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IpirangaRelatório Anual
2016

Good perspectives

Organic growth and new businesses pave the way for growth

With comprehensive territorial coverage of BraziL, Ipiranga has a payroll of 2,903 employees. The service stations, am/pm convenience stores and other services are managed by resellers and franchises. Infrastructure and scale are critical to the company’s ability to compete. Ipiranga operates from 54 storage terminals. These are operated either on a proprietary basis or in pool’s (association with other companies) throughout the country and responsible for the distribution of fuels and lubricants to the company’s 7,563 service stations.

Its business sector - the distribution and sale of fuels and lubricants - has been impacted by the decline in consumption due to the economic and political crisis in Brazil. In spite of this scenario, Ipiranga has continued to implement its strategy and has been able to maximize opportunities arising from its growth. Click on Ipiranga's perfomance.

Products and services

  • Fuel distribution: 7.6 thousand service stations 

  • am/pm stores: the largest network of convenience stores in Brazil with 2,166 units in 2016, offering a differentiated range of products and services both on the highway and also in the city 

  • Lubricants: a diversified line of products for automotive, industrial and maritime uses  

  • Jet Oil: the largest network of automotive services in Brazil with 1,594 units in 2016 

  • Km de Vantagens: Ipiranga’s loyalty program with 24 million participants 

  • ConectCar: an electronic toll collection and parking lot system with 840 thousand tags in 2016 

In addition to the organic expansion of the service station network, among growth drivers during the year was the acquisition of the ALESAT fuel retail network for R$ 2,168 million - the operation still subject to approval by the Brazilian anti-trust authority - CADE. Also announced in the period was a joint venture with the US company Chevron, establishing a new company for the production and sale of lubricants, greases, additives and coolants bearing the Ipiranga and Chevron brand names. Already approved by CADE, the association strengthens the operations of both companies in the Brazilian lubricants segment through the complementary nature of the channels and products as well as the adoption of both companies’ best practices. The benefits are to be extended to resellers, distributors and consumers, all of whom will enjoy the improved performance and capillarity of a network with greater logistical efficiency. Ipiranga is to have a 56% stake in the new company against Chevron’s 44%.

Sales volume, Net revenue and EBITDA

2.9 thousand

work at Ipiranga

Differentiation

Ipiranga reported a total network of 7,563 service stations at year-end 2016, having added a further 333 in the period. The company continues to see a promising future in innovation and convenience as a strategy of differentiating its products and services. During the year, a clean gasoline additive, DT Clean, was launched, the new product having a sustainability component so that as engine performance improves, there is a reduction in greenhouse gas and equivalent emissions.  

Ipiranga also launched the cell phone Fill Up Here (Abastece Aí) app, which introduces an innovative and differentiated experience when the consumer fills up at the service station. The app allows the consumer to pay for the fuel directly by cellphone and on payment, have the option of exchanging Km de Vantagens for benefits or obtaining a discount on the fuel purchase. This innovation is available for Android and iOS operating systems.

Currently, the Km de Vantagens has 24 million participants, making it the largest loyalty program in Brazil.

One of Ipiranga’s flagship services in the differentiation strategy is the am/pm store, first in the ranking of convenience stores in Brazil. This business reported year-over-year growth of 13% and ended 2016 with 2,166 points of sale in Ipiranga’s service station network, thus increasing the supply of products, services and convenience available to the consumer. During the period, Ipiranga consolidated the implementation of two new store configurations: for urban-based service stations, an am/pm store with an expanded convenience concept similar to a neighborhood minimarket and offering fresh products – such as fruit, vegetables, meat, flowers together with a greater variety in ready-to-eat meals. Currently, this new model has two stores, one in São Paulo and the other in Rio de Janeiro. The other configuration is the am/pm Estação (Station) store, designed for highway service stations – offering one-stop shopping in the form of a series of products and services for travelers. Such a store prototype is located on the Presidente Dutra Highway linking Rio de Janeiro and São Paulo and consisting of restaurants, family restrooms, lounge, kids’ space, among other conveniences.

The Jet Oil network also saw growth during 2016, the number of units increasing from 1,466 in 2015 to 1.594 in 2016, and offering specialized products and services for motorcycles and automobiles.

