First off, it’s crucial to remember that gas stations don’t always make money from selling gasoline. In actuality, the profit margin on petrol sales is frequently very minimal, frequently just a few cents per gallon. The sale of a range of additional goods, such as food, beverages, cigarettes, and auto accessories, which have significantly larger profit margins, helps gas stations make up for this low margin.
Experts in the field estimate that the typical American gas station sells 5,000 gallons of fuel each day. Gas sales alone would bring in $500 per day in profit for the station if its profit margin on fuel is 10 cents per gallon. As previously stated, this represents a relatively modest portion of total profit.
Convenience stores that are connected to petrol stations typically generate $1,200 in daily sales. About $900 of that sum comes from non-gasoline sales, which also include the sale of snacks, beverages, cigarettes, and other goods. Therefore, if your gas station also houses a convenience store, you may anticipate monthly total revenues of roughly $27,600, with about $20,700 of those coming from non-gasoline items.
The size and location of your station, the pricing you decide to charge, and the quantity of goods you sell will all have an impact on your actual profits, which are, of course, averages. However, these figures can serve as a decent place to start if you’re seeking for a general idea of what to anticipate.
There are a few important measures you must follow if you want to start a gas station business. To start, you must find the money to buy or rent the necessary property and machinery. Additionally, you’ll need to get any required licenses and permits, which can change depending on where you are. The last step is to create a business plan that details your objectives, target audience, marketing plans, and financial estimates.
Along with petrol stations, other small retail establishments can be quite successful. Small retail stores with yearly revenues of less than $1 million typically have a profit margin of about 10%, according to industry statistics. So, if your retail business generates $500,000 in annual sales, you can anticipate making a profit of about $50,000.
Convenience stores that are connected to petrol stations typically draw 1,000 consumers per day. The quantity might, however, differ significantly based on the location and other elements. While less popular stores may only see a few hundred patrons per day, the largest convenience stores may see several thousand.
Last but not least, a convenience store’s typical markup varies based on the item. While cigarettes and other tobacco goods may have a markup of 20% or less, snacks and beverages often have a markup of roughly 50%. There may be markups of 100% or more on some other things, like phone chargers and auto accessories. Remember that these are merely averages, and your exact markup will vary depending on a number of variables.
In conclusion, gas stations can be quite successful, especially if they are connected to a convenience shop. However, a number of variables, such as location, pricing, and product volume, will affect actual profitability. If you’re considering opening a gas station, make sure to complete your homework and create a strong business strategy before starting.