How to Start a Gas Station

@Emeka Akpatulu, It is better that you prepare a business plan for your business. It is not wise to produce a sample business plan to your banker for loan. Most likely you will not get the loan. There are tons of existing gas stations are selling already. If you are interested to buy then go to www.bizbuysell.com

@Sangs, it is a tough job. He should have done the survey before opening this filling stations. btw, here are my suggestions.
1. invest more money and have some regular diesel so that people who come into the station might convert to other type by error, by choice, by surprise to see what is this new one.
2. Open some other services next to the filling station, like restaurants, auto repair, tyre repair, small grocery shop, etc. People stopping by might convert as well. Try some indirect ways to make the vehicle stop by and then convert few from there.
3. Sell it and try something else.
Good Luck...

@george, A gas station in Texas, US can cost you at least 100,000 USD and the upper limit can be anything. An average C-store and the gas station will cost you around $3/400,000. Things to consider will be location, other restaurant franchises like subway, ice cream parlor, car wash, etc.. All these can add to your investment and it can go up to 1 Million or more..

@mudzrafaea: at the outset, it bears stressing that in any business endeavor, one has to inject a substantial amount of capital in order to gain a competitive foothold. in your case, you will really have to start securing your premises to ensure that no property dispute shall haunt you in the future.... you may buy the 1/2 portion from your family member (relative) with staggered payment scheme if he/she approves of it. otherwise, you may apply the same through loan financing with a bank... the downside though is that bank would charge you hefty interest... so, the best thing is to buy the 1/2 with a one (1) year payment scheme by dividing the full purchase price into 12 monthly installment basis. since a filling station is already identified in the area, it is best to pursue such line of business... people would readily recognize your brand as there was already a trailblazer. any and all other business features you interject, the likes of A.T.M., service station, mini-mart and others would give your business activity a diversification that is geared to maximise the position of your business in relations to the development of the area as residential and/or commercial junction. it is not uncommon knowledge that your gains in fuel sales would be peged at cents per litter as it is a supply-demand circumstance. the important thing is that you could protect your inventory and optimise control and security of your assets. good luck, johnsarciasalvadora@yahoo.com

@Kennedy Shamakamba. the bank will only entertain you if you could provide them with an impressive business plan. so you need to have one. But first you need to decide on whether you would want to have your very own service/filling station which carries your own logo or would you want to enter into franchise/dealership with branded companies the likes of Shell, Chevron or BP. Either way, you need to register your business name, example: Shamakamba Fuels. then you can submit proposal or apply for dealership/franchise with the companies that you wish to operate with. Otherwise, you can have your very own company and scout for fuel suppliers who could give you the best deal. Having established your business plan, you now can go to the bank to apply for a credit facility or loans with which to get you going. you would have your business assets as collateral. im sure than bank would make you execute loan agreement and require you to submit pertinent personal and business papers the likes of birth certificate, identification cards, business registration, business permit and others. good luck.

Solaman. I'm sorry but i cannot exactly help you on the COST issue as i am not from UK. I'm from Philippines. A good basic thing you could do is to pay a visit to the nearest service station near your home and engage the manager or owner in a cordial business interview. relay to him/her your interest and he/she may give you pertinent financial details. Good luck.

ZAMO (zmahlanze@yahoo.com) Dear Zamo, Hello there. I learned that Kwazulu Natal is South Africa's garden province. Sounds interesting. Well, about the filling station (we call it service station in the Philippines) which you plan to put up. First things first, do you plan to franchise a branded product the likes of Shell, Chevron (Caltex), BP or others? Or you would want to put up your own generic station? IF BRANDED: You would need to enter into a Franchise Agreement or Dealership Contract with whatever brand/company that is existing/operating in South Africa. Do you have Shell, Chevron or BP there? But before they entertain you, you must put up and register you business name, example: ZAMO FUEL ENTERPRISE. You have to register your business with the business registration department of your district/hometown. This is because multinational corporations the likes of Shell, Chevron or BP only enters into contract with legitimate business entity, either as sole proprietorship or corporation. In your case, you are a sole proprietorship business. The thing with being a franchisee, you will be required to have your own parcel of land where to build your filling station which shall be constructed under compliance with their brand image and design. You would also be required to put up a bond for the fuels which shall be supplied to you. Your earnings would be per cents litter, so you cannot expect to earn so much. Hence, you have to diversify your services by having a food court, convenience store, repair service and other commercial undertaking like selling of clothes, shoes, cellphone or other stuffs but be sure that you have a separate section for this in your station. So plan your construction well. Be very careful with your design and how you would construct in your land. Part of your franchise fee to the company will cover the underground fuel tanks, fuel dispensers, pos machines and other equipment. The products you would sell in the convenience store and food court would be yours alone. So you have to find for suppliers. IF GENERIC (NOT BRANDED/YOUR OWN RESELLER): You would need still to register a business name like ZAMO SERVICE STATION with the business registration department of your local government of your hometown or province. You can use your own design in constructing the service/filling station using your own color/paint and logo. Usually, service/filing stations should use attractive colors like yellow, red, orange, blue or green. You will need to find and buy your own underground fuel tanks, fuel dispensers, pos and other equipment like computer and other pertinent technology on your own. I suggest that you scout for them in South Africa through dealers. I know that China-made fuel underground storage tanks and dispensers are cheaper. Find out if there are any of them in your area. Otherwise, you will have to put up with whatever you find in South Africa or nearby countries. As to the convenience store, food court and department store where you can sell clothes and other items, you may search for suppliers within South Africa or from other countries, depending on your choice. In all these, you need substantial amount of capital with which to start up. Your local bank can help you with your finances through loans, but be aware of hefty interest and penalty charges. I suggest that you invite your family and trusted friends to invest with you so that you can have a pool of investors. In all your business undertakings, be always mindful of the way you spend your money. Be thrifty and economical in your expenses. Be practical with your assets. Good luck. Truly yours, John S. Salvadora, Manila, Philippines johnsarciasalvadora@yahoo.com

