Maxol, a company founded by two brothers from a unionist background more than a century ago in Belfast and now operating from a headquarters near the Custom House in Dublin, knows a lot about the challenges of unification.
In August 1919, the McMullan brothers, William and JG, from Donaghadee in Co Down took Stand No. 13 at the Dublin Horse Show to launch their new wares, including a range of motor oils that would prove to be the key to the family’s fortunes for a century.
Despite the challenges soon to come, including the War of Independence, partition and the Civil War, the McMullans were one of the biggest importers of oil on the island within the following decade.
Today, the still family-owned business is known as Maxol, has revenues of €750 million from its operation on both sides of the Border and produced a profit of nearly €33 million last year, according to its chief executive, Brian Donaldson.
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Throughout, the business has reflected the changes on the island of Ireland over the past century, and more. Starting off as one business, it broke apart into two from the 1930s, with separate operations in Northern Ireland and the Republic.
The Troubles deepened the gap. The Northern company operated from Ormeau Road offices, while Dublin was run from the now demolished Apollo House on Tara Street.
“It took 3½ hours to drive between the two,” says Donaldson, with people from Dublin picked up at Belfast’s train station for board meetings, and brought back.
“I wouldn’t have known my counterparts. People grew further and further apart. A lot of it was down to concern about travelling across the Border. Not about religious or political views, but just people feeling for their own safety.”
The wheel began to turn in the early 1990s under Donaldson’s predecessor, the Skerries, Co Dublin-born Tom Noonan, who sought to bring the two operations together after he was appointed general manager.
Noonan began “cleverly”, says the Newtownards, Co Down-born Donaldson, by seeking ideas – covering everything from product supply, IT, marketing, “even ways of making sure that customers order full loads, not part loads”.
However, an understandable nervousness remained. He recalls a dinner in the early 1990s with a Dublin colleague in Bushmills, Co Antrim, when the latter was uncomfortable with the display of Union flags.
The unification work soon began to make strides, however, culminating in a successful day in 1995 when staff from all parts of the island were brought together to celebrate the company’s 75th anniversary.
“We hired a train, brought up all of our Southern colleagues and bussed them in a convoy from Belfast with all of our Northern colleagues to Down Royal races. We had one hell of a party, but the hard yards had been done by then,” he says.
Not everyone bought into the new world, and some left. In time, the finance, IT and marketing departments moved to Dublin, but “a very generous redundancy package” eased the separation.
The Belfast office on the Ormeau Road, one that had been there since the early 1920s, finally closed in July 2020, reflecting, perhaps, the one third/two-thirds division of revenues between Northern Ireland and the Republic.
The changes pioneered by Noonan and his colleague Paul Cran left Maxol in a better position to deal with the huge increase in competition that took place with the arrival of the UK supermarket multiples into Northern Ireland.
The challenge was led by Tesco, who bought Stewarts Supermarkets in 1997. “Then Asda came, Sainsbury’s came. In a very short time, the whole geography of the Northern Ireland market was seriously impacted,” he says.
The big retailers opened filling stations at their stores, offering cut-price fuels, while the rapid growth in the volume of laundered fuel illegally produced by paramilitaries “reduced the legitimate market by 50 per cent”.
The threat posed by the paramilitaries, especially the IRA – both before and after the Belfast Agreement – partly explains the departure from Northern Ireland of the big oil companies from directly owning filling stations.
“There was an awful lot of damage done to the legitimate trade, and the environment. That’s why you saw companies like BP sell up, Shell sell up. They got tired, too small a market, too difficult to make money in.”
With its own stations, Maxol adopted a zero-tolerance approach: “We had a programme called ‘Fuels You Can Trust’. We then introduced spot testing. If we found that product wasn’t our product, then we de-branded the station,” he explains.
Today, Donaldson gives much of the credit for dealing with the illegal fuels to Peter Mandelson, who served as Labour’s Northern Ireland secretary between October 1999 and January 2001.
“We did lots of deputations to secretaries of State. Then, Mandelson looked at what resources were needed by HM Revenue and Customs. Then they started getting on top of it.”
Checks imposed since by HMRC and Revenue in Dublin have strengthened significantly, with digital tracking of fuel even before it has been imported offering “a complete 360 degrees, so they can track everything”.
