Good morning, and welcome to the Dover Fueling Solutions Analyst and Investor Meeting Webcast. In attendance from Dover Corporation today are Richard J. Tobin, President and Chief Executive Officer Brad Serapak, Senior Vice President and Chief Financial Officer Andre Galuk, Vice President of Corporate Development and Investor Relations David Krause, President of DFS Kevin Long, President of OPW. Today's webcast will include multiple video presentations, so all attendees are encouraged to participate via the webcast link on Dova's website. After the presentation, there will be a question and answer period.
As a reminder, ladies and gentlemen, this webcast and conference call is being recorded Thank you. I would now like to turn the call over to Mr. Gallic. Please go ahead.
Thank you, Dylan. Good morning, everyone, and thank you for joining our virtual meeting today. This webcast will be available for playback on our website through February 17, 2021. Dover provides non GAAP information and performance metrics. Relevant definitions and reconciliations between GAAP and adjusted measures are included in the presentation materials, which are available on our website.
We want to remind everyone that our comments today may contain forward looking statements that are subject to uncertainties and risks, including the impact of COVID-nineteen on the global economy and on our customers, suppliers, employees, operations, business, liquidity and cash flow. We caution everyone to be guided in their analysis of Dover by referring to our Form 10 ks and Form 10 Q for the Q3 for a list of factors that could cause our results to differ from those anticipated in any forward looking statement. We undertake no obligation to publicly update or revise any forward looking statements except as required by law. With that, I will turn this call over to Rich.
Thanks, Andre. Good morning, everyone, and thank you for joining us today for the 2nd iteration of our business deep dives. We are pleased to talk to you today about our fueling solutions business. I'll begin with a high level overview of the business and our strategy and then let our business leaders walk you through what we believe is a compelling value creation story. Joining me today are 2 of our seasoned operators, David Krause, who leads our Dover Fueling Solutions operating company and Kevin Long, who leads OPW.
Let me clear out some potential terminology confusion before we get started here. We have an operating company called Dover Fueling Solutions led by David, which supplies above ground equipment and software solutions. We didn't do our help ourselves by naming the segment fueling solutions, but to avoid confusion, will we use fueling solutions or segment when referring to the segment and DFS when referring to the operating company. So let's start with Slide 5. As you know, Dover's industrial portfolio consists of a healthy diversity of end markets and geographies.
This has been a great asset to us in the recent downturn and we believe this model will continue to be value creating in the future. The fueling solutions segment represents about 20% of our total revenue and there are a number of factors making this a very builder like business. We will demonstrate in the presentation that the businesses have many positive attributes, diverse product lines, geographic revenue balance and attractive market structures. Additionally, there are a number of logical adjacencies around the core fueling solutions segment that we already participate in and we believe new adjacencies will emerge as the large and healthy customer base evolves into the future. In brief, fueling solutions is truly global operation with attractive financial profile grounded in an innovative product portfolio of proprietary technologies supported by more than 1600 global patents.
The business mix within the segment is also diverse with attractive profit pools. Dispensers represent less than 40% of the total revenue and the total core fueling capital equipment is less than 60% of sales. We already derive a substantial share of revenue from aftermarket and systems and software as well as adjacent offerings like vehicle wash, which will be significant growth platforms into the future. Our portfolio has been purpose built and we believe that we have the broadest set of solutions available to the global convenience and fuel retail market and adjacent vehicle wash, critical fluid transportation and fleet fueling markets. This breadth of participation makes us an indispensable partner to our customers and puts us in a position to participate in emerging business models as the convenience retail infrastructure continues to evolve.
Today, we organize and manage the businesses in this segment along several product lines and end markets. As you can see on the page, intuitively, you can see that there are significant opportunities, particularly in systems and software to provide integrated solutions across the product portfolio. If you followed over closely, you know this management team has delivered commendable performance over the past few years. Revenue grew at 10% average rate in 2018 2019 and we are on track to achieve nearly 500 basis points of margin improvement for the segment exceeding the targets we established in 2018. Much of this margin improvement is the synergy captured from the deals executed in 2016, but more importantly, we still have clear margin improvement path to continue to execute.
The industry has experienced a slowdown this year primarily caused by a slowing in China where double wall compliance was largely achieved last year resulting in a 50,000,000 dollars regulatory revenue headwind for us. The balance of the decline has been caused by COVID and its disruption to demand and ability to conduct normal business, but we remain bullish about our future prospects. The future opportunity in this market is significant with an addressable total addressable market of $12,000,000,000 While our core market is retail fueling, we also serve sizable adjacencies outside of retail fueling such as fluid transfer and vehicle wash. The core fueling equipment demand is expected to grow in low single digits and we expect systems and software and vehicle wash markets to grow in mid single digits. Alternative fuels such as CNG, LNG, hydrogen and electric charging represent the smallest market today, but will grow relatively fast over the next decade.
My colleagues will present today the strategies for winning their share in the sizable TAM opportunity. We expect the core equipment market to grow in low single digits as the global car park and fuel consumption continue growing for the next 15 years driving the need for new improved and safer infrastructure around the world. This growth will be augmented by additional environmental regulations and continued consolidation across our customer landscape, which we see as an opportunity rather than a risk to future volume. Consolidation by customers typically bring site upgrades and remodels where margin mix is attractive and larger operators tend to be also be more sophisticated in deploying digital solutions, which are high value reoccurring revenue streams. We are well positioned to participate in these trends, which our 2 leaders will cover in their presentations.
Overall, we will be opportunistic with capital deployment in the core equipment markets and we will continue diversifying the fluid transfer components business. Next, we'll build out adjacencies where we have already strong positions. We are a leading supplier of vehicle wash systems in the U. S. And will capitalize on the secular growth and expand our participation in that space.
Systems and software that operate fueling sites and convenience stores where we're still in the early stages of adoption and are evolving rapidly. We have a strong position here and the business is over $200,000,000 in size today. Our number one capital deployment priority will be investing organically and inorganically to drive long term growth as these solutions will serve the global installed base. And finally, we're keeping our eye on emerging sources of value in our markets. Alternative fuels like compressed and liquefied gas, hydrogen and electric charging are the most obvious vectors.
We do intend to capitalize on these value streams and we will share more of that strategy today. In addition, we believe the convenience, retail format and business model will continue to evolve in the end and their key asset is their convenient location, which can be monetized in a variety of ways. As such, technologies that help retailers increase and monetize traffic and improve operational efficiency will continue to evolve and we intend to participate in those over the long term. In summation, we intend to invest behind the segment and to maintain our technological edge and competitiveness, which underpin the strong financial profile it delivers. We will also pursue growth avenues already on our radar and continue repositioning the business longer term towards revenue streams that are less dependent on capital replacement cycles and fueling equipment.
With that, let's get on to the meat of the presentation. I believe that you'll find that we have some interesting initiatives and opportunities which will deliver significant future value to Dover. So I'll hand it over to David here.
Thanks, Rich. Good morning, everyone. This is David Krause. I'll begin with an overview of key long term tailwinds in our core fuel and convenience retail space. Before I dive in though, I want to say a few words about our customers.
They are 1st and foremost retailers with high value real estate assets. They capitalize on their convenient locations and customer traffic in a variety of ways. In fact, a typical customer site derives approximately 30 percent of its profits from fuel sales and the rest from store sales, car wash and other services. The set of products and services offered by retailers will continue to expand. This is important because our playing field is not just fueling the customer's whole ecosystem and we will continue expanding our solution set to serve our customers' critical applications customers.
