Fuel is the only commodity in the world where demand has consistently increased despite price increases. The general rule of the market is that “higher the price, lower the demand” and vice versa. However, in the petroleum business, this is always advantageous to the owner of the petrol station because demand rises in tandem with the number of cars on the road. In the petroleum sector, numerous franchises are available on the market, including Reliance and Bharat Petroleum; however, the Hindustan Petroleum Dealership Franchise is the most notable among its rivals.
The general population in our nation believes that petrol stations are lucrative businesses with respectable profits. However, there has been a notable shift in petrol pump profits in recent decades. The number of cars on the road in our country is growing, which has increased fuel usage and raised the demand for petrol stations. According to statistics, the average Indian petrol station sells roughly five lakh litres of diesel and petrol monthly. Hindustan Petroleum Corporation Limited (HPCL), a government-owned Navratna oil and gas company, has its main office in Mumbai, Maharashtra. 14,675 petrol stations manage partnerships in India. This post goes into great detail on how to open an HP petrol station franchise. If you want to become an HPCL petrol pump dealership in India, this blog will pique your interest!
Where the HPCL Retail Stores are Located?
Have you considered purchasing an HPCL dealership? Experts advise that before proceeding, several standards must be fulfilled; the parent organisation will determine whether or not such a project is appropriate to take on.
It’s crucial to understand that HPCL chooses the dealership location after considering its viability. The owner must be aware that the ideal location must be carefully chosen and that it must be conveniently connected to main thoroughfares, bypass routes, and highways. After the designated authorities select the site, HPCL prints ads for the designated areas. As a result, the company will concurrently open normal and rural HPCL retail stores.
According to professionals in the relevant field, the following points are stated:
- Regular HPCL Retail Outlets are opened in urban and semi-urban regions that are near National or State highways
- At the same time, if we take the case of the Rural HPCL Retail Outlets, the sites that are off National or State highways yet in rural areas
The likelihood of the site being selected appears to be higher when it is close to major roads, highways, and bypass connections.
What Requirements Must be Met to Open an HPCL Petrol Pump?
The eligibility conditions for those on the shortlist and who will be contacted to collaborate on or purchase an HPCL Petrol Pump dealership are outlined below.
- If they abide by income tax laws, an Indian national may own an HPCL petrol station.
- A person must be at least 21 years old and no older than 55, except for freedom fighters who are classified as CC2.
- The tenth grade is the minimum educational requirement for an individual to operate a rural HPCL RO.
- To establish regular HPCL ROs, the candidate must fulfil the minimal prerequisite of completing an HSC-level exam given by a board or organisation.
Qualifications for Fuel Pump Dealership: Financial
Standard HPCL RO qualifying requirements are set at Rs. 25 lakhs for investment and Rs. 12 lakhs for money requirements for rural HPCL ROs. The funds could be received in any of the following ways:
- Funds kept in bank deposits and savings accounts
- Equity in companies, Postal Schemes, Income Funds, National Savings Programmes, etc.
Details on Investments in HPCL’s Retail Store
The amount of public money needed to build an HPCL petrol station varies depending on the property’s cost, the length of the site, and the amenities that must be included to meet the needs of customers in the trade area of the HPCL retail store. The statement will include an estimate of the costs of constructing the infrastructure and buildings at the next HPCL retail outlets.
Amount of the bid
A non-refundable fixed price of Rs. 5 lakhs for a rural HPCL retail outlet and Rs. 15 lakhs for a regular HPCL retail outlet would be charged for dealer-owned or company-leased locations.
The minimum bid amount for a Rural HPCL retail outlet is Rs. 10 lakhs, while for normal retail outlets, it is Rs. 30 lakhs. This applies to locations owned by HP Corporation that are up for auction. For Rural HPCL ROs, the applicant must pay Rs. 50,000; for Regular HPCL retail outlets, the deposit is Rs. 1.5 lakhs.
Application and Franchise Fee for Retail Gas Pump Stores of HPCL
For Rural HPCL ROs, the application fee is Rs. 100; for SC/ST applicants, it is Rs. 50.
The application fee for an average HPCL retail outlet is Rs. 1000. The SC/ST group demands 500 rupees in fees.
