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Eureka Operations Pty Ltd (trading as Coles Express) is an Australian chain of convenience stores at Shell Australia petrol stations. Its operations are managed by Coles.
The business venture and corresponding fuel discount offer was launched in July 2003 in response to the similar offer by rival Woolworths Limited some years earlier, proving attractive to shoppers.
Wesfarmers purchased the retail business of Shell Australia multi-site franchisees in 2003 for A$94 million. Shell is the exclusive supplier of fuel products, leases the service station property to Coles, and maintains the presence of the “pecten” and other Shell branding on the price board and other signage.
Approximately 270 independently franchised Shell service stations, remain unassociated with Coles Express and where the fuel discount offer is not accepted.
Despite revenue for FY16 decreasing, Wesfarmers stated that excluding fuel sales (which have declined), in-store sales increased.
The Coles Express brand originally referred to a small number of medium-sized supermarkets Coles ran in the central business districts of Melbourne, Sydney and Brisbane. With the launch of Coles’ fuel offer, these were rebranded Coles Central.
The current Coles Express chain began at more than 150 service stations in Victoria on 28 July 2003. After this initial trial, it was followed by a national roll-out from 1 December the same year, starting with New South Wales, and completed in mid-2004. The initial success of the discount offer saw fuel shortages in Victoria after the offer began in New South Wales – where Shell’s busiest sites are located – as Shell failed to cope with the distribution of a 30 percent increase in demand.
There are now 695 Coles Express service stations across Australia. All former Shell multi-site franchisee sites became Coles Express stores. This transition included the petrol stations and stand-alone Shell Select convenience stores in Melbourne’s CBD (which closed by December 2006).
On 20 February 2006, 90 vehicle servicing bays at Coles Express service stations (formerly part of Shell’s Autoserv and AutoCare network) became Kmart Tyre & Auto Service outlets.
The Coles and Shell alliance
The Coles and Shell commercial alliance involves:
- Setting fuel and shop prices and running the business
- Management under the ‘everyday needs’ business within Coles Group
- Convenience and grocery merchandise provided by Coles Group’s supply chain and distribution network
- Directly employing the service station staff
Shell Australia (‘Viva Energy’, in this case):
- Exclusive supplier of fuel, oil, lubricant and car-care products
- Leases the service station property to Coles
- Maintain its “pecten” and other Shell branding on site signage
Fuel discount offer
When a customer spends over a qualifying amount (typically $30) in one transaction at Coles Supermarkets, Bi-Lo, Coles Central, Pick ‘n Pay Hypermarkets or at Coles Online, they are entitled to a fuel discount of 4c per litre off the bowser price at Coles Express service stations. This discount is obtained by providing a discount voucher, printed at the bottom of their receipt, and includes all of Shell’s “quality fuels” such as V-Power Nitro+, E10 and Hydrogen.
On 7 June 2007, Kmart joined the 4c fuel discount offer, only as a “limited time” until 1 August when it became permanent. This offer does not include Kmart Tyre & Auto Service transactions. Kmart eventually pulled out of the 4c fuel discount offer in July 2010.
The discount offer does not apply to Shell Card, Fleet Card, Motorpass or Motorcharge transactions.
An additional “bonus” discount was introduced in late 2006, with a further 2c per litre fuel discount when customers spend $2 in-store in the one transaction. The offer was made permanent in April 2007 after rival Caltex Woolworths created a similar offer of an additional 4c discount if customers spend $5 in the one transaction at their petrol stations. The 2c per litre finished on 1 February 2013.
Coles Express now offers a “Spend $20 and Save 10 cents per litre” this was launched to an “Everyday” offer in late 2015 and has continued since, variations of this deal are offered occasionally e.g. Buy product X for X dollars and save X cents per litre.
Other variations of the fuel offer have been offered from time to time including:
- In the lead-up to Christmas 2006, the 4c offer increased to 10c for customers spending $80 and over in one transaction at Coles Supermarkets; this offer was extended for a further short time in attempt to boost Coles’ sales figures.
- Occasionally Liquorland offers a 20c-per-litre discount offer when customers purchase six bottles of wine in one transaction.
- Kmart Tyre & Auto Service has offered a 30c-per-litre discount offer when customers purchased four certain tyres in one transaction.
- From 13 to 15 July 2009, the discount was increased to 10c for customers that spent over $100, 25c for customers who spent over $200 and 40c for customers who spent over $300.
In 2016 Victoria joined New South Wales, Queensland and South Australia imposing laws against falsely advertising the discounted price on petrol boards, this followed on from a 2013 ACCC ruling on fuel discounting on Woolworths’ and Coles Express’ fuel discounting practices.
- “Fletcher upbeat about Coles Express”. The Australian Financial Review. 2003-10-15. Retrieved 2009-08-30.
- “Coles Express | About Us | FAQ”. Eureka Operations Pty Ltd. 2016. Retrieved 2016-10-05.
- “Coles fuel offer extending after trial”. B&T. 2003-10-30. Archived from the original on June 29, 2004. Retrieved 2009-08-30.
- “Coles runs short on petrol”. The Sydney Morning Herald. 2003-12-09. Retrieved 2009-08-30.
- “Coles Myer adds to Kmart fuel load”. The Australian. 2006-01-08. Retrieved 2009-08-30.
- “Coles Express Special Offers Save up to 6c a litre on Fuel”. Eureka Operations Pty Ltd. 2009. Archived from the original on 2010-09-22. Retrieved 2009-08-30.
- “Coles ups fight in petrol price war”. Business Spectator. 2009-07-13. Retrieved 2009-08-30.[dead link]
- Battersby, Lucy (21 February 2016). “Ban on adverts for discount fuel”. The Age. Fairfax Media. Retrieved 2016-10-05.
Petrol stations will be banned from advertising discounted fuel prices on their display boards, under new regulations to be introduced by the Victorian government later this year.
- “Coles and Woolworths undertake to cease supermarket subsidised fuel discounts”. ACCC. Australian Competition & Consumer Commission. 6 December 2013. Retrieved 2016-10-05.
The ACCC has today accepted undertakings from each of Coles and Woolworths that they will each voluntarily cease making fuel saving offers