Oil companies insist on marketing branded fuel: retailers

June 29th, 2008 - 12:36 pm ICT by IANS  


Kozhikode, June 29 (IANS) The fuel outlet owners in Kerala say they find it difficult to go ahead with the business, as petroleum companies are insisting on selling branded petrol and diesel. The branded fuel costs more and customers prefer unbranded fuel. “The petroleum companies are interested in selling branded fuel as it reduces loss in the business. But in many petrol pumps branded fuel remains unsold for customers move out in search of unbranded stock in other outlets,” Sunil Abraham, state secretary of All-Kerala Petroleum Dealers’ Association,told IANS.

The fuel outlet owners say almost one third of the fuel now supplied is branded. A fuel tanker truck carries 12,000 liters in three compartments. “Invariably, 4,000 liters in one compartment is branded type,” said the manager of a retail outlet here.

According to fuel retailers, the Hindustan Petroleum Corp Ltd (HPCL) has increased the quota of branded fuel recently.

“Bharat Petroleum Corp Ltd (BPCL) and the Indian Oil Corp (IOC) have also started implementing this marketing strategy,” said Abraham.

Branded petrol costs Rs.4 per liter more than the unbranded fuel, while the difference is around Rs.2.25 in the case of diesel.

However, when contacted by IANS, a senior marketing official of a petroleum company said branded fuel constitutes only 17 percent of their total supplies in the state. “It is true that we promote branded fuel. Many car owners prefer branded fuel.”

Abraham said fuel outlet owners were planning to limit working hours to cut losses. “I am getting only 10 paise in profit per liter of petrol sold. It makes sense to reduce working hours as operations need lesser employees and lesser overheads.”

“This will discourage people from making frequent visits to the petrol pump for small purchases. Small purchases are a burden on us. The machines are calibrated to dispense five liters. Dispensing less than this ends up in loss of petrol. Frequent operation of the machine also pushes up electricity charges,” Abraham added.

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