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A photo of workers behind the till at a service station shop

Aug 29, 2018

Mentorship key in filling station industry

An article appearing in The Citizen (Gauteng), 29 Aug 2018, by Antoine e Slabbert, Moneyweb.

Filling stations can be really lucrative businesses, but a significant number of entrepreneurs entering this industry fail very quickly, two entrepreneurs report.

Building on their own experience, which includes everything from personally washing windows and pumping petrol to managing filling stations as partners, Sbonelo Mbatha and Mark Harper have established PetroConnect to support existing and new entrepreneurs in this field.

Mbatha had planned to become an accountant and only started pumping fuel as a stopgap when he couldn’t find an accounting job after completing his studies.

He was then promoted from an attendant to various other positions at the petrol station. And he eventually got an opportunity to own one himself, after completing an entrepreneurship programme run by a major oil company.

Meanwhile, Harper grew up washing windows at the petrol station his father owned. He also studied accounting. The two met at an industry body for petrol station owners. Mbatha was the chair and Harper deputy chair.

Five years ago, they joined forces and now own nine filling stations, spread across KwaZulu-Natal, Gauteng and Free State.

“Of the group of 10 who attended the training programme with me, I am the only one who survived,” says Mbatha. “It is not because I am smarter than the others. Some of them are very smart, but there is a missing link – that training and mentorship.”

This results in up to 40 people losing their jobs and as much as R20 million being lost, he says.

The first real challenge new owners face is cash management.

A filling station could receive on average R200 000 to R300 000 cash every day. If it’s not managed properly, an owner could end up being unable to pay the R500 000 to R600 000 required to replenish the fuel stock.

PetroConnect developed a back-office system that tracks the money from the moment the petrol attendant takes receipt of it, and right through another six or so pairs of hands before it ends up in the company’s bank account.

This is aimed at flagging any potential leakages.

About 18 months ago, the company started an academy for potential filling station owners.

It starts with the screening of potential candidates for among others, credit-worthiness and possible criminal records. This is followed by a two-week practical programme on site.

Currently, the training candidates pay for the programme themselves to ensure they “have some skin in the game”.