Petrol Pump Open Process- There is a lot of earning in the business of petrol pump. The fuel pump owner gets commission on every liter of petrol-diesel. This is a business running from cities to towns. You too can earn a lot by opening a petrol pump. But is it so easy to open a petrol pump? Today we will tell you where to get a petrol pump license? How can you apply and how much does it cost?
Actually, the number of vehicles in the country is increasing year after year, due to which the demand for petrol and diesel is also increasing rapidly. Even now, more than 90% of petrol and diesel vehicles are sold in the country. Accordingly, the income of petrol pump owners is also increasing. However, it is true that opening a petrol pump is an attractive business model. But it requires a complex licensing process and huge investment.
According to an estimate, at least Rs 20 lakh is required to open a petrol pump in rural areas, while in cities an investment of Rs 40 to 50 lakh is common. This includes the cost of license, tank, dispenser and infrastructure. The price of land can be higher or lower depending on the city, which can also increase the cost. You can take a loan of up to Rs 2 crore from banks to open a petrol pump.
How can you start a petrol pump?
– Petrol pump applicant must be an Indian citizen. Applicant should be between 21 and 60 years of age.
– Petrol pump can be opened on own or rented land, if the land is on rent then lease papers have to be submitted. The lease of the land should be for 15 to 25 years. If the land is your own then a copy of the registry has to be attached with the application.
How much land is required for a petrol pump
– To open a petrol pump in urban areas, 800-1200 square meters of land is required and in rural areas, 1200-1600 square meters of land is required. The land should be near the main road and in a place with good traffic.
Dealership or license is required from Oil Marketing Company (OMC)
To open a petrol pump, dealership has to be taken from public or private oil marketing companies like Indian Oil (IOCL), Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL), or Reliance Petroleum. These companies issue advertisements for dealership from time to time in newspapers or on their official website. Apart from this, OMC also provides information about dealership in newspapers and on its website www.petrolpumpdealerchayan.in.
These documents are required for application
The applicant has to apply online, in which personal information, land documents and financial details are submitted. To apply, one has to register on the OMC website. The application fee for the license (Rs 8000 for general category, Rs 2000 for SC/ST) has to be deposited. Documents like land documents, Aadhar card, PAN card, bank statement and birth certificate (10th mark sheet or passport) have to be uploaded in the application form. If multiple applications are received for the same location, then the selection is done through lottery or bidding process.
After selection, the applicant has to obtain NOC from the local administration, fire safety certificate and permission from the Municipal Corporation. Apart from this, it is necessary to have GST number and open a current account in the bank. If the land is agricultural land, then it has to be converted into non-agricultural land.
It may take a year to get the license
On an average, it may take 6 to 12 months to get the license. There is more competition to open a petrol pump in urban areas. After getting the license, the petrol pump has to be constructed as per the guidelines of OMC, which includes facilities like tank, dispenser, and toilet. Initially 8-10 employees are required.
Let us tell you, IOCL is the largest OMC in the country, which has more than 50 thousand marketing touch points. It provides dealership in both rural and urban areas. IOCL publishes advertisements for petrol pump dealership on its website (www.iocl.com) and in newspapers. Applications for BPCL’s dealership process are submitted on www.bharatpetroleum.in. BPCL encourages opening of petrol pumps especially in rural areas. Applications for HPCL’s dealership are submitted on www.hindustanpetroleum.com.
You can also take dealership of private companies like Reliance Petroleum and Nayara Energy. Applications for these are made through their websites (eg www.reliancepetroleum.com). The rules in private OMCs are a little easier than government OMCs. But more investment has to be made. Now let us tell you how the pump owner earns on petrol and diesel? Let us tell you, the government has fixed a commission for the pump owner on every liter of petrol and diesel.
Currently, the price of one liter of petrol in Delhi is Rs 94.77, out of which the petrol pump owner gets Rs 4.39, that is, the pump owner earns Rs 4.39 on 1 liter of petrol in Delhi. The base price of petrol in Delhi is Rs 52.84 per liter on average, on which the excise duty is Rs 21.90, which is collected by the Center. VAT of Rs 15.40 is charged on one liter of petrol, which is collected by the state government. Apart from this, the price of 1 liter of petrol is fixed by applying some other small average charges of Rs 0.26.
That is, in Delhi, the pump owner earns Rs 4.39 per liter of petrol. However, the petrol pump owner has to cover all the expenses. More than a dozen employees work at a petrol pump, and the expenses are incurred from their salary to the maintenance of the petrol pump. Still, it is a profitable deal. Suppose, a petrol pump sells 5000 liters of petrol in a day, according to the rules, it will get Rs 21,950 as commission. Even after deducting 50 percent of the expenses, it is possible to earn at least Rs 10,000 every day.