Two Shell stations across the street from each other. Why?
January 8, 2013 4:42 PM   Subscribe

In my town, there's a Shell station on one corner of the intersection. On another corner of the same intersection, another Shell. There're also two Woolworths right across the street from each other, and two Pizza Huts. Why? Does anyone out there have any idea? I mean, any ACTUAL idea, not just supposition? Maybe someone who works in marketing, or urban planning? Also, are there any resources I could read that explain these kinds of business decisions? I've looked online and can't find any information. Thanks very much.
posted by staggering termagant to Work & Money (19 answers total)
"Going to the other side of the street can be a barrier," said Launi Skinner, senior vice president in charge of Starbucks' store development.

Obviously this is for Starbucks, but I imagine it applies to other businesses.
posted by doowod at 4:46 PM on January 8, 2013 [4 favorites]

Full article similar to the dead link in the post above. The term you appear to be looking for is "infill".
posted by doowod at 4:50 PM on January 8, 2013

The gas stations probably didn't start out that way. The gas affiliation is just a marketing agreement between the franchisee and the oil company. They change all the time if somebody offers a better deal. Somewhere along the way Shell was offering a good deal so both gas stations on the corner went with Shell.

I have no idea on the Pizza Huts or Woolworths. Hell, I didn't realize there were still two operating Woolworths in the country, let alone on one corner!
posted by COD at 4:51 PM on January 8, 2013 [2 favorites]

In the case of the Shell, it's a franchise. So it's probably two different owners competing with each other. It doesn't matter too much if they're both Shell or if one is Mobil, AFAIK.
posted by drjimmy11 at 4:52 PM on January 8, 2013 [1 favorite]

Are you talking about a stand alone pizza hut or one of those pizza hut/taco-bell stand alones? It makes sense if one was an original pizza hut and the other was a taco bell that added pizza hut.
posted by empath at 4:56 PM on January 8, 2013 [1 favorite]

A friend in marketing told me once that multiple gas stations at the same intersection could increase business for both stations. Can anyone comment on this?
posted by Raybun at 5:22 PM on January 8, 2013 [1 favorite]

A friend in marketing told me once that multiple gas stations at the same intersection could increase business for both stations. Can anyone comment on this?

Yes, this is called Hoteling's law.
posted by beagle at 5:34 PM on January 8, 2013 [6 favorites]

You might find this previous ask.mefi about clustered Thai restaurants relevant
posted by charlemangy at 5:47 PM on January 8, 2013 [1 favorite]

It's also possible that they are in fact owned by the same person and hence are not competing with each other but rather are just trying to scoop up as much business as possible from that intersection. Franchisees often own multiple franchises and so possibly it would be accurate to think of them not as two Shell stations but as one Shell station on two corners.
posted by Scientist at 5:48 PM on January 8, 2013

Obviously this is for Starbucks, but I imagine it applies to other businesses.

It applies even more to businesses that are essentially drive-in (petrol stations, absolutely; supermarkets very much; pizza hut only slightly less so).

The businesses want to make it as hassle-free as possible for people in cars to get in & out easily, or else the consumers might take their money down the road to the store that *is* on the easy side of the street. If a driver has to make a turn (or a u-turn) that's potentially at least two lights they have to wait for. If the traffic is busy, it could take multiple cycles of the lights before they even get a green.

It might help if you explained what the intersection is like. Busy highway? Quiet suburban crossroad? City block?
posted by UbuRoivas at 5:57 PM on January 8, 2013 [1 favorite]

Shell bought Texaco in 2004 and converted/ rebranded all the Texaco stations. Could be that one of them used to be a Texaco.
posted by Sweetie Darling at 5:59 PM on January 8, 2013 [3 favorites]

I have a feeling doowod and UbuRoivas have it. I recently moved to a more car-centric suburban landscape, and it drives me a little bit insane when there's a business I want to patronize on one side of a monster intersection/strip-mall clusterfuck, and then another different business I also want to patronize on the other side of the same monster intersection/strip-mall clusterfuck. (For example, let's say getting gas and picking up a pizza.)

I don't know if people who've always navigated those types of landscapes have personal hacks for this or what, but I have a strong suspicion that the two Shell stations or two Pizza Huts or what have you don't directly compete with each other, despite being right across the street.
posted by Sara C. at 6:35 PM on January 8, 2013

Yep, most people aren't willing to make a left turn across traffic, twice, just to make a quick stop along the way to somewhere else.

In our parlance, a "naked Walgreens" is one without a CVS or Rite Aid across from it.
posted by rlk at 6:53 PM on January 8, 2013 [3 favorites]

In this case, I agree that the street is probably the main factor, but you might find this segment on clusters of shops interesting as well.
posted by eponym at 7:00 PM on January 8, 2013

Yes, this is called Hoteling's law.

As nicely paraphrased by, naturally, Simpsons:

Hank Scorpio: Uh, hi, Homer. What can I do for you?
Homer: Sir, I need to know where I can get some business hammocks.
Hank Scorpio: Hammocks? My goodness, what an idea. Why didn't I think of that? Hammocks! Homer, there's four places. There's the Hammock Hut, that's on third.
Homer: Uh-huh.
Hank Scorpio: There's Hammocks-R-Us, that's on third too. You got Put-Your-Butt-There.
Homer: Mm-Hmm.
Hank Scorpio: That's on third. Swing Low, Sweet Chariot... Matter of fact, they're all in the same complex; it's the hammock complex on third.
Homer: Oh, the hammock district!
Hank Scorpio: That's right.

In Australia you often find two service stations directly opposite one another, but that's on a motorway, where if you're travelling one direction, you're travelling that one direction for the duration. You can't get to the other side.
posted by turgid dahlia 2 at 7:01 PM on January 8, 2013 [4 favorites]

Sara C, the LA traffic secret is always two rights. There are easy spots to do this, like gas stations and parking lots with two entrances/exits. Same for alleys - we have alleys that run for miles and miles, enabling all sorts of two right combos. Never turn left unless you have to. It sounds nonsensical until you do it, but sometimes it is way faster than waiting several green light cycles for a left turn. Sincerely, a former runner from back in the day.
posted by last night a dj saved my life at 7:33 PM on January 8, 2013 [2 favorites]

The being on one side of the street or another is definitely a thing. When I worked at McDonald's, some locations would have more pronounced breakfast, lunch and dinner rushes depending on which side of the street they were on relative to the prevailing rush hour.

They may not have planned it that way, but I'm sure they don't actually end up competing with each other all that much or else one would be gone.
posted by gjc at 7:41 PM on January 8, 2013

I used to work with Walgreens and the guy there told me that when there were two drugstores at the same intersection, that business went up in both stores.

People drive out of their way to go to that store, because if the first place doesn't have what they need, the second place probably will.

The same with restaurants. If you go to one place and the wait is over an hour, you might say "screw it" and try the place next to it.

As for fast food, Husbunny doesn't like Taco Bell, I do. So if I'm picking up lunch and I want Taco Bell, I'm going to the street where there's both a Taco Bell and a Wendy's.

Humans are very weird.
posted by Ruthless Bunny at 5:59 AM on January 9, 2013

I once lived on a street that had two SuperAmerica stores, one with gas, the other without. They were on opposite ends of the block and on opposite sides of the street. The one without gas had been a 7-11 that went out along with all the other 7-11s in the region at that time and the space was purchased by SuperAmerica. To the casual observer, it was always weird to have two SAs that close together, but to folks who'd lived there a while and knew the history, it was totally normal. Eventually the non-gas store space was sold off and is now a laundromat.
posted by kuppajava at 11:09 AM on January 9, 2013

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