Episodes
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Remember the store I helped some investors buy in 2015 that was losing money? I shared two updates so far and now here is the 3rd one about how that store is doing now. This is a long awaited episode, but here it is. Enjoy!
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 61. This is the show where we discuss everything under the sun about the gas station and convenience store business, how to buy these businesses, how to operate them and how to grow them to be a million dollar success.
Now on to the show.....
On Episode 23, I brought you a real life store sales data and analysis, where I was helping a group of buyers decide if they should buy a location or not. If you recall, in that episode I published the real sales figures of the store and some projected ones as well. Based on their sales data I created some P&L's of my own and it showed for the month of October the seller had lost about $2500. But despite the fact that the store was losing money, I did go ahead and recommended that they buy the store based on few factors which I discussed in that episode 23 as well. If you recall, in that episode (episode 23) I discussed few issues, and few opportunities of the store and we covered 9 points:
The store and its location Demographics Age and brand Physical inspection of the store and the issues we noticed Recommended upgrades and how much those upgrades would cost Indoor Issues Outdoor Issues Sales and financials Projected P&L vs. Real P&LIf you have time, please go back and listen to Episode 23 and 29 this way you will know the whole story.
In episode 29 I shared some P&L for March 2016, in that episode, I did compare P&L’s from October 2015 which the sellers provided us to what the new owners did in March 2016, and if you recall there was a drastic difference between those two. The new owners increased the business and made it a very profitable one. But to get to that increase, the new owners implemented these nine strategies that I proposed.
Strategies we implemented:
Address all maintenance issues Upgrade all lighting and put a fresh coat of paint Clean up the store Remerchandising the store based on its traffic flow Bringing in products that sell in the area Advertise heavily via reader board, pump toppers and on the front door Bringing in EBT and money order Implementation of new fuel and merchandise pricing strategy Full on marketing and promotional campaignAs you can see it was not one single strategy that made the business profitable but a combination of many factors. It was not an easy task, but the credit goes to the management team of the store who were able to follow directions and implement everything we suggested for the store.
Now let’s take a look what and how the store has done since March 2016 until December 2016, instead of showing you month by month P&L, I can tell you that the new owners have seen a gradual increase in business and enjoyed a positive growth each month. Let’s now take a look at the P&L from this last December.
But remind you in most areas, November through February are usually the slowest winter months. Business usually slows down quite a bit compare to the summer months. So I figured if we can see something positive even in December then we can be assured that the business will make more sales and show more profit during the summer months.
Here is the P&L for the same month of December 2016
(If the Excel Spreadsheet is not viewable, please visit my blog at GasStationBusiness101.com to view them)
Let’s look at the Profit and Loss history of this store. If you remember in October 2015 right before the new owners took over the store lost $2574.51, then the new owners took over in December, and by March the store became profitable which I shared in episode 29, the P&L then showed a profit of $5193.33.
Now fast forward to December 2016, which is a slower month for most gas station business, and with less fuel sales, the store generated $6,875.46. It is important to share that in this past one year, their best month was August 2016, and for that month the net profit was $9,612.90., But I wanted to give you a full year’s snapshot so I brought December and not August in this calculation.
What have they done differently? Well, nothing other than keeping up with the proper inventory, making sure the pricing is right and superior customer service. That’s the secret sauce of success in this line of business.
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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In this 2nd part of our last Q&A episode, I answer remaining 5 questions all related to buying gas stations and how to understand the numbers and if the stores are really making money or losing money. I also answer questions about how to grow your business with financing and how to take on a new partnership. I think you may find this episode helpful if you are in the market to buy a business. Here I analyze some sales numbers and see which ones are making money and which ones are not. Stay tuned.
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 60. This is the show where we discuss everything under the sun about gas station and convenience store business, how to buy these businesses, how to operate them and how to grow them to be a million dollar success.
Question #4
Hope this email finds you and your family well.
I personally want to thank you for writing a book about Gas Station Business. You have explained very well process of how to buy and what to keep in mind before purchasing store.
I am in Gas Station with C-Store business since The year 2005. I have been thru many challenges similar to yours which you have explained in your book. I am currently looking for something to understand how to get finance to expand like big national corporations? Can you explore few points of financial strategies in order to expand in gas station business?
Your help will be highly appreciated.
Question #5
Dear Shabbir,
I will be running a gas station from April 1st. Let me give you the picture; the store owner still has 3.4 million volume of gas volume under contract. He splits his profit, expenses, credit card fees, and maintenance fees with a small oil company.
If I take his contract, I have to split the fuel profit 50/50, but I get 3 cents cheaper than other gas store. If I don't take his contract, I have to pay 3 cents more than his contract price. Which deal will generate more profit for me? Being a 1st-time business runner, I would appreciate your suggestions.
Question #6
Hi Shabbir
Thanks for the great article, it helps a lot. One question, though: when a seller say his store sales are 37k, does that figure normally including lotto and scratch off sales?
I am asking because one of the stores I looked at treated lotto, scratch off tickets and prepaid phone cards separate, so inside sales were more than what they were saying.
Thanks and keep it up
Question #7
Thanks for the great info. I had limited fund like around 100k, and most money making gas stations as I saw on websites are expensive. Do you think it is a good idea to go in partnership with a stranger? I have posted on cl for partnership and got responses, but I am curious about it.
Answer: Check out episode #21 where I spoke in details about how to create effective partnerships.
Question #8
Andres sent me this question, he is a long time listener and contributor of this show, he asked
Hi Shabbir I hope you are fine. Do you have a good template to control cigarettes in your stores? I would imagine your employee has to count the cigarette boxes when he starts the shift and also at shift end to reconcile the daily sales, right? If not, how do you do it?
Tune in and listen to this episode for all the answers.
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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Missing episodes?
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In this episode, I answer three questions all related to buying gas stations and how to understand the numbers and if the stores are really making money or losing money. I think you may find this episode helpful if you are in the market to buy a business. Here I analyze some sales numbers and see which ones are making money and which ones are not. Stay tuned.
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 59. 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.
First my apology once again for not coming up with an episode sooner, I was busy with a few projects and had to put the blog and the podcast on the backburner for just a bit, but I am back, and hopefully I will be posting new episodes sooner rather than later. I still haven’t forgotten about the episode I promised you where I would share the new P&L of the subject store I helped some investors buy about 14 months ago. I have some new updates on that store and recorded that episode halfway through already, which I will share soon I promise.
