Gas Station: Startup Costs, Profit, and an Honest Verdict
Buying an existing station runs $300,000 to $1.5 million, and the fuel itself nets you 10 to 15 cents a gallon. The candy, cigarettes, and coffee inside are the actual business.
Updated 2026-07-05· US figures
The short answer
Buying an existing gas station costs $300,000 to $1.5 million in 2026, plus $30,000 to $80,000 in fuel inventory float and more for store stock. Fuel itself nets only 10 to 15 cents per gallon after card fees. The convenience store inside carries the profit, and old underground tanks can add six figures.
Almost nobody builds a gas station from scratch anymore; you buy an existing one, which means $300,000 to $1.5 million for the business plus $30,000 to $80,000 floating fuel inventory before your first customer. The economics surprise most buyers: after credit card fees, fuel nets $0.10 to $0.15 per gallon, so a station pumping 80,000 gallons a month clears maybe $8,000 to $12,000 on fuel against all of its overhead. Inside sales carry the profit. The hidden monster is underground storage tanks: environmental liability transfers with the property, and replacing old tanks costs $150,000 to $400,000. Add the EV transition slowly eating gallon volume, and this is a tighter business than the sale listings suggest.
Where the money goes
| Item | Low | Typical | High |
|---|---|---|---|
| Purchase of existing stationBusiness plus real estate in smaller markets; business-only leasehold deals run cheaper but leave you exposed to the landlord. Priced off inside sales and gallons, verify both from supplier statements, not the broker's summary. | $250,000 | $600,000 | $1,200,000 |
| Fuel inventory floatYou pay for each tanker load days after delivery and recover it pennies at a time. This float never comes back until you sell. | $30,000 | $50,000 | $80,000 |
| Convenience store inventoryCigarettes alone can be $15,000 to $30,000 of this. High-theft, date-sensitive stock; count it yourself at closing. | $40,000 | $60,000 | $100,000 |
| Fuel brand agreement costsBranding with Shell, BP, or Chevron often comes with image requirements you fund. Unbranded means cheaper fuel sourcing but no card program or brand pull. | $0 | $25,000 | $70,000 |
| Environmental site assessmentPhase I, and Phase II if anything smells wrong. Never skip this. Contamination liability transfers with the property and can exceed the value of the station. | $3,000 | $8,000 | $25,000 |
| POS, back office, and dispenser upgradesEMV-compliant dispensers and modern POS. Sellers love to leave this bill for the buyer. | $10,000 | $30,000 | $100,000 |
| Licenses: fuel, tobacco, lottery, alcoholAlcohol licenses are the expensive, slow one and vary enormously by state and county. | $2,000 | $10,000 | $50,000 |
| Working capital and insuranceIncludes pollution liability coverage, which is its own line and is not optional. | $25,000 | $50,000 | $100,000 |
The costs the sellers do not mention
Every pitch deck and broker pro forma for this business leaves the same lines out.
- Underground storage tank replacement. This is the monster. Steel tanks from the 80s and 90s are at or past end of life, and replacement runs $150,000 to $400,000 including excavation and downtime. Get tank age, material, and testing records before you offer, and price the station as if you will replace them if they are over 25 years old.
- Environmental cleanup liability. If tanks leaked, even under a previous owner, remediation can run six to seven figures, and state trust funds cover less than sellers claim. This is why the Phase I assessment and pollution insurance are non-negotiable.
- Credit card fees on fuel. Card interchange takes roughly 2 to 3 percent of the pump price, which is most of the gross fuel margin. This is why net margin is 10 to 15 cents, not the 30 to 40 cent gross spread you see quoted.
- The EV transition. Gallon volumes for small independents are flat to declining, fastest in coastal metros. A 10-year hold assumes fuel demand that may not be there. Stations with strong food service and inside sales are the ones positioned to survive it; pure fuel plays are melting assets.
What you will actually make
- Year-one profit
- $40k-$80k
- Established
- $60k-$150k
- Net margin
- 2-5% net
- Payback
- 5-8 years
Underwrite the store, not the pumps. Get 12 months of fuel supplier statements and inside-sales registers, verify gallons and margins yourself, and assume card fees eat what the broker's pro forma ignores. Then subtract a market wage for your 60-hour weeks before calling the remainder profit. Many listed stations only 'make money' because the owner works two unpaid jobs: cashier and manager.
Verdict: crowded, declining for small independents
Gas stations are a real business with real cash flow, but the easy years are over. Fuel margin is pennies, hypermarts and chains use fuel as a loss leader, and EV adoption is slowly shrinking the gallons that bring customers to the lot. The independents that do well own their real estate, run strong food service and inside sales, and bought at prices that account for tank age. If you are looking at a listing priced on fuel volume with 30-year-old steel tanks and a dying c-store, you are buying the seller's problem. Come in with environmental diligence done, a plan for the store, and a price that assumes gallons decline, or do not come in at all.
Thinking about a specific version of this?
Numbers say whether the model works. They cannot say whether your version, in your town, against your competitors, will. Run it through Olune for a build-or-kill verdict on live demand signals, or model your own costs first.
Keep reading
Gas Station: common questions
How much do gas stations actually make per gallon?
Gross margin runs 25 to 40 cents per gallon in normal markets, but credit card fees, supplier charges, and shrink take that down to about 10 to 15 cents net. A station pumping 80,000 gallons a month nets roughly $8,000 to $12,000 from fuel, which mostly covers overhead. The convenience store is where the profit comes from.
Should I buy the real estate or lease?
Buy it if you possibly can. Owning the dirt turns a mediocre operating business into a real asset, protects you from rent hikes when the lease turns, and gives you the exit option of selling to a developer. Leasehold stations are cheaper to enter but you carry all the operating risk, including environmental exposure in many leases, while building equity for someone else.
What should I check before buying an existing station?
Tank age, material, and tightness-test records first; anything over 25 years old, price in replacement. Then a Phase I environmental assessment, 12 months of fuel supplier statements to verify gallons, register data for inside sales, the fuel supply contract terms and remaining years, and whether EMV and POS upgrades are done. Broker pro formas routinely overstate margin and understate labor.
Are gas stations a bad bet because of EVs?
Not immediately, but the trajectory matters for your exit. Gasoline demand for small independents is flat to declining, fastest in urban coastal markets, and a station you buy today probably sells into a weaker fuel market in 7 to 10 years. Stations with real food service, strong inside sales, and owned real estate have paths forward. A pure fuel play on a leased lot is a melting ice cube.