We don't just sell fueling equipment, but rather tools that attract and engage their consumers in a safe and revenue maximizing way. Our solutions improve the economic efficiency of their operations. In short, we saw higher revenues, lower costs and better safety and we will showcase some of these examples today. We expect the following 5 secular trends to support growth over the coming decade or 2, And I'll elaborate on each of these in the subsequent slides. First, the global car park with increasing consumption of both traditional fuels and alternative fuels will grow through at least 2,030.
2nd, the convenience retail landscape will continue consolidating around more sophisticated operators and that benefits our business through demand for upgrades and demand for cutting edge solutions. 3rd, evolving regulations around environment, payment and security and safety will continue to get more stringent around the world and we supply compliance solutions for all of these things. 4th, a shift towards automated car washes, which will continue to grow for the foreseeable future, driven by environmental regulations, convenience and labor economics. And lastly, and probably most importantly, the convenience retail industry, which has traditionally been less sophisticated in the digital realm compared to other retail formats, will accelerate the adoption of new digital technologies that drive revenue and efficiency. All five of these trends will drive growth over the long term.
First, the most important driver for our customers and for our business are total car park, miles driven and fuel consumption. It's not necessarily new car sales. We've done a study of all the forecasts out there and the majority seem to project battery powered vehicles to represent about 30% of new vehicle sales by 2,030, with the majority still being combustion engine and hybrid powered. With approximately 1,500,000,000 automobiles on the road today and the increasing lifespan of modern automobiles, the expected shift in the mix of this large car park will happen slowly and gradually over decades. There are of course multiple uncertainties around the future of forecast of electric vehicles, such as cost of batteries, government subsidies, supply chain constraints around rare earth minerals for battery production, battery recycling, and lastly, the power generation required to produce electricity to power all these EV vehicles.
Based on all these things, most experts foresee at least another decade or 2 of growth in the core infrastructure that we serve and then many decades where fueling infrastructure will continue serving the traditional car park and gradually evolve to include new sources of energy. Let's move on to the customer base we serve. Convenience retail is a healthy and growing industry. As you can see, the number of locations is growing and is expected to increase significantly in the developing markets. Our customers see favorable sales trends and improving economics, making investments in new facilities and upgrades a strong return on investment opportunity for them.
The margins on fuels and in store sales are increasing and in store sales are growing well above sales in general retail. And this is why you see many large players in convenience retail continuing to invest in their sites and we expect that trend to continue in the long term. Another important dynamic in our industry is growth of chain operators around the world. There are multiple chains not affiliated with large oil companies and that are expanding their presence both organically and inorganically. The consolidation is around more sophisticated retail operators that are highly interested in technology and solutions that drive revenue and create operational efficiencies to keep their costs low.
And this is exactly where we are going with our Dispenser technology and our solution suite. We are focused on enhancing the customer experience and providing cloud deployed applications that improve efficiencies and drive profitability. On this slide, you can see an illustration of positive capital deployment trends based on the data from 4 publicly traded convenience retail operators in North America. When these operators acquire properties, they tend to upgrade them to modern standards and most of them also have a robust new to industry construction pipeline. There has been a number of announcements in just the past few weeks around new M and A and also increasing We believe that current industry fragmentation, favorable economics and robust return on investment on capital deployment will support the trends towards industry professionalization well into the future.
Let's briefly touch on a few additional important trends that support the growth of our business. 1st, regulations around the world continue to become more stringent around the environment, payment and security and safety. We expect the steady deployment of regulations to continue over the long term. Another trend is the shift away from do it yourself car washing to the use of automated car washes. Automatic car wash systems use significantly less water than do it yourself washing.
Additionally, modern conveyor wash systems offer much more favorable economics for operators compared to full service manual washes, especially in high labor cost locations. Our convenience retail customers view car washes as a very important profit driver. All of these factors are driving stable growth and demand for automated car wash systems, and we see continued long term growth in this market. And lastly, adoption of digital technologies and and convenience and fuel retail is still in the early stages. The return on investment of our solutions is very clear and we expect the adoption of these new technologies to continue to grow for an extended period of time.
Plus new solutions are being developed, especially around customer loyalty and engagement. And we are going to showcase some of these exciting examples later today, including our partnership with Microsoft to bring the latest cloud technologies to our industry. The last slide in this section shows how the large installed base we serve will continue to be a source of value over the long term. We expect both dollars per site and number of the sites adopting these various solutions will continue growing in the future. A typical modern fueling site requires approximately $450,000 worth of equipment with approximately half of that for the car wash system itself.
Most equipment is replaced every to 10 years and is driven not just by wear and tear, but also due to technological advances making modern equipment more productive, safer and cost effective. We will show you examples later. Largely the same, but scaled down equipment base will be required when retailers begin adding electric chargers, which in itself represents a separate revenue opportunity. We expect operating expenses and recurring revenue to grow in the future as solutions and software are adopted to further digitize and improve retailer operations. For example, today in North America, car washes are present at about 10% to 15% of fueling sites.
We expect that number to grow as car wash represents a great profit center for operators. Rapid growth is expected and the number of sites adopting software technologies as solutions outside of payment and back office are still relatively nascent. We will now get into more detail on specific products and solutions. We will begin by showing you a short introduction video showcasing our portfolio of products and solutions.
Historically, building or renovating a retail fueling forecourt has been a fragmented undertaking. But now the entire process has been revolutionized by the industry's global all inclusive and customizable solution, introducing the Dover fueling and OPW end to end 4 quart solution. Let's start with dispensers. As you can imagine, we offer some of the industry's best. The sleek, stylish Wayne Helix Fuel Dispenser Series is a global family of products with a blueprint based on a sophisticated platform designed for every corner of the world.
Within that global design is housed the innovative IX Pay secure payment solution, which delivers advanced security in addition to investment protecting flexibility and scalability. A favorite in North America, the Ovation Fuel Dispenser is known for its sleek style, durability, and innovative IX Pay Secure Payment Technology, featuring a 2 d barcode scanner and contactless NFC reader. We also offer OPW automatic nozzles and nozzle accessories, including a complete line of conventional and vapor recovery hose swivels and breakaways for virtually any hanging hardware requirement. Available in Europe, the Middle East, Africa and Asia, the iconic Tokime Quantium Dispenser range includes powerful security features, robust componentry and unique customization. With a 17 inches screen and web based media control tools, the T Media solution keeps consumers informed and entertained while bringing additional income to your business.
The mobile payment solution lets customers pay quickly and securely and in line with the station safety regulations on their mobile phone from within their vehicle. The Quantium line also features the Crypto VGA outdoor payment terminal with touchscreen technology, anti fraud and anti tamper devices, bar code scanner and contactless NFC payments on both indoor and outdoor terminals. As connectivity is essential to a fully integrated forecourt, the Fuel Paws point of sale system connects seamlessly with dispensers, indoor and outdoor payment, CCTV, tank level gauges, back office, pole sign and car wash to simplify the day to day running of the business. Speaking of tank level gauges, we offer Pro pro gauge automatic tank gauge solutions, including a variety of tank probes, consoles and related software and calibration services for retail fueling stations to measure and monitor tank levels. Wireless mag probes, tank truck mag gauges, 3 d laser tank calibration and fuel quality sensors are also available.
Underground, OPW's flexible fully integrated fuel piping systems provide advanced capabilities that offer a higher level of protection, meet compliance needs, control costs and simplify installation. In addition, OPW's liquid tight isolation containers provide secondary containment for tank and pipe fittings, valves and pumps, as well as surface access to tanks for service and maintenance. OPW also offers sumps for new and retrofit applications specifically engineered and manufactured in both polyethylene and fiberglass. And of course, the entire solution dispensers, point of sale, media, tank levels and reporting is controlled with the Fusion Site Automation Server. From the moment of great selection, the FusionSite Automation Server sends data throughout the system to create a smooth, seamless transaction.
