It all started after Shell international decided to take initiative to think about its

customers than its profits. Following its international policies it decided to take action against
people who were not abiding by their set rules and regulations. From 2009 to 2014 64
fuelling stations were de branded in Pakistan (Exhibit 1). There were three main reasons due
to which shell cancelled retailers license. 1) Dumping competitor products 2) Short
measuring 3) Non-compliance.
Dumping
Shell is an International brand known for its premier quality products. According to
contract retailers could only keep branded products provided by Shell. However some of the
retailers were offering competitors products. For example one of the filling station on
M.M.Alam Lahore started keeping ZOOM products which was a directly imported from china.
The reason behind keeping them was firstly they were cheaper than the market; secondly they
could earn higher profit margins on those products. Shell was concerned about it as its brand is
at stake any harm done using that particular brand, shell would be blamed as it was sold at its
branded fuelling station. Shell notified the retailer that if it did not discontinue the other product
line Shell would not be able to lend their brand name, after various litigations and case pending
it court for two year shell was able to DE brand that fuelling station and its now running under
ZOOM.
Another major concern for Shell is to maintain its quality various stations in remote
areas were engaging in malpractices of mixing Shell premier oil with lower quality oil.
Filling stations in smaller cities like Jaranwala, Sadiqabad, Nankana, Taunsa and Sahiwal
were involved in mixing smuggled petrol and diesel from Iran with the fuel provided by shell.
The quality of these petroleum products is really poor thus Shell conduct random Audits to
check the quality, it also uses statistical analysis to study the potential demand in that area

and if there is some serious deviation it tries to look into it the possibilities of such practices.
As figure 1 shows 41% of the de branding was mainly due to Dumping competitors
products.
Reasons for DE branding (Figure 1)

8%
noncompliance

33%

19%

Dumping competition product

short measuring

other

41%

Short measuring
Shell has a dedicated team for quality assurance, which is responsible for bi monthly
audits of all fuelling stations. These Audits are done randomly to ensure transparency and
prevent any possible bias. They are responsible for checking quality of fuel, whether all
safety standards are being followed and if there is any presence of short measuring.
According to law there is an allowance of 0.2%, this means if the mismeasurement is within
this deviation is to be ignored due to machine error. Anything beyond this is not tolerated for

Shell customers comes before Profit, Thus they ensure that customers are not exploited in any
way.
As it could be seen from (figure 1) 33% of the De-branding took place due to this reason.
There have been incidents where Shell received complaints from customer about such issue.
For example at Shalimar filling station in Gujranwala a customer came to get his tank full,
the capacity of the tank was 42 litres but they employees at the station managed to fill in 50
litres this led to a case being filed against the fuelling station and shell reputation was
harmed. Soon after shell cancelled the license and made sure these sorts of incidents does not
happen again. This led to negative word of mouth campaigning as people for a long time
prefer competitors over Shell due to such events.
Non-compliance and others
Shell provides a credit period of 3 days to its retailers; it requires them to hold up an
inventory up to 15 days forecasted demand. Failure to pay within the allowed credit period
results in a yellow card being provided to the retailer which is sort of a warning and he has to
bear a fine for late payment if it happens again he is given a red card and the license is being
cancelled.
When a new license is given it goes through rigorous screening, looking at the
demand in the area, retailers profile and history, whether there is any externality attached to
it. After all the checks are done my the network planning department its given a go ahead.
Shell tries to look into reasons why there has been a sudden fall in decline or retailer is unable
to pay the credit on time. The usual reasons are false demand calculations, bad customer
experiencing leading to lower sales or poor onsite services. Thus Shell has to intervene and
ask them to either improve or stop using their brand name.

Another main reason was customer loyalty card fraud. Telecom companies like
Telenor gives post-paid cards to its employees to get fuel for generators at signal towers. The
card usually has a limit of Rs. 1,000,000 whenever an employee gets fuel the card is
supposed to be charged. What actually happened was workers at these towers started dealing
with the retailer that they could charge the card for fuel and give them money instead; a profit
ratio was agreed between the two parties. A huge fraud was caught at Faiz Filling Station at
Dera Ismael Khan where a transaction of Rs, 325,000 was done. It was a huge transaction for
a single day so they looked into the matter and got to know what actually is happening. Thus
due to non-compliance and fraud license was cancelled.
Non-compliance with companies contract SOP (add the name I frgot) led to DE branding of
12 fuelling stations which is 19% of total de branded (figure 1). There are few other reasons
for de branding of fuelling station that were due to new government policies or widening or
road that lead to the closure.
De-Branding A special Case
Shell has a list of its top 10 leading retailers called Gold Customers they are invited
to shell global growth event every year. It is a platform for retailers from around the world to
gather at one place and discuss their best practices and try to work towards a mission for next
year focusing on customer centric approach to retailing. Its a two day event followed by an
Award ceremony.
2014 global growth event took place in London on 23rd and 24th June. Top 10
Pakistani retailers were present at the event. In an after party one of the retailers got really
drunk and misbehaved with a fellow female retailer from another country. This became a
serious issue as she charged a sexual harassment case against the retailer. That retailer was
the biggest retailer in terms of volume for Shell Pakistan. Without even considering its

profitability it decided that they could no longer allow that retailer to work under Shell brand.
Shell lost a huge chunk of market share to its competitor but it took a decision based on
ethics.

