Americans fuel up their cars about four to five times every month at the estimated 150,000 fueling stations across the United States. But who owns these fueling locations? It’s highly unlikely that it’s an oil company and very likely it’s a one-store local business.
There are 122,552 convenience stores selling fuel in the United States, and these retailers sell an estimated 80% of all the fuel purchased in the country. Overall, 59% of the convenience stores selling fuel are single-store operators—more than 70,000 stores. Many of these small businesses may not have the resources to brand their stores separately from the brand of fuel they sell and promote on their canopies, often leading to consumer misperceptions that they are businesses owned and operated by a major oil company.
Source: NACS/Nielsen 2017 Convenience Industry Store Count
Large, integrated oil companies, especially since 2007, have exited the retail business to focus more on resource production and refining operations. ExxonMobil, Shell, BP and ConocoPhillips have either begun or completed the process of selling off all of their directly operated facilities. Of the 122,552 convenience stores selling fuels, well less than 1% (314 stores total) of them are owned by one of the five major oil companies as of July 2017.
Source: Nielsen, July 2017
While the major oil companies are withdrawing from retail operations, their brands remain. In fact, roughly half of retail outlets sell fuel under the brand of one of the 15 largest refiner-suppliers. Virtually all of these branded locations are operated by independent entrepreneurs who have signed a supply contract with a particular refiner/distributor to sell a specific brand of fuel, but these retailers do not share in the profit/loss of their suppliers.
The remaining 50% sold “unbranded” fuel. These stations often are owned by companies that have established their own fuel brand (i.e., QuikTrip, Wawa, 7-Eleven) and purchase fuels either on the open market or via unbranded contracts with a refiner/distributor.
In 1971, only 6.8% of all convenience stores sold gas (1,401 stores). Convenience stores saw enormous gains in market share for fuel over the next 37 years. Over the past decade that growth has slowed, but the number of convenience stores selling fuels still has grown by 6.4% (from 115,157 to 122,552 stores). Today, 79% of convenience stores have fueling operations and these stores collectively sell an estimated 80% of the fuels purchased in the United States. Meanwhile, the overall number of overall fueling locations has dropped.
There were 152,995 total retail fueling sites (convenience stores, service stations and grocery stores) in the United States in 2013, the last year measured by the now-defunct National Petroleum News’ MarketFacts. This was a steep and steady decline since 1994, when the station count topped 202,800 sites.
The channel that has seen the most growth over the past decade is big-box grocery stores and mass merchandising stores, otherwise known as “hypermarkets.”
As of May 2016, there were 5,934 big-box retailers selling fuel. These sites accounted for an estimated 14.5% of the motor fuels (gasoline) purchased in the United States and have sales volumes roughly double that of traditional retailers, according to Energy Analysts International.
The top five hypermarkets selling fuel, by store count, in fuels retailing are:
- Kroger (1,354)
- Walmart (1,323 stations, mainly Murphy USA with small mix of others;)
- Sam’s Club (535)
- Costco (430)
- Safeway (341)
(Source: Energy Analysts International [EAI Inc.]; based on market research work completed in May 2016)
The remainder of fuels sales in the United States comes from traditional service stations without convenience operations and very low-volume fueling sites, such as at marinas.