Today, it really is all about technology. And our end to end solution offers an impressive array of tech tools, such as Fairbanks sophisticated web portal, Station Manager 365, which provides round the clock real time visibility over inventory and equipment. Available for all platforms, our Cloud Solutions suite of technologies simplifies payment compliance and data analysis, provides integration with mobile payment and loyalty systems, enhances customer experience with media content, and improves operational efficiencies with new point of sale systems and remote management and diagnostics. As data security is always a priority for retailers, the OASA online authorization and switching platform is PCI DSS certified, and in combination with the Tokime and Wayne payment terminals, provides a seamless point to point encryption solution, enabling acceptance of all cards on indoor and outdoor payment terminals. And finally, OPW offers the latest in touchless car wash equipment in a range of model options to suit all forecourts.
End to end, above and below ground, from card swipe to car wash. For turnkey simplicity, advanced functionality and future scalability, you need the industry's global end to end solution. You need the Dover Fueling Solutions and OPW end to end forecourt solution.
We will start with our largest product line, above ground dispensing equipment. We operate 2 of the world's leading brands, Wayne and Tokaim, both with more than a century long legacy of innovation. Wayne is stronger in the Americas and Tokaim is stronger in Europe, Middle East, Africa and Asia Pacific. In terms of products, we offer traditional 4 core dispensers as well as dispensers for fleet fueling applications and for LPG, liquefied petroleum gas and CNG, compressed natural gas. We currently offer customers electric chargers through strategic partnerships with ChargePoint in the U.
S. And with ABB in Europe. Our strategy to drive growth above and beyond market growth rests on 2 pillars. First, continue to innovate and offer our customers cutting edge revenue maximizing solutions that drive equipment upgrades beyond normal replacement cycles. Our latest dispenser with an enhanced user experience technology is a good example of such innovation and we expect it to drive healthy growth in the coming years.
This is a proprietary technology with over 100 global patents and patent applications. 2nd, we have runway to continue improving our margins. Since Wayne and Tokaim were brought together in 2016, we have executed on many operational synergies. However, there are a lot of remaining opportunities to harmonize product platforms and technologies to drive vast efficiencies on a global scale. In our business, we also have a well developed rhythm of driving continuous improvement and execution excellence.
Our margin performance in the past few years is a testament to those capabilities and gives us a lot of confidence for continued margin expansion into the future. Since innovation is so important in this business and a major driver of value creation over the long term, I want to illustrate the power of innovation by comparing dispensers that were brought to market around 20 years apart. You can see the evolution in the technology content. The Ovation Dispenser with our Anthem enhanced user interface on the right is a vast upgrade versus the model from the late '90s on the left. Our state of the art dispenser includes a cutting edge customer engagement technology that is important to driving a retailer's top line, increasing fuel throughput, offering multiple compliant payment options and connectivity enabling advertising optionality, remote monitoring and operational optimization.
This kind of innovation drives replacement demand at much higher average selling prices. Our competitive differentiation in the Dispenser business today is much more centered on software and intelligent machinery versus legacy pumping and flow control technology. To wrap this section, we will show a short video showcasing this enhanced user experience technology. We hope you get a chance to experience one of these dispensers in your own neighborhood sometime soon.
Refueling, reimagined, reinvented and reborn. The new DFS Anthem UX user experience platform integrates the absolute latest technology, a stunning 27 inches touchscreen display, personalized welcome screens, increased selection of fuel offerings, real time weather, traffic and multimedia options through DX Promote, part of the DFS DX Connected Solutions platform, making the consumer experience fast, easy, relevant and even fun. The cutting edge features contained within the platform allow the dispenser to recognize each customer personally with a single step transaction. Customers may visit myfuelexperience.com to input their preferences on fuel grades, language, and even select their desired entertainment and information options. A new feature designed to serve a diverse customer base is the multi language selector.
Whether you have filled out the consumer profile or not, the Anthem UX platform is always speaking your language. High fidelity stereo speakers deliver unmatched sound quality that will fully immerse you in the Anthem UX experience. This powerful technology platform truly equips your Forecourt with endless forward looking possibilities, including enabling purchases at the pump, mobile app and loyalty program integration, and enhanced customer personalization. Fueling at night? No problem.
Introducing Dark Mode. User experience is always at the forefront of our designs, and that is why this feature is included on all Anthem UX platform offerings. It reduces eye strain, creates energy savings, and simply looks amazing at night. Packed with the latest technologies and first of its kind touch screen interface, the Anthem UX platform is, without question, the most innovative, flexible and stunning fuel dispenser user experience platform available today. The DFS Anthem UX user experience platform, not just a leap forward, it's fueling reborn.
Let's move to the next line of business on Page 27. We are proud of the business we've built around software and solutions that power modern convenience, retail and fueling operations. This is approximately a $200,000,000 business for us and encompasses payment solutions and a variety of forecourt management solutions. Our offerings help customers maximize revenue, reduce costs and ensure safety and compliance. We'll show you some examples of this shortly.
Convenience and fuel retail is a complex multifaceted operation where uptime, safety, speed and consumer experience are keys to success. Connected and digital solutions are evolving to improve operators' performance across the whole site from underground infrastructure to above ground equipment, in store equipment and car wash. DFS today offers a leading portfolio of solutions focused on payments and forecourt management. The applications you see in blue are within our portfolio today. The ones in gray are where we're pursuing partnerships with 3rd parties.
There are also many evolving applications we are developing. We do intend to become an end to end digital and equipment solutions partner to our customers. We believe that the software and solutions demand in our market will continue growing in mid to high single digits over the next decade and beyond, increasing to over $10,000,000,000 in size. This will primarily be driven by adoption of digital solutions as they become core to remaining competitive as a retailer. Industry consolidation around more sophisticated operators will also support this trend as mentioned earlier.
Additionally, new applications will continue to be developed in particular around customer engagement and customer loyalty. You can see how modern technology embedded in our equipment unlocks a whole new layer of possibilities here for our customers. Lastly, the drive to standardize and integrate disparate solutions will favor broad line suppliers. Operators will favor single screen solutions to manage their workflows and business and have one support number to call as opposed to picking various applications with narrow functionality. So think of this as a single operating system for the site.
Let me show you a preview of the cloud platform we are building that we envision will become the single operating system for the site. DFS has partnered with Dover Digital and with Microsoft to develop a new truly unique cloud platform specifically tailored to our industry. We have not yet officially introduced this to the world, so today we're giving you a preview. Our Edge device will enable operators to connect all sorts of equipment and devices at the site. This will streamline workflows and allow operational optimization by providing a single pane view and data compatibility.
The platform will be a true cloud solution that will speed up and simplify deployment and upgrades. The platform will also be unique then it will be an open platform that allows operators to connect their preferred solutions. So think of it as an Android style open platform compared to Apple's closed iOS platform. Teams from Dover, from DFS, Dover Digital and Microsoft brought to table cutting edge capabilities, including machine learning and AI powered solutions to create these operational optimizations. The following video will showcase some of the benefits and capabilities of this new platform and how it can advance our customers' digital capabilities to the next level.
Sealing stations and retail petroleum have traditionally been very slow to adopt new technologies. Do a site upgrade, do software changes traditionally have always been very manual.
Overfilling Solutions was really created to enable the evolution of the consumer experience. We have over 125 years of experience in fuel retailing. Our mandate is to innovate.
The DFS iSense remote monitoring provides comprehensive remote monitoring capability to do diagnostics, software downloads, predictive analytics. Instead of having a technician go out charging several $100 to go look at
a problem, we can do a lot of that in an automated way and remotely.