Now as for this episode, I had to do this one first because I have had way too many emails lately where many of the blog readers and podcast listeners have been asking me various due diligence questions, and it is hard to answer them via email. So I have decided to pick just 6 out of them since they are mostly all similar in nature, and I thought by sharing them with rest of you, it will benefit everyone. For various privacy reasons, I have decided not to mention any names of the people that sent me these emails here.
Let’s dive right on…
Question #1
I need your advice about the valuation for the store based on the following information.
Inside Sale# $55000/month (27% profit margin)
$55,000 x 27% = $14,850
Outside Sale# 25000 Gallon/month (10 cents per gallon)
25,000 gallon x 10cents =$2,500
Lottery commission# 4000/month, ATM# $200/month
Total Gross Profit $21,550
Owner absentee
Capability to open deli with grill.
Store located in small town and mostly neighborhood business.
Expense:
Rent# 5000 "NNN."
Utility# 1300
Credit# 1000
Payroll# 2400 (Two full-time employees)
Other# 500
______________________
Total Expenses: $10,200
Net profit: $21,550 – $10,200 = $11,350
Asking price is $225,000
What would be the price we should go for?
Question#2
Shabbir, here are few questions.
Please note that I do not have prior experience, so how can I convince them that I am serious and are there any training provided by gas companies?
When buying just the business, I mean just goodwill without R/E, how do I make sure that my investment is protected? For Example, If I buy the lease for 500k and pay 16K a month. What if the lease is for two years and after two years the owner does not want to renew the lease. How can I make sure 100% that I will not lose everything? As far as tax benefits are concerned at the end of the year, which option is better buying or leasing? I would appreciate if you only focus on the tax benefits since you have already talked about pros and cons from other angles. For example, let's say that gas station A is leased with goodwill paid by on-hand cash and gas station B is bought with R/E with a bank loan. Let's say both gas stations have exactly same per month profit after all lease or loan payments.Now at the end of the year when I will file income tax, which option will give me bigger return? What is the best way to approach companies which own multiple stations around me?
Question#3
Good Morning Shabbir,
Glad, I ran into your website. I found a gas station business for sale for
$85K. We did our due diligence to look into the traffic, etc. Mostly the sales are from Cigarettes and Beer. The other items are pretty much a stand still.
In addition, this station the gas is unbranded. They are selling like 700
Gallons per day, inside the store with the majority of sales been Cigar and
Beer. The sales is about 40K revenue and 35% profit, and expense is about
9.5K. Profit is about $2,750 is what I am estimating.
Is the goodwill they are asking outrages? Currently, the owner is not opening the store properly and wants to sell it.
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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I am sure you have seen a gas station or two that are closed up in your area and wonder why did someone close it or if you should buy it, or would it do great business if you start it up? Listen and find out as I answer 6 burning questions from our listeners in this episode.
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 58. 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.
First my apology for coming up with an episode sooner, I was little under the weather at first then got busy with a few projects and had to put the blog and the podcast on the backburner for just a bit. Well, we all have to make money to survive right? I was doing just that too. But I am back, and hopefully, I won’t take much breaks anymore. Even though I told you in the last episode that this next one will be about the update and P&L of the story I helped some investors buy back in December 2015, but I am still analyzing and sorting out those P&L numbers, so hopefully it will be in the next episode.
As I said I have been busy so I didn’t even get to answer some of yours email yet, and if I haven’t, my apology. But I picked out 6 questions out of 30 or so email I looked at in last two days and decided to answer them on this episode this way everyone gets to benefit from the answers.
In this 3rd Q&A episode, I answer 6 questions
I am looking to buy a closed up gas station with the property, what do I need to worry about in this process? In one of the podcasts, you had mentioned that one of the reasons someone could sell their gas station is because some competitor is crushing them on fuel prices. How can we figure out if this reason why a seller is selling his gas station. I am buying a gas station, but the seller wants to sell the tanks, canopy, and pumps for $1.00. What I want to know is if I leave the business at the end of the lease term due to not finding any buyer then what should I do if it is in my name? What if the landlord doesn’t want to buy it for a $1 like I did I have been meaning to tell you how much I enjoyed the gas station/c-store development podcast you did. Thank you! One point I was not clear on was about reselling or leasing the property. Let’s say I stabilized the business in 3 years and it does: 120,000 Gallons/Month on fuel sales 22,000 gallons of Diesel sales $75,000 on inside merchandise sales $90,000 in Fast food salesMy question is what should my resale value be after 3 years of operation?
How much can I sell and/or lease the business for which will not include the R/E
How much can I sell the business with R/E
5. First of all, thanks for your podcast and for all the resources you share with us. It's great to learn from someone with all your experience. Keep it up! The public restroom at my gas station is located outside, meaning people have to ask for the key at the counter to use it. Normally we give the key to customers (people who actually buy) and people we know (customers from the past who might not be buying anything on that day) but sometimes people get very mad when we don't give the keys out if they are not buying anything (people who only stop at the station to use the restroom). That being said, the cashier is many times "forced" to give out the keys to non-customers in order to avoid headaches. The problem is that people don't care about the restroom. They pee on the floor, misuse the toilet paper, soap and paper towels and write graffiti on the walls. Some others use it to consume drugs and have other illegal activities. The main problem is that once every week the toilet gets clogged, sometimes so badly that I've had to actually replace the toilet 3-4 times a year as it is impossible to unclog it. I've been trying to find the best solution for this. It is mandatory to have public restroom according to Florida laws so I can't close it. I am also forced to offer toilet paper, soap, and paper towels even if people misuse them and it represents a high cost to my business. Some people have suggested installing a coin lock, so I charge something small to use the restroom, but I'm afraid this would make me lose real customers. While I know the coin lock does not fully solve the problem, at least it would generate me some cash to keep the restroom neat. Have you had this problem in your stations? What is the best way to tackle this, so the restroom does not become a drain of my profit? Thanks for any hints you might share to help me out. (Andres sorry for the delayed response to your question)
6. I have noticed in 3 of my dispensers the regular unleaded runs very slow but other two grades are fine, it has been happening on and off, what should I do?
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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I get asked this question often, and I have tried to answer them before as well, but let’s answer it once again in very much details so we can clear up any and all the confusion, let’s discuss how you can figure out how to calculate your fuel profit precisely and accurately.
