In general there are three main ways to become a gas station owner, namely by buying into an existing station franchise, buying a business that is up for sale, or starting from the ground up to build and operate your own station. Certain options may be more viable in certain circumstances than others, and of course a lot also depends on your situation and preferences. All options have both benefits and setbacks. No matter how you get started, though, you’ll almost certainly need some form of investment capital. Operating a gas station can be very profitable, but it often takes a lot of time to start making money, and the cost outlays at the beginning can be significant.
Join a Franchise
One of the quickest ways to become a gas station owner is to join a gas station franchise. This means that you pay an existing company or corporation a fee in order to start a business using their company name and business model. A franchise business has many benefits, including working under a well-known entity and having access to a proven business model that has been successful in the past. You will also likely have some help higher up in the parent company because the owners will want your business to do well, primarily if you are required to pay them a cut of your profits.
These benefits aren’t without their downsides, though. Depending on the franchise agreement, your costs might be very high, particularly when it comes to what you must pay back to the parent company. It can be hard to make a lot of money under this scheme, and the rules and regulations when it comes to things like expanding or offering different services can be restrictive.
There are generally rules set by the parent company dictating how many of their stores can operate within a certain location, but in general they choose the placement of your station — and it might not always be favorable. Another issue may arise if something negative happens with another franchise, especially if it gets a lot of press. Since your store will share the name and logo of the offending business, your sales may suffer as a result even if you had no part in the matter.
Buy an Existing Business
Buying an existing business is another way to become a gas station owner. This generally requires making a bid or offer on the business. The sum will be paid to the current owner, at which time you will take over operation of the company. There are a number of benefits to doing this, including having a business that is already established and possibly successful. Just make sure you research to find out the profitability of the company, expenses, taxes, and other information before you make a purchase.
Downsides to buying someone else’s business include keeping customers who may have had a good relationship with the previous owner and are not happy to see a change. You may also run into issues if the former owner did not keep accurate records, had debts with suppliers or creditors, or failed to mention other heavy expenses. If you complete a thorough investigation before you buy and get a few opinions on why the sale is happening, you’re less likely to be surprised with finances or otherwise once your investment is locked in.
Start From Scratch
You can also become a gas station owner by starting your own business from scratch. The main benefit of owning your own independent business is that you do not have to answer to anyone else and you make all operating decisions yourself. This is usually the hardest method at the outset, but does tend to give you the most flexibility and control. It will likely require a large initial investment as well as the procurement of licenses to both own a business and sell gasoline. You will typically also need to find suppliers for goods and services.
The primary downside to starting a new business is that you will have to do more work to market and advertise than if you owned a franchise or existing station. This can require a lot of time and effort aside from the actual running of operations. You will be competing with big-name companies and franchises as well, and may have trouble getting a foothold in the market, at least at first.
Investment and Starting Capital
All three options will require an investment. You will likely need to take out a business loan in order to make the purchase. Other things to take care of include obtaining the proper licensing, hiring employees if needed, developing rapport with suppliers, marketing yourself, and hiring an accountant or learning to independently balance your books and handle any tax obligations.