South Africa’s petrol stations are undergoing a significant transformation, moving beyond simply selling fuel to become multi-purpose convenience hubs. This shift is driven by the global move towards electric vehicles and a require for fuel stations to adapt to changing consumer habits and revenue streams. The traditional model of relying solely on fuel sales is becoming increasingly unsustainable, prompting major retailers to stake their claim in the R33 billion forecourt market, according to data from Trade Intelligence.
The change isn’t about petrol stations disappearing, but rather evolving. As more electric vehicles hit the roads – a trend gaining momentum worldwide – the demand for petrol will inevitably decrease. Fuel stations are responding by diversifying their offerings, focusing on convenience retail, and attracting customers with a wider range of products and services. This evolution is already well underway, with several major brands vying for dominance in the sector.
The Rise of Retail Brands at the Pump
OK Express, SPAR Express, Pick n Pay Express, and Woolworths Foodstop are leading the charge, steadily expanding their presence within South Africa’s petrol station network. Over the past five years, these brands have collectively opened 145 fresh stores, representing a growth of 44.6%. While the pace of expansion slowed slightly in the first half of 2024 with only six new openings, their strategic partnerships with major petrol station operators demonstrate a long-term commitment to this market.
Shoprite-owned OK Express currently holds the largest market share, boasting partnerships with Puma and TotalEnergies. The brand is also increasingly visible at Sasol stations as the company itself looks to modernize its retail offerings. OK Express distinguishes itself through its franchise model, allowing individual store owners to tailor product selections to local preferences and share in the convenience store’s success. The OK brand portfolio, encompassing Ok Foods and OK MiniMark, comprises over 500 stores nationwide, and OK Express is the only Shoprite brand offering franchise opportunities.
SPAR Express has secured a partnership with Shell, even though Shell already operates its own convenience store brand, Shell Select. Like OK Express, SPAR Express leverages a franchise model to expand its reach. Pick n Pay has aligned with BP stations, rapidly growing its footprint across the country. Woolworths’s Foodstop is a common sight at Engen garages, but these locations are exclusively franchisee-owned, differing from the company’s other store formats.
Competition and the Dominant Player
While these major retailers are aggressively expanding into the forecourt market, FreshStop, owned by Food Lovers Market, remains the dominant player in the convenience store sector at petrol stations. The competition is intensifying, however, as the other brands seek to capture a larger share of the market. This increased competition is likely to benefit consumers through improved offerings and potentially lower prices.
The shift towards convenience retail isn’t merely about adding a shop to a petrol station. It’s about creating a destination – a place where customers can fill up their tanks, grab a quick meal, do their grocery shopping, and access other essential services. This transformation requires significant investment in infrastructure and a rethinking of the traditional petrol station business model.
Adapting to a Changing Energy Landscape
According to Karen Keylock, Nedbank Commercial Banking National Retail Services Manager, the changes are part of a “global drive towards cleaner fuels and new energy vehicles (NEVs).” TopAuto reports that fuel stations must evolve to remain relevant in this changing landscape. This evolution will likely involve incorporating electric vehicle charging stations, offering alternative fuels, and expanding the range of convenience services available to customers.
The future of South Africa’s petrol stations is therefore likely to be one of diversification and adaptation. The stations that successfully embrace these changes will be well-positioned to thrive in the evolving energy market, while those that fail to adapt risk becoming obsolete. The competition between OK Express, SPAR Express, Pick n Pay Express, Woolworths Foodstop, and FreshStop will continue to shape the landscape of convenience retail at the pump.
The next key development to watch will be the continued expansion of electric vehicle infrastructure and the response of petrol station operators to this growing demand. Further details on partnerships and investment plans from the major retailers are expected in the coming months.
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