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 57. 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.
Before we start, one important announcement, my new email server is working beautifully now, so if you are on my email newsletter list, I am sure you already noticed you are receiving my seven very important how to find and buy a gas station email series. If any of you are not receiving these emails, please sign up again, and that should solve the issue, you can simply go to http://gasstationbusiness101.com/subscribe or go to my blog at http://gasstationbusiness101.com and sign on the landing page. You will also receive my free eBook 9 Passive income idea book for signing up.
Okay now on to the show…
First take a look at the attached daily fuel price notification that we all receive from our jobber/suppliers. This is the price we pay to buy our fuel. Remember it will vary city to city, state to state and country to country. What I pay for a gallon of regular in Alabama may not be the same as someone buying the same brand fuel in NY City. But a couple of things to consider here, if you look at this fuel prices you will notice there is a difference in price between the regular, Mid-grade and premium right?
Well, typically, your mid-grade price should be around 15 cents higher than your regular price, the same way your premium price should be around 50 cents higher than your regular price. So, you need to price your fuel accordingly.
Let me show you how.
Price Regular Mid-Grade Premium
Cost $1.89 $2.04 $2.39
Retail $1.99 $2.39 $2.89
Profit: $.10 $.35 $.50(Listen to the show for details on how we price our fuel)
Now let’s look at the Excel image of the fuel margin calculation, it will be easier for you to understand this episode if you can see the excel sheet. You can also download this and use it for your business as well.
(Listen to show for full discussion on this)
To download the Fuel Profit Calculator please click below (In Microsoft Excel Format)
http://www.gasstationbusiness101.com/Fuel-Profit-Calculator
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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I want to tell you about five proven marketing strategies that have worked for me for last 18 years. But remind you they will sound silly at first, but I want you to hear them out in their entirety before you knock any of them out. After you hear me out then maybe you can go try them in your business and see how your business rises to the top.
Welcome to Gas station business 101 podcast, I am your host Shabbir Hossain, and this is episode 56. 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.
Here are five silly sounding strategies you can take and become a unique retailer in your area. Trust me they work; I have tried and tested them for last 18 years. Just trust me on this okay? Before you knock these proven ideas, hear me out, let me explain each and you will see and hopefully agree with me. So here we go...
Know your Customer Give them something for Free Feed them Free Support your local community Give out Candy to Kids(Listen to the episode for all the details)
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
For all our international listeners, if you are interested in learning about the investment category visas and how to get one of those by investing in a gas station business, do check out my new book USA Investment Visa to Green Card, How to Qualify, Apply and Obtain EB-5, E-2 and L-1 Visa. You can find this book on most online retailers like Amazon, Apple iTunes store, Barnes and Noble, Kobo and most other online booksellers.
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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How can you tell if an employee or customers are stealing from you? How do you know someone is not stealing your beer, cigarettes or other merchandise? Is your business losing money every day and you just don't know about it? Let's see how a great inventory management system can help you stop the leaks, stay tuned..
Welcome to Gas station business 101 podcast, I am your host Shabbir Hossain, and this is episode 55. 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.
The topic today is How to have an effective Inventory management system. Sounds complicated? It is really not, I will not be talking about any complicated computer program or any such things. Instead, I will take a very simple decade old method that business owners used for years.
If you recall from my previous episode where I talked about various types of theft, then you may recall there are two different ways theft takes place in our business
External InternalExternal is where your vendors and customers are walking away with your money or products without paying, and internal theft is where your employees are walking away with your money and merchandise.
Since stealing cash is typically harder than stealing merchandise, and we did address the cash issue in the previous episode, let's discuss how we can have a great yet very simple inventory management system to check and see if you are losing your merchandise due to either kind of theft.
First, I need to tell you how big chain stores and companies do their inventory management then I will talk about how we do it.
There are two ways you can do inventory management
Item level inventory tracking Department level inventory trackingBig corporations like Circle K, 7-11, Wawa food and many other regional, local and national chains practice Item level inventory while small business owners like us typically practice department level inventory. Item level inventory tracking is more cost and labor intensive; this system requires more labor and dedicated managers on duty on every shift. Which is usually not cost-effective for most of us small business owners.
First, let's recall your typical merchandise categories and see which ones are more prone to theft.
Typical product categories:
Cigarettes Beer Tobacco Soda/Drinks Grocery Automotive Fountain/Coffee NoveltyLet's discuss each category and see which ones are an easy target and which ones are not, also which ones are easy to track and which ones are not.
(Listen to the episode for the whole story)
If you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
In the meantime, 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.
Here is a link to my podcast page on iTunes, if you follow this link you can give me a review right on that page. Trust me it will make my day and won't cost you anything other than maybe 30 seconds of your time.
https://itunes.apple.com/us/podcast/gas-station-business-101-podcast/
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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Once you finish the construction of your new gas station how do you get it open up for business? How to pass the inspections, how to merchandise, how to get everything ready, let's discuss and let's see if we can finally open your new store for business. Stay Tuned...
Welcome to Gas station business 101 podcast, I am your host Shabbir Hossain, and this is episode 54. 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 is the third and final part of How to build a gas station from start to finish.
In this episode we will discuss:
The final inspections (Building, fire, electrical and most importantly the health dept. inspection and what they look for)
How to merchandise your store for the first time How to hire people How to train them When to buy your first load of fuel How to set up your POS How to set up all the pricing The actual opening of your store How to do a grand opening Resale value of your newly build storeIf you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
Good news is the email transition process has started, so in about a week or so we will be able to start sending out emails that many of you have been waiting for.
In the meantime, 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.
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Would you like to know how to build a gas station from ground up? 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 your host Shabbir Hossain, and this is episode 53. 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 is the second part of How to build a gas station from start to finish. The idea for this topic came from a long time listener name Shahnawaz so this episode too is dedicated to him. A big thanks goes to Shahnawaz for bringing such a wonderful and important topic to the forefront.
