Are you looking to invest in a gas station for sale? Gas stations present a great investment opportunity. Domestic sales of petroleum products in Canada reached 1.8 million barrels per day in 2019. When you are operating in a market with consistent demand, it makes things significantly easier. People need to drive their cars daily, and trucks are a big part of every modern logistics chain.
However, almost 12,000 gas stations in Canada and 93 brands compete for their slice of the market. Finding the right gas station to invest in is hard, especially if you’re about to make your first steps in this industry. On top of that, you have to consider several due diligence factors to make an informed decision.
Here at FindBusinesses4Sale, we know how challenging it can be to find a gas station worth your time and money. That’s why we offer you a short guide to help you master the research process and know how to pick the right gas station to invest in.
How to Find a Good Gas Station for Sale
Finding a gas station for sale is similar to finding any other type of business for sale. Finding a good one can prove challenging though. The buyers often start their research online. All you have to do is to type “gas station for sale” in Google, Bing, or some other search engine, and you will immediately find out some opportunities.
You can also visit the websites of some major banks and see if they list some gas stations. These gas stations usually end up in a bank’s inventory because the previous owner piled up too much debt. Newspapers and ads sections are also viable places to look for gas stations.
Driving around the country looking for a “For Sale” sign is also viable but significantly less feasible given how big Canada and its provinces are. After all, not one of these methods provides you with enough information to see whether you are looking at a good or bad investment opportunity.
That’s why we have created FindBusinesses4Sale. We offer you gas station listings you can access on our website whether you are using a desktop computer or smartphone. We have a very strict policy to offer only accurate and regularly updated information about gas stations. Our listings are comprehensive, and every gas station entry will provide you with all the information you need to make a smart decision.
Things You Need to Know When Looking for a Gas Station for Sale
Although similar from the outside, every gas station is unique. Yes, they operate on the same business model, but you can do some aspects of a gas station business in different ways. If you are new to this industry, you need to learn a couple of things before looking at the listings. Here’s everything you need to know to assess a gas station business by only skimming through listings.
Independent of Franchised Operation
Gas station businesses can either be independent or franchised. All franchised gas stations such as Esso Gas Station and Ultramar Gas Station, are operated according to a Franchise Agreement and often can choose from a limited list of suppliers.
Franchised gas stations are often located in high traffic areas and work on a proven business template that can be seen across the entire franchise. Franchises also often own the real estate where the gas station is located. If you want to run things your way, you won’t be able to do it with a franchised gas station.
You need to check the quotes of requirements for fuel sales as the same franchises do have those. There is also the question of whether you will be paid rebates for fuel sales.
What you will be able to do, though, is put your management skills into action. You will be in a position to make sure that your business works according to Franchise Agreement, to manage your staff, and in this way, ensure business growth.
An Independent gas station is a far better option if you want to have absolute freedom. However, you should consider this option only if you have experience in the industry or you have some experience on your team. When you acquire an independent gas station, you’ll be able to follow your business plan and do things the way you prefer.
Does it Come With a Convenience Store
The very name “gas station” implies that gas is what makes the main revenue stream, but you also know that many gas stations have convenience storefronts as well. Do you know why a gas station convenience store is a good thing?
Because the profit margin on gas is minimal even with million liters sold. To improve the bottom line, you will need to consistently sell a million liters of gas. On the other hand, convenience stores enable you to custom-tailor the margins as you see fit and improve gross income.
Selling convenience store products in a prime location will help you generate an additional revenue stream and further improve your business’s bottom line. If a gas station you plan to buy doesn’t have one, make sure to check if there are enough sq ft to open one and store and house extra products. Do your research to see if it is even possible to do it. Find out which permits you will have to obtain and how much it will cost you. Besides, a store car wash is another great idea.
Who Owns the Tanks and Pumps
It might hit you as a surprise if you are new to the industry – not all gas stations own the tanks and pumps. That’s quite surprising, given that pumps and tanks are the essential assets in this line of business. Who can own the tanks and pumps if not the gas station itself?
The tank and pump owners are usually the property owner or the national franchisor. The property owner often owns tanks and pumps only if the gas station is operated on leased property.
That’s a very important factor to consider when browsing gas stations for sale. Another important thing to look for is information regarding the sale. More specifically, does it include the transfer of the tanks and pumps on-premises?