@Elly Towo, Send me the pertinent information like, the specific location (address) where you are going to put up the business; the available capital that you have (if any) that would be supplemented by the bank; the available materials/equipment that you have (if any).Send me also the name and address of the bank. You can send it to my e-mail address: johnsarciasalvadora@yahoo.com, i will help you draft the business plan for the bank loan process. John

Hi there, Muhammad. im not familiar with the business registration protocol of toronto, canada, as i am from the philippines. but it is a universal legal compliance that before you set up any business outfit, you have to secure yourself with a strategic location for your business. in your case, i suggest that you seek somewhere volume of vehicles passes daily. make sure that the same is not adjacent to residential houses for safety and security reasons. Having done that, you need to go to the business registration department of your local government to secure pertinent documentations. you would need to pay for it, i'm sure. you will have to register a business name for your station. otherwise, you can patch up with a establish fuel business for franchising. this can be ironed by their business development officer and/or operations officer. you will need substantial capital for the franchise fees. not to mention the costs of underground tanks, fuel pumps/dispensers, computer and point of sale cash register, among others. The legal preliminary also includes environmental compliance. so the city environment department would conduct inspection and other pertinent preliminaries before you would be given a license to operate.

@naim, it is tough but with little research your business can be profitable. If you know a place that is going to be popular in a year or two then plan about starting a gas station there. Similar thoughts can really earn you more money.

@Lulama, you can prepare a business plan to approach investors, lending companies. You can also seek help from friends and relatives but the amount will be very limited from these resources.

Rohan, thanx a lot... good luck on all your endeavors.

Rohan, i'm also working as Documentation Specialist/Consultant with CCI, one of the marketing arm of Chevron Philippines that market Caltex brand. i wrote their company handbook and HESS (Health, Environment, Safety and Security) Culture.

@Timar. you're more than welcome. i am more than pleased to share my ideas, no matter how small, to those people i have common interest. good luck on all your endeavors. make it happen. believe in your self. all the luck, john

@Rishabh. If you have substantial amount of money and you want to have a commanding "customer recall" i suggest that you go into franchising. big companies the likes of Chevron, BP or Shell would provide you with marketing strategy with which to undertake the business. plus, they shall supervise the construction of the station, installation of underground storage tanks, pos and other pertinent equipment that are incidental to your business. you are also more assured of a steady supply of fuel, depending on your credit limit or bond. Franchising is almost always advisable to startups. However, in due time that you get to establish your self and somehow master the ins and outs of fuel retailing service, you may terminate the franchise agreement and go on with your own. you may now have your own brand/business name and outsource for fuel supplies elsewhere who may offer bigger returns.

Guys in South Africa who would like to set up fuel service station or needed technical expertise, contact Mr. Rohan Kidson at Progresus Project & Safety Management. he has already spent years in Chevron (that markets the Caltex brand). i can assure you that this guy is one of the best in the fuel service business. i can assure you that anybody who have worked for Chevron can deliver a good job. i know... i worked for a marketing firm that operates five (5) Chevron (Caltex) station here in the Philippines. they're darn professionals. they're the marines of fuel industry. good luck guys. bring it on...

@Rishabh. First, you need to register a business name, example Rishabh Enterprise, with the Business registration department of the city in florida you are residing in. you will of course pay certain amount for the processes. when they finally approve your registration, they will conduct inspection of the site for administrative compliance. you need to contact the marketing department of whatever fuel brand that you want to market, example is Chevron or BP, that is available in Florida or near your location. they will discuss with you their franchise terms and conditions. you must be prepared to pay the bond and other processing fees vis-a-vis submit pertinent personal and business documents for security transaction. They will then provide you all the necessary details on how to construct and set up your service station. good luck

@WILLIAM OFENTSE. Pls contact Mr. Rohan Kidson at Progresus Project & Safety Management. He can provide you with assistance that you'd be needing.