If you recall in the last episode we spoke about:
Site Selection Basic Market research Market study done by oil companies)
Zoning Traffic count Demographics # of CompetitorsWhat size to build
How many MPD's Actual size of the store Deli or no DeliSales Projection
Fuel MerchandiseIn today's episode we will cover:
Land development Drawing up the plans Applying for various permits Pitching to the oil companies Deciding on a Brand Hiring the Right Contractor or build it yourself(how much can you save) How to Save money in the process (installing one tank with compartments instead of 3 or 4 tanks) Cost to build per SQFIf you have any question, feel free to send me an email at [email protected], or you can post it on my Facebook group page by going to shabbirhossain.net
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
Good news is the email transition process ahs started, so in about a week or so we will be able to start sending out emails that many of you have been waiting for.
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.
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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 51. 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:
What are good traffic count #s that make a profitable gas station site? What are good income level demographics that make a profitable gas station site? What are good population density demographics that make a profitable gas station site? How far away from the site should other gas stations and hypermarkets be in order not to pose a threat to business? 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 monthSince "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 CompetitorsHere 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 DeliSales Projection
Fuel MerchandiseIf you have any question, feel free to send me an email at [email protected], 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!
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In business we all have to do some degree of negotiation, when buying a home, a business or just with your suppliers or vendors, but we don't get to win each time, but we should win if we know and practice this 13 negotiating skills, stay tuned and let's find out what and how they work
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 51. 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.
This episode is also important because it is based on my new book " How to Master 13 Negotiating Skills and Win in Business" that I published a few months ago, I know I didn't mention it here before, but this is one book I have been working on for a while now and was finally able to finish it. It was a soft launch, as I wanted to get some feedback from people and see what they think of this book. Now that I got some great feedback, I am happy to announce that it is out and available on every digital and print platforms out there.
But this episode is not about my book but about the 13 skills that will help you win in business and in life
Let's dive right in and get started..
The first and most important lesson in negotiation is never to show desperation, no matter what you are buying or selling, the smell of desperation can spread really fast and ruin any chance at winning a deal.
There is some basic legwork that you need to do before each deal or negotiation, even long before you go to the table and sit down. You need to collect some data by research and discovery ahead of time so you can take the time to analyze it and then determine what your exact game plan is going to be.
I know this may sound confusing, but after I discuss all 13 skills sets I will walk you through a real-life example of a negotiation that I had done recently and how these skills sets worked in that negotiation process. I will share the details and the outcome of the negotiation so you can visualize how these 13 skills work in real life business situations.
Skill 1 - People Skill
Know how your behavior affects others.
Understand various negotiating styles and which one you're dealing with.
Change your style of meet the needs of the listener.Skill 2 - Listening Skill
Using steps to learn the interest of others.
Three levels of listening to gain information.
How to perceive yourself while listening to win at negotiating.Skill 3 - Develop a Full Plan Before You Go To Negotiate
What a detailed plan should include.
What alternatives should you be prepared for?
Additional planning to be prepared.Skill 4 - Knowing What You Want
Know what you want to gain.
Know what you are willing to concede.
Know timeline and expectations.Skill 5 - Knowing What They Want
Know their interests.
Know their walk-away alternative.
Know their authority.
Know their arguments, questions and tactics.Skill 6 - Knowing When to Walk Away
Know your acceptable range.
Know their acceptable range.
Know your deal breakers.Skill 7 - Know How Much to Compromise
What is a compromise?
What can't be compromised?
The perception of compromise.Skill 8 - Knowing the Barrier
Identifying the seven barriers
Language differences
Culture differences
Physical barriers
Personal problems
Preconceived notions
Reputation
Exhaustion
Overcoming barriersSkill 9 - Knowing How to Control Your Emotion
How do you want to feel and why
What to do beforehand to put yourself in an emotional state.
What can through off your emotional balance in a negotiation.
How to regain emotional balance.
How you want to feel when you're finished.Skill 10 - Using the Time (Clock) to Your Advantage
How deadlines affect negotiations
How you can use deadlines to your advantage.Skill 11 - Finding Mutual Gain
Five principles of mutual gain.
How to negotiate for mutual gain.Skill 12 - Make Them Look Good, Let Them Brag
Why this is important.
How to do this.Skill 13 - The Power of Paper
Why you should put it in writing.
When you should put it in writing.If you have any question, feel free to send me an email at [email protected], 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.
If you want to see the " How to Master 13 Negotiating Skills and Win in Business" just click on the name and the link will take you to Amazon. You can also find this book on Kobo, Barnes and Noble, Apple iTunes store and many other book retailers.
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
I am working on a very important episode which will be our next episode, and it will be all about how to build a gas station from the ground up, the idea for this very episode came from a listener name Shanewaz, and he even sent me a breakdown of the whole episode. Thanks to Shanewaz in advance and I think it will be a great episode.
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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In this episode, I answer four very unique questions about the underground storage fuel tanks. Some of these are very unique problems; these problems can happen to any gas station operators. I highly recommend you listen to this episode and take notes...
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 50. 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.
This episode is a direct response to 4 of our podcast listeners, they all have questions regarding UST or underground storage tanks, I could have included these questions in our next Q&A episode, but I decided to keep this very important topic separated from all the rest.
Back in Episode 40 and 41, I spoke at length about some of the risk factors that come with buying a gas station business, in those episodes, I covered some of the risks associated with UST. If you haven't listened to those episodes, I highly recommend that you do so, this way you will get the complete picture. But today I will take a different angle and talk both from a tenant's point of view and from an owner's point of view.
The first question comes from Andres and he wrote:
"I own the gas station business but not the property. The landlord (fuel distributor) is responsible for the underground activity and I maintain all above ground. In case there is a soil contamination, a tank leakage or a tank replacement need, the landlord will have to take care of that. However, I would face a business interruption. Is it normal to include in the lease with the landlord that, in case such things happen, I will not pay rent during the time period when I can't operate my business? Even more, would the landlord indemnify me? How far can I push it in the contract normally?"
The second question came from Tina and she wrote:
The land is owned. The business is owned. But the tanks are leased. So...who insures the leased tanks? What kind of insurance? If the tanks are not double lined...can the leased tanks be replaced through the company which is leasing them? What should be reviewed for UST through the TCEQ website? Who registers the tanks? How much does registration cost?
The third one came from Michel, he wrote:
"Hello, I enjoy your podcast very much. Great information and useful tips. Could you do a podcast on how you manage inventory effectively? Also, what do you think is the best way to handle, record and comply with UST regulations and compliance. Thank you."
Last one came from Rakesh, and he wrote:
"I am getting complaints from customers time to time that my gas has water/dirt in it, I called a local repair company and they told me to call a tank company to wash my tanks!!! I am confused, please help"
Here is an image of how the UST sits underground and various layers of earth look.
