Situation Analysis
Renowned for its membership warehouse model and bulk discounts, Costco has established itself as a significant player in the retail fueling market. The company’s unique business approach attracts loyal customers with its consistently lower fuel prices and the convenience of shopping for every household item imaginable.
To meet growing demand, the company has been expanding its gas station network nationwide, relying on companies like WPI to complete its expansion and modernization projects on time and on budget—with minimal disruption to its operations.
Project Background
Before the expansion, the La Habra gas station had a limited number of fueling positions, resulting in traffic congestion and long wait times. The backup at the pumps spilled into the parking lot, making it difficult for patrons to quickly and conveniently park their cars. The inefficiency frustrated customers and posed operational challenges, threatening Costco’s reputation for efficient, convenient service.
To enhance the customer experience and circumvent traffic snarling, Costco initiated an expansion project to increase the station’s fueling capacity. The goal was to ensure the station could handle higher volumes of traffic while maintaining the fast, efficient service that its members expected. Achieving this goal required a comprehensive approach to redesigning and expanding the existing layout and fueling infrastructure.
Project Scope
WPI, a long-time Costco partner, was tasked with executing the expansion. The project’s scope was comprehensive and included several key components:
- Increase Fueling Capacity: Add seven new fueling dispensers to the existing eight, nearly doubling the station’s capacity.
- Coordinate the Expansion of the Station Canopy: Enlarge the station’s canopy from 4,535 square feet to 10,676 square feet to accommodate the additional dispensers.
- Relocate—Expand the Station’s Data Hut: Relocate and expand the data hut to accommodate the additional control system equipment and electrical wiring needed for the station expansion.
- Enhance the Station’s Aesthetics: Add new curbing and enhance the surrounding landscape for improved aesthetics.
Project Execution
The project kicked off on March 25, 2024, and required the team to navigate several critical factors and implement solutions for each of them. These challenges included adhering to the city’s ordinance prohibiting night work, ensuring comprehensive safety measures, maintaining effective communication with the onsite warehouse personnel and corporate executives, and strategically scheduling construction to minimize disruptions during the days the fueling bays were operable while construction was underway:
- City Ordinance Compliance: The project faced schedule constraints with city ordinances prohibiting night work, necessitating tightly coordinated schedules for daytime construction of the canopy and pump installation. Despite these restrictions, the team managed to adhere to the project timeline.
- Safety Protocols: To prioritize safety, WPI implemented rigorous protocols, including regular safety briefings, strict adherence to regulations, and continuous monitoring to identify and mitigate potential hazards. This proactive approach minimized risks and ensured a safe working environment throughout the project duration.
- Stakeholder Communication: Constant communication with Costco management ensured transparency regarding construction progress and potential impacts on daily operations. This collaborative effort enabled swift decision-making and adjustments as needed, maintaining the project’s momentum.
- Strategic Construction Scheduling: High-impact construction tasks were strategically scheduled during off-peak hours to minimize disruptions and optimize efficiency during peak customer traffic. This careful planning during the days the station remained open maintained customer satisfaction and operational continuity.
By adhering to city ordinances, implementing robust safety protocols, maintaining clear and constant communication with Costco management, and strategically scheduling construction activities, WPI ensured minimal disruptions and efficient progress. The team’s approach not only facilitated the timely completion of the expansion but also upheld Costco’s commitment to delivering exceptional service and convenience to its members.
Project Outcomes
Through meticulous planning and execution of this high-visibility project, WPI was able to deliver results that significantly enhanced the station’s operational efficiency, customer satisfaction, and environmental compliance while achieving the following results:
- Fast-Tracked Project Timeline: The project was completed in 68 days, with 40 days allocated for station shutdown and 28 operational days. Remarkably, the project finished a day ahead of schedule, despite the city ordinance, minimizing inconvenience for residents, Costco members, and local officials.
- Improved Customer Experience: Significant improvements were made to reduce customer wait times, resulting in higher satisfaction levels. Additionally, the increase in fueling positions contributed to a substantial rise in fueling volume for the location.
- Operational Efficiency During Construction: Throughout the 68-day project timeline, the station remained operational for 20 days (nearly 30 percent of the time), effectively minimizing service disruptions for customers.
- Environmental Compliance: The project adhered to all air quality monitoring certification and tank testing requirements, ensuring long-term operational integrity and environmental responsibility.
These results demonstrated WPI’s ability to efficiently manage a complex project while reinforcing Costco’s commitment to delivering exceptional service and maintaining high standards.
The success of the La Habra gas station expansion not only achieved its immediate goals but also positioned Costco for future growth. By expanding facility capacity and maintaining efficiency, Costco reaffirmed its dedication to providing exceptional service to its members.
Key Project Takeaways
The La Habra Costco gas station expansion provides valuable insights for other Costco gas station locations, as well as other fuel station operators. These takeaways highlight best practices and strategies that can be applied to similar projects to ensure successful outcomes:
- Understand Customer Demand Patterns: By accurately gauging customer demand, Costco was able to optimize its station layout and capacity. This not only involved assessing current traffic but also predicting future growth and changes in customer behavior.
- Optimize Station Layout and Technology: Implementing efficient station layouts, including queuing systems at each fueling bay, greatly enhanced the customer experience and efficiency throughput. Efficient layouts improved traffic flow and reduced congestion and wait times, providing a smoother, faster fueling experience for patrons.
- Minimizing Disruption During Construction: A well-planned, phased construction approach with clear stakeholder communication can significantly reduce the impact on ongoing business operations. Strategic scheduling, effective communication with customers, and close coordination with operations teams ensure customers continue to receive high-quality service during construction.
- Balancing Cost-Effectiveness with Customer Experience: Striking the right balance between initial investment and long-term customer satisfaction is key to project success. Careful analysis of costs and benefits, and working with a knowledgeable team that’s experienced in the key aspects of permitting, collaboration, construction, environmental engineering, procurement, and safety practices, can ensure project success and long-term operational efficiency.
A Model For Efficient Expansion
This project upheld the standard for Costco’s gas station expansions, emphasizing the importance of strategic planning, meticulous execution, and a steadfast commitment to meeting customer needs.
By understanding customer needs, implementing innovative solutions, and prioritizing a smooth construction process, the project has markedly improved the customer experience. Town officials were thrilled with how quickly and professionally the project was completed.
The project’s success underscores the importance of strategic planning, effective execution, and a commitment to customer satisfaction.