Entity Eligibility Requirements (Non-Individual Applicants)
- In India, non-individual entities must be registered.
- The organisation should have been incorporated or registered for at least three years.
- Conditions about land and finance are the same as those for individuals.
Documents Needed to Start an HPCL Petrol Pump
The most important step in submitting a suitable application to operate an HP petrol pump business outlet is documentation. Please carefully read the provided material to ensure that you comprehend it.
The following paperwork must be submitted to register for an HPCL retail outlet dealership.
If you have academic credentials from foreign colleges or boards, you must get an equivalent certification from the relevant officer, state government, or federal government. For the purchase price, a duplicate NSC and value credentials are required. A duplicate of the Demat declaration and value credentials are also required for the registration communities or businesses.
Records Required to Establish an HPCL Dealership
At least one of the following documents must be supplied to demonstrate that the candidate is the owner of the property being considered for the HPCL Dealership:
- A registration sale deed or a registration gift agreement
- Documentation from revenue officials, such as a registered Khasra or Khatauni or any other comparable income record or diploma, attesting to the terms of the property acquisition
- Shareholdings of any other kind or the transmission of deed memoranda, such as a notice of mutation and also a lease contract signed by the government or semi-governing institutions
Retail Outlet Management at HPCL
- A candidate chosen for the HPCL retail outlet dealership will oversee the business’s day-to-day operations directly, focusing on daily tasks.
- A dealer for HPCL will not permit employment.
- Before the HPCL issues a letter of appointment, the chosen candidate, if they are currently employed, must provide a letter to that effect confirming that their employer has accepted their resignation.
- Additionally, the LOI holder must provide a notarized document when the letter of appointment is issued, certifying that he is not engaged in the private sector or receiving any remuneration.
- Under the guidance of their staff and in compliance with the terms of the dealership agreement, the company chosen for the dealership will be responsible for overseeing the day-to-day operations and affairs of the business.
Rate of Dealer Commissions
For each litre of petrol sold, dealers receive a commission of more than Rs 2.50 from Hindustan Petroleum Corporation Limited (HPCL). In contrast, the corporation pays dealers a commission of Rs 1.65 for each litre of diesel sold.
Hindustan Petroleum Dealership Benefits
Even if a person can make money just by using the brand name alone, there are other things one should consider before opening an HPCL dealership. With such formidable rivals as Reliance Petroleum and BPCL, an individual can benefit from HPCL’s USPs to circumvent and outperform the competition. These are a few of the many benefits of opening an HPCL dealership.
- In fact, the graph scale shows no change at all despite an increase in the price of petrol and diesel, indicating that demand for these products has not reduced. This is primarily due to people’s strong need and inclination to drive a car for comfort and habit. For the same reason, as a franchise unit holder, you never have to be concerned about a situation in which rising pricing could force you out of business.
- The number of automobiles on the road continues to rise daily, monthly, and yearly. As a proprietor of a petrol station, you make more money the more cars there are on the road. In addition to selling gas and diesel, the HPCL franchise allows you to offer various other services, adding another revenue stream to your petrol station.
- You have a significant advantage because of the government’s support and the well-known and expansive brand of Hindustan Petroleum Corporation Limited. A franchise unitholder must only locate the petrol pump in a prime position to guarantee healthy profits. Posing your gas station next to a highway or in a busy area will guarantee a large traffic volume and, eventually, profitable operations.
- The fact that an HPCL petrol pump is owned and managed by the government itself is a big benefit. Government regulations and other variables frequently can potentially disrupt or negatively impact private industry players and the size of the business. But since the government is in charge, you, as a franchise holder, don’t need to be concerned about any of the previously listed details because the government is watching out for you.
Openly, if we talk, it is to be said that setting up an HPCL Petrol Pump and getting the dealership for the same is not an easy game. It is a long and tiresome process with many background works, documentation, etc. Hence, you must find the right consultant to partner with who has good market and client experience, like Kanakkupillai. But it is also important to ensure they don’t cost you a fortune for such a service.
So, we at Kanakkupillai urge you to talk to us, let us understand your problem, and aid you in reaching the right destination with simplified efforts, as our experts know how to get the work done!!