If you have any question, feel free to send me an email at [email protected], 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.
If you are interested in learning more about small business and gas station marketing strategies, you should check out my book Sales Genie, Retail Marketing 101. In this book, I show you 5 Proven Ways to Increase Retail Sales and boost profit by 25% in just 60 days. You can find this book in every online bookstore from Amazon to Apple and every other one in between.
I would love to see a review from you on iTunes; this will mean a lot to me so please take a minute and put up a review for me on your app store. thanks.
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
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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Did you just buy a gas station business and now finding out that even with high sales volume the business is not generating enough profit for you? Are you struggling to just meet your basic business expenses? Or are you about to buy a business that will put you in the red? Some of our listeners have just found themselves in that exact situation, so stay tuned and let's analyze all that in this episode.
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 49. 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.
This episode is a direct response to 3 of our podcast listeners and the issues they are facing about their new business venture. I won't mention them by name since I didn't ask for permission ahead of time, so I will just refer to them as person A, B, and C.
Here is the situation, Person A recently sent me an email where he mentioned he recently bought a business but now a month and a half later he is still putting money into the bank just to meet his expenses. Person B sent me an email with a lot of sales data from a store he is thinking about buying and asked for my advice, and lastly person C just sent me an email which said he followed my advice that I gave on various podcast and bought a business but now he sees two of the categories in his new business has less profit margin than what I suggested. The two categories are automotive and cigarettes, where he said my suggestion was 15-17% on cigarettes but he found out his new business has only 5% margin, in the automotive category my suggestion was around 50%, but he sees around 18% margin. But what is alarming is that his cigarette sales are around 37% of his total merchandise sales while the automotive is only 3%
Do any of you remember listening to episode #1 and #33, in these two episodes, I shared my own life story and how I failed miserably in my first gas station business venture, and how I was taken for a fool by the sellers. I am not suggesting that this is what is happening to this three gentleman, but as buyers, we do have to be aware and be very careful, so this does not happen to any of us, right?
Let's start with Person A first, in his case, he is not sure why he is not making any money, in last two weeks we have shared a lot of sales and purchase data with me along with some of the selling prices on some of the products. Here are his numbers and since I am not sharing his name, I will share the numbers this way his privacy won't be compromised.
Last month these were his sales:
Fuel: 67,457.23 gallons
Merchandise $71239.05
Out of the 67K gallons, he sold 61900 gallons of regular fuel and 5100 gallons of premium and plus grade fuel.
The breakdown on merchandise were (I rounded the sales figure off)
Cigarette $27,000 X 15% = $4050
Beer $16000 X 23% = $3680
Soda $12000 X 33% = $3960
Grocery $9000 X 35% = $3150
Tobacco $3000 X 23% = $690
Novelty $2500 X 40% = $1000
Auto $1000 X 50% = $500
Deli $500 X 35% = $175
__________________________________
Sales $71,000 Estimated Gross Profit $17,205. The gross profit margin here is $24%
For the same month, he purchased $62,500 merchandise, which seems high for 71K total sales.
If inventory level remained the same both at the beginning of the month and at the end of the month, then he should have ideally only replaced what he sold at cost right? If so then his purchase should have been$71,000 - $17,205 = $53,795, but he bought $62,500 which was $8705 more. But this is not always bad; this can also mean he may have $9,000 worth of extra inventory sitting on his shelves, but to find that out it is a good idea to have your inventory counted on the 1st day of every month. In his case, he hasn't but he told me he doesn't think he has that much extra inventory. Instead, he thinks he has less than what he started with.
Now if his inventory has decreased compared to what he started with while he bought extra $9,000 worth of inventory, which can mean three things:
His profit margins are lower than we estimated His having massive amount of theft Or a combination of bothAfter I had concluded these 3 outcomes, I asked him to investigate and to tell me what are his profit margin by each department/category, he came back a few days later and informed me that his cigarettes were off by 4%, Beer was off by 3%, tobacco was off by 5%, auto was off by 6% and novelty was off by 10%. Only deli margin was higher than my estimated, and it was at 45% instead of estimated 35% and rest of the categories were pretty much same as predicted.
So, the new calculation looks like this now
Cigarette $27,000 X 11% = $2970
Beer $16000 X 20% = $3200
Soda $12000 X 33% = $3960
Grocery $9000 X 35% = $3150
Tobacco $3000 X 18% = $540
Novelty $2500 X 30% = $750
Auto $1000 X 44% = $440
Deli $500 X 40% = $200
__________________________________
Sales $71,000 Actual gross profit $15,210; the gross margin for him here is around 21%.
The difference between my estimate and the actual gross profit was $17,205 - $15,210 = $1,995.
Remember the difference of $8705 in inventory? Well that amount can now be reduced by $1985, so actually it should be $8705 - $1995 = $6710. He is still missing this much inventory in his store and now since we know the real profit margin, I can safely predict that he is having a serious case of theft in his store.
Person B sent me a lot of sales data, and since he hasn't bought his store yet, I have decided not to share any of that here, but what I want to share with you is that he found a good store and the sales and profit margins both look great, the store is selling around 80,000 gallons a month while the merchandise sales are right around $75,000 with combined gross profit margin is around 26% and he has done some hard work analyzing numbers and the spreadsheet he shared showed the purchase is very much in line with the sales and as Is aid the store has great profit margin both in and outside. So I advised him to go forward with the purchase.
Now, let's talk about person C, in his case he already bought the store, and he too analyzed his profit margin in each category and compared them to my suggestions and noticed that there are only two categories where he was off by big numbers compare to what I suggested.
Cigarettes my suggested margin is 15-17% he found out his was only 5% Automotive category my suggestion is 40-50%, but his is 18%The problem is Cigarettes represent 37% of total store sales while automotive at just 3%.
Do you see the problem here? Typically cigarettes carry anywhere from 20-40% of the total merchandise sales, but the since this is typically a low-profit margin category so if your store has lower sales in this category like 20-25% you are doing better than people with stores where they are having 40% of their sales coming from only cigarettes.
