Weybridge-based Prax Petroleum has been in existence for 10 years. In less than a decade, the company has risen to become one of the largest independent oil importers and suppliers of automotive and industrial fuels in the UK
Prax is owned by The State Oil Group which operates 22 service stations and employs over 100 staff in the Midlands and south east of England. Established in 2000, the Group’s expertise in commodities and derivatives trading soon enabled it to enter the UK wholesale market where it has quickly established a strong presence under the Prax Petroleum brand.
A high quality customer experience
With its ethos of providing a ‘high quality retail experience’ on each of its forecourts, State Oil Limited has applied similar principles to the wholesale arm. Its customer-focused approach saw State Oil reach 9th position in last year’s Sunday Times Fast Track 100. Not only ranking as one of the UK’s fastest growing private companies, the Group also featured in the 2010 Top Track 250 which details Britain’s mid-market private companies. With a doubling of revenues forecast for the current financial year, the Group could be moving further up the rankings…
Fuel Oil News spoke to trading director, Don Camillo about the rise of Prax in the UK’s wholesale arena. Don, who has a background in law, trading and ship broking, said: “State Oil always had aspirations to be an importer and its growth has been quite spectacular.”
Further storage aspirations
“Prax, which supplies diesel, biodiesels, kerosene, gas oil and petrol, started with 6000 cubic metres of storage in Dagenham,” explained Don. “Storage at Dagenham has now increased to over 50,000 cubic metres.” The company, which has had dedicated storage at Dagenham since 2007, signed a contract in January 2010 to continue to store and blend fuels there for a minimum of 10 years. The terminal can accommodate ocean-going tankers of up to 45,000 tonnes; originally TDG operated, it was recently acquired by Norbert Dentressangle.
“With such good growth in our current heartland of south east and the Midlands, the next natural step is to extend storage to other areas in the UK,” said Don. Presently, several fuel distributors draw from Dagenham and, in addition, Prax supplies fuel, south to Devon, to Bristol in the west, Suffolk in the east and north to Coventry, through a flexible logistics capability able to meet the most demanding of delivery requirements.
Putting the customer in control
Prax counts the Ministry of Defence, NATO bases in the UK, the Royal Mail and Stagecoach among its many prestigious customers. The company is also an authorised supplier of diesel to many of the major fuel card networks in the UK.
With its aim to ‘provide quality products at exceptionally keen prices’, the company prides itself on being able to offer tailor made pricing mechanisms to suit individual customers. “We work out all kinds of exotic pricing deals, “Don explained. “Based on Platts monthly or weekly averages, there are at least 15 pricing options available as we speak. And, with access to real time prices, customers can decide exactly when they want to trigger a deal. Plus, our pricing software was built in house with our customers’ needs very much in mind.
“Phones are routed to a member of the sales team 24 hours a day, 7 days a week; customers always have access to a dedicated account manager who in turn can always reach a member of the senior management team for a quick decision. We work closely with customers to understand their business, asking questions to ensure that they have the right pricing deal to suit their needs.” The recent appointment of a new sales and marketing director, Neil Robertson, has further enhanced the company’s sales team. (see page 5 FON August).
“We’re a small team that works incredibly hard,” said Don. “In this business, margins are slim, and everyone needs to be on the ball. In just four years, we’ve built up an excellent team to look after cargo trading, hedging, sales, credit, stock control and human resources.”
FON asked Don for his thoughts on the reasons behind Prax’s impressive growth in the UK’s wholesale market. “Flexible pricing with much more choice – whilst companies often want to be loyal to a supplier, in a business with wafer thin margins, they nearly always follow price. As fuel prices have rocketed, customers are hitting credit limits that much quicker – they’re looking for good service from a wholesaler who’s willing to listen and take onboard their requirements.”
The wholesale future
“A company’s ambition is always to be number one,” Don said. “The Group’s aim is to really establish the Prax brand – with a larger forecourt presence, retail sites will carry the Prax brand; how we get there is currently under review. In the meantime, our priority is extending storage to other parts of the UK, as previously mentioned.”
In common with others in the wholesale market, Don had much praise for the recently established Downstream Fuel Association (DFA). “As independents like ourselves become major players in the UK’s wholesale market, we need to belong to an organisation that has credibility with government. Having galvinised its members into action, the DFA is a body this industry really needs – one that’s ready to act as a pressure group and really lobby government. As a commodity, energy is vital to the economy, in latter years, the government has simply viewed the industry as a cash cow; but with the DFA behind the wholesale market the combination could become a potent force.”