Valero 2003 Annual Report Download - page 20
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Please find page 20 of the 2003 Valero annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.17
topwholesale&retailstrategy
Gene Edwards, Senior Vice President of Product Supply & Trading and Wholesale
Marketing, and Gary Arthur, Senior Vice President of Retail & Specialty Products
Marketing, (left to right) helped lead wholesale and retail marketing to achieve record
earnings. Valero’s wholesale network grew to 2,400 branded distributor sites, and the retail
division invested in re-imaging stores which resulted in greater prots with fewer stores.
Becauseofitssuccessfulmarketingstrategy,Valero’sretailandwholesaledivisionstoppedtheirpast
performancebyreportingrecordearningsin2003.
Inretailmarketing,Valerohassuccessfullyexecuteditsstrategyofinvestingintop-performingstores
andsellingorclosingmarginalsites.Todate,aboutone-thirdofthenetworkhasbeenre-imagedand
thevastmajorityoftheremainingstoresshouldbecompletedby2006.Asaresultofgainsinfuel
andmerchandisesales,Valeroexpectsa15%returnoncapitalemployedforthesenewlyre-imaged
locations.
Whileretailhasbeenworkingtorationalizeitsnetwork,wholesalehasbeenaggressivelygrowingits
brandeddistributornetworkacrossthecountry.In2003,Valeroaddedmorethan600newbranded
sites and re-imaged over 800 new and existing locations. A big part of that expansion included
introducing theValero brand on the East Coast – giving the company a presence from Bangor,
Maine,toMiami,Florida!With2,400brandeddistributorsitesinthenetworktoday,Valeroiswell
onthewaytoreachingitsgoalof5,000sitesbytheendof2007.Becausecapitalcostsarerelatively
low,Valerocanachievesignicantgrowthwithminimalcapitalandexpectedreturnsintherange
of20%.
Alsoreportingsignicant growthlast year, asphalt marketingsolda record-breaking22.6million
barrels.And,thecompanycontinuedtogrowitslubesandpetrochemicalsbusinessthroughfavorable
partnershipsandagreements.
Astheseresultsillustrate,thecompany’smarketingstrategyishelpingtoputValero’sbrandsontop!