For Dover Fueling Solutions, the platforms that were deployed were Azure IoT Hub, followed with Service Fabric and the ability to collect that information off of those fuel pumps to process that information in the cloud and then to be able to provide updates directly down to the device as new features and capabilities come available.
We think at an industry level, iSense is poised to drive as much as $75,000,000
of cost savings.
The DFS Edge device has the ability to connect the refrigerators, the coolers, the pumps, all those types of devices that a retailer would want to be able to manage at their site.
Project Anthem is a smart fuel dispensing customer experience platform.
They leverage our relationship with Microsoft and their Azure and IoT products to be able to take that consumer data and make a loyalty driven application that recognizes you when you come up to the pump.
You can start the fueling transaction just one click. We will remember which octane you picked, what media channel that you like to watch, and we also know how you want your receipts delivered. And it's all done in a secure environment that's on the Dover fueling solutions cloud powered by Azure.
I've noticed that sales have gone up. The pump has ads on the screen and they come in and get whatever they need inside.
Dover fueling solution uses Windows 10 for IoT as the operating system for those pumps. These connected solutions provide a secure and scalable solution that can go across all of these convenience stores.
It's also not just a dispenser or facelift. We're developing a platform that can be applied to any other types of devices, car washes, payment kiosks, EV hardware equipment manufacturer. You combine that with our legacy of innovation with what Microsoft's providing from the Azure cloud, it's a very powerful partnership.
We are very confident about the growth potential of the digital solutions we are offering because we know they bring real return on investment to site operators. Let me give you 2 quick examples. One of the growing solutions we offer is wet stock monitoring, which comprises both connected hardware and a software subscription. It offers operators multiple benefits such as monitoring and managing fuel inventories, but on a granular level that would otherwise be too time consuming to perform in a traditional manual way. One of the most tangible benefits of this solution is ensuring that the customer gets what they ordered and what they paid for.
Sounds like a trivial task, but even small deviations and volumes can add up over time. And in this one customer example, using the data from our solutions, they were able to reclaim $500,000 in under delivered fuel, which if you think about it is the cost of replacing all the equipment at a site. Operators place a lot of value on the peace of mind that example of an innovative solution with clear return on investment is a self checkout payment terminal we are piloting with Shell in Europe. The solution greatly speeds up the checkout process, increasing customer satisfaction and reducing the need for cash, while also allowing greater store labor utilization and lower operating costs. We've seen tremendous results in these pilots with sales increasing by about 20% and cost reductions of around 40%.
Shifting gears to our growth strategy in this business. 1st, we already have strong offering across multiple products and solutions. We will continue to drive adoption of these solutions globally. 2nd, we will continue adding new applications and functionalities to our portfolio with a focus on continuing to enhance the customer experience. We will do this organically through strategic partnerships such as Microsoft as well as inorganically.
And we have interesting opportunities in the pipeline in this area. As I mentioned before, our cloud platform will be the single operating system for all digital solutions deployed to our customers. And we think that this will serve as a great way for us to remain relevant and at the cutting edge of digital innovation in this space. With that, let me pass it to Kevin to talk about the OPW business.
Thanks, David. OPW is a global provider of above and below ground retail fueling equipment, components and supplies. We're the number one global supplier of both above ground hanging hardware as well as below ground equipment. On the above ground side, we provide fuel dispensing nozzles, breakaways, valves and vapor recovery systems as well as nozzles for CNG's dispensing and other fuel types. On our below ground business consist of various products for delivery and storage of fuels in harsh environments together with related sensors and technologies to help monitor tank gauge and leak detection.
Moving to Slide 36, I'll outline our growth strategy. Since our founding in the 1890s, the OPW brand has stood for reliability, performance and safety, which is paramount importance in our field. There are myriad of localized government regulations and compliance initiatives that dictate which products can be sold to which customers. We have the scale to maintain a diverse product portfolio that can accommodate these regulatory requirements. We'd also continuously invest in new product development to drive innovation and improve user experience, which often results in patent protected technologies and applications.
As an example, here's a recent CleanTouch Clean Technology nozzle line that greatly reduces spilling, dripping and contamination. We all know how unpleasant the little spills are after you remove the nozzle from the tank and those little spills do add up across billions of fueling sessions. The reputation for reliability and innovation together with our global presence has enabled us to continue expanding into new product adjacencies and geographies. An example of this lever is our strategy in the new euro nozzle that we introduced recently to participate in a large European segment of the market, which is historically not addressed for us. I'd like to show you a brief video highlighting our innovative capabilities.
Headquartered in Smithfield, North Carolina, OPW Retail Fueling is a leading producer of innovative fuel dispensing, transfer and secondary containment solutions.
At OPW, we're pioneering innovations such as double wall flexible piping, watertight secondary containment, dripless nozzles and CNG clean energy fueling products, all designed to help meet the needs of the business and sustainability goals of our customers while helping to make communities in which we operate stronger.
OPW introduced the only integrated fuel transfer and containment solution in the industry by combining flexible fuel transfer piping and fiberglass secondary containment to reduce potential leak points underground. We also acquired FiberLite and combined our fiberglass sump technology with their watertight composite cover technology to create a totally unique best in class watertight secondary containment solution that has quickly been embraced by fuel marketers around the world, especially in the U. S, China and India.
In 2019, we launched a new line of clean fueling nozzles featuring patented dripless, free draining spout technology to reduce volatile organic compounds at the customer point of fueling and to reduce messy diesel fuel from getting on people's hands and on the ground. Earlier this year, we rolled out a new European nozzle design. This new nozzle features a sleek, lightweight profile and is also available for vapor recovery applications to give us access to new markets. Beyond these fueling innovations, we are addressing alternative fuels such as CNG products and taking steps to expand our presence in hydrogen and LNG.
We implement environmental social governance operating principles across all of our operations in the U. S, China, India and Europe to minimize our manufacturing impact around the world and to offer region specific environmental compliances and sustainability solutions to our customers.
Enhance the business performance of our customers and the environmental sustainability of our planet. As we expand our product portfolio, we remain dedicated to defining what's next in retail fueling innovation and sustainability worldwide.
I'll now shift gears to discuss our vehicle wash business. OPW has been in the business since the late 1990s with the acquisition of PDQ, the number one North America supplier of in bay automatic equipment, which is a type of wash equipment most prevalent at convenience store sites due to the smaller real estate footprint required. In 2019, we acquired Bellinger, one of the leading suppliers conveyorized tunnel equipment. The acquisition further strengthened our position in both the convenience retail segment as well as the independent wash operator, which is a thriving segment of the market. We do also offer terminals and tunnel can tunnel controllers, which are smaller suppliers in those space, but they're areas that we want to expand.
The following video will give you a sense for the type of solutions we offer the benefits they bring to our operators.
OPW Vehicle Wash Solutions is composed of PDQ, a world leading manufacturer and inventor of touch less in bay automatic car wash equipment and Bellinger, a full line equipment manufacturer of conveyorized and drive through tunnels, touchless and soft touch automatics and large vehicle washes. Part of OPW, a Dover company, OPW Vehicle Wash Solutions creates value for customers through a robust pipeline of product innovations that continuously offers both economic and environmental sustainability benefits.
The demand for professional vehicle wash systems is growing due to secular shift from manual washing to automated high throughput professional systems. Robust long term expansion and consumer demand for car wash services is supported by the convenience of professional washes as well as the increased adoption of loyalty programs by car wash operators.
Headquartered in De Pere, Wisconsin with facilities in Northville and Millby, Michigan, OPW Vehicle Wash Solutions possesses 219,000 square feet of world class manufacturing space. We implement environmental and social governance operating principles across all our wash businesses in an effort to minimize our manufacturing impact.
