Gas station business. Most affordable..

[jut703]

In this scenario, how much net income are we talking abt here? 100k /month? 200k?


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Roughly 100-150k net operating income, depending on how you manage costs. So if you have an investment of 10M it'll take over 5 years to get your ROI.

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[n_spinner06]

Hi folks, i would really appreciate your inputs. We have idle farmland approx 2000sqm roadside about 1km from the town proper somewhere in the province. We were aproached by a neighbor who wants to lease the land to put up a gas station. His offer was 10k a month for 10yrs. Why he doesn't want to put it up on his own land beside ours is beyond me. And i think the price is too cheap considering the land might not be useable anymore after 10yrs. How do i properly valuate this? I believe the running rate per sqm is roughly 2k-3k in the area. The land is idle though and doesnt get much use other than the occasional banana harvest for the family's consumption so 10k monthy is better than (almost) nothing. I just dont think 10k monthly is a fair deal and would appreciate inputs on how we could get a better and more equitable deal (if at all). Many thanks!

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[ray_noel]

Hi folks, i would really appreciate your inputs. We have idle farmland approx 2000sqm roadside about 1km from the town proper somewhere in the province. We were aproached by a neighbor who wants to lease the land to put up a gas station. His offer was 10k a month for 10yrs. Why he doesn't want to put it up on his own land beside ours is beyond me. And i think the price is too cheap considering the land might not be useable anymore after 10yrs. How do i properly valuate this? I believe the running rate per sqm is roughly 2k-3k in the area. The land is idle though and doesnt get much use other than the occasional banana harvest for the family's consumption so 10k monthy is better than (almost) nothing. I just dont think 10k monthly is a fair deal and would appreciate inputs on how we could get a better and more equitable deal (if at all). Many thanks!

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How bout get the 10k and request for 20% of their income per month... [emoji16]


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[n_spinner06]

How bout get the 10k and request for 20% of their income per month... [emoji16]


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I thought of profit sharing too. Is 20% reasonable?

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[cadayjerry]

Mga boss.. magkanu pinaka murang cost para mag pa tayo ng gas station? Sample sa amin ang lupa.

kumusta po proposed gasoline station nyo?

[cadayjerry]

I thought of profit sharing too. Is 20% reasonable?

profit sharing may not be the best option specially if you have no direct control over the operation. annual rental increment may be still the best option.

saan po ba province nyo. can you describe the location.

[cadayjerry]

Mga magkanu sir sa petron? Ang puhunan na need sa pinaka maliit na posible. Tangalin na natin ang cost sa lupa.. target po sana naman yung pinaka murang gas na pwding e binta. Kasi may shell narin sa amin na malapit..

pag petron bulilit. you will invest around 2.5 million to 5 million depende sa luwang and design na gusto mo. all in na dyan including the cash bond, permits, driveway/canopy construction and initial stock. the company will provide the fuel pumps, underground tanks and signages including the cost of installation.

pag generic naman with the same size and design as the petron bulilit, mas malaki investment mo which will be around 4 million to 6 million. lahat kasi ng capital investment galing sayo. and with that amount, your UGTs and pumps are brand new. avoid second hand pumps. sakit lang sa ulo.

sa income side naman, your income pag generic ka is around 8 times your income pag nag franchise ka. ganon kalaki ang agwat. pag nag franchise ka, 1.00 to 1.20 pesos lang income mo per liter sa diesel and around 1.20 to 1.50 pesos naman sa gasolina. pag generic ka, around 3 to 6 pesos per liter income mo for diesel and around 8 to 14 pesos naman income mo per liter sa gasolina. your income per liter depend on the prevailing pump price sa area mo.

if you go generic, you must make your gasoline station is presentable, more beautiful than those branded bulilit station, maluwang, with clean CR, air and water provision, trained gasoline attendant and lower pump price. fore sure, you will be competitive with those branded gasoline station specially in the provinces where lower pump price matters. dont worry about the supply. ang dami supplier na pwede mag deliver sayo. also, make sure na mga bago yong delivery tankers yong supplier mo. also you need to know the source of your supplier.

[cadayjerry]

Just be ready with about 10M for a small station. This will include the cost of pumps, underground tanks, civil works, and your initial working capital.

10m is too much for a small gasoline station. specially for a petron bulilit where the company will be shouldering almost 50% of the cost.

[cadayjerry]

In this scenario, how much net income are we talking abt here? 100k /month? 200k?


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if you are generic with 80,000 to 100,000 liters sales per month with at least 40% sales coming from gasoline, your NET income is around 350,000 and up if your price in your area is low. in baguio city and other places with high fuel pump price, your NET income should be more than 500,000.

if you are a petron bulilit and the like with the same sales volume, your net income is less than 100,000.

