In November 1999, I interviewed my very first fuel distributor at Carlton Fuels which had just been listed among the north-west’s top businesses. Asked for the secret of his success, owner Frank Hunter said the company’s strength came from its people, citing his 28-year old sales manager, Paul Vian for special mention. Fourteen years later and now managing director at Certas Energy, Paul Vian was in the interview chair
From GB Oils to Certas Energy
Why the change of name? “It was more than a change of name; it was a culmination of a number of developments within the business in the last 12 months – a restructured sales & operations function (including the introduction of logistics services) and renewed investment both in our people and also our infrastructure. However, the main driver was ensuring consistency – for customers and colleagues. As a business built on acquisition, we had any number of different ways of doing things. So, this two-year project re-established who we were, what we do, and most importantly how we did it.” Paul explained.
“The name Certas in itself is significant as it translates to ‘Certainty’ which is at the heart of the business; we are committed to providing assurance and certainty of supply to our customers. The Certas brand not only reflects the size and strength of the business but also the great team that sits behind it. Along with the name and identity, we created the Certas Energy Way of Working where we shared our company mission, giving us a common goal, and a shared set of values. Externally, Certas Energy positions us as a leading market force in the distribution sector, and gives us the scope to achieve our growth ambitions, both organically and through acquisition, the latter of which we are constantly reviewing to see where there is opportunity for acquisition expansion.
Certas Energy branded tankers are now being spotted out on the road. “We wanted to get the name known as quickly as possible,” said Paul. “Since the vehicles have been on the road, the name is gaining momentum.” The company operates 1,000 vehicles; starting next summer we will ramp up the pace of converting our vehicles to the Certas Energy branded ones.
WE’LL LOOK AT ANY OPPORTUNITY THAT PRESENTS ITSELF IN ANY BUSINESS SECTOR
There are 45 brand names operating under the Certas Energy umbrella. Although there is an aspiration to operate under the one name, Paul appreciates that existing brands cannot be changed overnight. “A collective name is an ambition but we’re not sure that we can get there just yet…
“At the start of the brand project, we conducted one of the largest pieces of customer research in the industry. It was essential we listened to our customers. In the domestic market our customers have developed strong relationships with a particular brand over many years. We now have a great understanding of the different factors customers are looking for when dealing with us so we need to operate with sensitivity for the foreseeable future; retaining customers will still require a multi-brand strategy.
“However, no matter which brand, customers know who they’re dealing with in terms of the parent brand; we are completely transparent.”
GB Oils did receive some adverse media coverage in the winter of 2010/11, what action has the company taken to remedy this?
“We’ve taken a much more proactive approach to our corporate social responsibility,” said Paul.
“We regularly offer bursary schemes across the country providing donations and funds to a host of local charities and community initiatives.
“This winter Certas Energy is the official corporate partner of Independent Age (IA), a charity which works with and for older people throughout the UK and Ireland. And we are working with them to help us better identify and support elderly customers.”
“We’re also big supporters of the new Code of Practice recently launched by the FPS, and as market leaders we’re very happy to drive this through our business.
“Across all our brands every customer knows the price of a delivery before it’s delivered. Underlying oil prices may change daily but our consumer pricing policy ensures the quoted price is the one the customer pays thus giving them the ability to make an informed decision. With the more financially vulnerable, we encourage budgeting by paying over a period of time via direct debit and ordering early.”
“The business is an active supporter of the Buy Oil Early campaign run by the Action with Communities in Rural England, Citizens Advice Bureau, Consumer Focus, and FPS.
“Additional drivers and telesales staff have ensured that we’re much better geared up for the winter period when the number of calls and deliveries can more than double. In times of peak demand, third party logistics cover may also be used to ensure a good level of customer service.
“We like to think we are leaders now in terms of customer service and transparency,” added Paul.
Certas Energy continually promotes strong messages about ‘transparency’, ‘honesty’ and great customer service.
A Customer Charter has been developed and is available to all customers; approved by the Plain English Campaign it outlines the company’s customer commitments; the level of service customers can expect from Certas Energy and how easily accessible the company is.
Transparency is also extended through the company’s online presence – Idania Borerro-Knight, online marketing manager, is very proud of the new website which was developed in house.
“Yes, we’ve improved the website’s transparency – content is written in plain English with jargon limited wherever possible. Mobile and tablet friendly, this website was designed with the end user in mind, making navigation easy and intuitive, enabling the visitor to find exactly what they’re looking for.”
