself is a renowned brand with high market share and quality fuel which is why it is being
referred by the majority of the people. However, the gas station is not under real threat as the gas
station of Caltex is operating in a different location but is in the same city. On the other hand, the
convenience store is under real threat as the superstores and other marts are the major attraction
and serve the sole purpose with a variety of items.

Therefore, this cannot serve as the only attraction for the gas station and in order to increase its
sales and attract families’ strong efforts will be required. This will have to be done appropriately in
order to keep the sales going and achieve the target of profitability in the desired period.

Marketing Plan
The marketing plan holds a key position in the overall strategy of the gas station and the
implementation and development of the marketing plan is very important to achieve the objectives
that are set in the initial stages. The marketing plan comprises of various strategies that are being
practiced in different stages and are very critical for success.

In this regard the new owner of the gas station will have to invest extensively on the marketing
strategies of the gas station. However, the gas station will be serving under the brand name of
Shell, which is why extensive media promotion is not required and no need to invest heavily on the
promotional aspect.

There are certain benefits that the owner is getting in this deal as he is paying only to use and
operate under the brand name of the Shell and vast strategies will be handled by Shell. However,
certain risks are also involved that needs to be catered by the owner and will have to suffer from.
The marketing plan is important, but the owner will also have to invest some amount in promoting
and pricing for which some strategies are required.

Marketing Objectives
The marketing objectives of the owner with regard to the gas station are to attract the local residents
and the people travelling by specially the tourists coming into the city. Besides that the gas station
also needs to make the visibility apparent by leveraging different communication channel. The
marketing objectives will cater the target market and in regards to that cover the gap between the
target market and the gas station to attract people for regular, weekly and monthly visits. Besides
that the marketing objectives are also to promote the station in such a manner to generate sales and
increase the number of daily visits.

Secondly, the gas station also needs to take complete leverage of the support activities to build
customer satisfaction and as a source of promotion adds value to the money of the people. On the
other hand, by offering discounts and coupons increase the sales of the convenience store and
attract people to become regular customers. The marketing objectives of the gas station are clear
and are described very precisely but clearly. To achieve these objectives, strategies need to be
developed which will allow the owner of the gas station to increase the sales and achieve the
objectives described above.

Marketing Mix
This section will describe the products that will be delivered by the gas station, the pricing strategy, it
should adopt, the placement techniques and the promotional strategies that are in best favor of the
gas station. The section presents a brief but beneficial outlook of the fundamental strategies
essential to develop and achieve the desired objectives without any hindrance.

Product
The products that are being offered at a gas station include the primary and secondary products and
have their own significance. As stated above the products and services overview the company is
offering services and products of wide range. The gas station must offer the basic gasoline products
to cater the prime needs of the customers. The gasoline products are different in which the gas
station can offer a variety of gasoline and petroleum products that can serve as fuel for the car, bike
or any other automobile. Basically, everything that is being offered at the gas station is serving as
the product with benefits that are being purchased by the customers.

Customers buy value for their money and in this regard, they demand the best. Therefore, the gas
station must focus on delivering the prime product efficiently and without any delay. However, the
convenience store is also there to offer an abundance of products. Therefore, the gas station must
have the enough inventories to meet the requirements of the customers as forecasted. Besides that
the services offered as support products must be well delivered and must be complementary.

Place
The place that will hold the responsibility in terms of placement is the location at which the gas
station will be located. The location is pre-determined and is serving the station and its objectives
very well. However, the placement deserves very less attention, but efforts should be made to
improve the appearance of the gas station and also to use different measures to make the place
attractive for customers.

Price
Pricing is an important aspect that holds key importance in the overall strategy development of the
product. There can be different pricing strategies that can be followed by the company or the owner
of the gas station which is why the options are there. However, there are also some restrictions that
are being imposed by the industry and the regulatory environment that does not allow deciding on
strategies freely.

The company has the option of following price skimming or price penetration strategy that has
different objectives. However, the industry scenario and limitations and also the guidelines set by the
regulatory environment; the best strategy for the gas station will be a competitive pricing strategy.
This strategy is efficient and most suitable for the company in many ways as it allows the company
to stay in collaboration with the other brands.

The pricing strategy for the gas station will play a vital role in the sales generation of the prime
product. However, the pricing strategy for the convenience store cannot be developed as the prices
are pre-determined and set by the companies delivering those products. On the other hand, the gas
station will have to serve the clients with air filling in tires and window cleaning as complementary
products for which no products will be charged.

Promotion
The promotional plan of the gas station needs to be aligned with the promotional plan of the
company. This is very important and asks for strong relationships between the owner of the gas
station and the Shell Company. As stated above the gas station will serve under the brand name of
Shell as it is being licensed.

Therefore, the marketing and promotional activities will be decided at the company’s end. In this
regard strong integration between the two partners must be there in order to achieve the marketing
objectives derived from both of them. However, the owner of the gas station can introduce coupons
and discounts on personal behalf in order to attract people from the neighborhood or residing
nearby.

Similarly, this strategy can be followed to increase the sales of the convenience store as well. The
owner can also support different sports events held locally to embark his personal presence and
establish stronger relationships with the company. This will allow the owner to gain extra benefits
and maintain high quality standard and special consideration for the gas station at the board
meeting.