[cadayjerry]

General rule of thumb, if you're building a branded station in the province, you should have a secure volume 80-100 thousand liters per month. Otherwise it won't be a very profitable venture.

If you're going independent/generic, you should get at least 40 KL per month. Much lower volume required to stay afloat because generics have much higher unit margins and lower fixed costs.


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in my computation, NET income on 80KL volume (40% gasoline and 60% diesel) for branded station like petron bulilit is more or less equivalent to 20KL sales volume of a generic station with the same gaso to diesel sales ratio.

[MR_BIG18]

Hi folks, i would really appreciate your inputs. We have idle farmland approx 2000sqm roadside about 1km from the town proper somewhere in the province. We were aproached by a neighbor who wants to lease the land to put up a gas station. His offer was 10k a month for 10yrs. Why he doesn't want to put it up on his own land beside ours is beyond me. And i think the price is too cheap considering the land might not be useable anymore after 10yrs. How do i properly valuate this? I believe the running rate per sqm is roughly 2k-3k in the area. The land is idle though and doesnt get much use other than the occasional banana harvest for the family's consumption so 10k monthy is better than (almost) nothing. I just dont think 10k monthly is a fair deal and would appreciate inputs on how we could get a better and more equitable deal (if at all). Many thanks!

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Location?

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[jut703]

in my computation, NET income on 80KL volume (40% gasoline and 60% diesel) for branded station like petron bulilit is more or less equivalent to 20KL sales volume of a generic station with the same gaso to diesel sales ratio.

Highly dependent on where you are. If you're in an area with high pump prices like Baguio, then yes, there's probably a 4:1 spread between the margins of a branded station and a generic one. At almost 60 pesos per liter for gasoline, of course your margins are over 10 pesos per liter vs the usual 2.50-4.00/L that branded stations give.

But if you go to an area with compressed prices like Bamban or Gerona in Tarlac, the spread is much smaller. In fact there were times when I was practically making negative margins since we were matching pump prices of generics while keeping the assured 4 and 2.50 which were higher than what the generics were getting due to the price war in the area.

10m is too much for a small gasoline station. specially for a petron bulilit where the company will be shouldering almost 50% of the cost.

10M is actually on the low side of a decent branded station (approx 600-1500 sqm) in the province. Have built several branded stations and they range from about 8-15M depending on the size and finish. These of course are built to the company's higher standards - no Beilin dispensers here, all Tatsuno. A current project I'm helping out on inside Metro Manila is already over 25M+; company owned of course.

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[n_spinner06]

Double post...

[n_spinner06]

Location?

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4th class town in the province along the nautical highway...

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[cadayjerry]

Highly dependent on where you are. If you're in an area with high pump prices like Baguio, then yes, there's probably a 4:1 spread between the margins of a branded station and a generic one. At almost 60 pesos per liter for gasoline, of course your margins are over 10 pesos per liter vs the usual 2.50-4.00/L that branded stations give.

bumaba na pump price in baguio city (minus 5 pesos) due to protest initiated by the congressman but still mataas pa rin compared to nearby provinces. as of today, generic stations in baguio city earn 5 to 7 pesos on diesel and 12 to 16 pesos mark up on gasoline. pump price of branded stations are higher by 4 to 5 pesos compared to generics so i supposed the big three are earning too much in baguio city.

my area is one of those with lowest pump price in la union. generic mark up is only 2-3 pesos on diesel and 8 to 9 pesos on gasoline.

may tanong lang ako. 2.5 to 4 pesos mark-up ba talaga bigay branded to all of their franchisee including the bulilit one? ang sabi ng mga petron bulilit stations dito 1.3 pesos on the average mark up nila sa diesel and 1.7 pesos on on the average sa gasoline. ganon daw kaliit so hindi mo sila masisi kung magpapa dumping sila from outside sources. also when i inquire before sa petron on the mark up, hindi rin ganon kalaki bigay nila so i decided to go generic. there are three petron bulilit near my area and i talk to the owners from time to time concerning price movements. of course i also inquire on their capital investments so i have an idea on how much a petron bulilit cost.

[cadayjerry]

10M is actually on the low side of a decent branded station (approx 600-1500 sqm) in the province. Have built several branded stations and they range from about 8-15M depending on the size and finish. These of course are built to the company's higher standards - no Beilin dispensers here, all Tatsuno. A current project I'm helping out on inside Metro Manila is already over 25M+; company owned of course.

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tanong kasi ng proponent ng tread na ito is yong pinakamura and pinakamaliit na gasoline station so i was thinking of the usual maliliit na petron bulilit stations and not those stations that will cost 10 million and above. ang investment lang kasi na alam ko sa petron bulilit is the land preparation and development, fencing, driveway pavement,canopy and the permits and licenses. dispensers, UGTs and signages will be provided by the company including the cost of installation.

anyway, wide range of replies will give a good input for the thread starter to explore his options on the range of capital investments to built a gasoline station that will suit his proposed budget.

thanks bro for sharing your knowledge on the petroleum industry. i'm learning more.