If the gas station is located on leased property, you should revisit the terms in the lease. Get in touch with the property owner to check whether or not they will consent to the assignment on the lease.
Finally, regarding tanks and pumps, you should also check whether they comply with all regulatory requirements. Both pumps and tanks have limited lifespans. The double wall fiberglass tanks are considered the best.
They have to be regularly serviced and sometimes repaired too. Check the maintenance and repair history of tanks and pumps to determine whether these critical assets can serve you well in the following years.
How are Environmental Risks Addressed
Every industry comes with specific risks. When it comes to owning a gas station, you should mainly focus on the environmental risks. Why? Because environmental problems can shut your business down. The double-walled tanks can help you minimize these risks, but not all gas stations have them.
You should also consider the location – if it’s an area under development, you have to account for the risk of blocked access. Sometimes construction projects can block some streets and reduce the number of customers able to get to you.
Check the Station’s Environmental History
One of the most important things you should do before purchasing a gas station is to check its environmental history. Look for the report of the environmental site assessment. You should also see a study and sampling of the underground property.
It can prove quite hard to navigate your way out from environmental contamination after acquiring a gas station. That’s why you should do everything in your power to ensure that the gas station poses no threat to the environment. You can hire some professionals that cover gas stations specifically, to assess the risks.
Why Choose a Gas Station Business
Why choose a gas station business after all? There are numerous investment opportunities out there. Owning and running a gas station comes with some unique benefits. The chances are that you don’t know them, especially if this is your first time running a gas station business. Here are some of the most noteworthy reasons why you should choose a gas station business.
The Demand for Gas is Consistent
Even with the popularization of electric vehicles, the demand for gas is still consistent and projected to remain at the same levels in the foreseeable future. After all, transportation is one of our essential needs, and most of the cars are still non-electrics.
People use cars every day to get to work. They drive their kids back and forth from school, go on camping and road trips. It’s safe to invest in a business when you know that the demand for the product you are selling will remain the same.
Potential for Multiple Revenue Streams
As we’ve mentioned earlier, gas stations are not only focused on selling car fuel. You can set up your game and generate additional revenue streams. You have several options. Gas station owners often open a convenience store and offer various products ranging from snacks to beverages.
You can also add a self-service car wash system or even open a car repair shop. With a gas station, you also can generate non-fuel revenue streams and get that bottom line up.
It’s Easy to Find Employees
Some industries require skilled labour making it very hard for business owners to recruit top talent. It will not be the same case if you choose a gas station. Gas station job positions don’t require skilled labour. The experience is beneficial to some extent, but you won’t have problems even with absolutely new hires.
The situation changes only if you decide to open a car repair shop. But with some good negotiation skills, you will be able to get an experienced technician on payroll.
You Can Get Out Easily
At last, gas stations are profitable businesses, and they attract many investors. If you improve the bottom line of your gas station and keep it insured and compliant, you’ll have no problems flipping it. In fact, some investors prefer having this option.
At some point, you might want to get out and invest in some other business. The ability to become liquid as soon as possible enables you to make a fast purchase and obtain a more profitable venue.
Buying and Selling a Gas Station
Here at FindBusinesses4Sale, we have reinvented the process of buying and selling a gas station. In our efforts to make it the most convenient for you, we made the most comprehensive gas station listings you’ll find online. Using our platform is straightforward whether you want to sell or buy a gas station business.
All gas station profiles in our listings feature the latest and accurate information. You can use them to find out details regarding a specific gas station such as cap rate, or open multiple tabs to cross-compare different gas station business investment opportunities. You even have access to search functionality and search filters to find exactly what you are looking for.
Listing a gas station for sale is also easy. All you have to do is complete the form, and your gas station will automatically enter our listings.
Pros and Cons of a Gas Station Business
The following list of pros and cons is great if you want a quick look at the upsides and downsides of owning and running a gas station business.
- Gas is always in demand, and you won’t run out of business
- You can generate additional revenue streams
- Hiring is easy
- If you are new, you can work under a reputable franchise
- It can be hard to organize your time if you opt for your gas station to be open 24/7
- You have to deal with the serious environmental risks
- Gas stations are often the target of robberies
- There is a high competition
With all this information, you’ll be able to make a good decision. Finally, if you just want to browse through and find the right gas station for sale, we provide you with a rare opportunity to do so effortlessly. Feel free to register for free at FindBusiness4Sale.