Today, Maxol has 252 service stations on the island – with 152 in the Republic and 100 in Northern Ireland. “Of those 252, we own about 126. The majority of which are all freehold. We don’t like doing leases,” he says.
In the past, Maxol had up to 400 filling stations in the Republic alone, with 200 more in Northern Ireland, but some of those “in the old days would have been a couple of pumps beside a pub”.
Forty per cent of the company’s revenues no longer have anything to do with fuel, with more and more emphasis placed on the sale of food and other goods in the company’s own Maxol-branded shops.
“Being a fuel retailer is very different from being a convenience retailer today. They’re different skills,” says Donaldson, speaking in his Custom House Quay office, “It’s a different type of animal.”
The reunited Maxol supplies its stores differently, with BWG filling its shelves in the Republic and the Henderson Group doing so in Northern Ireland.
The two parts of the island are different markets, with different tastes and attitudes, and far less disposable income in Northern Ireland, with higher wages and a higher cost of living in the Republic.
“People in the South live for today, and spend for today. In Northern Ireland, they’re still very much more cautious. They still have this thing, ‘Well, maybe I really shouldn’t buy that takeaway coffee, or maybe I shouldn’t buy that sandwich.’
“People will work to a budget more in the North than what you might find in the South, regardless of their demographic class. What we have been trying to do is to make sure our offer is fit for each of those types of consumers.”
Different planning rules impact, too, because filling station stores in the Republic must be kept below 100 sq m, unless it can be shown that a new store would not hurt existing retail nearby.
“In Northern Ireland, the stores typically are much larger,” says Donaldson, “Some will be 300, 400 sq m. It’s one of the things that we have to continue to push for change on in the Republic.”
Last year, the company said it had invested €65 million across the island, including the purchase of seven stations in Leinster previously under the Circle K brand and refurbishments for nearly 20 more.
In a bid to bring non-fuel revenues beyond the 50 per cent mark, new food outlets, such as Burger City, Burger King, Supermac’s, and Wendy’s, are, or have been, introduced.
Talks also are under way with Dunnes Stores about expanding its sale of the latter’s Simply Better ready meals: “They’re fair and honest to deal with,” he says.
The relationship between the companies began 18 months ago. Before meeting The Irish Times, Donaldson had begun his day at 7am at a Maxol station in Templeogue, Dublin, where they are piloting some new ideas.
“We want to make sure that everything works, testing it with the consumers’ lens,” he says. “We have decided on the range which we think is right, so it could be a range of about 420 items.”
Equally, Maxol has invested heavily in high-speed EV chargers at some of its stations, though Donaldson sounds less than convinced that EVs are the future of motoring.
So far, Maxol has four so-called rapid EV hubs, including one under way at the Long Mile Road in Dublin. Each requires 1 megawatt of energy. However, the use of the hubs is not yet “where they need to be to justify the investment”.
Recently, he met former minister for the environment Eamon Ryan: “I told him that 83 per cent of all cars still being sold have some form of internal combustion engine (ICE). I drive a plug-in hybrid because I need to have that certainty.
“Yes, we have Teslas in the fleet for people who don’t do as many miles. That’s fine. The other thing I said is that the average life of a car is 12 years. So, there’s still a long period in which those cars have to be serviced,” he says.
Incentives that encouraged people “to move from a full ICE to a hybrid, then potentially to a plug-in and then potentially to a full EV” should be considered by the Government, he argues: “People have to have confidence.”
[ If electric vehicles are the future, additional State support is requiredOpens in new window ]
Commercial fleets have embraced EVs, but partly for tax reasons: “But the private household, unless you’re a high-income earner, is sticking with a hybrid or a plug-in. They haven’t quite made that switch.
“And it’s even more pronounced in Northern Ireland if you’re looking for differences where the EV percentage of new car sales is less than what it is in the Republic.”
EVs will change the fuel business, however, since companies that have traditionally had nothing to do with it, such as fast-food chain McDonald’s, are beginning to offer high-speed charging.
“Everyone has to understand the customer. If you’re in the middle of a supermarket car park late at night, would you feel safe charging your car? Lots of people wouldn’t.”
