What Happens When You Build a Petrol Station In the Wrong Location?

The following problems are a selection that will, without exception, arise for businesses that locate their petrol station in a bad location.

You will notice that bankruptcy is not among them.

That is because, as I’ve said many times, a good petrol station location site is not necessary for the financial success of your petrol station business.

You can fall backward into growth – and many brands do.

But even if that’s the case, these chronic problems will remain; causing perpetual headaches and holding your petrol station business back from the far greater potential that lies within.

So let’s get to it. What are the consequences of poor location?

Consequence 1–You will make average profits.

The broadest result of locating your petrol station in a poor location will be an inability to make remarkable profits. Poor petrol station sites attract insufficient numbers of motorists for you to make superior profits to accelerate the growth of your business.

You will still make money in the poor petrol station sites. But the profit you earn in this nonstrategic location is just average.

Consequence 02: You will be more similar to your competitors.

The other result of the wrong petrol station site is an inability to distinguish yourself from competitors. You will feel locked in the battle with other operators fighting by lowering prices which in turn will reduce your margin.

Consequence no 3: You will be at the mercy of big guys.

The well-financed multinational oil and gas companies have the resources to edge out small petrol station competitors by being able to cut prices the lowest and spend the most on marketing campaigns.

Consequence 4–You won’t know what to do next.

With a tight and focused strategy, you will have a way to evaluate which location has the potential to give you a high return on investment. It’s like being able to tell the future.

If location is on-strategy then it will fit with the overall picture and lead to growth. And if it’s off- strategy then it won’t. This is useful when it comes to decision-making and allocation of resources. If like most businesses, however, you don’t have a strategy that acts as such a filter, then the suitability of your location sites descend to rank guesswork. Will this location lead to growth? Will this site work? Who knows, better just give it a go and find out.

Consequence 5- Slow growth.

The problem poor location creates for business is that they suffers years of slow growth as they waiting for their trade areas to develop and expand.

So there you have it. A thriving petrol station business is the one which lack these issues