The international oil and gas company ExxonMobil has been in business for more than a century. It is one of the biggest publicly traded firms in the world as of 2021, with a net income of more than $7 billion in just the first quarter. With Exxon’s enormous name in the oil and gas sector, many business owners are drawn to buying a franchise. But how much does owning one run you?
Exxon franchise ownership costs vary depending on a number of variables, including location, size, and market conditions. Entrepreneur claims that a franchise with Exxon costs between $500,000 and $1 million to start up. The franchise fee, supplies, advertising, and other startup expenditures are all covered by this sum. Franchisees must also have a net worth of at least $1 million and a minimum of $250,000 in liquid assets.
Additionally, a royalty fee of 6% of total sales and a marketing fee of 1% of gross sales are levied against Exxon franchise owners. While the marketing charge is used for advertising and promotional efforts, the royalty fee is utilized to support the usage of the Exxon brand name.
Exxon franchise ownership involves more than simply the initial outlay of cash, though. Franchisees must also take recurring costs like rent, utilities, labor, and inventory into account. To achieve profitability, it is critical to have a strong business plan and strong financial management abilities.
Moving on to related issues, the automotive industry is progressively transitioning to electric vehicles because of concerns about climate change. President Joe Biden issued an executive order in January 2021 to electrify the federal government’s fleet of vehicles and to put in place measures to phase out gas-powered vehicles by the year 2035. As a result, after 2035, gas-powered automobiles won’t be produced or sold in the US.
The switch to electric vehicles will surely have an effect on gas stations’ business. Many gas stations, though, are already looking for strategies to adjust to the shifting market. While some are investing in alternative fuels like hydrogen, others are renovating their stations with electric charging stations.
Finally, it is difficult to anticipate gas prices in 2035. Gas prices can be impacted by a variety of factors, including supply and demand, geopolitical unrest, and technical improvements. Gas prices, however, are probably going to increase in volatility and unpredictability as more people switch to electric cars and alternate fuels.
In conclusion, having an Exxon franchise demands a substantial financial commitment, but with careful planning and management, it may be a successful business enterprise. Gas stations are expected to adjust to the changing market as more people switch to electric vehicles in order to remain competitive. Only time will tell what the future holds for gas prices.