Keys to Site Selection

When you're choosing a site, we know it can be tough to interpret competition. Of course, your instinct might tell you to avoid investing in an area that has existing competition. But did you know in many cases, competition can be a great sign of potential success?

You'll want to avoid investing in an area that is already noticeably over-saturated with gas stations. A popular high-density area may have a large number of stations, so consider carefully how you will offer more value than the competition. If you have to win business over multiple competitors, you may be positioning yourself for a challenging future.

The natural growth of cities presents an opportunity. Look at parts of the city where natural growth will increase the fuel volume of an area. Understand what new players will be arriving in that same area by looking at zoning and city planning documents that are accessible to the public.

Also look closely at nearby big-box retailers offering significant fuel discounts. Understand the discount gap between the local stations and the big-box retailers offering gas. Examine the nearby grocery stores and wholesale clubs without a gas offering and evaluate if you think there is a chance they may expand into fuel. You will also want to research whether or not those grocery stores offer fuel at other locations

However, don't be afraid of competition. In some cases, trying to build in a location with zero opposition can be more frightening than high competition. Healthy competition indicates that there is demand in the area. With that said, even if there is low competition but rapid growth, it could result in higher sales volumes.

Also, consider investing in site modeling. There are a number of reputable companies that will, for a fee, create a digital model of the site you are planning to build at the specified location. They can predict gasoline volume, convenience store sales and the potential for alternate profit centers.

Lastly, invest in a good architect who specializes in gas stations and who is familiar with the city and state ordinances. Ask for and check references.