@Chumani,i suggest that you contact Mr. Rohan Kidson of Progresus Project & Safety Management at "www.progresuspsm.co.za".

@Kumar, CNG filling stations are allotted by CITI GAS Companies which have rights to do business in a fixed territory. In delhi NCR it is Indraprasth Gas Ltd (a JV of GAIL and Govt Of Delhi) Similarly a number of JVs of IOC, BPC, HPC, Gail are operating.

@Surinder Pal Singh, In India Government Oil Marketing companies viz. Indian Oil Co. Ltd. (IOCL), Hindustan Petroleum Co. Ltd. (HPCL), Bharat Petroleum Co. Ltd. (BPCL), and private sector companies Essaar Oil, Relinace are alloting Gas Stations on franchisee basis. One should have a suitable plot of land (45m front X 45 m depth on Highway, 35m X 35m in Cities), apart from land one should have about Rs 50,00,000 (Rs Fifty Lakh/Rs 5 million)in ready cash. Reliance is not allotting Gas Stations at present, You can apply to Essar directly with land details. For Govt oil Co. Viz IOCL, HPCL, BPCL you should apply against news paper advertisements.

@Docter. I suggest that you go to the business registration department of your city hall or provincial government. You should bring along with you your pertinent personal identification documents like birth certificate, baptismal certificate, school ID or other ID that you have. You would be required to pay certain amount for the processing of course. They may even ask for the title of your property where the business would be set up. the business registration officer would guide you with the filling up of the business registration form and how the same would be processed with the concerned offices. and hey, they will also ask for a 2x2 colored photo of you for profiles. Good luck.

@Docter. Upon obtaining a business registration you may contact the business development officer of any branded fuel company the likes of BP, Shell or Chevron (Caltex). inquire about the possibility of entering into a Franchise Agreement with them. If you are granted the franchise, it will be the responsibility of the oil company to provide you with the underground storage tanks, fuel dispensers, pos and other equipments. on your part, you would be required to provide the location where the station would be constructed (according to the brand design and style of the oil company). you would need to post a bond certain in amount to answer for the fuels that shall be delivered to you.

@GONEL ULYSEE. Good day. A junction or crossroad intersection is always the best location when planning to put up fuel/service station, mini-market, burger joint or other commercial establishment, to that effect, because it is frequented by traffic and people on the go. You are bombarded with options and you seem to want to engage in a diversified business endeavor. While it is impressive that you want to do it all, i hereby humbly suggest that you take it one at a time. You may have a substantial capital with which to bank roll your business but with so much divided attention and interests, you may lose your focus and end up mismanaging your business. I suggest that you commence your endeavor by securing the title/ownership of the parcel of land. After which, you register a business name (example, GONEL PETROLEUM INC.) with the business registration of your city or municipal government which has jurisdiction over your place of business. Then you contact the franchise manager or operations manager of Chevron, Shell, BP or whatever branded (international/local) petroleum company available in your country. They shall discuss with you the pertinent details about their corporate business style and the terms and conditions of their franchise agreement. They would require bond with which to secure the fuel supplies they shall deliver to you, over and above the cost of the construction of the fuel station itself which they shall supervise on the premise considering that you have to follow their brand/corporate style. If you need bank loan, then the bank would require either collaterals or you could chattel your business with the bank as security transaction for whatever amount of loan that they may approve for you. Good Luck. John S. Salvadora of Las Pinas, Philippines.

@JESS LEE, Sales quota is the matrix that makes branded/international petroleum company get to survive the highly competitive market. They tend to pass this to their franchisee. The thing about a service station is that it is dependent on the traffic. If you have many competitors along the vicinity, you would normally share the market with them. I therefore suggest that you expand your marketing strategy by going around your city or adjacent cities to scout for on-going construction projects as and offer them supply and delivery of fuel. Construction projects needs a lot of fuel for their delivery trucks, generators and service vehicles. The pricing of which would be higher because you are going to have it delivered to them. For this though, you would need several barrels with which to deliver the fuel. You need to have a drop side truck as well.

