Kroger seeks to add gas station near Carpenter Road store in Pittsfield Township
Kroger’s national plan to pair gas stations with its grocery stores soon may be visible locally at the Carpenter Road store in Pittsfield Township.
The Cincinnati-based grocery chain received preliminary approvals to add a gas station at the store, located between Packard and Ellsworth in the Carpenter Plaza shopping center.
The National City ATM machine on Carpenter Road would be razed to make room for a gas station if Kroger obtains Pittsfield Township approvals.
Paula Gardner | AnnArbor.com
The location, said township planner Paul Montagno, would be an outlot north of a retention pond in front of Home Depot, replacing an existing National City automatic teller machine.
The preliminary plans called for building five two-sided pumps and a 115-square-foot kiosk.
The kiosk will house an attendant and some convenience store-type merchandise, Montagno said, “but it’s not a store where you can go in.”
Kroger is turning to gas station development at its newer stores and is beginning to add the stations where it's possible near existing stores.
“They did note that this is what Kroger is doing nationally,” Montagno said. “They listed many different Kroger sites that have done this an they claim to have good success.”
About one-third of over 2,500 Kroger stores across the U.S. have gas outlets, generating about 10 percent of its $7.2 billion annual revenue, according to corporate reports. The company also announced a partnership with Shell this year to pair Kroger fuel rewards with existing gas stations.
“The plan is to grow fuel centers as fast as we can (in Michigan),” said Dale Hollandsworth, Kroger’s consumer communications contact for the state. Thirty are now operating, with another in Shelby Township set to open this spring.
The gas stations complement the grocery outlets because the chain pair promotions between the two. One example: A promotion at the Mid-Atlantic stores lets loyalty-card customers who spend $100 in a calendar month receive 10 cents per gallon discount in a single fuel purchase.
Still, profit margins at gas stations are slim, especially in Michigan, according to industry experts. Several local stores have closed in the past year as statewide sales fall. Others turn to convenience store and fast food co-locations to boost revenue.
Kroger is redrawing plans for the gas station based on feedback from officials and still has to file for final site plan approval, Hollandsworth said.
Part of the plan will include some changes to the traffic patterns in the parking lot, Montagno said.
Unclear is the impact the new station would have on the existing fuel market in the vicinity of the store. A Speedway operates at the north end of the same parking lot, and Mejier Inc. operates a gas station at the corner of Carpenter and Ellsworth near its superstore there.
Two other nearby gas stations have closed: One at Packard and Carpenter and another at Carpenter and Washtenaw.
Gas sales in Michigan are down 17 percent from 2004, according to the Michigan petroleum industry.
Kroger’s move to add fuel centers fits into that changing retail landscape, Hollandsworth said, by capitalizing on an existing customer base and customer loyalty program.
“The face of fuel centers are changing today,” he said. “…This is another dynamic in the industry.”
Paula Gardner is Business News Director of AnnArbor.com. Contact her at 734-623-2586 or by email. Sign up for the weekly Business Review newsletter, distributed every Thursday, here.
Comments
washtenawresident
Sun, Mar 28, 2010 : 8:50 a.m.
The real reason is, this all about money. Pittsfield Township only approved this plan because of all the tax money they are going to get. Never thinking of the other gas stations in the area, guess they don't care if they close too. There are already 2 gas stations within a mile that have had to close. What a dumb idea! What jmac wrote is exactly right! Well put.
Pam
Sat, Mar 27, 2010 : 4:45 a.m.
I am not for it either. I think they are hoping for support with the 10cent of offer. I wonder how they will be able to offer that since speedway has told me that I can't use my speedy points to get cents off gas because of Michigan state law? How is Kroger going to be able to get around that?
krc
Fri, Mar 26, 2010 : 3:31 p.m.
Ridiculous. What they need to do is redesign and rebuild that awful parking lot.
Paul the Malcontent
Thu, Mar 25, 2010 : 11:18 p.m.
What they need there is a roundabout!! :-) * http://www.annarbor.com/news/ypsilanti-township-roundabout-construction-underway/ * http://www.annarbor.com/news/work-begins-on-3-new-roundabouts-at-geddes-road-and-us-23-in-ann-arbor/ * http://www.annarbor.com/news/opinion/stop-wasting-highway-dollars-on-roundabouts/
iceman
Thu, Mar 25, 2010 : 10:59 a.m.
I have lived near Carpenter and Packard for fifteen years. I ride my bicycle to Krogers because I can get in,out and home faster than in my car! If I had the money I'd build a bodyshop in the old Marathon gas station. Just think, you wouldn't need a tow truck after your accident.
naturally
Thu, Mar 25, 2010 : 10:13 a.m.
I hate to beat a dead horse but that area is already too congested. How are they going to add a gas station to their already full and logistically challenged parking lot?
josemartin
Thu, Mar 25, 2010 : 10:01 a.m.
Top Twenty crash-prone intersections in Washtenaw County http://www.annarbor.com/news/top-20-crash-prone-intersections-in-washtenaw-county/ They need to fix all the holes in the parking lot first.
treetowncartel
Thu, Mar 25, 2010 : 9:38 a.m.
@Ignatz, I completely agree with you on using the marathon site at Carpenter and Packard. However, they would probably have to spend money to remove the existing tanks and remediate any contamination in the ground there. So instead, they will just go and pollute some more. If they were to actually clean up the old Marathon station I would make a point of getting gas there since they would be doing good for the community and the planet.
tdw
Thu, Mar 25, 2010 : 8:56 a.m.
This is a bad idea as no one will be paid to build and staff it.Employees will only be people who do not need to work or make an income
jmac
Thu, Mar 25, 2010 : 7:41 a.m.
This is ridiculous. As the article and other comments point out, there are nearby existing gas stations at Carpenter/Packard (Speedway) and Carpenter/Ellsworth (Meijer) as well as a closed gas station opposite the Speedway. There is no need for Kroger to put in another gas station in that area. All it will do is cause further congestion along Carpenter and mire down a parking situation that is already sub-optimal. Why did Pittsfield approve this in the first place? I don't buy Montago's 'reasoning' given in the article, that this is 'what Kroger is doing nationally'. So what? Does that mean they have to do it here as well when it's not needed or wanted???
Ignatz
Thu, Mar 25, 2010 : 7:38 a.m.
Why don't they just buy that defunct Marathon? It would give them a lower starting cost and occupy an abandoned property at the same time.
tidge
Thu, Mar 25, 2010 : 5:48 a.m.
As a frequent shopper at the Carpenter road Kroger, I don't think this is a good spot for a gas station. That parking lot doesn't have very good traffic flow at either end of the parking rows, adding more traffic at the east side will not improve things. Traffic exiting the shopping center onto Carpenter is already very messy. There is a single light for a two-lane path into the center (near the proposed site) and everything else is an 'at-risk' entrance to the 5-lane Carpenter Road. Logistics aside, I can't imagine that a gas station *there* is going to be a chosen destination station as only Southbound traffic (that fights past grocery store-bound shoppers) will enter, or shoppers that decide to fight through the parking lot. The other two nearby successful stations (Speedway, Meijer) have at easy access for traffic moving in at least three other directions plus a very large footprint.
racerx
Thu, Mar 25, 2010 : 5:39 a.m.
Why? There's one at Meijer, the Speedway at Carpenter & Packard, though the Marathon has closed, it's still standing. Is there really a need? Traffic is already congested at a very prone accident intersection at Carpenter & Packard. Due to competition I doubt if Kroger could offer lower gasoline prices.