In 2016, Ipiranga installed a pilot electric car battery recharging station in partnership with BMW.

1,191

eco-efficient service stations

256

new am/pm franchises

128

Jet Oil units

165

bakeries

138

beer caves

Retail School

The Retail School is dedicated to the training of resellers, franchisees, authorized lubricant distributors, leading corporate clients, suppliers and their respective teams. The programs cover training in products, services, sales, management, the opening of franchises and consumer service, among others.

The focus of the Retail School is on service to the end consumer. In this context, the company offers all support necessary for Retail School attendees interacting with customers to be able to transmit the benefits and differentiations of the brand at the point of sale. 

In partnership with the Disney Institute in Orlando (USA), Ipiranga promoted the Disney Experience program for its resellers. The training theme was Team Leadership and Engagement with the aim of learning the main concepts of the Disney model of Excellence in customer service. Participating resellers were able to go behind the scenes of the Disney complex to see how the theory of business drives operational excellence.

Other international training included the Authorized Lubricants Distributor Technical Mission (ADs) through the Leadership and Management Program. Run in partnership with the University of Pittsburgh, this initiative had the mission of broadening leadership concepts and skills necessary to administer businesses and optimize results. During five days, participating mission AD entrepreneurs were subjected to an immersion program from lecturers on advanced concepts of strategic leadership, management of high performance teams and leadership influence. Participants also made technical visits to companies in the wholesale segment to understand the theoretical concepts in practice.

Important courses were also organized in Brazil, one of which was the Retail Expert Program for the clients of authorized distributors. The classes were designed to trigger reflections on the importance of the management of results for business development. In addition, participants were able to broaden their knowledge of financial concepts, procurement strategy and inventory management and exchange experiences on the management of the business. This course was made possible through a partnership with Universidade Estácio, which replicated the training sessions at different locations around Brazil.

Another key international program is the NACS Show, the largest fair in the world for the convenience and fuel distribution segments. During the course of the show, Ipiranga’s Resellers and Franchisees had the opportunity to attend lectures and workshops on both businesses. Ipiranga has run this program for eight years now and in 2016, took about a thousand people to the event.

The Retail School was responsible for training 43,525 clients in 2016. Among them were urban and highway-based resellers, authorized lubricant distributors and teams. This training was largely onsite, but also conducted on a remote basis (e-learning). An all-time record.

Ethical relationship

Ipiranga is proud of its ethical behavior and the quality of products and services offered to consumers. Through Sindicom (Brazilian Association of Fuel Distributors), the company is a member of the Legal Fuel (Combustível Legal) program. This initiative seeks to provide answers to society on the illegal market in fuels and promote the importance of an ethical and regulated environment for the sector at all levels.

Social Responsibility

With major capillarity in Brazil and nearly three thousand employees, Ipiranga encourages its staff to get involved with volunteer work. The bedrock of social investments is always education, aligned with the objective of promoting inclusion, local development and benefiting the communities with which the company relates.

The Ipiranga Internal Volunteer Worker Program mobilizes volunteer employees to give their time to schools and institutions surrounding the company’s premises. In 2016, the program held Internal Volunteer Worker Week activities in Rio de Janeiro, São Paulo and Porto Alegre. This involved more than 830 children and adolescents who enjoyed the benefits of talks on the importance of studies for future careers, stimulating an interest in reading from a young age and activities for developing skills for subsequently entering the labor market.  

The company also resumed the Shadow Entrepreneur Program in partnership with Junior Achievement. This initiative is designed to arouse the entrepreneurial spirit in the young students, stimulating their personal and professional development and providing information on how a company operates. During the “Shadow Entrepreneur” session, students are put in contact with the routine of an entrepreneur to discover what skills and knowledge are necessary for future success.

Overall, 241 voluntary actions were supported and realized, these involving 280 employees and interns, some two thousand people enjoying the benefits.

Driver health

The company has run the Health on the Highway initiative since 2008, already attending more than 405 thousand people nationwide with a focus on professional drivers. The project operates on a roaming basis from Ipiranga Rodo Rede service stations. Free examinations are offered, so helping to prevent such diseases as diabetes, high blood pressure and obesity while also contributing to increasing safety on the highways.

The event is supported by municipal health departments, universities, and the federal and state highway police.