To open a petrol station, the applicant must be able to invest a minimum of Rs. 25 lakhs in standard gas stations and Rs. 12 lakhs in rural petrol stations.
Is it profitable to open a gas station?
In India, opening a petrol station is a high-risk venture. Still, it’s a lucrative business, with fuel station owners earning roughly 3.5 lakhs per month if they sell 400000 gallons of gasoline at a commission rate of 3.0/litre.
What is the best way for me to start my own gas station?
Not only in India, but around the world, the petrol pump business has traditionally been regarded as one of the most profitable. This is largely due to the transportation and logistics sector’s ever-increasing growth and resulting demands. Another obvious cause is the rising demands of the average person’s daily commute. Furthermore, in today’s world, owning a vehicle is nearly a need for a middle-class individual to secure his comfort and convenience in day-to-day living.
As a result, starting your own fuel pump business is a viable alternative in today’s world. Despite the fact that it entails a significant amount of legal duties and paperwork, it is one of India’s most profitable enterprises. Furthermore, Oil Marketing Companies (OMCs) want to create more feasible prospects in order to support the growth of the petrol pump sector in India in 2020-2021.
The following is the procedure and formalities for opening a petrol pump business in India:
In Bangladesh, how many petrol stations are there?
The petroleum industry is regarded as one of the most vulnerable sectors of the economy. The price of petroleum products has a significant impact on macroeconomic indicators. Bangladesh’s oil and petroleum industry is largely under government control. By presidential Ordinance in 1976, the government founded Bangladesh Petroleum Corporation (BPC) with the goal of distributing petroleum goods to all consumers at the same price, regardless of transportation costs. BPC’s businesses include three oil marketing firms, two blending factories, one LPG bottling company, and a refinery.
According to the Bangladesh Petroleum Act of 1974, the government of Bangladesh is solely responsible for the production, processing, refining, and marketing of petroleum products in the country. The Petroleum Act also defines BPC’s authorities, functions, and responsibilities, which include the establishment of plants and infrastructure, the construction of necessary facilities and extensions for the marketing of petroleum products, the monitoring of BPC’s subsidiary companies, and any other functions and responsibilities as directed by the government. The presence of more than 50 market players, as well as brands marketed by three state-owned oil marketing firms, has created intense rivalry in the lubricant sector. Three oil marketing corporations are responsible for the marketing of petroleum products:
- Padma Oil Company Limited is a private company based in India (POCL)
- Jamuna Oil Company Limited is a company based in Jamuna, India (JOCL)
- Meghna Petroleum Ltd is a company based in Meghna, India (MPL).
Currently, the three oil marketing organizations supply just around 30% of the market demand for lubricant products. It’s worth noting that BPC doesn’t have any price control over the lubricant’s products. The government determines the pricing structure at the ex-refinery, depot, and consumer levels over various distances. The government also sets the commission at each level of providers, such as oil marketing corporations, agents, and dealers. The government of Bangladesh imports crude oil and refined oil as needed, then refines the crude oil at Eastern Refinery Ltd. (ERL), another BPC subsidiary, and distributes it through its oil marketing businesses. A particular agreement exists between the three oil marketing businesses and a few direct clients. Some government agencies (PDB, Bangladesh Railway, and Defence Service), autonomous bodies (Chattogram Port Authority, BIWTA, Bangladesh Ordnance Factory), and nationalized companies are among the direct customer groups. Oil marketing businesses advertise oil products, and the revenue they generate is known as ‘Margin,’ which is set and controlled by the government. Sales net of cost of goods sold (net earnings from petroleum products) are shown as net revenue rather than gross revenue in the financial statements.
The country’s current yearly demand for petroleum products is at 3,300,000 tons. The country’s total petroleum product storage capacity is 12,00,336 MTs, with Eastern Refinery Ltd having a capacity of 5,04,560 MT. The storage capacity of the main installations of three BPC oil-marketing businesses is (Padma Oil Company Ltd-2,54,248 MTs, Jamuna Oil Company Ltd-1,84,794 MTs, Meghna Petroleum Ltd-2,15,275 MTs).
Oil firms have oil depots in Godenail, Fatullah, Daulatpur, Bhairab, Chandpur, Baghabari, Balashi, Chilmari, Ashuganj, Rangpur, Dhaka, Barisal, Jhalokati, Sreemangal, Sylhet, Parbatipur, Rajshahi, Natore, and Harian, in addition to Chattogram (Rajshahi).
82 percent of petroleum products are delivered by river (coastal tanker), 6% by rail (tank wagon or box wagon), 10% by road (tank lorry/truck), and 2% by other local ways from Chattogram (boat, push cart or van etc).
From Chattogram to Godenail, Fatullah, Daulatpur, Barisal, Jhalokati, Chandpur, Ashuganj, and Bhairab depots, 72 coastal tankers (850-1200 tons capacity each) deliver petroleum products. The transportation of products from Godenail or Fatullah to Baghabari, Chilmari, Balashi, and Chandpur depots is handled by 33 shallow draft tankers (each with a capacity of 400-450 tons).
