What is the profit margin in the business of a petrol pump in India?
Lost your password? Please enter your email address. You will receive a link and will create a new password via email.
Please briefly explain why you feel this question should be reported.
Please briefly explain why you feel this answer should be reported.
Please briefly explain why you feel this user should be reported.
The profit margin for a gas station business in India is a fixed commission per liter, typically ranging from ₹1.5 to ₹3 per liter for gasoline and ₹2 to ₹3 per liter for diesel. This translates to an overall profit margin of between 1% and 3% on fuel sales. While these margins are low, profitability depends on high sales volume, efficient management of operating costs, and the ability to generate revenue from related services, such as convenience stores.
Keep in mind that nowadays you’ll have to invest in everything: land, buildings, equipment, and fuel. Therefore, your investment is quite high. To justify it, you must achieve a high return. This is possible if your sales volume is high. A high volume depends on your location and reputation.
The gross margin in India is approximately 3.25% of sales. You will need to pay:
Fuel evaporation (0.75% gasoline and 0.2% diesel)
Don’t expect more than 0.5% to 0.75% of your net profit.
The keywords are location, reputation, and volume.