Buying a Gas Station/Convenience Store
Six Strategies for Making Your Gas Station Into a Money Machine
By Richard Parker: President of The Resource Center for Buying a Gas Station/C- Store™ and author of How To Buy A Good Gas Station/C-Store At A Great Price© .
When you buy a gas station or buy a convenience store, you ask the seller dozens of questions. And you scour the seller’s books to make sure the business, on the day you become the owner, is already turning a profit.
But that’s not enough. Here are six strategies that will cause a dramatic uptick in your income and cash flow – fast!
Strategy One: Apply pressure-point marketing to snag new customers. The “under new management” period is a great time to get your station and store into customers’ routines and buying patterns. Get aggressive! Put up huge signs announcing that you are knocking a nickel off the price of every gallon of gas for a week. Or give away free coffee at the pumps every morning for the first week. Or give away free car washes. Or have uniformed, energetic employees distribute free newspapers, coupons for discounts and other incentives at every pump. The week after you apply these strategies, your business will be making more money than the previous owner thought possible.
Strategy Two: Co-promote with other merchants in the area. Don’t wait for customers to come to you. Instead, find them where they are already shopping! If there’s a supermarket across the street from your station, make a deal with its manager to distribute their coupons at your station if they’ll distribute yours at their store. Forge similar deals with tire vendors, car washes and other area merchants. Cast your net wide and pull those dollars in!
Strategy Three: Negotiate aggressively to get better deals from vendors. As the new owner, it is your right to reopen price discussions with the distributors for everything you sell in your store – from coffee to donuts to magazines. One of the best strategies is to bring new vendors in and invite them to bid for your business. If you do, you’ll be surprised how quickly previous vendors offer you price breaks and other advantageous deals. Another winning strategy is to invite vendors to sell additional products in your store, with return privileges if they do not sell. If the products do sell, you make money. If they don’t, you don’t lose a cent.
Strategy Four: Make it a family affair. Even if you don’t plan to have your family members work for your business indefinitely, get them to volunteer to work during your first few months of operation. It’s a great way to slash payroll costs during the first critical months of ownership. Plus, it’s a great way to train family members in the event they need to step in for you during vacations, sick days, etc.
Strategy Five: Identify underperforming products. If you analyze past retail records, you will discover that certain items outsell others by a margin of at least 2:1. As a new owner, consider cutting slow-selling items for your first few months of operation in exchange for testing new products and displays. Vendors will often be willing to place them on a guaranteed sales basis. You can always reintroduce them after you are generating steady cash flow from hotter-selling items. This strategy has to be in balance with the fact that you are selling “convenience” – people come in for all kinds of odds and ends. A good operator knows that some items simply do not sell enough to warrant the retail space they occupy. Finding products that sell well can only be done by testing, testing, testing.
Strategy Six: Apply some basic strategies to boost retail sales. Put your hottest-selling products on end-of-aisle displays, or right inside the door – try offering a coupon display outside by the pumps if appropriate. Think seasonally too. If slush drinks sell well in summer, put your slush machine right inside your front door. If you can apply similar strategies to only four or five of your top-selling products, you will see a marked difference in your bottom line.
Those are only six ideas for ways to create a sales surge in your first days as an owner. You’ll find many more in our guide, How to Buy a Good Gas Station/C-Store at a Great Price.
This article represents a fraction of what you’ll learn in How To Buy A Good Gas Station/C-Store At A Great Price© - the most widely used reference resource and strategy guide for anyone thinking about buying a gas station. Read a detailed listing of what you'll learn.