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Home » How To Start Petrol Pump Business – Petrol Pump Dealership

How To Start Petrol Pump Business – Petrol Pump Dealership

Petrol Pump Business

The petrol pump business has always been regarded as one of the most profitable, not only in India but also globally. Today, Whenever people live in urban areas would raise their life, they would use different vehicles like two-wheelers, three-wheelers and four wheels on the roads. Yes friends, in any city, whether it is small or big, vehicles are dominated on the roads everywhere.

The reason for their rapid increase in comparison to earlier is probably the improvement in the lifestyle and income of the people. Well, whatever the reason may be but the truth is that except for cycles and battery-operated vehicles on the road, all other vehicles require fuel diesel or petrol to run.  And the vehicle holders are subjected to this need and move towards a place where petrol and diesel is being sold on the side of the road, this roadside available space is called a petrol pump. 

And since the person opening a petrol pump is earning money by selling fuel, so commercially this process can be called Petrol Pump Business. If you are interested to start your own petrol pump business, Then here in this article we provide a detailed guide about how to start a petrol pump station business.

Market Potential for Petrol Pump

In India, the fuel sector has always been one of the major industrial sectors in the year, this industrial sector plays an important role in the decision making of all other industrial sectors. According to a data, in the last year, the consumption of fuel in India has increase of 10.7% which was the highest level in the last few years. 

Where earlier oil marketing companies Indian Oil Corporation Limited, Bharat Petroleum Corporation Limited, Hindustan Petroleum Corporation Limited, were leading the fuel sector.  But at present, all these companies are facing challenges from Reliance Petroleum Limited, ESSAR Petrol Pump limited

These companies took the initiative to link the prices of petrol and diesel with the price of the market, which was welcomed by almost all sectors, that is, their move was called a welcome step by all.  Although fuel is used in every small and big area, but its consumption is more in metro cities than others, so every company tries to set up more and more of its petrol pumps in metro cities.

Eligibility to Open Petrol Pump Business

The eligibility to open a petrol pump was earlier, the age of application for petrol pumps was 21-45 years, now it has been increased to 60 years, and to apply it was necessary to have done graduation earlier, but now this rule has been changed.  That is, now even those with 10th pass will be able to open petrol pumps.  The financing conditions for initial dealerships have also been canceled under the new rules. 

The security deposit has also been reduced.  Obviously, even if you have less cash, a petrol pump can be opened.  Your age should be between 21 to 60 years, it is important that you are an Indian citizen, only Indian citizens can open a petrol pump in India.  You must be at least 10th pass.

Land Required to open a Petrol Pump

Requirement of land for petrol pump Land is a very important factor to start a petrol pump business. Oil marketing companies also first seek applications from those people who have their own land attached to a highway. If your land is on the state highway and national highway, then you will need a minimum of 1200 square meters to 1600 square meters Land will be needed. 

If you want to open your petrol pump in urban area or city, then you will need at least 800 square meters area. The proof of Land documents are may need to submit to while applying. If the land is not owned, and If you have taken the land on lease, then it is necessary to get the lease agreement. Also, you have to get the N O C Certificate from the landowner. Then you can apply for a petrol pump.

Investment for Petrol Pump Business

The investment of the petrol station business depends largely on the location where you install it. The minimum amount required to start the petrol pumps is Rupees 12 lacs for rural locations And Rupees 25 lacs for urban locations.

The investment of the funds can be stored anywhere like national savings certificates, bonds, stocks, savings accounts, mutual funds, and the like. For bonds, stocks, and mutual funds, only 60% of total investment is considered funds under this deal.

Licence and Permits for Open a Petrol Pump Business

To open a petrol pump, the applicant needs to obtain certain certificates and permits to operate his petrol pump without any hassle and pressure.  Some of these include a Certified copy of No Objection Certificate. Consent Certificate from Municipal Administration.

Get the No Objection Certificate from  Fire Safety Bureau concerned authorities. and Income Tax registration, VAT registration papers and now GST registration documents are required. And also the Location of the petrol pump an important aspect. As per the specifications and guidelines of the OMC, the applicant should install the petrol pump and oil tank after obtaining the license.

How to Apply for Petrol Pump Dealership Business

As we all know that there is a cost to open a petrol pump is little high, but this business is included in the list of profitable business because the consumption of fuel is increasing continuously in India.

  • When an oil marketing company in India has to open its own petrol pump.  Then, he advertises it in the local newspapers in the area where it is opened.  So that people living in that particular area can apply for it. 
  • So in general, a person can apply for opening a petrol pump only when an application has been sought by an oil marketing company for opening a pump in that particular area. 
  • Apart from this, there are many oil marketing companies who have given the form of inquiry in this regard in their official website
  • If you also want to contact them through the inquiry form, then Go to the official website of the petrol company’s.
  • After completed the dealership process, The company’s will be help to set the petrol pump station for your business.

Profit Margin in Petrol Pump Dealership Business

Currently, there is more use of fuels like, petrol and diesel for All vehicles, So If you sell at least 1,000 liters of petrol per day, then you can earn 2,500 to 3,000 are per day. The mileage in diesel is less than that of petrol. So the profit of diesel ranges from Rs 1.80 to Rs 2.50 per liter. If your petrol pump is well located on the highway, then you will be able to earn well.

If you sell diesel in 1000 liters per day, then your profit can be comfortably from 1500 to 2500 from diesel daily, if you catch a big transport company and give good facility to keep good relation with your customer. Your profit can also increase and you can earn more than 2 lakh profit in a month.

Important Notes for the Petrol Pump Dealership Business

  • Oil marketing companies keep on changing the rules and guidelines from time to time, so it is advisable to visit the official website from time to time for official information.
  • Further, Petrol pumps sell highly inflammable products. So Working in petrol pumps or running such business can bring any type of hazardous accidents at any time. This can be risky if not handled by skilled labour.
How To Start Petrol Pump Business

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