Between PDQ and Bellinger, we've been leading the way with industry defining solutions for more than 50 years. Our systems provide exceptionally clean vehicles, while also helping wash sites optimize their usage of water, electricity and chemicals for a more sustainable operation.
OPW Vehicle Wash Solutions equipment is focused on delivering an outstanding experience and quality wash for consumers. A good example of this is SpinLight, one of the most successful wash technologies in Bellinger's wash equipment portfolio. SpinLight was introduced as the world's first patented illuminated hub design enhanced with color changing LED lights. The multi patented Spinrite car wash media is billed as the world's 1st car wash technology designed to deliver better than hand wash results at production line speeds. Self supported soft foam arms deliver an ultra quiet, thorough and gentle massaging clean.
Building upon the success of our SpinLight technology, our innovative thinking can be found in our newest product, the CUBE. The CUBE is a 3 brush in bay automatic rollover system utilizing our innovative slow spinning ShineMitt media. The CUBE provides a gentler, quieter wash for customers and cuts both the perceived risk and the actual risk for damage. OPW Vehicle Wash Solutions is making its mark in the car wash industry being valued by consumers and operators alike for providing unique innovative designs, durability,
reliability, exceptional cleaning
performance and user friendly functionality. OPW cleaning performance and user friendly functionality. OPW Vehicle Wash Solutions continuously strives to lead the way through innovative thinking, technology, environmental sustainability and most of all through customer satisfaction.
Let's talk briefly about the market tailwinds in this industry on Slide 40. Car Wash Equipment is exhibited through cycle above GDP growth driven by steady increases in consumer demand for professional automated washes. The primary driver of the secular trend is a shift away from do it yourself washes and driveway washing, which is inconvenient and less environmentally friendly. Do it yourself washing still comprises somewhere between 20% 30% of total washes, so there's runway for this driver to continue supporting growth. The second driver is the attractive economics of car washes.
If built in the right location and operated well, car wash systems offer a very attractive return on investment for both convenience retailers and standalone wash operators. We also see the consolidation among chain wash operators, which typically leads to site upgrades. This trend is also in the early innings as the largest consolidators still operate just a few 100 sites in a market with tens of thousands of sites. Our equipment is thoughtfully designed to enhance an operator's return for providing revenue generating features to optimizing the washes consumption of power, water, chemicals and to minimize downtime and total cost of ownership via highly engineered and well manufactured systems. Everything we produce is aimed at helping the wash operator drive attractive profitable levels.
Finally, this market is benefiting from the secular shift away from labor intensive hand washes towards automated facilities. To give you a sense of the labor arbitrage magnitude, a professional conveyorized tunnel site operated by just 4 people can support a similar throughput as a full service manual wash that requires 15 to 20 workers. This creates a massive competitive advantage for the automated washes further supported by fast service. Customers could be in and out in a couple of minutes at a tunnel and within 5 minutes at an in bay automatic compared to 30 to 60 minutes at a full service manual site. We have multiple avenues continue driving growth for very strong foundation in this business.
1st, we don't currently supply the full scope of equipment required to operate AWASH and we see several attractive product niches that we can add to our portfolio. Most notably, we intend to expand our offering in access terminals, which is a very important digital solution powering the site. 2nd, we're uniquely advantaged with the broadest distribution channel spanning convenience retail and standalone locations. We'll continue leveraging these channels to maximize the reach of our solutions to scale new additions to our product portfolio. On the efficiency side, we have synergies that can be derived by leveraging technology across our in bay and tunnel offerings.
And lastly, being joined with DFS puts us in a unique position to integrate vehicle wash operations into the broader convenient site infrastructure and offer that single pane visibility that David talked about earlier. I won't spend too much time on Slide 42, but suffice it to say that our car wash franchise is built on a culture of innovation. We invented the touchless car wash and in recent years have introduced our SpinLight and Cube product offerings that are unlike any other wash experience because they provide by our patented Shineknit wash media. Unlike conventional fast bend brushes that require centrifugal force to extend the brushes to engage with the vehicle surface, Freestanding foam arms rotate slowly over a vehicle providing an outstanding clean and gentler, quieter customer experience. I encourage you to go to experience a SpinLight or Cube for yourself and I guarantee it will become your wash of choice.
The last line of business I want to talk about is our Fluid Transfer business. We are a global leader in the safe handling, monitoring and transportation of hazardous fluids. We're the number one global supplier of loading systems, including couplers, loading arms and other components related monitoring solutions for chemicals and other industrial applications. We are also the number one global supplier of petroleum transfer solutions, including valves, breakways and swivels for rail and cargo transport of fuel across the value chain. This business applies mission critical components with sticky, specified demand and high compliance and safety requirements.
With a large and growing installed base, there's also an annuity like aftermarket opportunity for replacement parts. And finally, there are also clear regulatory tailwinds that will continue to benefit our business into the future. The following short video showcases our offering and innovative solutions in the space.
Headquartered near Cincinnati, Ohio, OPW Fluid Transfer Solutions is a leading producer of innovative fuel transfer products comprising market leading brands, each dedicated to delivering world class solutions for the safe, efficient handling, transfer and transport of hazardous bulk products.
OPW Fluid Transfer Solutions is organized into 3 distinct business units: Cargo, Rail and Chemical Industrial. In each case, our mission is to deliver solutions that protect people and the environment while improving business performance of our customers.
OBW Fluid Transfer Solutions Technologies help to prevent chemical and petroleum spills, cargo and rail tank overbills and fugitive emissions at bulk terminals, in processing plants and at retail fueling sites.
At OPW Fluid Transfer Solutions, we're leveraging digital innovation to explore, create and introduce new smart products to the market, products designed to deliver significant value to our customers. For example, cross contamination of fuels during deliveries cost transport fleets and retail fuel marketers significant lost revenues, profits and reputations every year. Our new COPS system prevents cross contamination of diesel and gasoline during fuel deliveries by utilizing RFID technology. COPS completely eliminates human error at the point of delivery, allows faster unloading and delivery times and prevents product theft.
India, China and Australia, OPW Fluid Transfer Solutions implements environmental and social governance operating principles as a way to minimize our manufacturing impact around the globe. Our Cargo business unit is pioneering advanced innovative thinking such as cloud based asset management technology for cargo tankers to provide real time monitoring and geofencing of valuable liquid assets. In our Rail business unit, we leverage our engineering expertise in pressure relief valve technology to minimize product loss and environmental impact in the event of a rail accident. For terminal operators, our chemical and industrial business unit has introduced best in industry dry brake API to help minimize potential fluid loss and environmental impact when connections experience high pressure surges. Our bottom loading technology helps to improve operator safety by reducing the danger of static electricity while simultaneously protecting the environment by reducing vapor emissions during the filling process.
At OPW Fluid Transfer Solutions, human safety and environmental sustainability are at the heart of everything we do. Our commitment to digital innovation, smart products and customer driven solutions will enable us to address the ever evolving challenges and opportunities in the world of fluid handling today, tomorrow and into the future.
In addition to our core business today, we see the opportunity to grow digital solutions in the space. We're proud to offer the world's 1st digital tank truck solution, a connected set of electronic devices such as overfill protection, sensors, controllers and emergency shutoff devices. By connecting these devices under 1 digital system, we're able to provide asset management, reduce operator intervention and human error to improve safety, guard against environmental contamination and lower risk of business disruption. We introduced this solution to the market recently and we're seeing good traction already. With that, I'll turn it back over to David to discuss our opportunities in alternative fuels and emerging business models.
David?