In his case, this is very unfortunate because let's assume his store sales are at $70,000, if you take 37% of that sales which is $25,900 is cigarettes only, and at 5% margin he is making $1295. This is a serious problem, let's assume he is making 30% combined gross profit on the rest of categories
$70,000 - $25,900 = $44,100 at 30% = $13,230 + $1295 = $14,525
But now let's look at if his cigarette margin was at 15%, how this number would change
$70,000 - $25,900 = $44,100 at 30% = $13,230 + ($25,900 X 15% = $3885) = $17,115
The difference is $17,115 - $14,525 = $2,590
Typically when gross profit is this low, it is hard to meet all your fixed and variable expenses and still make a profit.
So once again before you buy a business make sure to check episode 40 and 41 where I spoke at length about doing proper due diligence. In a nutshell remember to always check their sales vs purchase, if the seller tells you they are doing $70,000 merchandise sales and 50,000 gallons you want to check their records of actual sales documents like daily close out that comes out of the registers and not what they entered in their bookkeeping system, because when you go to buy a business you have to assume the seller may tell you lies, so I always tell people to let the seller prove to you that they are honest and truthful by showing you actual sales and purchases for at least last 2 years. This way you can draw your own conclusion. Don't look at their P&L; don't look at their balance sheet or income statement. These documents mean very little to you when it comes buying a gas station.
3 Things matter to you when doing due diligence:
Verifying actual sales Verifying the purchases Verifying their profit margin by categoryOnce you are satisfied, then move on to other parts of due diligence like expenses, payroll and such, but do follow the list I outline in episode 40.
Let's now talk about what if you bought a business like this person C did, how to fix this issue, how do you raise your margin so you can start making money? One advice is if you find yourself in this situation, please don't start raising prices day after you buy the business, which can harm your business beyond repair. Instead, you have to take a smart but slow yet steady approach.
Here are the six steps I would take:
Check on competitor's margin Contact all three cigarette company reps and renegotiate the contracts Raise price in at least three different increments with long intervals in between Run 2 and three pack or even carton pricing special Run at least two other promotion on other categories like Beer and maybe Soda Start giving superior customer service and increase the WOW factor.If you have any question, feel free to send me an email at [email protected], 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.
For all our foreign listeners, if you are interested in learning about investment category visas and how to get one of those by investing in a gas station business, do check out my new book USA Investment Visa to Green Card, How to Qualify, Apply and Obtain EB-5, E-2 and L-1 Visa. You can find this book exclusively on Amazon for now.
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
Thank you once again for joining me in this episode; I will see you in the next one.
Cheers!
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If you are not yet a gas station business owner, then you may want to listen to this episode, as I discuss what is like to be a owner or an operator of a gas station business, what are the daily challenges, and issues we face every day, and if you are already in this business, stay tuned and see if the challenges and issues I talk about matches what you face every day.
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 48. 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.
The idea for this very episode came from David, he sent me an email asking me to explain the day to day life of a gas station owner, so David here it is..
As a business owner we all get up every morning and hurry over to our business to start our day. Every business comes with its own sets of challenges, similarly gas station business comes with its own as well. today I want to discuss some of these daily issues and challenges and how we can manage them properly so they don't become a big burden on your shoulder.
Here are the 8 issues we will discuss today
Cash shortage/Overage Error in daily paperwork Merchandising issues Vendor issues Theft - Internal & External Maintenance issues Employee/Schedule issues Various InspectionsIf you are like me, the very first thing I do when I walk in to a store, I pick the daily close out report to see how much business we did the day before. Then I sit down and go through each shift report to see if there were any issues there. Next I will count money from all shifts and do my sales data entry in my bookkeeping system and balance the cash and the credit. Next, I check on any vendor and merchandising issues. Every store has some degree of theft, I try to analyze and see if there is any other safety measures that can be taken to minimize it. I then check on any issues related to maintenance either outdoor or indoor. Next comes the employee and scheduling issues, again every store has some degree of employee and or scheduling issues that needs to be resolved. Lastly I check on various compliance issues that we may have either from the local health department or from the brand inspectors.
Once again a big thanks goes to David as he is the one who came up with this topic, so this episode is fully dedicated to him.
If you have any question, feel free to send me an email at [email protected], 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.
For all our foreign listeners, if you are interested in learning about investment category visas and how to get one of those by investing in a gas station business, do check out my new book USA Investment Visa to Green Card, How to Qualify, Apply and Obtain EB-5, E-2 and L-1 Visa. You can find this book exclusively on Amazon for now.
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
Thank you once again for joining me in this episode, I will see you in the next one.
Cheers!
-
Welcome to Gas station business 101 podcast, I am Shabbir Hossain, and this is episode 47. 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 is a rather interesting one, and this idea came from Moe. Moe sent me an email about a month ago asking about this very topic as he found an opportunity to take over a store for very little money. I did answer his questions via email but I figured this is a topic that can benefit most of my other listeners. So here it is.
As I said, we all know someone who flips home to make a living, and often they make good money doing so. But there is a growing market where people buy and sell gas stations for a big profit. But if you want to do this business there are few very key points you need to measure first and make sure you fulfill all those requirements. It can be a risky business, it can even be a money pit, so you have to be extra careful to do this business. But if you do it right the payout can be huge.
6 Key factors to consider and analyze before deciding to get into this business
What type of gas stations are better for flipping Where and how to find them Who can flip gas station capital requirements Manpower requirements Management skill requirementOnce you have fulfilled the requirements and bought your first store to flip, your real work begins.
Find out the causes of failure of the business.
5 Main Reasons Businesses Fail
Mismanagement Lack of competitive pricing and promotion Lack of merchandising Store outlook and maintenance issues Change in demographics or change in regulationsOnce you know what cause this business to fail, you need to take a comprehensive approach to fixing not only that single issue but all the other factors as well. It will be like opening a new store where you touch and improve on every part of the process.
6 Key Improvement areas
Fix any and all maintenance issues Updated fresh outlook on a budget Remerchandise the store Innovative/aggressive marketing and promotion Well trained employees Install a good bookkeeping and store operation procedureOnce you successfully implemented each of the above improvement measures, it's time to wait and see the results. On an average, it takes anywhere from 4-6 months for a dying store to come back to life and show growth. In my opinion, a flip from start to finish should take no less than four months and no more than 12 months. Once you see the sales are at a point where the store became profitable, it is time to put it on the market. But don't try to hide the fact as to why you bought this business when buyers ask you why you are selling the business.
Once again a big thanks goes to Moe as he is the one who came up with this topic, so this episode is fully dedicated to him.