In 2001 when DCC Energy moved into the British market it was Ireland’s fastest growing independent oil distribution company. First purchasing BP’s fuel marketing businesses in Scotland and Cumbria, it was the 2004 acquisition of Shell Direct that gave the business a national footprint. Texaco’s equity distributors were added in 2008, Gulf aviation and retail (the latter now has 390 sites) in 2009 with Total Butler’s 48 depots brought into the fold more recently.
In the last 7 years, there have been 24 acquisitions, the most recent being Advance Fuels and 13 retail sites from Shell in Scotland, where considerable investment will be made.
Asked about further acquisitions Paul said: “We’ll look at any opportunity that presents itself in any business sector.” Paul reports strength in all operating sectors which includes lubricants, marine fuels, fuel cards, national accounts and a heating services division with over 70 engineers.
An area of particular interest is retail. “This is a very, very competitive sector but retail offers a massive marketplace. We’ve already enjoyed considerable success with recognition at the Forecourt Trader awards and our own SuperStation initiative.” said Paul.
“Having the support of DCC has enabled us to invest and to make some pretty decent sized acquisitions over the last 10 years. Our ambition, and moreover our vision, is to grow both organically and through acquisition. Subject of course to continuing to provide strong returns on capital employed for our shareholders.”
Managing a growing business
The company’s considerable assets – 150 depots – are managed both centrally and regionally however procurement of major assets and operational equipment are undertaken centrally to drive economies of scale. “Whilst we do have some preferred suppliers such as CODAS which provides all the company’s software, the door is always open to others with good offers!,” said Paul.
“Our capital expenditure is significant, and with that in mind a strong focus on working capital is essential. The sustainability of assets – trucks, depots etc. – requires year in, year out investment with tens of millions of pounds invested to date. As a storage facility owner, just relining the tanks at Caledonian Oils in Aberdeen cost over half a million pounds each.
“We’re keen to take a lead in the industry. We have a strong HSE and compliance culture driven by our dedicated Safety F1rst and Doing the Right Thing (compliance) campaigns. And we have developed strong and proactive relationships with the OFT, Trading Standards, etc.
“However, whatever the challenges faced, it’s important for us not to lose sight of our entrepreneurial spirit.
“We’ve also invested heavily in one of our other key assets … our 2,500 colleagues. We have a great team with a super work ethic.
“As the company continues to evolve, effective management of change is also essential. We’ve invested heavily in training and development for all our colleagues to ensure we have competent and skilled people in all our business activities.
“We also like to be viewed as an employer of choice where people come because they feel there’s an opportunity for them to be developed in terms of their skillsets, roles and responsibilities.
Do you feel threatened by initiatives such as the Renewable Heat Incentive?
“This is certainly on our radar. Although we don’t envisage it having a huge impact on the industry in the short term, we are fully in support of OFTEC initiatives which encourage the installation of lower carbon emitting boilers, and the drive to install renewable energy systems.
Through our parent company, DCC, we are involved in the heating industry from a number of angles. For example, DCC’s New Energy division already operates in the renewables market via UFW and Clearpower, and the Flogas operation in turn supplies homes with LPG. In addition, alternative sources of energy such as solar and biomass are being seriously considered.
Is there anything about the industry that you would change?
“Yes, it would be brilliant if people really appreciated just how much time, money and effort is invested in the downstream fuel distribution business to maintain the service at the levels our customers have come to expect from us.”
How do you see the future?
“Short term we see customers continuing to drive economies and more legislation changes necessitating additional investment.
“Long term the industry needs to take a more balanced approach to selling heating oil and look at other methods of generating revenue.
“I guess we’ve been preparing for the long term for quite a while now. We’re not naïve to the fact that we cannot be solely reliant on cold weather or the heating oil market for future revenues. Our focus has already been to develop other areas/business sectors for expansion, including our lubricants division, retail, aviation, marine, fuel cards and boiler maintenance services. We believe we have the balance right to ensure a sustainable business model.
Paul concludes, “I’m really proud of what the company has achieved for the long term sustainability of the industry with key suppliers and customers buying into what we’ve sought to achieve. To borrow from our new Certas Energy mantra – Doing it right together is certainly keeping our customers happy.
“Oil is in my blood. After 23 years working in this great industry, I still look forward to coming to work every day, I’m extremely competitive and still have ambitious plans for this business.” added Paul.