How Much Is It to Buy a Gas Station? 6 Facts for Your Deal

Are you thinking about running your own gas station? It can be a smart investment but comes with many moving parts. From startup costs to daily operations, every detail matters. The more you understand upfront, the better prepared you'll be to make the right call. Now, let’s dissect what you need to know before signing the dotted line. 

UNDERSTANDING THE COST OF BUYING A GAS STATION  

Buying a gas station can cost anywhere from $250,000 to over $2 million, depending on several key factors. Location, for instance, plays a big role. Urban stations tend to cost more than rural ones. Brand affiliation also impacts the price, as does whether the business includes real estate or is lease-based. Your initial investment often covers: 

• Purchase price or lease. 
• Renovation and equipment upgrades. 
• Licensing and permit fees. 

Each of these costs varies, but together, they make the total you’ll need to get started. 

BUYING A FRANCHISE VS. INDEPENDENT GAS STATION  

Franchise gas stations like Shell or Exxon usually cost more upfront. You’ll likely pay franchise fees and follow strict brand rules. However, you also get name recognition and higher initial customer demand. 

On the other hand, independent stations often cost less and give you more freedom to run things your way. The main differences between franchise and independent gas stations include: 

• Franchise fees and supplier agreements. 
• Marketing support and brand trust. 
• Operational control and flexibility. 

Choose based on your budget, goals, and the level of control you want. 

THE ROLE OF REAL ESTATE IN GAS STATION PRICING  

The cost to buy a gas station with the property outright is usually higher upfront. However, you also own the land, which can build long-term value. Leasing is cheaper to start but may come with restrictions or rising rent. Here are the essential real estate factors to consider: 

• Commercial property value based on location, traffic, and lot size. 
• Zoning laws that control what you can and cannot do on the site. 
• Property taxes that affect yearly costs.  

Your decision impacts both the upfront price and future profit potential. 

BREAKDOWN OF THE MAJOR COSTS IN A GAS STATION PURCHASE  

Your initial investment isn’t just about the sale price. It’s made up of several elements that can quickly add up. Learn about them below. 

1. PROPERTY & FACILITY COSTS

Real estate and facility upgrades are often your biggest expenses. You’ll need to budget for: 

• Renovations to meet code and customer expectations. 
• Repairs to pumps, canopies, or parking areas. 
• Ongoing maintenance to keep the property safe and functional. 

Expect more spending if the property hasn’t been updated in years. 

2. EQUIPMENT & INFRASTRUCTURE

To successfully run a gas station, you need to have the right infrastructure and keep it up to date. Old or damaged equipment can lead to safety issues, fines, or lost sales. Essential items to budget for, include: 

• Fuel pumps and underground storage tanks. 
• Point-of-sale (POS) systems and card readers. 
• Lighting fixtures, signs, and HVAC units. 

Outdated equipment may need upgrades to meet regulations. Maintenance and inspections add ongoing costs that directly affect your station’s safety, compliance, and profitability. 

3. LICENSING, PERMITS & INSURANCE

Running a gas station means meeting strict legal and safety requirements. You’ll need multiple permits before opening, and staying compliant isn’t optional. Expect costs tied to: 

• Local, state, and federal permits. 
• Environmental compliance, like fuel storage regulations. 
• Business liability and pollution insurance.

Skipping these steps can lead to serious fines or delays. Make sure to budget for renewals and ongoing coverage to keep your station protected. 

4. INVENTORY & SUPPLIER AGREEMENTS

Before opening, you’ll need to stock up and lock in your supply chain. This step refers to offerings like fuel inventory, retail products, and sometimes car wash supplies. Be ready for: 

• Upfront fuel costs and signed supplier contracts. 
• Stocking shelves in your convenience store. 
• Managing deliveries with reliable distributors. 

Some contracts include minimum purchase requirements or fixed pricing, which affects your margins. Don’t solely focus on what you sell. How you buy and from whom is just as important. 

5. STAFFING & OPERATIONAL COSTS

Labor is a big part of your day-to-day expenses, especially if your station runs 24/7. You’ll need to factor in wages, hiring, and training. Costs to consider include: 

• Payroll for cashiers, managers, and maintenance staff. 
• Onboarding and ongoing training to meet safety standards. 
• Scheduling tools or payroll software to stay organized. 

Staffing impacts both customer service and profitability, so plan ahead to avoid understaffing or overpaying. A well-run team supports efficient operations. 

FINANCIAL CONSIDERATIONS & FUNDING OPTIONS 

Most buyers don’t pay out of pocket. Knowing your financing options is key to making a smart investment. 

HOW TO FINANCE A GAS STATION PURCHASE 

There are several ways to fund your deal. Traditional options include SBA loans, business loans, or commercial mortgages. Some buyers partner with private investors or pitch to venture capital firms. You can also explore owner financing, where the seller helps cover part of the cost. 

Each option has its pros and cons. As such, be sure to compare terms, rates, and timelines before moving forward. 

