Opening a gas station as a business

If you are seriously interested in retailing petroleum products, be prepared to pay close attention to the safety of staff, customers and the environment. Before opening a gas station, it is necessary to prepare documentation confirming that the newly created facility for storing and selling petroleum products complies with all federal and local regulatory requirements. This article talks about how to open a gas station in modern conditions and how to avoid mistakes that can ruin your entire start-up business and prevent you from opening a gas station as a legitimate and promising business.

Contents of the article:

• Which gas station to open?
• What do you need to open a gas station?
• Enterprise registration
• Formation of the material base
• Construction
• Doing Business

Which gas station to open?

A proper business plan for opening a gas station is a program that includes the main activities that an entrepreneur will carry out to open a gas station from scratch and turn it into a profitable business. The project will largely depend on what form the new enterprise is planned to take, what its main source of financing is and what strategic plan the founder intends to implement within the framework of this business. There are four main types of gas station business

• Gas stations with underground tanks (blocks);
• Modular filling stations (on ground tanks);
• Container filling stations;
• Mobile or mini gas stations.

The most expensive project is the construction and launch of block gas stations with underground tanks. How much does it cost to open such a gas station from scratch in modern conditions? On average, one block gas station costs approximately $600, 000 to build.

Mobile gas stations are the most budget-friendly option for a petroleum product trading business and can start at around $20, 000. These days, container filling stations are in great demand among business people. Unlike mini gas stations, this type of equipment for selling gasoline can provide a large volume of product sales due to the large container capacity; there is no need to build a capital structure, as happens when opening a block gas station.

What do you need to open a gas station?

After government oversight of the gas station business was significantly relaxed in 2020, it became somewhat easier for entrepreneurs to comply with all federal and municipal legislation. However, before starting to earn money from their gas stations, business owners must obtain several permits.

Enterprise registration

Work on establishing a gas station cannot begin until the company is registered. Entrepreneurs can choose the legal structure depending on the conditions under which they are starting their business. The law permits both legal entities and individuals to open gas stations. Whether to open a sole proprietorship or an LLC is up to the entrepreneur. Acceptable tax regimes:

• General (OSNO);
• Simplified (USN).

Regardless of the tax regime, companies operating gas stations must pay VAT. This VAT is included in the company registration application. Information on the type of business activity: Individuals or sole proprietors must indicate that their primary activity is the wholesale and retail sale of petroleum products. Building a Material Base

Formation of the material base

The seller of such equipment is obligated to provide the buyer with a package of technical documentation when

selling the gas station. The requirements are defined in the Technical Operation Rules for Gas Stations (hereinafter referred to as the Gas Station Rules). You can access this document on the legal system website at www. consultant. ru. Since a gas station’s function is tied to the use of land, it is necessary to obtain permission from local authorities to install gas appliances on a specific plot of land before purchasing equipment. An understanding of the conditions in which the gas station will be located is sufficient to begin searching for suitable equipment Construction construction of the base is one of the key components of a gas station project plan. Acquiring the project, construction and installation work, and the entire commissioning of the facility require significant financial investment. For example, if the equipment for a container fuel station costs approximately US$15, 000, then preparing the site for that station and meeting all TEI regulations will cost at least US$15, 000.

Construction

Fire station;

Clean electricity;

• Traffic police;
• Gas service.
• They must also obtain construction and planning assignments from the local town planning department. If construction is carried out without mandatory permission, the customer cannot operate the facility and begin official work. Entrepreneurs need to take note and contact local authorities for detailed clarification before editing a business plan, as each municipality has requirements for the establishment of gas stations in its territory.
• Doing Business

Due to the large initial investments that are required, business at gas stations cannot be called a quick return on investment. The average time to achieve net profit is about five years when opening a block gas station. If an entrepreneur looks at how to open a mini gas station, he can count on a shorter payback period. With an investment of up to $20, 000, the purchase of equipment and organization of a business process pays off in seven to eight months.

Doing Business

However, before opening a franchise gas station, entrepreneurs should study in detail the terms of the concession (franchise) agreement of the partner and the future partner. Fulfilling all the conditions of the franchise is a very expensive pleasure. According to experts, the implementation of a large project of one franchise can cost up to 1 million US dollars (including a lump-sum fee).

Whether gas stations are guaranteed to operate under the auspices of a well-known brand, the success of the entire project can be judged by the situation on the Russian petroleum products retail market. Obviously, the large chain will increase its presence, but at the same time, customers will be offered high quality service and excellent gasoline as more regional gas stations appear. Such developing franchises are potentially available to aspiring entrepreneurs and can help them achieve their planned economic results in a short time.

Opening a gas station as a business

Opening a gas station as a business