The Steenkolen Handelsvereeniging (SHV), founded in 1896, had been running on – the name says it all – coal for a long time. SHV Holdings is now the largest family business in the Netherlands in which coal hardly plays a role anymore. It has become a diversified company, with activities in the fields of energy, wholesale, animal nutrition, investment and heavy transport. SHV has about 55,000 employees worldwide and is active in 58 countries, we read on the corporate page. SHV’s role has therefore changed: perhaps a blueprint for the struggling and now surprisingly undervalued Shell.
The brand has more assets
After all: the RDS or Shell brand also has more notes on its vocals. Moreover, the – now considerably depreciated – oil stocks will continue to exist. The gold price may fluctuate, but the gold will not leave your gold mine. The same is true for a source or field. Although you may wonder whether the use of the ‘black gold’ after the pandemic will return to the same level as before. In the ‘first’ and ‘second’ world, perhaps not 100%. But population growth and emerging economies will (also) mean more demand for fossil energy.
Of course, it is also a virtue that Shell is now also working for cleaner alternative energy sources and, as a large company, is also working on this with high R&D budgets. Who like MarketingTribune, was present during CEO Ben van Beurden’s Economics lecture in 2018, recalls how the boss left the parking lot in front of the Rode Hoed in Amsterdam in a special executive car that ran on a hydrogen cell. He set a good example and was already using cleaner energy himself.
For example, Shell may also be able to contribute ideas about the safe generation of nuclear energy, which after the exclusive focus on ‘solar fields’ (solar energy, ed.), On the no longer fashionable biomass plants and on (land) windmills in the Netherlands is tilting opinion. Nuclear energy can, according to the national government, contribute to the climate goals, because little CO2 is released during generation. The only nuclear power plant in the Netherlands supplies about 4% of the electricity used in the Netherlands. There are currently no plans for the construction of a new nuclear power plant, according to the government, also because these low CO2-emitting energy sources require a substantial investment. Who could help achieve this relatively sustainable form of energy?
Shell strong in retail
Shell’s ‘multiple notes’ also include the entrepreneurial spirit present in the group. In Q2 / ’20, in which a total loss of 15.4 billion euros was suffered, the traders’ department still delivered a good result. Rightly so, just like SHV, a trading club. In addition, the retail department of RDS offers additional opportunities to be developed. Not everyone is aware of the immense scale of this department. ‘As a retailer of Shell stations you get a unique opportunity to run your own business with the support of the largest brand retailer in the world’, the site of the top brand itself says. The reason given for this is that service employees at the petrol stations with 500,000 colleagues in almost 80 countries worldwide serve more than 25 million guests per day, although this will currently be slightly less due to the slowly dying pandemic. Such a distribution network still offers many possibilities, including partnerships with parties such as Bol.com, Amazon or Google Retail can be imagined. After all, Shell is itself a marketplace.
A close look at how SHV operated over time will in any case provide inspiration. In the meantime, the RDS share is available for next to nothing, fluctuating around up to a third of the value that was quoted a year ago. Because of the underlying opportunities offered by the brand, even Norwegian investment funds, which previously exited their own (because ‘too fossil’) Statoil, are now buying very favorably on Beursplein 5 with Shell. The near future will show whether this is smart trading. A vaccine against corona in combination with visionary brand thinkers and R&D people (thanks in part to the good ties with TU Delft) who are already on board at RDS itself, can in any case gain the value very quickly ‘upstream’ , so change upwards. Ceo Van Beurden will announce Shell’s latest strategy in February 2021.
(PvWK, photo mirroring pumping station: Justus Menke / Unsplash)
* Read the recent interview with Ben van Beurden here (source: Shell)
* MarketingTribune co-wrote during the Elsevier Economics lecture in the Rode Hoed (2018)