Thanks, Kevin. I'll spend a couple of minutes talking about our vision and plan for alternative fuels. The most obvious one is EV charging. This is an emerging market as we showed earlier, but in a couple of decades it will be material. We expect that over 20% of chargers will be located at convenience retail sites, in particular along highways and in urban areas where charging in garage and or charging on street level parking may not be available.
It is important to emphasize again that the key asset of convenience stores is their location and their infrastructure like restrooms, cafeterias, car washes and other services like e commerce hubs that will continue evolving. Consumers will continue visiting convenience stores to meet these various needs and fast charging will be a very suitable service as well. We already see customers investing in EV charging. Currently, the investment goes primarily towards electric infrastructure to enable the site to support EV charging. As part of the electric vehicle incentives package adopted last summer, Germany has required that all fueling sites offer EV charging.
But the timeline and details are not yet clear. Just last week, Total announced the acquisition of a large network of electric chargers in Germany. But in most markets, convenience retailers are just experimenting with putting in EV chargers. As you may know, fast charging technology is still evolving and until the charge time gets reliably to around 10 to 20 minutes, charging at fueling sites will remain limited. It's important to highlight that EV charging will need to be integrated into the site's broader infrastructure to allow operational visibility and asset management, and we believe there is a role for our site management software and solutions here.
Today, we offer electric charges to our customers through strategic partnerships with both ChargePoint in the U. S. And ABB in Europe. Both players are the largest OEMs in their respective markets. At this time, we are a channel partner representing these solutions in the convenience retail segment.
We believe at this early stage, this model best leverages our collective capabilities to bring these early solutions to interested customers. As the market evolves, we will continue evaluating our participation options. Currently, we envision 2 primary paths to participating in electric charging space. 1st is the equipment supply. This is an obvious path and we do have a right to play here since the electric chargers have many commonalities with a dispenser.
There are wires and transformers, of course, instead of pumps and pipes, but the customer interface, payment processing and other functionalities are quite similar. Over time, we may adapt a 3rd party electric charging technology into a DFS form factor suitable for a C store and provide a similar intuitive customer interface and payment functionality. For now though, we're satisfied with the partnership model. A second vector of participation is software and connected solutions. The primary opportunity for us here is helping connect EV chargers into the broader site ecosystem and provide similar asset management, monitoring and optimization tools that we offer in our core fueling business today.
Additionally, sites will likely strive to unify the customer engagement and interfaces at their sites. And that may open an opportunity for our user experience platforms like Anthem that we demonstrated earlier. I do want to emphasize that we view EV charging as an upside opportunity. We are fully confident about the growth prospects in our core market for at least 1 or 2 decades and the large installed base of fueling equipment will exist for many decades to come there will be plenty of opportunity for us to monetize it. We also see interesting opportunities in other alternative fuels, which have revenue potential comparable to electric charging.
In the near term, CNG and LNG represent the most tangible opportunities. We already have an offering for compressed natural gas and we are looking for participation options in LNG fueling. These solutions will primarily be applicable for larger vehicles such as trucks, buses or construction machinery where EVs are not optimal. We believe these new fuel markets will evolve differently in various regions and will be driven by local regulations, existing infrastructure and the local access to different alternative fuels. For example, compressed natural gas is already used to fuel fleets globally and will continue growing.
LNG is growing as a source of fuel for trucks and buses in China and hydrogen appears promising for large machinery and also specialized small fleets. On this slide, you can see a visual of a typical hydrogen fueling site and some of the products that we believe could be a fit for us to participate in. We are in the early stages of evaluating different opportunities for hydrogen, but hydrogen is still very much in the early stages and we expect the adoption to be gradual. As we said earlier, the convenience retail format will continue evolving. To leverage their physical locations, operators will enhance the selection of services they offer to their customers.
New business may emerge providing vehicle services and autonomous vehicle hubs or e commerce delivery hubs. Consumer behaviors and preferences as well as transport technologies will evolve, but the need for mobility and convenience will remain and there will be a place for convenience retailers. We also believe that there will be ongoing trends towards more automation and unmanned solutions for these sites. We think the future will present more exciting opportunities and we will continue to be a go to partner for our customers. So with that, I'll pass it back to Rich for closing comments.
Thanks, David. I hope this gives you an appreciation of the quality of this business and its future prospects. Before we get to the Q and A, let's address EMV and revenue trends and a brief 2021 group outlook, so we can hopefully use the Q and A time to talk about product and markets. The current EMV compliance deadline is April 2021 and we expect to reach approximately 70% adoption rate by the end of this year. If you remember, EMV is a $500,000,000 revenue opportunity for us, which we've been benefiting from over the last 5 years.
2020 is the peak year and we will see some slope of fan fade from here that will last 2 to 3 years. The exact shape is hard to predict, but overall, we're talking about tens of 1,000,000 of dollars of headwind per year for a segment with $1,600,000,000 revenue base implying a headwind of several percentage points. However, we expect that growth in the systems and software business, developing economies and other trends we talked about today will help us offset the headwind. Additionally, we plan to make further progress on margins in this business. All in all, we expect to maintain or modestly grow the profit line for 2021.
On Slide 55, I'd like to recap the very attractive strategic fundamentals of this business. We cater to a healthy and growing retail format and sell high value innovative solutions that maximize customers' bottom line. Footprint growth and continued innovation and model mix enhancement as well as further adoption of software solutions will support the growth for at least over a decade. We already participate in attractive adjacencies and we'll continue to build out those with the goal to future proof the business and improve the revenue mix towards more reoccurring sources. We see a robust path to participate in EV charging in a logical and targeted way, helping our retail customers deploy these solutions efficiently into their greater ecosystem.
We also intend to participate in other alternative fuels such as CNG, LNG and hydrogen, which by the way we already do in our precision components business. We expect that executing on this strategy will deliver strong double digit shareholder return in line with our corporate objectives. The sources of value creation will be balanced between mid single digit growth, margin expansion yielding a high single digit earnings growth and a healthy free cash flow. I'll finish with a brief performance update on Slide 56 since we're already halfway through the quarter and I won't be able to avoid the topic in Q and A. We continue to see a positive trajectory across the majority of our portfolio in October, continuing solid trends from the Q3, particularly in the shorter cycle businesses.
Bookings and backlog were up on a year over year basis with sustained demand momentum in food retail, marketing and coding, aboveground retail fueling, biopharma and heat exchangers. We are targeting the high end of our full year EPS and cash flow guidance provided at the end of Q3. Moreover, we remain encouraged by the setup for a good 2021 performance driven by the continued recovery across our end markets, new product launches and digital initiatives and robust productivity plans across our portfolio as we continue our multiyear structural cost initiative. We are continuing to drive efficiency improvement leveraging Dover scale and common ownership through multiple initiatives you see on the right side. We have significant runway remaining across all of these levers.
We will provide more color in our 2021 outlook and guidance during our Q4 earnings call early next year. And in closing, I would like to thank all of our employees of this segment for delivering excellent performance in the last few years and also persevering in 2020, while continuing to serve our essential customer operations in this time of need. And with that, let's move on to the Q and A.
Thank you, sir. I show our first question comes from the line of Jeff Sprague from Vertical Research. Please go ahead.
Thank you. Good morning, everyone.
Great presentation.
A couple of things. First, on the Car Wash opportunity,
dollars
2,000,000,000 potential served market, I know you're experiencing some nice growth there, but how do you accelerate that? And could you elaborate a little bit on maybe what kind of the service and aftermarket opportunity that gets generated by kind of the propagation of these more automated technologies?
Sure. I think Kevin can answer that question for you, Jeff. Go ahead, Kevin.