If you have any question, feel free to send me an email at [email protected], 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
Thank you once again for joining me in this episode, I will see you in the next one.
Take care
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Welcome to Gas station business 101 podcast, I am Shabbir Hossain, This is only podcast show of its kind where I discuss every aspect of gas station business from how to find and buy the right location, how to market your business, how to do bookkeeping, how to minimize theft to what type of insurance do you need to have for your business. So it is a one stop shopping for any of you that are in this line of business. You may ask how does he know it all? Well I don't and that is why I go and ask the experts sometimes, and I also want your participation in this, because I know some of you out there may be great at something that I am not, so together we can share our knowledge and empower the rest of our community for a better future for our business. Sounds good?
Let's get started
In Episode 17(click HERE to listen to that episode or to see the show notes) I touched on this very topic briefly, but I wanted to make an episode out of it as I have had many email requesting more information on this very topic.
There are two ways to setup a deli in your store.
Fist, you can have limited deli food. This applies to stores that have limited space and small; the other way is opening up a full deli where you offer a full menu from Breakfast to dinner.
But before you open up a deli in your store, there is a certain degree of due diligence you need to do to find out if deli will generate enough business to make it viable for your store. Deli is not for everyone; deli tends to thrive in rural and blue collar neighborhoods, So some research needs to be done to find out if your store should benefit from having a deli business.
Looking at the demographics of the immediate area of your store can tell you if it will be a good idea or not.
Look at data like:
Age of the population Income level of the population Housing (median prices for houses and if there are rental apartments around you) Are there other stores with Deli within 1.5-mile radius Ask your customers if they want to see food in your storeAfter doing the research, if you are still not sure, smart a small limited menu deli.
Limited menu deli is essentially what you see when you walk into a 7-11 or Circle K type corporate stores, where they carry cold sandwiches, hot dogs, and other pre-packaged ready to eat meals.
Once you decide you will want to start a deli business these are the next steps to carry out:
Health dept requirements Equipment requirements Space requirements modification requirements What food to sell How to price your food itemsThe benefits of having a deli inside your store:
Extra income stream Increase in sales of other products Increase sales of fuel Lunch hour rush Loyal customer baseOne small announcement, I recently published a book call How to Master 13 Negotiating Skills and Win in Business, it is a soft launch, but any of you are interested in seeing it, just click on the book title and you will get to see it. This book is one of the three that I have been working for a long while; I was finally able to finish it recently. As of now, I am putting the finishing touches on a book that I co-authored, and that book is all about the various types of investment visas for people that are interested in investing in the USA.
If you would like for me cover a topic I haven't yet, feel free to email me or post it on the Facebook group, and I will try my best to have an episode on that topic, but remember if I pick your topic I will dedicate that episode to your name.
Don't forget to sign up for my newsletter; you can sign up for it by going to http://gasstationbusiness101.com/subscribe or you can directly go to my site and at the bottom of every page there is a subscribe button.
Cheers!
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Welcome to Gas station business 101 podcast, I am Shabbir Hossain, This is only podcast show of its kind where I discuss every aspect of gas station business from how to find and buy the right location, how to market your business, how to do bookkeeping, how to minimize theft to what type of insurance do you need to have for your business. So it is a one stop shopping for any of you that are in this line of business. You may ask how does he know it all? Well I don't and that is why I go and ask the experts sometimes, and I also want your participation in this, because I know some of you out there may be great at something that I am not, so together we can share our knowledge and empower the rest of our community for a better future for our business. Sounds good?
Let's get started
The idea of our topic today came from a gentleman name Yash, he sent me a few emails so far and in one of them he asked me to cover FSA and commercial lease, so again this episode is fully dedicated to Yash, Yash my friend, thank you for bringing such an important topic to the forefront of our discuss.
On that note, if any of you have any other topics that you think everyone can benefit from, please let me know and I will cover that one a future episode.
Before I start, let me just let every one of you know that I am attaching a sample fuel supply agreement in the resource section of my blog at http://gasstationbusiness101.com/resources for you to download and read, and see what it really looks like. This way once you listen to this episode you can go back and look at the agreement for a much better understanding.
23 Key Points of a Fuel Supply Agreement to Pay Attention to
Parties and Premises Duration Product/ Commodity Schedule Quantity/Allocation (Keep an eye on the minimum quantity) Methods of Payment Liability/Credit Credit card acceptance Failure to Perform Excess Quantity/ Determination of quantity or quality Trademark Audit/Inspection of records Customer service and complaints Assignment Environmental compliance Price regulation Equipment and fixtures Termination Insurance Law compliance Guarantor Key person rider Survivorship Choice of law/ attorney feesClick HERE to download the Sample Fuel Supply Agreement
If you would like for me cover a topic I haven't yet, feel free to email me or post it on Facebook group and I will try my best to have an episode on that topic, but remember if I pick your topic I will dedicate that episode to your name.
Don't forget to sign up for my newsletter, you can sign up for it by going to http://gasstationbusiness101.com/subscribe or you can directly go to my site and at the bottom of every page there is a subscribe button.
Cheers!
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Welcome to gas station business 101 podcast. This is episode number 44. This is the only show of its kind where we focus on all aspects of gas station business and we discuss, analyze and try to improve the process by trying to see what works and what doesn't.
Today's topic a very important one and it is all about commercial lease and how to read and understand this complex document. What to look for as potential problem in these leases.
The idea for this episode came from two people, Yash and Jasmine, so thanks to both of you for bringing up such a good topic out front for everyone else.
Most commercial leases are complex by nature as it is a legal document but it gets even more complex when it is prepared for a gas station because there are two parts of a gas station business, a convenience store part and then there is the fuel part.
To understand this document fully I am attaching a full commercial lease as a sample which you should be able to download from my blog site, by going to the show notes for this episode or you can go under the resource tab and find it there.
In this episode I will not read every word of a lease because that would not only take a long time to do but it will be not worth your time as you can just download that copy and read it yourself. Instead what I will do is explain few important points of a commercial lease and some potential issues that maybe be hidden in a commercial lease.
Below is a link you can download and view a Commercial Lease for a Gas Station
Commercial Gas Station lease
So let's get started..