You cannot just simply dump your franchise, lest you would be fined for unilateral rescission of contract. Going generic on fuel can be a bit tricky as you have to source fuel from different supplier whose fuel products may not be similarly produced or may have used different additives. Anyway, you can have separate dispensers for them. Good luck. JOHN S. SALVADORA johnsarciasalvadora@yahoo.com

@ZHERNA, Bonds may vary from 10 million to 30 million, depending on the projected sale and/or fuel requirement of your service station. This is exclusive of the initial investment which could peak to 50 million (if you need to buy/rent a parcel of land) for a sizable service station or at mere 10 million (if you own the land) and the service station you want to put up is lesser than 200 square meters. You need to appreciate that branded petroleum companies (Shell, Chevron, Petron) have strict branding protocols. They'll be the one to construct the station, through their certified/accredited construction firm because it has to suit the design of the company. The underground fuel tanks, dispensers, pos and other system are not cheap as they are of the highest standards. Good luck, JOHN S. SALVADORA

@Astraf. It is interesting to note that indeed, Singapore has a small and precious land area. However, this shouldn't be a problem in establishing a service station. to maximize space, you can have your underground fuel tank (ugt) for gasoline (e-10/e-15) and diesel (leaded/unleaded) installed close together and have your fuel dispenser machine installed beneath the ground as well wherein the fuel pump hose could be designed to be attached to the canopy. the floor area therefore is open for traffic wherein your attendants can pull down the nozzle when filing a vehicle.

@Reynaldo V. Diaz, before you even try to come up with a Business Plan, you should first have a Feasibility Study. Feasibility study would enable you to determine the viability of the filling station which you want to put up. It the feasibility study points to a positive direction, the you can prepare your business plan by incorporating salient features of your feasibility study into it. this is all a matter of marketing. You have to determine first the soundness of your market and ascertain your capacity.

@Reynaldo V. Diaz. For the format of the Feasibility Study, you can follows this:

EXECUTIVE SUMMARY
INDUSTRY DESCRIPTION
THE PROJECT
THE SIRE
COMMUNITY PROFILE AND BUSINESS CLIMATE
TRANSPORTATION AND ATTRACTION IN THE AREA
MARKETING STRATEGY
FINANCIAL ASPECT
FINDINGS AND RECOMMENDATIONS

@vevs. underground fuel tanks (UGT), pumps (with dispensers and other equipment are usually provided by companies the likes of Shell, Petron, Caltex, PTT, Seaoil, Total and other branded petroleum companies. You are however required to enter into a franchise agreement with a bond of at least 20-50 million pesos which covers the construction of the service station which could cost you an initial investment of 50 million pesos.

@Chandrashekhar, you can get a general idea on Shell India gas stations from here. You can also contact the company from their website. Funds required to start a gas station will depend on location and type of agreement you do for the land acquisition.

Syed, you need to prepare a feasibility study first and possibly a business plan for your business. this will help you assess the viability of your planned endeavor and the location where you would have it built. I suggest that you go to your city business registration and register a business/trade name for yourself. they usually have business name registration form which they would ask you to fill up and you also have to submit personal documents like valid identification card or residence certificate. Then you need to get environmental clearance from the city engineering's office in order that they will give you the building permit so that you can have your contractor build the gas station for you.

If you plan to franchise branded petroleum products the likes of BP, Shell or Chevron (Caltex), i suggest that you contact their franchise department or marketing department to obtain information in executing Franchise Agreement. But if you want to have a generic gas station, you need to source out petroleum traders/suppliers near your place. Good Luck.

@LYNA. At age 60, i would say that it is no longer physically tenable for you to personally take the helm of establishing and managing a petrol/service station. I therefore suggest that you task your son to undertake the operations of the business whereas you can settle yourself with the treasury/finance management. First thing first, your son needs to go to the Office of Business Registration/Licensing of your City Government in order to register a business name and obtain license. There would be paperworks to attend to and payment of certain processing fees. If you intend to franchise branded products like BP, Shell, Caltex (Chevron), then your son needs to make representation with the marketing/franchising department of either of the foregoing petroleum companies and enter into a Franchise Agreement. Details of which shall be discussed thoroughly by the petroleum company's representative. IT shall touch on the amount of bond and the cost for the construction of the service station, the underground fuel tanks (ugt), dispensers, pos and other equipment/materials. But if you choose to run a generic petrol station, then your son needs to scout or outsource fuel products from importers/traders within your area. Stress in establishing any business undertaking comes not in the various activities associated thereto but more on the absence or dearth of pragmatic information. When you have establish the petrol station, the only pressing need is to make sure that you meet your quota sale per litter every month as what the petroleum company would stipulate in the Franchise Agreement. In all fours, it is important that you have a feasibility study and business plan for the foregoing. Good luck Madam.

@Raymond Mokotedi. Franchise Agreement shall not be made readily available to you by petroleum companies, specially international brands the likes of BP, Shell, Chevron and Union. First, you need to make a letter of intent to their marketing/franchising manager expressing your desire to put up a service station. You will be required to submit pertinent business permits and other personal documentations such as bank accounts certificates for assessment. It is only then that they will entertain you as you will be asked to visit their office personally for a business meeting to discuss relevant matters. Good luck.