Sure. So as mentioned in the presentation, so we've got the fundamental economics and growth prospects that are going on that are driving some of the growth and the way that we accelerate that through our distribution channel. I mentioned that we're only offering a portion of the solution that goes into a site when they're building a new selection. So we're looking at expanding into some other parts of the solution that go into there. We have some things that are interesting that we'd add to our portfolio that allow us to participate bigger on a site by site basis.
And was there a second part of your question as well on the service and aftermarket piece? So from the aftermarket. So we've got a replacement cycle for anything you have this in roughly in a 10 year type of time frame. So with our installed base that we have, we do see a nice aftermarket business there. On the service side, we sell through distribution and that's largely done with our distribution partners.
That's the service that they provide on the ground with an in bay automatic, particularly C store as they're providing that service on hand. We support them through technical support and through the parts business, but they're performing the service business.
And then on EMV, if I could just get a second one in here. Just your view on how this tail plays out. I mean, I think as part of the punch line for you guys has been maybe you're biased towards some of the smaller players that maybe take longer. I guess that would be fully incorporated in the guide you gave us today. But looking at that kind of 70% plus complete, do we get to 100%?
Is the number 90%? How long do you think this actually spreads out?
Sure. This is David. I'll take that. We don't think it'll get to 100%. That's unlikely.
But I do believe it will get to 90% plus. We've looked at the implementation of ENV in Europe and then we looked at the years after the deadline. And really there was a multi year smooth curve as the installed base of EMV was built out. We looked at Canada, and they went through a similar thing when they deployed EMV. It was a multi year smooth curve as that demand was taken care of.
So we expect something similar in the U. S. We think it will be fairly steady over a number of years. If we're at 70% at the end of this year, there's probably 20% or 25% of the market left and that'll get spread across multiple years.
And I guess the biggest headwind should be 2020 based on that historical algorithm as we kind of just spread out the rest over time?
Yes, I think the wildcard is how much work did not get accomplished in 2020 because of coronavirus and other obstacles that could get pushed into 2021. So I think there's a lot of really unknown about how that will shape up. I think Rich's comment that 2020 was probably the peak year is correct. But 2021 could also be a fairly strong year as well.
Great. Thank you.
Thank you. I show our next question comes from the line of Steve Tusa from JPMorgan. Please go ahead.
Hey, good morning.
Hey, Steve.
Thanks for hosting another one of these, very helpful. Has COVID at all or anything in the last year kind of changed the way that your customers were thinking about kind of EV infrastructure investments?
I think from what we all see in the news, it appears that the EV investment is at the forefront of everyone's talking points. But in reality, we're not seeing a whole lot of market activity. I think the whole COVID situation will change people's thinking on how they want to touch customers and things like that. But I don't necessarily see an increase in capital being deployed towards EV charging.
Got it. Very helpful. And are there any investments that you guys need to undertake kind of out of the ordinary to reposition your product line for that or you kind of have capacity in technology?
Do you mean reposition for EV or
Yes, yes, yes, for any of these growth initiatives, I guess, going forward?
Yes. Well, I think right now our strategic partnerships with ChargePoint and ABB are working and we are participating in the investment that is taking place. As we mentioned in the deck, we are incorporating EV chargers into, for example, our POS systems in Europe and the way that we channel financial transactions from an EV charger through the point of sale and hosting those transactions. So we are doing that incremental work as we go, but it's not going to require like a seismic shift in the way we're investing our R and D dollars right now.
Right. Okay, great. Thanks a lot.
Thank you. I show our next question comes from the line of Andy Kaplowitz from Citigroup. Please go ahead.
Good morning, guys. Thanks for the presentation. You obviously gave a fair amount of color around opportunities in software and systems and your international businesses in 2021 that should help you offset EMV headwind. Can you give us a little more color regarding what your expectations are for China and overall international business in 2021 that's embedded in that 1% to 2% growth forecast? I mean, I see the little bar there, but maybe if you can give us a more color around expectations?
Sure. I'll touch on the software and solutions first and then touch on China. We're seeing, I'd say, fairly high growth in our solutions portfolio today. During the course of next year, we are launching that cloud solution with Microsoft starting in the Q1. So we should see almost a full year impact of that product launch.
In terms of China, I think we saw kind of a stable market environment this year, at the reduced levels after the double walled tank and piping initiative was complete. I think that we're just going to see some incremental gains in that market as we go 2021. But I don't think we'll see a shift back to prior year levels until the next regulatory wave of activity.
Great. And then maybe following up on that, I often get asked a question about sort of future regulations and you talked about sort of vapor recovery systems. So as you look over the next few years, obviously, EMV is the big one, but can you give us more color around future regulations in these emerging markets? We obviously have likely have a new administration coming in. So how that could impact overall fueling over the next couple of years?
Yes. I'll take a first shot at this and then Kevin, I'll turn it over to you for paper recovery. But there's a lot of regulations around security that are underway right now. Mexico has passed regulations that require the security around dispensers to get pushed to a whole new level. And the security is really around ensuring that if the dispenser says a liter of fuel was dispensed, that it was actually a liter of fuel that was dispensed.
So that's driving a lot of volume this year and it will into the quarter of next year. India is looking at something very similar. Brazil is looking at something very similar. So even just around dispenser security, which involves weights and measures, there's going to be waves of activity over the next, I would say, decade. And then on the environmental front, I'll let Kevin talk about that.
Yes, in much the same way. So as the technologies mature in one country and then the others are expanding their environmental regulations that we see the same thing. So vapor recovery, we see the potential with the station build out and some of the double wall piping and other opportunities within India and on the vapor recovery. So we see vapor recovery opportunities that are going on in Latin America right now. And then even in the U.
S, where we have our CARB approved novel, California Air Force Board approved nozzle. So in that case, the one that I mentioned in here, it's becoming the standard in one of the states and that could span to other states as well. So as the technology continues to improve, that can offset and help drive some of the regulations as we have the different technology that can achieve different levels of vapor recovery or some other environmental regulation standpoint. But we see that continued advance. It's not always able to see how that is coming down the road maybe 3 or 4 years out and it tends to come in waves as Dave said, but we are seeing in different parts of the world different elements that we've seen through different markets.
Appreciate it, guys.
Thank you. I show our next question comes from the line of John Inch from Gordon Haskett. Please go ahead.
Thanks. Good morning everyone. Good morning, Rich. And thanks, everyone, for putting this on. What is the mix of self serve versus full serve gas station pumps or outlets sort of U.
S. Around the world? I ask because your the dispenser upgrades are great and you can understand the trajectory. But if it's a full service station, which I think a lot of these stations overseas like in China, India are full serve, maybe I'm wrong with that, but you're not going to really need those kind of pumps, you're just going to need the bare bone stuff. So maybe you could talk a little bit to that and some of the trends?
Yes, sure. Just a few years ago, the developing markets that you mentioned, India, China, were almost completely full serve. And Brazil is very much the same way. You fast forward to today, they're starting to create additional self serve stations. And really it goes around the whole concept of having a convenience retail stop, where you have a scenario where people are going to get out, they're going to pump their own gas and then they're going to go the store and shop.
And then of course, in Europe, it's almost primarily self serve and the same in the US. And then it's kind of a mix in Latin America and the rest of like Southeast Asia. But I'd say the trend is away from full service sites to really fully leverage the convenience retail aspect of that real estate.
Does that I mean just out of curiosity, is that enough to quantify in terms of the trajectory of average expected growth or is it just is it sort of TBD at this point?
I don't think it's a monumental trend that's going to kind of change the mix of what we're selling today. I will say that even in the China market, we are selling a version of that Anthem product, even though it's a full service site where there's multimedia on the dispenser and various payment options as well. So it'll be interesting to see how that evolves over time.
