Thinking of opening a petrol pump, great thought!!! You have landed at the right page. In this highly detailed blog we will subsequently deliberate about the numerous factors discussed below. Also petrol pump dealership cost could be acknowledged.
The Payback in Petrol Pump Proceedings
Come let’s take an edge look at the profit a dealer makes: Normally the payback for diesel is about Rs 1.9 for filling up 1 liter, for 1 liter petrol is Rs 1.3. As mentioned that the margin of profit is practically low and can help in generating a decent amount of profit for every month when blessed with a decent enough location for the petrol pump business. This blog will also feature the petrol pump dealership profit. The profit margin differs for every dealer in the market.
Table of Contents
All profits are entirely dependent on factors like
The petrol pump dealership cost can be estimated after considering the below factors
1) Rental to owners of land, just in case the property is rented
2) Salary for staff
3) Electricity rental
4) The amount paid of transportation of fuel from one point to the end point including the petrol loss in transition of petrol for the same.
5) Accounting and maintenance expenses
What profit does make in petrol pump business?
The net earnings rests on the petrol pump location just because if it is in suburban city location in contrast with sale of petrol against the diesel sale. But if the petrol pump is built on a highway then the sale of diesel will be comparatively more than petrol.
Also if you efficiently manage a petrol pump then a good amount can be expected as profit. Majority of the petrol pumps in India are not managed properly and eventually losses are incurred by the owners.
Opening a petrol pump, is it profitable?
Of course it is profitable but in a condition where the petrol pumps are administered efficiently.
How to kick off of a petrol pump business in India?
1. One should get the firm (Private Ltd Company) enrolled or indexed. This can be done right after the preference by company.
2. Get the tax registration accomplished.
3. Scrutinize the various promotions in the daily newspaper enlisted by famous companies such as Bharat Petroleum, Hindustan Petroleum, Reliance Petroleum, Shell Petroleum, Essar Petroleum, Indian Oil etc.
4. You need to assure that you qualify by meeting all the eligibility criteria mentioned below.
(a) The further procedure for the last selection.
(b) For Bharat Petroleum the deposit amount is 15 lakhs which is not refundable
(c) The needed amount as investment for starting a petrol pump in urban and rural areas.
(d) The total investment amount for opening a petrol pump is between 50 lakhs to 2 crore.
Depending on the locality the investment varies in accordance to the petrol pump dealer margin. In some cases it may also cost below 50 lakhs or 60 lakhs in urban and rural areas which will not cost more as it is slightly tough to get a license.
What is the purpose of opening a petrol pump?
We are living in a world which is run with personal vehicles have resulted into a manifold boosted. There are however more private vehicles than the public automobiles. Under any circumstances, any vehicles will be needing fuel to run. Majority of the eco-friendly substitutes have been put to action in order to save our planet from the harmful emissions such as LPG and CNG.
However with the rising number of vehicles on the road, the gas demand also is rising with every passing day. So in this scenario, kicking off with a petrol pump is something that is going to pay you really well. As people these days avoid public transport and prefer private vehicles which clearly means that there will be a never ending demand for its which practically has no end to it. The more the better.
Does not matter if you are opening a petrol pump in outskirts of the city or in city itself, which will be nearer to the Highway routes as the business will be a high yield for the owner. So in the present day scenario, this is definitely a profitable idea. The profit will be directly dependent on the volume of petrol which is sold in one year and also the margin of the profit would differ from one area to the other. Nevertheless, the demand for fuel is definitely not going to see a fall so soon.
The basics of the petrol pump business
Business of any nature needs impeccable knowledge but a strong financial backing too. And as you are not only going to be about running a petrol pump but also the business revolves around the potential risks of dealing with fluids that are highly flammable. Hence one needs to ensure that there are all kinds of safety measure taken. There is not even a chance of making a small mistake which would be very dangerous.
This is the very reason where the need of a proper license arises. There are a few steps and tests which will be approving all the safety standards which needs to be passed in order to get a license. And after all the safety standards and measures are taken care of, you can go ahead with the other necessary legal procedures.
Getting all the papers and the mandatory bonds is very important as majority of the petrol pumps are a government undertaking. So just in case you are trying to open a private petrol pump you will need to enroll with the concerned authorities to make sure that it is fully legal.
Location is a major factor to be considered
The locality whereupon the petrol pump is opened is one of the most important factors impacting the profit margin. As if a pump is in the city, the sale for petrol will be greater including the profit that comes from selling the petrol with every liter of petrol sold.
Whereas if the pump is opened in the outskirts of the city there will be a greater demand for the diesel, as it is nearby the freeways which will definitely mean the transport vehicles coming in for fueling up. Hence it will definitely create an impact on the overall sale of the diesel which is directly dependent to the profit margin of per liter diesel sold.
So when it is about opening a petrol pump, there is a need to sign the important documents and the legal bonds that are required to be signed. As it will no doubt provide you and the concerned authorities with the information of emission levels of all the types of fuels that you are selling.
Whether it is petrol, power petrol, diesel, white petrol etc. In this way if anything which is out of the law happens in your premises then you can contact the concerned authorities and be safe from all kinds of dangers and to put you on the safe side