Communities have relied on gas stations for decades to supply transportation fuel and convenience goods to those on the go. But now that electric and hybrid cars are more popular, the question of whether gas stations are still lucrative emerges. Yes, but with a few restrictions.
The cost of investing in a gas station is one element that influences its profitability. Depending on the location and size of the station, the price can vary significantly. Investment in a gas station can cost anywhere between $250,000 and $3 million, according to industry estimates. This investment comprises buying the property, erecting the structure, and getting the required machinery. In locations with high land and construction prices, the price may even increase.
The number of independent gas stations in the US is another element that influences the profitability of gas stations. Over 122,000 convenience stores with gas stations exist in the US, and approximately 63% of them are operated by independent operators, according to the National Association of Convenience Stores. This indicates that there is a lot of market competition, which may have an impact on the profitability of specific stations. The owners of gas stations can still generate a respectable revenue in spite of the competition. Gas station owners can make anywhere between $40,000 and $100,000 annually, according to a Chron study. However, depending on the location and size of the station, this income can vary significantly. Owners of larger stations with car washes and convenience stores can earn considerably more.
Alternative business models should be taken into account by anyone interested in investing in a gas station. For those interested in owning a convenience store with a petrol station, 7-Eleven, for instance, offers franchise opportunities. Depending on the size and location of the store, 7-Eleven franchise owners can earn anywhere between $30,000 and $1.5 million annually, according to Franchise Direct.
In conclusion, gas stations can still be lucrative for their owners despite market rivalry and potentially hefty investment costs. Before making an investment in a gas station, it is crucial to conduct careful study and take other business models into account.
Gas stations can still be successful, but it depends on a number of different things, including location, competition, and pricing policy. In addition to selling gasoline and diesel fuel, gas stations often make money by operating convenience stores, car washes, and offering additional services like oil changes and auto repairs.