Just as a follow-up, I didn't hear maybe you've said this, but I didn't hear what the recurring revenue is of the fueling solutions business. What actually is it today and where is it headed in terms of the mix?
So, the recurring part is actually quite a significant part of our revenue. Part of it is parts for dispensers. As you can imagine, there's a very healthy parts business. But also there's this subscription that falls within our solutions business. So a lot of what we're offering today are subscription services, and that's going to continue to grow over time as well.
So I would say that our recurring revenue is healthy today, and it's just going to grow over time.
Healthy as in like it's 10%, a third, like what's the percent of the mix, Just out of curiosity.
It's over
I mean, if you look at go back to the presentation and take a look at Slide 6, John. I think that you can derive right out of there.
Okay, great. Thanks, Rich. Appreciate it. Thanks, everyone.
Thanks. Thank you. Our next question comes from the line of Julian Mitchell from Barclays. Please go
ahead. Hi, good morning. Maybe a question on margins and the outlook there. I don't think that's been touched on yet in the Q and A. You talk on Slide 55 about that 300 bps improvement runway.
Maybe help us understand as you look ahead, what margin opportunities there are from integrating those previous acquisitions? Is there a lot left to do there still? How accretive perhaps could a mix shift in the business be to margins from things like the systems and software taking share versus everything else? Any color really on that, please?
Well, Julian, I mean, I think you touched on it. I mean, I don't want to go piece by piece here, but I think what's not understood well is in 2020, despite having a tailwind on EMV demand, I mean, we had a tough time on the underground business for obvious reasons, right. We already had announced the headwind that we had from the China double wall roll off and then we went a good portion of the year not being able to access sites. So construction activity around with our customers was significantly lower than we would have expected. So going into the future, you get the volume leverage and some amount of mix that comes back from the OPW business, which is accretive to the segment by the way of that bouncing back.
And then some of these growth initiatives that we have, we would expect over time that as software and services grows as a larger portion of the portfolio, the gross margins inherent in that business once you get to full fixed cost utilization are accretive. So it's a variety of things. I think that comment I would make is I think that a significant portion of the 500 basis points that was delivered was synergy savings of prior period acquisitions. And I think going forward, it's going to be much more reliant on business mix.
Great. Thank you. And then my second question maybe around that EV charging aspect. So on Slide 48, you talked about charge points and ABB, for example. Maybe help us understand what the scale of any kind of sales are from EV in the medium term that you're thinking?
And also regarding your partnerships with these 2, specifically any color you could give on the exclusivity, how differentiated these partnerships are for Dover?
I don't think that we can answer about the contractual relationship specifics without having our partners sitting here with us. And as David mentioned in the presentation, these are nascent opportunities. So, I don't think that it's overly material to either revenue or earnings in the forecast period that we've provided today.
Great. Thank you. Thanks.
Thank you. I show our next question comes from the line of Joe Ritchie from Goldman Sachs. Please go ahead.
Thanks. Good morning, everyone, and thanks again for all this material. It's great. Just maybe following on Julien's question there. I guess maybe just kind of broader question.
I know it's a nascent opportunity on the EV side, but Rich, like longer term, do you think you need to own the dispensers? Or can you go after this opportunity via the partnerships that you have in place today?
We do have a revenue opportunity that does not require us to own the dispenser. I'm not taking that off the table completely, but we believe that we can extract profit out of the EV pool without having our own dispenser. To evolve and one could imagine that the form factor that we have on our traditional dispenser is going to be highly attractive in terms of the synergy benefits that it brings to the retailer. So, I know that's a roundabout question and I think that we're going to preserve some optionality. But right now, we believe that we can derive profits out of EV into retail and there are multiple ways that we can participate in terms of Dispenser infrastructure.
Got it. Okay. That makes sense. I guess maybe just my one follow on, on the vehicle wash business. So you guys highlighted the opportunity in automated vehicle wash.
I'm just curious, do you have market data on how much automated watch is underpenetrated, like what the potential opportunity is there? And then I guess when you're again, I know that there's this labor arbitrage. When you think about payback, what's the kind of right payback for switching from manual to automated wash?
I think that the TAM that we have on page 10 is our best estimate of what the opportunity is today and I think that we referenced in the presentation that it goes to $2,000,000,000 over time. In term of the economics between manual and not manual, I don't know Kevin. I think that we've run the economics, but I wouldn't want to throw big numbers around. More importantly for us, we've run the economics with our customers of the profit pool potential for retailers to install vehicle wash as part of their complex and it is significant.
Okay, great. Thank you all.
Thanks.
Thank you. Our next question comes from the line of Andrew Alban from Bank of America. Please go ahead.
This is David Ridley Lane on for Andrew. On the software sales, how much of this is white space versus the displacement of a competitor?
You want to take a crack at that, David?
Yes. So we have a graduated graphic on one of the slides that shows the rate of adoption of these solutions. So I would say a large part are very early in the adoption cycle. So the incremental growth that we're seeing today is not necessarily taking business from a competitor, it's customers adopting that technology for the first time. As you move up that scale to point of sale systems in which we have a major role in EMEA, That is high adoption.
So those are scenarios where we're competing with someone else every day and we're either taking market share or maintaining market share in those cases. So it's really kind of a mix. But I think a lot of the growth will come from further adoption of new and evolving technology.
Sure. And as a quick follow-up, it sounds like the new cloud offering is going to be a big push for you. How concerned are your customers about security on the cloud? Is that perhaps an item that's a limited option? Sort of what's the customer readiness for cloud solution in this market?
Well, I think that's why it's important to have a strategic partner like Microsoft. If you look at a lot of the major oil companies, they also use Microsoft as a strategic partner. So that alleviates a lot of the security concerns from our large customers. And then of course that flows down to some of our medium and smaller customers as well. So I think security is of the utmost importance, but I think that we're really well positioned with our partnership with Microsoft to be able to address those concerns.
Thank you very much.
Thank you. Our last question comes from the line of Deane Dray from RBC Capital Markets. Please go ahead.
Thanks. Good morning. I wanted to go back to the recurring revenue model question. And I might have missed this, but do you offer underground tank monitoring as a service? You talk about subscription, but purely underground monitoring for leak detection?
So I'll take that one, Rich. So we offer the equipment that actually monitors the tank, but we do not offer tank monitoring as a service. But we have the enabling technology that other third party companies that do environmental monitoring, they use our equipment to meet those requirements. Is that an opportunity for you guys? It's an opportunity, but so far we have not gotten environmental monitoring.
I'm not sure if we will moving forward.
Okay. And then as a separate follow-up, on the wet stock management, that was a great customer testimonial and just the size of being able to recoup $500,000 but that was all on volume being shorted on deliveries. What about the ability to verify the fuel quality that the right octane was delivered to the right tank? I know there was one mention that you do offer fuel quality sensors, but just can you talk about that as an opportunity?
Yes, we do offer a fuel quality sensor. Then within Kevin's business also, they do a lot of security around making sure the right fuel goes in the right compartment on the truck itself, so that when it gets delivered, it can go into the correct tank. Mixing gasoline grades is an issue, but mixing diesel with gasoline is the large issue. And that is something that we are looking to address moving forward.
Got it. But you say when it goes on the truck, it's monitored. But what about the station owner that the truck is delivering the right octane, how is the fuel is the station owner able to verify?
Yes. So today, there's not a lot of, I'd say, low cost sensors that are available. So that's something that I think our whole industry is
the videos were very helpful and being able to see the product and see it all in action. So I know you guys put a lot of effort into that. We appreciate it.
Thanks. Thank you. That concludes our Q and A session period at Dover's Fueling Solutions Analyst and Investor Meeting. You may now disconnect your lines at this time and have a wonderful day.