Gasoline Depo – a business idea

I was watching an early news program, and I was a bit mesmerized when the subject matter shifted to used plastic materials, like plastic bags that for groceries and the styro material  for packed meals. Yes, these are biodegradable materials but commonly used by malls and fast food chains.

Anyhow, I won’t be talking about the business of turning plastic materials into diesel or gasoline. Ha ha ha! But of course it is amazing – remember doc?  the “back to the future” movie. Perhaps in some other days if science permits us to do so. 🙂 Hopefully, if that day will come, facts and information about “no harm” to the environment or to people per se are also available na.

Anyhow, as I was watching the news about diesel and gasoline, and ka-boom! Flashback! Six years ago, yeah, 6 years ago…I and my four friends were talking and storming our brains about business. Then suddenly we came up with something.  How about putting a gasoline depo? What? Gasoline depo?

The business model is so simple: purchase, provide and sell diesel to passenger jeepneys (PUJs) and the like basta those motor engines drinking diesel. So the question now is why gasoline depo? depo or depot? what the… whatever.

Hhmmm, anyhow, okay, the business idea was a product of a niche market that we have identified back then. Yep yep, since one of my four friends is a police guy who happens to own a passenger jeep and the concurrent president of a drivers and jeepney operators association — ting! Sweet. Earn while servicing the needs of your members then members have the chance to earn naman via rebates. There are about fifty (50) passenger jeeps registered under the association — very clean, a niche market. Let us do the math, 50 jeeps a day six year ago multiplied by per liter of diesel multiply by… 😉 Man! That is profit! yes, prooofiitt.

Another thing is one of us owned a 200 sqm lot near the hi-way whereby passenger jeeps passes through every day. So it’s not only jeep that we are looking at but all vehicles even trucks. Putting the raw ideas together, ka-boom! “a gasoline depo”. So the next step is to find the right business partner who can supply us diesel with a plus package like an overhead tank and at least one diesel dispenser to start with. We were able to talk with Sea Oil and Total that time – haggled with the best possible low cost deal and good terms.

So how do we earn?

Ok, normally those big operators of bus and jeep have what they called an on-sight refilling station. Meaning these operators purchased their own gasoline or diesel as part of their supplies and stores it. However, this thing already evolved. Most of them are now directly purchasing gasoline and diesel via available gasoline station near their garage. But the power of leverage is still there via discount and terms.

Now, by putting up a gasoline depo, you can also negotiate a better deal like discount and terms. Why, because you already have a sure buyer, a niche that will purchase your diesel.  And that is power.  Two ways to earn, purchase discount plus add on margin – but not that high and not that low so as not to distort the on-going market price of diesel.  In addition, you still have the chance to supply other vehicles aside from your niche market.

So there you are. Hope you get the idea…