How To Buy A Gas Station In A Receding Economy
There was a time when communities seemed to be built around tight neighborhoods, where your local corner store was a gathering point for everybody. Today, we are much more mobile and seem to need a car wherever we go, so we are much more likely to focus on the gas station and convenience store, instead. Due to our reliance on the car, we seem to be fueling them more often than ever before and an entrepreneur could easily be forgiven for being enthusiastic when they consider buying a gas station for sale in this light.
For those in the market to buy a business, a gas station could be viewed as a bankable bet. We all need gasoline and can be tempted into buying all kinds of other goodies in the attached store as we are on the property and can "kill two birds with one stone." The would-be buyer could be forgiven for salivating at the opportunity, but there is a lot to check into first.
Expect the unexpected. Now this is certainly true for any kind of business purchase, but you must be especially aware when it comes to a gas station. Gasoline is, after all, a heavily controlled substance and subject to all kind of regulation. Don't underestimate the power of outside parties and environmentalists, who are looking to see whether you have everything lined up correctly.
For example, do not buy gas station business rights until you have checked into the condition of the storage tanks and surrounding soil. Within older establishments, steel tanks are very vulnerable to leakage and if this is found it will require extensive excavation and downward pressure on your bank balance. There are also specific regulations for double-walled tanks that must be installed by certain dates and here again, it is a key point to investigate. Think twice before investing in an older property like this. You might be far better off seeking out a location which has already installed the more up-to-date, double skinned tanks.
Once you have convinced yourself that environmental and safety issues have been accounted for, make friends with the planning department at your local authority. If you live in an area that is prone to rapid population growth, understand that there are always plans on the books to reconstruct roadways and access points. While these may not actually come to fruition, you definitely need to know if any impending road construction, six months or a year ahead, may cause considerable difficulties. Remember, if people who had been used to coming into your gas station are forced to go elsewhere, even for a short period of time due to road construction, they may form a habit which now excludes your business and favors another.
While you may be interested in the business habits of the seller and the local conditions which are applicable, make sure that you take a good look at the franchisor as well. Get to know the industry position of the oil company whose name is on the billboard and don't assume that their interests in the property will continue, come what may. We have all learned from the economic events of the past few years that no organization is bulletproof.
For those in the market to buy a business, a gas station could be viewed as a bankable bet. We all need gasoline and can be tempted into buying all kinds of other goodies in the attached store as we are on the property and can "kill two birds with one stone." The would-be buyer could be forgiven for salivating at the opportunity, but there is a lot to check into first.
Expect the unexpected. Now this is certainly true for any kind of business purchase, but you must be especially aware when it comes to a gas station. Gasoline is, after all, a heavily controlled substance and subject to all kind of regulation. Don't underestimate the power of outside parties and environmentalists, who are looking to see whether you have everything lined up correctly.
For example, do not buy gas station business rights until you have checked into the condition of the storage tanks and surrounding soil. Within older establishments, steel tanks are very vulnerable to leakage and if this is found it will require extensive excavation and downward pressure on your bank balance. There are also specific regulations for double-walled tanks that must be installed by certain dates and here again, it is a key point to investigate. Think twice before investing in an older property like this. You might be far better off seeking out a location which has already installed the more up-to-date, double skinned tanks.
Once you have convinced yourself that environmental and safety issues have been accounted for, make friends with the planning department at your local authority. If you live in an area that is prone to rapid population growth, understand that there are always plans on the books to reconstruct roadways and access points. While these may not actually come to fruition, you definitely need to know if any impending road construction, six months or a year ahead, may cause considerable difficulties. Remember, if people who had been used to coming into your gas station are forced to go elsewhere, even for a short period of time due to road construction, they may form a habit which now excludes your business and favors another.
While you may be interested in the business habits of the seller and the local conditions which are applicable, make sure that you take a good look at the franchisor as well. Get to know the industry position of the oil company whose name is on the billboard and don't assume that their interests in the property will continue, come what may. We have all learned from the economic events of the past few years that no organization is bulletproof.
