MOGAS MARKETING STATION & BUSINESS IN KUWAIT

MOGAS STATIONS AND BUSINESS IN KUWAIT

An study and analysis was conducted by EXCPR™ - for consultant and business management – in April 2011, Kuwait , about the same subject. In this paper, EXCPR™ will present the main points which was observed by its study such as, the important of such promising market, the competition between the three companies, some market and business trends, in addition to the market requirement. 

1-      The population in Kuwait

The MOGAS market in Kuwait can be classified as growing and promising market for many reasons, first as the population in Kuwait is increasing in yearly bases. Additionally, the latest study which was done by EXCPR™, shows that such market is growing in the rate of 3.9% - in yearly bases. Such high rate will lead to increase the demand of the MOGAS in the market. In addition to that, the statistics show that by the year 2018, the population in Kuwait will be nearby 5 million. Thus the government and the related companies should look to such phenomena to avoid future troubles. The bellow trend shows the growing in population in Kuwait for the last five years in addition to the forecasting one.

From another hand, the MOGAS market in Kuwait is covering about 32.8% of the total population size in Kuwait, which means a lot of individuals are using such products.

Figure -1- the population in Kuwait

2-      The number of Autos and the driving license in Kuwait

 

The below graph ( no. 2) shows a parallel relation between the number of autos increase in Kuwait, with the driving license number for the last five years. Additionally, the results show that, every five individual in Kuwait have about six autos – which means an auto not in used for every 5 peoples. In addition to that, the rate for autos increase in Kuwait is about 5.7% per year, which means by the year 2016, the number of autos in Kuwait will be almost 2 million. As a result, such observation clearly indicate the important of the MOGAS business in Kuwait as the demand is expected to increase.

While, the rate of increasing for the driving license in Kuwait is slightly higher than the number of autos by 0.4% ( 6.1% is the growing rate for the driving license number).

Figure -2 – the number of autos and the driving license in Kuwait

3-      The MOGAS station in Kuwait

The total number of the MOGAS stations in Kuwait is 125 stations, which are located in different location in the country. The number of the MOGAS station in Kuwait is consider as low number, as the statistic shows that the number of the customer for each MOGAS station in Kuwait is around 0.68 million visitors ( around 1,850 visitors for each MOGAS station . every day ). Such high number of visitors lead to the traffic phenomena in the station, which raise a flag for expanding the MOGAS station in Kuwait, in addition to the required to establishing a new stations.

From another hand the figure number 3A, shows the number of MOGAS station in each Kuwait’s regions. In this figure, it can be observed that around 52% of the total MOGAS station in Kuwait are located in two regions only which are the Capital and Ahmadi regions ( such two regions have ONLY 33.4% of the total population in Kuwait). As a results, the future MOGAS stations in Kuwait have to be relocated base on the population in each regains.

Figure -3- Number of the MOGAS stations in Kuwait’s regions

In additional to the previous section, the MOGAS stations in Kuwait can be distributed base on its distance from the Cities, thus some MOGAS stations are located in the residential city, some of them may locate on the main roads- just between two residential cities- and the others are located on the high way – far from the cities. As it is illustrated in the bellow pie chart ( figure 3B ), 56.8% of the MOGAS stations are located in the city, 26.4% are on the high ways while 16.8% of the MOGAS station are located in the high ways.

Figure -3B –the Location of the MOGAS stations in Kuwait

4-      MOGAS marketing companies in Kuwait – competitions

The MOGAS marketing activities in Kuwait are looking after three companies, one of them is handling by the Kuwait’s government – Kuwait National Petroleum Company – KNPC local marketing department, it has around 39 stations. While the seconds are handling by the private sectors, which are OULA MOGAS company and SOOR MOGAS company ( each of these companies have 43 MOGAS station in Kuwait).

Base on the deeply study and analysis which was conducted by EXCPR™ - for consultant & business management- the market shares for each of the three competitors are as follows, KNPC has 35.2%, OULA 32.4% and SOOR 32.3%. The below pie chart ( figure 4 ) illustrate the market shares area for the three companies.      

Figure – 4 – the market shares for the three competitors

5-      MOGAS station’s products

All the three companies are providing five of the main standard products in their stations as it is shows in the bellow table ( 5 A)

Comments	Used	Price ( KD / Litter)	Product
Good quality engine	Autos	0.06	MOGAS-91
High quality engine	Autos	0.065	MOGAS-95
Excellent quality engine	Autos	0.09	MOGAs-98
-	Heating	0.055	Kerosene
-	Cargo and trucks	0.055	Diesel

Table  -5 A- the petroleum products in the MOGAS station in Kuwait

In related to that, the MOGAS marketing companies in Kuwait are spending around 87.2% from the total sales on its cost of goods sold – CGS. Such low profit margin gain by the MOGAS marketing companies, effect the level of services ( quality) and the new product channels.

 

From another hand, the study which was published by EXCPR™ - for consultant & business management – point up that the highest products demand in the MOGAS station in Kuwait, is for the MOGAS-95 by 48.1% of the total sales. At the same time, the lowest demand was indicated for the MOGAs-98 by ONLY 0.8%. The below figure ( 5 B ) illustrate the whole products demands in the MOGAS station in Kuwait.

Figure – 5 B – The Products sales in the MOGAS stations in Kuwait

6-      The services in the MOGAS marketing stations in Kuwait

Unlike the other global stations in the worlds, Kuwait’s MOGAS stations are concentrating in selling the hydrocarbons products ONLY. Thus such step is very important in the modern business point of view, as it will make the competitors loss an opportunity of making high profit margin is such field. 

Thus, EXCPR™ - for consultant & business management company – did a survey for almost 139 individuals which are visiting the MOGAS station in Kuwait in frequent bases. The result of such strong survey – as it was distributed in different way with an open question -  support EXCPR™ hypotheses as people are looking to see the changes in the MOGAS station in Kuwait in different priorities sectors such as the food, services and environment sectors. The following table ( table -6) illustrate each sectors with its priorities to be implemented. 

Level	Sector
High	Food
High	Services
Medium	Environment
Medium	General services
Medium	promotions

Table -6 – The MOGAS station services required by the customers

At the end, the modern business concept is starting from the customer requirement and how to minimize such gaps in such field to be consider as the success companies. Thus the whole competitors should start with these needs and the data presented in such research paper, in order to maximize its market shares, grow and expand in the MOGAS  business.

Reference

·         Strategic marketing planning for OULA MOGAS marketing co. by EXCPR™ 2011

·         Survey of EXCPR™ 2010

·         Annual report for KNPC 2009

·         Annual report for OULA MOGAS marketing co. 2009

·         Annual report for SOOR MOGAS marketing co. 2009

·         The public authority for civil information

·         Ministry of interior of Kuwait

For more information about the research contact EXCPR at info@excpr.com  or visit EXCPR website at www.excpr.com