What to Know Before Purchasing a Gas Station for Sale
Gas stations are profitable investment options to consider since they are recession-proof and are always necessary irrespective of the economy. As someone seeking to diversify their portfolio, gas stations for sale are great triple net investments.
Some factors to consider when purchasing a gas station include lease length, location, and business type. There are several ways to benefit from a gas station if you want to buy and manage one.
Here is what you should know about utilizing a gas station business opportunity and vital factors to consider when purchasing a gas station.
Pros of Gas Station for Sale
Gas station values usually increase as the gas market grows, and owners can make more profit by selling gas at higher rates
This policy is perfect for investors seeking to earn returns on their investments.
Before heading out to find gas stations for sale, it is vital to familiarize yourself with the pros of owning a gas station. Now, you can know whether or not a gas station for lease is right for you.
● Several Selling Options
One major benefit of buying a gas station is you have the opportunity to sell more items other than fuel to your community. Many gas stations have convenience stores where they sell snacks, souvenirs, and beverages.
Some gas stations have a repair shop, providing mechanical services to drivers when they need them while traveling. If you purchase a gas station without these add-ons, you can add a repair shop to the gas station in the future with the proper building permit.
● Gas Stations Sell Recession-proof Products
A gas station sells products always in demand since people need to go to work and take their children to school and after-school activities. Furthermore, since transportation is essential, there is still a demand for fuel even during the recession.
Although some people travel through public transportation, others depend on private vehicles for transport. There is always a need for gas stations as long as we keep driving around.
● Gas Stations Don’t Require Skilled Labor
Except you add a repair shop to the gas station, other available employment opportunities do not need skilled labor. This benefit helps you keep labor costs down since you can hire an entry-level position for all roles, including management.
Also, you can run a gas station as an absentee owner if you find a good general manager to handle the daily operations.
● You Can Work With Established Brands
Due to available franchising agreements in the industry, a gas station in an average community is typically operating under a famous brand name.
Also, companies like Shell and 7-eleven help create business opportunities by working with local providers to provide jobs and profits due to consumers’ recognition of their brand. Furthermore, becoming a franchisee is an easy way to become a gas station owner.
● Insurance Against Environmental Problems
Operating a gas station under a franchise agreement gives you insurance and protection against potential environmental problems on the site.
The franchisor is responsible for correcting any issue found in your gas station during the inspection. Also, the parent company is accountable for equipment leaks and tank upgrades, which are necessary expenses for your gas operation.
What to Know Before Purchasing a Gas Station
Performing research on a property will not guarantee the gas station’s financial success. However, it can prevent you from acquiring the wrong property.
Some critical questions to ask before acquiring a gas station include:
1. Are There Tank and Pump Issues?
During the routine environmental assessment, you should review the tanks. Also, ask the seller about the pumps’ condition and inspect the station’s overall equipment.
Are the pumps and other equipment reasonably modern? Are they in good shape? Old and unattractive pumps will affect your station’s outlook and overall sales.
2. Is the Gas Station Franchised or Unbranded?
There are benefits and disadvantages to buying a franchised or unbranded gas station.
Buying a franchised gas station means you get to use all the designs and branding from the franchisor, earning you instant market recognition.
Also, franchised gas station owners must purchase all their products and fuel from the franchisor and abide by its restrictions.
On the other hand, unbranded gas station owners do not follow the same regulations as the franchised owners, giving them more freedom and options. Nevertheless, they cannot benefit from the brand’s recognition and support system.
3. What Are the Local Demographics?
Since fuel sales are sensitive to demographics and competition, ask the current gas station owner and perform due diligence about the local market and competition.
Examine the area from a customer’s vantage point. Are the gas stations modern, convenient, and pleasant? What are the fuel options? Is the gas station a good investment option?
Also, consider the demographics. Who are the gas station’s customers? What product do they buy most? Are they commuters or local patrons? Answering these questions will help determine what to expect after purchasing the station.
4. Are Sales Diversified?
Fuel sales can be difficult to manage due to their volatile nature. Many stations have additional sources of revenue from car washes, convenience stores, auto maintenance shops, or quick lube centers.
Some experts recommend that it’s best for gas stations to have diversified streams of revenues. So, find out if the gas station is doing something to resonate with this line of thought.
5. Are There Any Environmental Problems?
Severe environmental issues can affect a gas station’s success. Thus, it is essential to perform an accurate ecological assessment of the entire site.
6. Has There Been Any Criminal Activity at the Gas Station?
Some gas stations experience crimes like simple credit card fraud or armed robbery. You must know about these issues beforehand to avoid future problems.
Hence, ask the seller about financial fraud and related crimes within the vicinity. That said, you can also seek insight from local regulatory bodies about criminal acts particular to that station.
As a new investor, you may be asking, “where can I find a gas station for sale near me?” Finding a gas station for sale can prove challenging, with numerous alternatives on display.
A gas station is a good NNN investment as these structures are recession-proof, have low maintenance costs, and are easy to manage. Here is an easy way to connect with brands selling a gas station with less risk and more reward.