Petron to set up unit to oversee service stations

Publicly-listed Petron Corp. yesterday will form a new subsidiary that will handle the company-owned and company-operated (COCO) service stations.

The new firm, which will be incorporated soon at the Securities and Exchange Commission (SEC), will play a major part in launching marketing initiatives to strengthen the Petron brand.

"Our COCO stations will not only promote the Petron brand and image but will also give us an opportunity to quickly introduce innovations beyond the present services that are available in our stations," Petron public affairs manager Virginia A. Ruivivar said.

The Board of Investments (BoI) has approved Petron’s application for prequalification to establish a retail enterprise under the Retail Trade Liberalization Act (RTLA) in the fourth quarter of 2003. Until recently, Petron, being partly foreign-owned, was not allowed by the Retail Trade Law to engage in direct retailing.

The Petron official said the direct operation of its stations will have a positive impact on its bottom line, although she did not give other details.

"The establishment of Petron COCO service stations will allow us to capture other revenue streams which include food and other consumer products and the direct franchising of complementary quick service restaurants," Ruivivar said. "This is in line with our thrust to capture more of the retail market."

Petron added that once the legal entity of its subsidiary is established, it will begin putting up stations in high-traffic, high-visibility sites. Over a five-year period, the company will put up nearly 30 COCO service stations in strategic areas.

Recently, the country’s largest oil refiner set up a separate subsidiary called Petron Treats Subic Inc. to operate its "mega-station" at the Subic Bay Metropolitan Area (SBMA).

The 3,200-square meter service station, which is expected to be operational in the middle of 2004, will be offering a complete range of fuel products and wash and service bays. Apart from a Treats convenience store, it will also host popular food establishments.