GSB-52: How To Build a Gas Station from Start to Finish (Hint- It Includes Construction) Part -1

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Would you like to know how to build a gas station from scratch? Do you wonder what all it takes to build one of those? Let’s discuss what it takes to build a gas station from start to finish. Stay tuned…

Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 52. This is the show where we discuss how to start, run and grow a gas station business successfully and give you an inside look at many real life case studies so you can follow and be successful in this business.

Today’s episode idea came from a long time listener name Shahnawaz so this episode is dedicated to him and thank you Shahnawaz for bringing such a wonderful and important topic to the forefront.

He sent me a list of questions to answer, and these questions are:

1. What are good traffic count #s that make a profitable gas station site?
2. What are good income level demographics that make a profitable gas station site?
3. What are good population density demographics that make a profitable gas station site?
4. How far away from the site should other gas stations and hypermarkets be in order not to pose a threat to business?
5. What are some good design characteristics of a gas station/c-store?                  1. How many MPD and fueling positions should I put?                  2. Should I do a 4,000 sqf store with 2,000 sqf branded fast food? Advantages and Disadvantages for doing so?                 3. How many signs?  What’s the cost vs. benefit for them?                 4. How many coolers, freezers, cashier stations, etc?                 5. Any other design mistakes that developers make?  Maybe have more expensive glass so people can see into store or have high ceilings and better modern design?     F. Based on the traffic counts, income levels, population, competition, and design characteristics, how do you forecast the following revenue?                 1. Fuel volume – # of gallons sold per month                 2. C-store sales – gross sales per month                 3. Fast food sales – gross sales per month

 

Since “how to build a Gas Station from start to finish” is a vast topic, I have decided to break it up in to two parts. In this first part we will cover:

Site selection, basic market research, demographics research, deciding what size to build and sales projection . On the next episode we will cover the actual planning, brand selection, hiring the right contractor, How to save money in the building process, cost to build, pre opening and grand opening.

Site Selection Basic Market research Market study done by oil companies)

• Zoning
• Traffic count
• Demographics
• # of Competitors

Here are the criteria for most major brand duel companies:

Not every site is suitable for retail fuel sales, and major oil companies such as Chevron, Shell, and ExxonMobil have established minimum criteria that must be met before sites can carry their brands. These site selection criteria are established to help retail operators select economically viable sites. Brand identity and protecting their brand’s public image are important to oil companies. The specific site selection criteria used by ExxonMobil are listed here to provide an example of how oil companies evaluate potential sites:

* Exclusivity of trade area–A trade area’s supply and demand profile is a key factor in site selection.

* High traffic counts–There should be 18,000-20,000 vehicles passing by the convenience store each day.

* +56,000 net usable square feet–The company will consider less square footage for stores in metropolitan markets.

* Residential density–There should be 15,000 existing or planned residences within a 1.5-mile radius.

* Excellent visibility–The site must be visible from one-third of a mile away.

* Excellent accessibility–There should be convenient ingress and egress from both primary and secondary streets.

* Signalized corner intersections–Ideally, stores should be located at four-corner sites.

What size to build:

• How many MPD’s
• Actual size of the store
• Deli or no Deli

Sales Projection:

• Fuel
• Merchandise

If you have any question, feel free to send me an email at shabbir@gasstationbusiness101.com, or you can post it on my Facebook group page by going to shabbirhossain.net

Lastly, If you are about to buy a gas station for the first time, make sure to read my book “Gas Station Business Smart Start-up” How to measure profitability, how to come up with a valuation, how to calculate ROI, how to write a business plan and how to get financing for your new venture.  You can find this book on most all retailers including Amazon, Apple iTunes, Kobo, Smashwords and Barnes and Noble.

Don’t forget to sign up for my very important newsletter; you can simply sign up for it by going to http://gasstationbusiness101.com/subscribe

Don’t forget to tune in to listen the 2nd part of this episode which will be out in about a week or so. In the mean time if you haven’t subscribed to this podcast, feel free to do so, and if you like this show, I would love to see a review from you on iTunes or where ever you download this episode from.

Thank you once again for joining me in this episode; I will see you in the next one.

Cheers!