These are the followings 18 important parts of a commercial lease agreement Identify each party What is for lease Term of the lease Rent Additional rent (taxes, fuel rent) Payment methods and due dates Insurance Indemnity Assignment(Sublease) Maintenance Casualty Right to Entry Default Remedies Personal guaranty Brand identification and minimum Standard Additional Exhibits or attachments Potential risk factors to look forCouple of quick announcements before we finish here..
I am still seeing people registering for my forum on my site, as I mentioned before, that forum is not working properly, so please join my Facebook group instead and there you can post questions, get quick answer to any question you may have. To join my Facebook group simply go to shabbirhossain.net and it will take you straight to my group.
If you would like for me cover a topic I haven't yet, feel free to email me or post it on Facebook group and I will try my best to have an episode on that topic, but remember if I pick your topic I will dedicate that episode to your name.
Lastly I want to send a big thanks to Nitin Gangwani, for his kind words as he gave me a 5 star review on iTunes, Nitin if you are listening I sure do appreciate your kind words and that sure makes my day.
Don't forget to sign up for my newsletter, you can sign up for it by going to gasstationbusiness101.com/subscribe or you can directly go to my site and at the bottom of every page there is a subscribe button.
Next week I will have another very important episode where we will discuss everything about FSA or Fuel Supply Agreement and that episode will be dedicated to a long time listener name Yash as he is the one who gave me that topic.
Cheers!
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First, let's define what is passive income. Passive income a process where you earn money without being involved in the day to day business operation of the business. If any of you remember the free book, I send to everyone on my mailing list all about passive income than you know there any many ways to make money passively. It is really where you work hard at first to set something up and then sit back and watch that hard work make money for you over time.
For example, say you wrote a book two years ago, at the time of wiring the book you worked really hard, you did a lot of research, and then took months to finish the book. But once you are done writing and you publish it, you can just sit back and relax and watch that book earn money for you month after month and year after year.
But the same approach will not work when it comes to a gas station business. It will require a very different approach. It's not a book, not an affiliate income or commission that you will earn every month. It is a retail business with lots of moving parts.
One way I have seen people try this approach that can work as passive income model is if you hire good employees and managers to run the business while you just monitor their work and step in only when you need to. But to me that is not a good idea, it's not a good approach either, I have seen too many owners lose their business by depending on hired help.
Instead, my suggestion is to find a good partner or two who are willing to do the hard work for a salary and portion of the net profit, and you just stay on as a silent partner or investor and enjoy the income.
4 key points to having a successful partnership Find a good hard working person or two that are willing to do the hard work Draw up all the legal documents and partnership agreement(Clearly define the expectation of each partner and their role and responsibility) Have a great bookkeeping system in place Physically Check and verify the numbersIn order for you to take this approach, first and foremost you have to know and trust that individual fully, and then you have to install or put some safety measures in place, so there are checks and balances. It's like a having a lock on a door, as we all know locks are there to keep honest people honest. But in your case you are not installing a lock but a system of tracking sales vs. purchase and expenses.
The best approach is what I have done many times is by having a good bookkeeping system in place. I explain to my partners that they have to prepare and furnish a monthly report to all partners which should include a sales report, a P&L and or an income statement and a copy of the bank statement. This way every partner or investors know what took place the month before at the store. Each will have the detailed knowledge of the sales volume, expenses purchases and how much net profit the store has made.
In my opinion, you will still have to visit the store, meet your working partner at least once a week, just look around see what is going on and if they need your help on any issues. So even though it is more passive but you still be to around and supervise without intervening in the daily operation of the business.
I have taken this approach for many years, and so far it has worked well for me, and I am sure if you pick the right person it will work for you also. So yes as you can see gas station business can work as a passive income model if you take the right approach to it.
If you haven't signed up for my newsletter where I send many valuable information through every couple of weeks, by all means, do so. This way you will be notified of any and all changes that affect our business. Just hit Subscribe below this page and you will be on the list.
If you need to ask me any question, you can do so by either sending me an email at [email protected], or you can join my Facebook group by going to http://shabbirhossain.net. It's a domain redirect; it will take you to my Facebook group page.
The app I spoke about in this episode is call Road Spoke, and here is a link to their YouTube video.
https://www.youtube.com/watch?v=K6dZ3fpPad0&feature=youtu.be
Cheers!
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Welcome to Gas Station business 101 podcast, I am Shabbir Hossain, and this is episode 42. For those of you who are joining me for the very first time, this is a show where we discuss from how to start, run and grow a gas station/convenience store business successfully and make money. In each and every episode we discuss a new topic that is targeted towards improving your business one step at a time.
Topics could vary from marketing ideas, to fuel management to bookkeeping and many more just like these topics, if you want me to cover a topic in a future episode, feel free to email me, and I will try my best to cover it in a future episode. Now here is the fun part, if you send me a topic that is valuable enough for everyone, and I make an episode out of it, that episode will be dedicated to you. Sounds good?
Let's get started.
Q1. How to use Facebook for gas station marketing? (Reference Episode#10)
Q2. Can leasing a gas station get me an E2 Visa? ( Reference Episode#31)
For answer also read my blog post by clicking HERE
Q3. I have ATM, should I start selling money orders too?
Q4. How to do I find out about previous contamination of a gas station that I am buying?
Q5. How do I know if the tanks of a Gas station I am buying has fiberglass tanks and not metal tanks like you said some stations have?
Q6. What kind of insurance do I need to get that can protect me from various loss and theft?
Q7. At closing the seller wants me to pay a percentage of the retail inventory, what should I do?
Q8. Should I change from selling diesel to selling E85 as E85 is much cheaper, and I am in a very competitive neighborhood
The announcement about the '" Ask Me Forum".Since I have had issues after issues with the forum sign up and posting, I have deiced to take the discussion to my Facebook Group. So any of you that have signed up for my forum, my sincere apology, instead please sign up to my newsletter this way I will have you on my mailing list to notify any and all important updates. Also to ask me any question, please join my Facebook group and to do so just type http://shabbirhossain.net on your browser and it will take you to my Facebook Group.
If you haven't signed up for my newsletter where I send many valuable information through every couple of weeks, by all means, do so. This way you will be notified of any and all changes that affect our business. Just hit Subscribe below this page and you will be on the list.
If you need to ask me any question, you can do so by either sending me an email at [email protected], or you can join my Facebook group by going to http:.//shabbirhossain.net. It's a domain redirect; it will take you to my Facebook group page.
Cheers!
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