EL DORADO, Ark.-Murphy USA's newest direction came as the result of Wal-Mart's decision to develop its own gasoline program on sites not already committed to Murphy USA. However, the abrupt change in the former business relationship did not catch Murphy USA CEO Andrew Clyde totally unprepared.
In an interview Tuesday, Clyde said that for the past few years the company has considered the possibility of no new locations with Wal-Mart and has prepared for that eventuality.
"This was a Wal-Mart decision," he said. "In a sense they decided to not work with Murphy USA anymore. We were not caught by surprise by this. We anticipated this move by Wal-Mart. We are only surprised by the decision.
"The role of management and the board is to keep the company (Murphy USA) two or three steps ahead of what we are not able to see."
In his announcement to the staff, he used the analogy of knowing that 10 miles down the road there is a T- shaped fork in the road and a right or left turn needs to be anticipated. While Murphy USA prepared to take a left turn and continue with Wal-Mart, as they approached the turn, the considered and prepared to also turn right.
"The foot never was off the gas for Murphy USA. The company was prepared for this decision," Clyde asserted.
Over the past few years, Murphy USA has purchased the property under its gas stations and plans to purchase more sites to continue building the anticipated 60 to 80 stations in the next couple years.
While still planning to work with Wal-Mart, Clyde says Murphy USA had set aside $500 million for future purchases that will not be redirected at re-purchasing stock. For a stockholder with a 1 percent hold on the company, they will then own 1.2 percent of the company.
"We have a bright future," said Christian Pikul, director of investor relations.
The El Dorado News-Times reports that in 2013, 2014 and 2015 the company hired 125 new people to work at the local Murphy USA office in El Dorado.
This year the company will hire another 40 people, reported both Pikul and Stacy Young, vice president of Human Resources.
"We have a stronger fuel supply chains than the typical retailers, including Wal-Mart," Clyde said. "With a local call center the company quickly addresses situations as they develop at the company's stations across 24 states. With stations that are open 24 hours a day, seven days a week, "we have to be responsive to store needs."
In 2016 and 2017, Murphy USA will continue with its plans to open 60 to 80 stores in locations.
"In the next two years nothing will change," Clyde said.
The plans for the future will expand the Murphy USA logo to locations other than those specifically associated with Wal-Mart.
Since Murphy Oil Corporation approached Wal-Mart in 1996 with the idea of a gas station to be built as Super Centers were built, the company has been establishing 125 stores per year.
In 2005 different leadership at Wal-Mart saw a different role for the gasoline stations.
"At that time we leased" Clyde said.
Over the next five years Murphy USA bought more land for the stations. In 2010, Murphy USA offered to buy the remaining SuperCenter Gas stations.
By 2013, all of the gas stations were third parties and in 2014 most gas stations were third party locations.
"We are still buying third party," Clyde said.
In January 2015, we met with Wal-Mart and made a pitch to grow SuperCenter sales and build in the remaining SuperCenter sites," Clyde said. "Wal-Mart chose not to pursue this. We had done our homework and were prepared for this."
The last couple of years Murphy USA has looked at the idea of expanding beyond the Wal-Mart association.
"We realized we had a strong alternative," Clyde said. He added that for most companies a growth above the two to three percent is a stretch. "We have three percent growth with 40 stores per year. We are opening 60 to 80 stores and are on cruise control."
He added that the company already owns all but about a quarter of the property for these locations.
"We looked at 160 different variables of the Wal-Mart traffic and found the things that mattered and grouped them into market types. We found the ones that work in 80 percent of the markets."
"We do not have to wait, we can cherry pick new markets and now we can do it without a blanket approach," Pikul said.
"Customers know the value they can get and certain categories," Clyde said.
"We have great rewards and incentives to keep it fun for our employees," Pikul said.
At this time Murphy USA has more than 10,000 employees across the country at store locations, the home office in El Dorado and its terminals. The company currently has more than 1,300 stores in 24 states, according to a press release.
"For every 10 to 11 stores there must be a district manager. For every 100 stores, there is a division director," Clyde said.
Adding stores adds jobs. As the company grows, so does the corporate offices for Murphy USA, which has already added to the staff in El Dorado.
"We love to recruit to El Dorado and find local people," Young said. "While other companies are retracting, we are still having employee growth."
She said that the company does not just hire for the position but also for the individual's fit into the community. Not everyone from a large city can adjust to living in the rural setting of Union County. The hiring process includes inviting the interviewee to ask questions about the company and the community.
"Andrew Clyde is a visionary. He looks at where we will be in a year. He was not caught off guard by Wal-Mart's decision to not continue the partnership in building adjoining gas stations. We are staffing up," Young said. "It is an exciting time for employees."