Acquisitions Change Landscape of California Petroleum Industry
SCL Keeps Eye on Opportunities but Focus on Continuing Tradition of Customer Service
Acquisitions of several family-owned oil and lubricant distributors throughout California by national players has created a new landscape of the state’s petroleum industry in the past 14 months alone.
While SCL has participated in its own acquisitions in order to more efficiently service customers in the northern part of the state, considerations for such moves goes far beyond simply creating a larger footprint.
“At the forefront, the age-old question of biting off more than one can chew is something we take careful consideration of in each expansion opportunity,” said SCL General Manager Travis Becktel. “It’s not always about growth for us in the geographical sense. We’re always looking for ways to increase our footprint, of course, but we want to do it in a way that continues to support the growth of our team without compromising our customer experience.”
In late 2020, for example, SCL’s acquisition of SC Commercial assets in the Bay area came after nearly 20 years of partnership with the company, and ultimately led to a seamless transfer of ownership with an added customer benefit of diverse product offerings.
Around the same time, national leader RelaDyne acquired family-owned Nick Barbieri Trucking, LLC a full-service oil, lubricant, gasoline and diesel fuel distributor, and card lock operator serving northern California.
Amber Resources LLC and its affiliated entities (M.O. Dion & Sons and Amber Petroleum Products), another long-time leading distributor in California, was also acquired this month by Renewable Energy Group Inc. The deal added eight locations for REG in southern California, including distribution centers and three cardlock sites.
“We’re seeing fewer and fewer family-owned businesses in our space, that much is certain. There are several reasons for that,” Becktel said. “One reason is that owners are not interested in keeping up with the ever-changing state and federal government regulations imposed on our industry, and another is the added stress and risk associated with operating a petroleum business in California. While we hate to see family-owned competitors go, the silver lining for SCL is that our mission and vision remain constant while others are having to re-learn their go-forward strategies. There are fewer people with the roots in this state and this market that we have.”
Future of Petroleum in California
Acquisitions and sales in California’s petroleum industry are nothing new – the ebb and flow of smaller companies giving way to national distributors has occurred for years. The difference now comes with the shift away from petroleum and petroleum products by elected officials in the state, including Gov. Gavin Newsom and his proposed 2035 ban of combustible engines.
For all of the reasons above, Becktel said, there will likely be continued movement in acquisitions throughout the state in the months and years to come.
“The petroleum industry may not be a forever solution, but the energy industry and the transportation of energy will be here to stay,” Becktel said. “Right now our focus isn’t on being the biggest or the loudest as that does not always produce the best results. Customers want a distributor that fits their needs, provides a high level of service, and offers the products to keep their machines moving at their optimal level. We have and will continue to be that in all of the areas where we operate.”
For information on how SCL can help your company save through preventive maintenance, premium products, bulk purchasing, oil analysis, fleet evaluations, or a number of other services, contact a sales representative today.
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In a wide range of automotive, industrial and commercial sectors, SCL remains steadfast in its commitment to product and industry knowledge, performance satisfaction and superior logistics. We protect and optimize the machines that keep our country moving. For more information on how we can help with services including bulk purchasing or managing inventory, contact an SCL expert today.