What is a good profit margin for a gas station?

What is a good profit margin for a gas station?

According to IBISWorld, gas stations make an average margin of just 1.4% on their fuel. That’s far lower than the 7.7% average across all industries — and ranks beneath other notoriously low margin businesses like grocery stores (2.5%) and car dealerships (3.2%).

What is the profit on 1 gallon of gas?

The markup on a gallon of gas averages 30 cents and after expenses, especially credit card fees which can be 10 cents or more per gallon, retailers have net profits of around 10 cents a gallon. Selling gasoline as a convenience store certainly can be a good business model.

What is the average net profit of a gas station?

After credit card fees and other operating costs, net profit for gasoline sales averages 3 cents a gallon, according the NACS. Contrary to what most consumers think, higher gas profits do not mean higher profits for individual station owners.

Do gas station owners make money?

Gas Station Owner Salary Overview If your station is in the West, you’re more likely to make around $60,000 annually on average. Gas station owners in the Midwest could earn around $61,000 on average annually, while operating a gas station in the South could earn you around $66,000 on average per year.

How much does it cost to produce 1 gallon of gasoline?

Cost to refine gasoline varies between $. 40 and $. 70 per gallon, depending on whether summer or winter formulas are being used. In the example above, the cost to refine gasoline is $.

Are gas companies profiting?

Last year, 28 of the top oil and gas CEOs raked in $394 million in compensation—a nearly $45 million increase since 2020. Shell’s profits were 180 percent higher than in the first quarter of 2021. Shell made $19.3 billion in total profits in 2021.

How much profit do oil companies make in a gallon of gas?

About $0.05/gallon is profit for refineries turning that crude oil into gasoline. That’s the ExxonMobil and Shell’s of the world as well. And that gas station of yours? Well the retailers (including distributors and marketers) on average made about $0.04/gallon in profit.

What is the profit margin on a gallon of gas?

For gas stations, the average profit margin for a gallon of gas is roughly 2.5 percent. For all of their products, gas stations made 3 percent net profit in 2013 and 1.6 percent in 2012. Most of the retail price of a gallon of gas, 69 percent, goes to the cost of crude oil. Taxes are about 13 percent of the price.

How do you calculate distribution margin on gasoline?

Distribution margin (distribution costs, marketing costs, and profits) is calculated by subtracting the wholesale gasoline price (either branded or unbranded) and taxes (state sales tax, state excise tax, federal excise tax, and a state underground storage tank fee) from the weekly average retail sales price.

Is there a retail-specific margin for a retail gas prices?

A retail-specific margin is not available at this time. Wholesale Gasoline Price: The average wholesale gasoline price is the average of 13 unbranded and 13 branded wholesale prices at various wholesale fuel loading racks around the state. This average price is for a single day.

What is a negative distribution margin in gasoline?

A negative distribution margin implies that some gasoline is being sold at a loss. Similar to the refining margin, the distribution margin also includes the costs and profits of operating the retail gas station as well as various transportation and storage fees incurred once gasoline is moved from the bulk terminal to the retailer.