KUALA LUMPUR – Bumiputera petrol dealers selling foreign oil products have expressed concern over an impending rental rate hike that they believe would see them make losses.
One dealer, Noor, told The Vibes that pandemic-induced measures have seen her struggling to stay afloat.
“I’m concerned about the rental rate hike. There’s a lot of buzz about this but nothing formal yet. If it goes through, then I feel it’s unfair.
“I’m already seeing a revenue drop of up to 50% due to Covid-19 measures. The only comfort here is that my station is near the North-South Highway, which might make things slightly better for me than my peers operating in cities and towns.
“But an increase in rent will squeeze all of us.”
Another dealer, Azam, said he might have to close shop if foreign oil companies raise their rent per litre.
“This is not the first time such a hike has been implemented, but we could deal with it back then as we could maximise foot traffic by offering customers other services such as ATMs.
“But this was pre-Covid-19. Understandably, everyone is squeezed, but a better solution should come forward. The easiest that I can think of is to not raise the rates just yet.”
The Vibes reported on Monday that petrol dealers are urging the government to intervene as they believe foreign oil companies are squeezing them on rental charges.
Foreign firms are planning to increase rent despite dealers suffering lower revenue due to Covid-19 travel restrictions, sources said.
There are two types of petrol dealers. The first – a minority group – are known as dealer-owned stations, wherein dealers have the financial capability to handle all capital expenditure, while the second group comprises company-owned dealers.
It is the latter group that needs to pay additional charges from their net margins in return for running a station built and set up in partnership with a petrol company.
It is understood that both groups do not make much from the sale of petrol, and complement their earnings from renting out space for ATMs, convenience stores, and fast-food outlets.
Operators typically earn 15 sen per litre for RON95 and RON97 petrol products, and 10 sen per litre for diesel products. These rates are set in consultation with the government.
Company-owned dealers also pay up to 4.4 sen per litre in rental charges. Some foreign oil firms are planning to raise this to 4.9 sen. – The Vibes, October 6, 2021
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