With a new real estate entity in place, the company is positioned to grow its chain of dealer-leased stores beyond Arkansas.
By Erin Rigik, Associate Editor.
Coulson Oil Co., one of the Southwest’s largest independent distributors of motor fuels, took a big step toward continued growth in August with the formation of Coulson Real Estate Group LLC.
The new real estate arm is set to manage Coulson’s current c-store properties, look for opportunities to acquire into new c-store holdings and to diversify its real estate portfolio into other business categories.
The North Little Rock, Ark.-based oil company supplies Shell, ConocoPhillips, Valero, Sinclair and unbranded fuel to more than 230 dealer locations, including 100 locations it leases to dealers throughout Arkansas, and 130 open dealers who own their own stores in Arkansas, Tennessee and Oklahoma. All Coulson dealers are eligible for membership in the company’s SuperStop Coop, which establishes relationships with vendors to provide products and services to dealers at negotiated prices.
Preparing for the Future
The primary mission of the real estate division is to increase the value of the company’s holdings, including the management, development and financing of present and future real estate acquisitions.
The company also plans to consider the purchase of new properties outside of Arkansas, according to Eddie Martin, president of Coulson Oil Real Estate Group. “We are concentrating on our fuel service business and trying to expand that geographically,” he said. “Right now, the majority of our leased dealer locations are centered in central Arkansas. We believe there is a great deal of opportunity outside of this area, and the state as a whole.”
Another reason for the launch of the real estate group centers on changes seen in the fueling and convenience store industries over the past few decades. “It has become more important than ever to ensure that our properties are being used to their best advantage,” Martin said. “To that end, what we are seeing now is that some of our holdings may have a better use than serving as a c-store location.”
Coulson Oil consists of several divisions in addition to the real estate group. CP Services & Testing installs, calibrates and repairs pumps, tanks and other c-store equipment for both Coulson Oil dealers and other c-store operators. Seahawk Transport LLC transports motor fuels, hauling and delivering gas and diesel fuel to dealers and providing fuel inventory management. The SuperStop Coop manages negotiated programs with various vendors who supply products to Coulson dealers. Together, these subsets make Coulson Oil a regional powerhouse that is ready to expand in numerous directions.
Evolving Though The Years
Coulson Oil was founded in 1969 by Ray Coulson and his friend Jim White, who were both longtime Amoco Oil employees. Coulson, who was born in Arkansas, saw an opportunity when Amoco decided to divest its Arkansas stores. He moved from Atlanta to Little Rock, Ark., to form Coulson Oil Co. with his wife Lois and White.
During the company’s first month in business, more than 83,000 gallons of fuel were sold through six dealer-operated service stations. White and Coulson decided that self-service, which was a new trend in gasoline marketing at the time, would work well in combination with a food store, so they opened the first convenience store in Arkansas.
Coulson Oil pioneered other firsts in the state, such as the first self-service diesel station, being the first in Arkansas to advertise gas prices on billboards and introducing gasohol (E10) to the state.
As the years progressed, the company began acquiring c-store properties. “Ray and Jim loved real estate, so the main focus for Coulson Oil has always been acquiring real estate,” Martin said.
At one time, Coulson Oil owned and operated more than 30 stores in Arkansas. The company also began supplying fuel to independent retailers. By 1979, Coulson Oil was managing the sale and delivery of an annual average of 22 million gallons of gasoline to more than 50 locations.
In the 1990s, Coulson Oil introduced the SuperStop Coop, which was available to any dealers who purchased fuel through Coulson. The coop offered stores specific programs and quarterly rebates through an established group of vendors, in order to aid the stores in gaining the best prices for goods and services buoyed by the collective negotiating power of the dealer network.
The coop today continues to save retailers valuable time by acting as an intermediary between operators and vendors, handling disputes and negotiations for everything from programs and contracts to tracking purchases and disbursing rebates. Members receive emails announcing new products and programs that are available through the coop, and every year a meeting and tradeshow is held to allow members to speak directly with vendors and learn about new products and marketing opportunities offered.
In the late 90s, Coulson decided to further evolve its business model and slowly began leasing out the bulk of its company-owned and operated stores. By 2003, it had converted to a commission dealer model, where it leased properties to various dealers who purchased fuel from Coulson.
“We set the prices at the pump and pay them a commission, and continue to offer them access to our SuperStop Coop to help them gain the best rates on products,” Martin said. “Ray Coulson always believed that if our dealers are successful, we’ll be successful. That is why we describe ourselves as a dealer dedicated distributorship.”
Growing into 2012 And Beyond
With its new real estate group in place, Coulson Oil is prepared to refine its acquisition and divestment strategies as it looks to future goals.
Currently, the company is in the process of identifying locations it plans to sell in order to reinvest in new properties. As it grows its real estate portfolio, Coulson plans to invest not only in c-store properties, but to diversify by taking advantage of other types of real estate opportunities, such as quick serve restaurants, marking a major shift for the company.
As a company, Martin noted, Coulson Oil excels at acquiring new locations, but has been more cautious in the sale of older properties. “We are ready to take a more disciplined approach to looking at properties—how we acquire them and when to sell them,” Martin said. “We’ve done a good job of acquiring properties, but now is the time to consider rebuilding some stores and simply divesting ourselves of others.”
Coulson Real Estate Group was found to offer some older properties in need of remodeling to the dealer for purchase. “We’ve already started visiting some of our dealers about several locations, and they are jumping at the chance to purchase the property and enhance the location,” Martin said. “It has been really gratifying.”
Coulson Oil At A Glance
Locations: More than 230 dealer locations.
Affiliates: Coulson Oil Real Estate Group LLC, Coulson Petroleum Services, Seahawk Transport LLC and the SuperStop Coop.
Coulson Oil Management Team:
J.W. (Jim) White, Co-Founder, Chairman Emeritus
Mike Coulson, Chairman of the Board
Mary Ann Dawkins, Vice President, Marketing and Corporate Secretary
David Zakrzewski, President and CEO
Eddie Martin, President, Coulson Real Estate LLC and General Counsel
Lance West, Senior Vice President and CFO
John Harris , Manager CP Services and Testing
Gwenn Collins, Vice President, Operations
Richard Cannon, President, Seahawk Transport and Safety Director
Sue Goodson, President, SuperStop Coop