Exhibit 1
Sr.
#

Site Name

Difficult
y Level

Year

Abbaseen

High

2009

SINDH FILLING STATION

Low

2009

Imtiaz Ali pet

Medium

2009

short measuring

Ubaru

2009

Dumping
competition
product

Shah pur
Jehania
Nawab shah

High

Reason for
termination
Dumping
competition
product
Dumping
competition
product

City

Dadu

Jahania f/s

JAMALI FILLING STATION

NAUSHERO FEROZE

High

2009

Dumping
competition
product

SHELL FAIZAN FILLING

STATION

Medium

2009

non compliance
Saeed Abad
Hyderabad

New Saeedabad

High

2009

Dumping
competition
product

SHAHRUKH FILLING
STATION

Medium

2009

short measuring

FRONTIER WAZIRISTAN FS

High

2009

10

HUSSAINI AUTOMOBILES
SERVICE (KARACHI)

Low

2009

Dumping
competition
product
came under road
widening

National High
way Karachi
Karachi

Dumping
competition
product
Dumping
competition
product

11

MUKHTAR PS KARACHI

Medium

2009

Karachi

12

AA FILLING STATION

High

2009

13

LYALLPUR FILLING
STATION FAISALABAD

Medium

2009

short measuring

Faisalabad

14

CHENAB PETROLEUM
SERVICE (FAISALABAD)

Low

2009

Dumping
competition
product

Faisalabad

15

HUSNAIN FILLING
STATION

Medium

2009

short measuring

Jhang

16

SHELL MEHAR GASOLINE

High

2010

Dumping
competition
product

Lahore

17

AL-MADINA PETROLEUM
SERVICE LAHORE

High

2010

non compliance

Lahore

18

STAR AUTOS (LAHORE)

High

2010

short measuring

Lahore
Distt Nankana
Jaranwala

Lahore

19

Supreme FILLING STATION

High

2010

Dumping
competition
product

20

Syed Wala FS

High

2010

short measuring

21

WAS FILLING STATION

Medium

2010

22

Chaudry f/s Channi Goth

High

2010

23

IQBALABAD FILLING
STATION

Medium

2010

non compliance

RY khan

24

SHELL PIT STOP

High

2010

short measuring

Multan

25

METRO PETROLEUM
SERVICE

Medium

2010

short measuring

Sahiwal

26

MOTORWAYS (RAHIMYAR
KHAN)

Medium

2011

Dumping
competition
product

Sadiqabad

27

RAO BROTHERS SAHIWAL

High

2011

non compliance

Sahiwal

28

SANGAM PET.SERVICE
BWP

High

2011

non compliance

Bahawalpur

came under road

widening
Dumping
competition
product

bahawalpur
Bahawalpur

29

SUPER HIGHWAY
PETROLEUM SERVICE

High

2011

non compliance

Sahiwal

30

TAUNSA TRUCKING
STATION

High

2012

non compliance

Taunsa Sharif

31

ZED EM FUELS

Medium

2012

non compliance

Khanpur

32

AFSAR FILLING STATION

High

2012

short measuring

Buner

33

ALIS FILLING STATION

High

2012

short measuring

Peshawar

34

AKHUNDZADA FILLING
STATION

Medium

2012

Dumping
competition
product

Rangpur
Chashma

35

New Mardan

Medium

2012

non compliance

Mardan

36

ABBASABAD FILLING
STATION

High

2012

Dumping
competition
product

Karachi

37

KHAN MOHAMMAD
AKRAM KHAN

High

2012

short measuring

Dargai

38

GRAN BADSHAH FS

2012

short measuring

Faisalabad

39

RAHAT FILLING STATION

Medium

2012

40

FAIZ FILLING STATION

High

2012

41

Timergara

Medium

2012

42

Warsak

Medium

2012

short measuring

Warsak

43

Al Sadaat

High

2012

short measuring

Ranipur

44

FATHEULLAH FILLING
STATION

Medium

2012

short measuring

Hassan abdal

45

PRP Hasan abdal

Medium

2012

46

SARDAR FAIZAN S S. DO

47

New Sadaf

2012
Medium

2012

Dumping
competition
product
came under road
widening
Dumping
competition
product

Dumping
competition
product
came under road
widening
Dumping
competition
product

Bajur
DI Khan
Timergara

Hassan abdal

Jhang

48

Aman

Medium

2012

short measuring

Kohat

49

Kalyar - DO

High

2012

non compliance

Sheikhupura

50

AL MADINA FILLING
STATION HYD

Medium

2012

short measuring

Hyderabad

51

BHURKHUND FILLING
STATION

Medium

2012

52

PIRSHAH TRUCKING
STATION

Medium

2012

53

HARIPUR PETROLEUM
SERVICE

High

2012

54

RAJCO FILLING STATION

High

2012

55

PAC FILLING STATION

High

2013

short measuring

Kamra

56

Shalimar GUJ

High

2013

short measuring

Gujranwala

Dumping
competition
product
Dumping
competition
product
non upliftment of
product
Dumping
competition
product

57

Haider

Medium

2009

58

Rasheed Theng More FS

Medium

2010

59

BABAFARID FILLING
STATION

60

Hafeez

Medium

2013

Dumping
competition
product
came under road
widening
Dumping
competition
product
short measuring

61

Janjua FS

Medium

2014

short measuring

62

Sargodha Khushab FS

2013

non compliance

63

Abaseen Motorway

2013

64

Kabul River Motorway

2010

2009

Dumping
competition
product
Dumping
competition
product

Mansehra
Gujranwala
Hari pur
Rawalpindi

Okara
Faisalabad