CALCULATING RETURN ON INVESTMENT (ROI) 

Profit isn’t just about selling gas. Most stations earn from multiple streams—fuel, snacks, car washes, and even services like repairs or ATMs. 

Before buying, look closely at current sales and expenses. Ask for profit and loss statements, and review how much each part of the business brings in. 

Also check local demand and traffic volume. That’ll help you estimate future performance. Strong ROI comes from a balanced mix of fuel sales, retail margins, and add-on services that boost total revenue. 

3 KEY FACTORS THAT INFLUENCE GAS STATION VALUATION 

A gas station’s asking price depends on more than just sales. Several external factors can raise or lower its market value, such as the ones outlined below. 

1. LOCATION & TRAFFIC VOLUME

Your station’s location is key. High-traffic areas near highways or major roads usually bring more cars and more sales. 

Urban stations may have higher costs but steadier foot traffic. Rural stations are cheaper to buy but can be less profitable if volume is low. 

Visibility, accessibility, and surrounding businesses also play a role in long-term value and daily revenue potential. 

2. FUEL SUPPLIER AGREEMENTS

Most stations sign long-term contracts with fuel suppliers. These deals lock in pricing, delivery terms, and branding. However, they can also limit flexibility. What to watch for: 

• Minimum purchase requirements that impact cash flow. 
• Fixed or variable pricing models. 
• Fees tied to early termination. 

Negotiating better terms upfront can boost your margins over time. Compare offers and read the fine print. These contracts directly affect your daily costs and long-term profits. 

3. ADDITIONAL REVENUE STREAMS

Most of your profit potential comes from what’s beyond the pump. Successful stations often earn more from extras than from fuel alone. Common add-ons include: 

• Convenience stores, which often have higher margins than fuel. 
• Food service, such as coffee and quick meals. 
• Car washes or repair bays for steady upsell opportunities. 
• Lottery tickets, ATMs, or gaming machines for passive income. 

These extras can turn a slow day at the pump into a profitable one. Strategic services increase your chances to boost revenue per customer. 

3 KEYS TO YOUR DUE DILIGENCE BEFORE BUYING A GAS STATION 

Doing your homework before buying is critical. These checks help you avoid costly surprises and spot a good deal. 

1. REVIEWING FINANCIAL RECORDS & PROFIT MARGINS

Start with the numbers. Ask for at least three years of financial statements—P&L reports, tax filings, and sales data. Watch out for: 

• Inconsistent income or unexplained dips in sales. 
• High operating costs without matching revenue. 
• Missing documentation or vague expense categories. 

A clear financial history helps you judge if the station is stable, growing, or struggling. 

2. INSPECTING ENVIRONMENTAL & REGULATORY COMPLIANCE

Gas stations are heavily regulated, especially when it comes to fuel storage and environmental safety. Before buying, check if the site meets EPA regulations and local environmental standards. Look out for: 

• Leaks or damage in underground storage tanks. 
• Incomplete inspection records. 
• Costly cleanup liabilities from past spills.

An environmental audit can reveal hidden risks. It’s a step you shouldn’t skip to protect both your wallet and future operations. 

3. EVALUATING THE COMPETITION & MARKET DEMAND

Before you buy, take a close look at the local area. Is there enough traffic to support your business? 

Check how many stations are nearby and what they offer. Compare pricing, hours, and extra services like car washes or food. 

Also look at the community. Who are your potential customers? What are they looking for in a station? By understanding demand and competition, you’re better positioned to predict future sales and avoid oversaturated markets. 

FREQUENTLY ASKED QUESTIONS ABOUT BUYING A GAS STATION 

Thinking about buying a gas station? These quick answers can help clear up common questions before you take the next step. 

How profitable is owning a gas station? 

The profitability of a gas station depends on location, traffic, and the services you offer. Many stations earn more from retail, food, and services than fuel itself. 

Is buying a gas station a good investment? 

Buying a gas station can be a good investment if you buy the right one. Do your research, check the accounts, and understand the local market before committing. 

How much money does it take to buy a gas station? 

The cost to buy a gas station can range from $250,000 to over $2 million. Factors include location, property type, brand, and the condition of equipment. 

How much does it cost to lease a gas station? 

The cost to lease a gas station is usually cheaper upfront than buying. Expect lower costs, but also less control and no ownership of the land. 

How do gas stations set prices? 

Gas stations set prices based on wholesale fuel costs, supplier contracts, taxes, and nearby competition. Brand reputation and operating costs also play a role. 

MAKING THE RIGHT INVESTMENT DECISION 

Buying a gas station is a big step. The right choice depends on your budget, goals, and how much risk you're willing to take. 

Review the finances, check the location, inspect the infrastructure, and understand the competition. Make sure every detail adds up before you commit. 

Once you're up and running, the next challenge is keeping customers coming back. Download the Paytronix Loyalty Guide to see how smarter rewards can drive repeat business for your gas station.