Around 1,000 railway tank wagons are in service (meter gauge and broad gauge). Products are shipped by meter gauge railway from Chattogram to oil depots at Sylhet, Sreemangal, Rangpur, and Dhaka. Products are shipped by train from Daulatpur to Natore, Parbatipur, Harian, and Rajshahi depots through broad gauge railway.
In the country, three oil-marketing corporations have designated 759 filling stations, 37 consumer pumps, 1,480 agents/distributors, 1273 LPG (LIQUEFIED PETROLEUM GAS) dealers, and 305 Packed Point Dealers for retail selling. The delivery of petroleum products from oil company depots to selling points is handled by over 6,000 tank Lorries operated by dealers and distributors.
Which gasoline company is the best?
The Top 6 High-Quality Petrol Pump Brands in India
- Indian Oil Corporation Limited is a public company based in India (IOCL)
- Bharat Petroleum Corporation Limited is a public limited company based in India (BPCL)
- Hindustan Petroleum Corporation Limited is a public limited company based in India (HPCL)
- Reliance Industries Ltd. is a company based in India (RIL)
- Shell India Private Limited is a private company based in India (Shell)
- Essar Oil is a brand of oil produced by Essar (Nayara Energy)
Is it true that gas stations make money?
‘Petrol stations are not profitable.’
There’s also the cost of the fuel itself, as well as delivery. Retailers aim for a profit of around 4-5p per litre, but they must pay for staff, business rates, and corporation tax.
What is the annual income of a gas station owner?
How much does a gas station owner make? In India, a fuel station owner can make up to Rs 3,58,000 per month. Your monthly gross earnings will be 5,70,000 Rupees if your commission is 3 Rupees per litre.
What is the profit margin on gasoline?
In most parts of the country, the dealer margin will be roughly Rs 6 per litre on petrol and Rs 5.5 per litre on diesel at 6%. A dealer’s actual profit varies according to a graded formula, with a bigger margin for pumps with lower sales and in rural locations.
What is the profit margin at the gas station?
This was done in consideration of the fact that employee pay and other utility expenditures, such as energy, are the same for all pumps, regardless of their sales, he added. “The margins for gasoline and diesel merchants have been adjusted. It ranges from 9 to 43 percent in petrol and 11 percent in diesel “In diesel, it ranges from 50 percent to 59 percent,” he stated.
Low volume dealers will receive the highest percentage and paisa per litre commission increases. For those selling 25 kl per month, petrol pumps at ‘A’ sites or in big cities would get 85.67 paise per litre and diesel pumps will get 78 paise per litre. The commission will be 57.05 paise per litre for petrol and 46.5 paise per litre for diesel for those selling up to 170 kilometers.
Outlets selling up to 600 kl will receive 57.10 paise per litre of petrol and 42.3 paise per litre of diesel, while those selling 1,200 kl will receive 45.26 paise per litre of petrol and 33.5 paise per litre of diesel.
For businesses selling 25 kl each month, the commission would be 109 paise per litre for petrol and 95.7 paise per litre for diesel at ‘B’ sites or pumps in smaller locations such as rural areas. For gas pumps selling between 25 and 170 kl, as well as 170 kl to 600 kl, the commission would be 78 paise.
The commission on fuel will be 64 paise for pumps selling up to 170 kl per month and 60 paise for those selling more than 600 kl. For pumps selling 1200 kl, the commission would be 66 paise for petrol and 51 paise for diesel.
According to Singh, the dealers’ margin is often adjusted at regular intervals to account for changes in operating costs such as salaries and power, as well as the cost of working capital and return on investment.
“In lieu of state minimum wages, central minimum wages for employees working at gas stations have been adopted as a major part of the current adjustment, which are around 50% higher. This will assist 9 lakh client attendants who operate at gas stations in the oil industry “he stated
How much does it cost to construct a gas station?
Fuel provision is a necessary service (at least for the time being) that accounts for more than 6% of South Africa’s gross domestic product (GDP). It is also one of the most robust industries in South Africa, and with the right approach, it can enjoy solid earnings even during economic downturns.
How much does it cost to open a petrol station business?
The cost of establishing a local petrol station varies between R15 million and R100 million, depending on the size and location. Furthermore, depending on the cost of development, predicted volumes, and profitability, the operation payment to the oil business ranges between R2.5 million and R15 million. Then there’s the typical working capital requirements for stock and operating expenses, which might range from R1.2 million to R1.5 million. Contrary to popular assumption, when the price of gasoline rises, the petrol station does not benefit. In reality, every R1 increase in fuel price necessitates an additional R100,000 in operating capital for the average service station. The RAS (short for Regulatory Accounting System) retailer margin, as estimated by the Department of Energy, is insufficient, and there is an under recovery of roughly seven cents per litre. What this all boils down to is that while a petrol station’s massive start-up expenditures are one thing, a successful petrol store also requires constant access to fuel.