[cadayjerry]

Mga magkanu sir sa petron? Ang puhunan na need sa pinaka maliit na posible. Tangalin na natin ang cost sa lupa.. target po sana naman yung pinaka murang gas na pwding e binta. Kasi may shell narin sa amin na malapit..

pinaka maliit na possible sa petron? i'll share a tentative computation if you are talking about a petron bulilit station:

1. Basic clearances, permits and licenses (Building and occupancy Permit, DENR ECC, DOE Compliance Certificate, BIR Registration, Barangay and Mayors permit, SSS and Philhealth Registration)= 100,000 to 300,000 depende sa area mo kung mahirap maglakad mga papeles.
2. Land Development = depende sa site mo kong marami kailangan i develop like backfill, riprap, drainage system and excavations
3. building the canopy = 9 x 12 meters - malaki na yan for a two pump 4 hoses or 6 hoses each pump with one center island. 800,000 to 1.2 million = cladding and signages will be provided by petron including the cost of installation.
4. drive way improvement and pavement for a 400 square meter. 600,000.
5. cashiers booth, CR, air and water system = 200,000 to 300,000.
6. initial stock = 1.5 million
7. cash bond 200K

Total estimate: 4.1 million = mataas na yan. actually yong ibang petron bulilit na maliliit talaga cost around 3 to 3.5 million lang. yong initial stock mo pwede na 1 million.

malaki din kasi counterpart petron like the underground tanks, fuel dispensers and signages. sila na rin mag install dyan including the pipe lay out. training ng mga attendants sila na rin.

yon nga lang maliit talaga kita pag nag franchise ka.

[jut703]

bumaba na pump price in baguio city (minus 5 pesos) due to protest initiated by the congressman but still mataas pa rin compared to nearby provinces. as of today, generic stations in baguio city earn 5 to 7 pesos on diesel and 12 to 16 pesos mark up on gasoline. pump price of branded stations are higher by 4 to 5 pesos compared to generics so i supposed the big three are earning too much in baguio city.

my area is one of those with lowest pump price in la union. generic mark up is only 2-3 pesos on diesel and 8 to 9 pesos on gasoline.

may tanong lang ako. 2.5 to 4 pesos mark-up ba talaga bigay branded to all of their franchisee including the bulilit one? ang sabi ng mga petron bulilit stations dito 1.3 pesos on the average mark up nila sa diesel and 1.7 pesos on on the average sa gasoline. ganon daw kaliit so hindi mo sila masisi kung magpapa dumping sila from outside sources. also when i inquire before sa petron on the mark up, hindi rin ganon kalaki bigay nila so i decided to go generic. there are three petron bulilit near my area and i talk to the owners from time to time concerning price movements. of course i also inquire on their capital investments so i have an idea on how much a petron bulilit cost.

If you're based in LU, we can meet up if you wanna know more about the offers of different gasoline stations.

Petron's Bulilit model has low capital outlay but also lower margins. Shell's dealer-owned model makes you spend for everything but also offer higher margins for the first 5 years to make it easier to recoup margins. Company-owned stations are all financed by the parent company and you come in as a operator and fund the working capital (inventory and manpower mostly) - margins are smaller of course but volume for these stations are so much higher.

For generics, you're completely on your own with no price protection for big rollbacks (usually 24-48 hrs for branded) and you also don't get marketing or maintenance support. But if you can get reliable supply with good prices, you can end up being very profitable. Centrum in the north is a prime example.

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[cadayjerry]

For generics, you're completely on your own with no price protection for big rollbacks (usually 24-48 hrs for branded) and you also don't get marketing or maintenance support. But if you can get reliable supply with good prices, you can end up being very profitable. Centrum in the north is a prime example.

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yah one of my gas station is based in la union but im from baguio. my supplier is actually owner of a shell gas station so i have access on weekly price movements (mops trajectory) 5 to 7 days before the actual price movement. pag may rollback, konti lang order ko just enough for the week pero pag may price increase pupunuin ko ugts and the overhead tanks.

good to hear inputs on the company owned gas stations. my knowledge is limited on the model of a petron bulilit station since i applied before but cancelled my application due to the very low income as compared to a generic station. ang laki ng agwat kasi halos kinukuha ng company yong kita mo.

in terms of generic naman, kakilala ko almost 50% of the owners of generic stations in baguio city and la trinidad.

[mokong22]

[QUOTE=jut703;2989032]Highly dependent on where you are.

sir jut affiliate ka ba sa petron?