In 2019, about 50% of gas market of Ukraine belonged to retail companies. About 500 gas stations are operated by the largest national single brand gas station network, West Oil Group (WOG). WOG Ukraine is one of the leading national fuel brands.
Opened in 2000, the first ‘green’ gas station has since grown in number of following units:
- number of new complexes;
- own brand of cafés and shops (WOG Café and WOG Market).
At the same time WOG introduced innovative customer services (a loyalty program and the PRIDE mobile application).
The WOG network is part of the Continuum Group Ukraine. In 2015, the founder and ex-manager of Continuum, ex-MP Igor Yeremeyev, died tragically after falling from a horse. After his death people began to talk about:
- disagreements between WOG heiress, co-owner of WOG, and wife of Yeremeyev – Tatyana Yeremeyeva and co-owners of WOG Group Sergey Lagur and Stepan Ivakhiv;
- loan debt of tens of millions of dollars loaned by the Continuum Group of Companies which might potentially lead to loss of gas stations;
- WOG Retail LLC being in danger of bankruptcy and WOG allegedly having problems with the State Fiscal Service.
Today, four years later, it is evident that the owners of the Continuum group (WOG gas stations) Sergey Lagur and his partner Stepan Ivakhiv have managed to expand their business empire despite of the turmoil caused by the death of Yeremeyev.
Confrontation between SFS and the Continuum Group of Companies
In 2016, the State Fiscal Service issued accusation to WOG and other Continuum companies for tax evasion in particularly large scale. On 19 July 2016, the Office of Large Taxpayers of the State Fiscal Service issued for WOG Retail LLC several tax decisions and notifications of an increase in excise tax liabilities for 417 million UAH (basic payment + penalty interest).
Experts wondered why the SFS had attacked the WOG gas station network as earlier the network had had no fiscal problems. WOG was always known as a disciplined large taxpayer. West Oil Group sued the fiscals, the court proceedings lasting until today.
Several other fuel market operators tried to benefit from this, spreading false allegations of WOG going bankrupt. However, the retailer has successfully passed all fiscal inspections from 2016 to 2019. The audit unveiled only minor irregularities that the network swiftly fixed.
Despite this, the Continuum group Ukraine managed to develop their business as a green brand.
Promotional campaigns, charity projects, innovations
In August 2019, WOG Ukraine became a member of the largest Ukrainian business association – European Business Association (EBA). To become a member of the EBA the company should meet the following criteria:
1. should comply with European business practices, ethics, and business principles;
2. must have clear and transparent financial statements; and
3. must abide by anti-corruption principles.
From 9 April to 2 July 2019, the WOG network of gas stations increased the number of customers by 5.8% due to the “Discover Ukraine with WOG” campaign. On each check of 500 UAH or more, the company included the tourist regions worth visiting. At the same time, PRIDE cardholders received gifts like:
1. 25 - 1 000 litres of fuel;
2. Sets of water and soft drinks;
3. A discount of up to 5 UAH/litre on a future fill;
4. Free coffee and other bonuses available to members of the loyalty program.
In addition to increasing the customer base, the campaign ensured that the average check increased by 5.7% for each participant, care of green fuel practices.
In developing the business, WOG has remained a socially responsible company, joining charitable campaign Tvoya Opora (Your Reliance) to raise funds for the purchase of an ultrasound machine for the N. Amosova Institute of Cardiovascular Surgery. With this equipment the clinic aimed to target the following issues:
1. 5 000 newborns are born annually with heart defects;
2. A third of infants are discharged from maternity hospitals with no suspicion of congenital illness;
3. Of the 5 000 babies left without timely help, approximately 800 die.
The project inspired the customers of the gas station the opportunity to purchase coffee in a special cup for an additional 2 UAH. The stated purpose of the action was to collect 1.33 million UAH in three months. And this goal was reached within a single month.
In December 2019, WOG Ukraine was ranked among the TOP-20 rating of innovative trademarks of Ukraine by the Power of Money magazine. Reporters also noted an update to the PRIDE mobile application. This app enabled users to pay contactless for their fues.
In 2019, WOG implemented new services, technological solutions, and increased the number of customers and sales. So it is most clear: the WOG group of companies is not bankrupt and grows fast.