I travel a lot, and whenever I see a gas station up for sale, like 90% of the time the pumps are no longer there.
It doesn’t make sense to me, because I know those pumps are crazy expensive. So it would seem to me if you wanted to sell it, you would want to keep everything intact
Are they leased and go back to the owner?
Is it some government regulation?
From my observation, pumps seem specific to different gasoline brands, so I’d assume either they lease them from the fuel company or have an agreement where they buy back the pumps. Curious to see if anybody has a better answer.
I do know the underground tanks remain and can be a hassle. In my home town, there’s an excellent bit of main street real estate that was a book store when I was young. It went out of business when I was a teenager, and I was surprised that such a good location sat vacant so long. I found out the lot was originally a gas station, and nobody wanted to touch it because it was understood that whoever bought the land was going to wind up footing a massive cleanup bill before long.
I don’t know, but I would guess that at least part of the reason is that pumps are removed because pumps can be removed. Specifically, they’re items that can be stolen from a largely abandoned location, therefore whether they are returned or not they will be uninstalled. If they’re not returned to a fuel vendor, they could be reconditioned and sold to another independent operator.
I think “the pumps are crazy expensive” is the answer. If there’s not an immediate buyer, the owner is going to strip everything valuable from the property. In order to minimize lost value as the property sits unused.
The pumps are often leased with maintenance plans. Even if they are owned by the gas station, the company that services them would be more than willing to buy them from a closing station. Thier business is supplying working pumps to gas stations. It’s a lot easier to deliver that service if you having working pumps to sell or lease. It’s very easy to replace the cosmetic covers so a used pump appears new.
Just second the thought that the real issue with a closed gas station is the underground gas tanks. I often see closed gas stations sit empty for years, maybe decades, because no one wants to touch the clean up expense. The countryside is especially full of them.
Selling a former gas station requires a full environmental assessment and cleanup in more or less any jurisdiction, and that is ferociously expensive - a quarter of a million would be getting off easy.
Warning - severe California slant.
If there were no leaks that reached the groundwater, the existing tanks are double-walled, and you want to use the property as a gas station or for car repair, the cost is much less, although nothing to sneeze at. Next best is a property with the tanks gone and no groundwater contamination, that you want to use as a gas station or for car repair.
A property where the station closed because it wasn’t cost effective to put in double-walled tanks when the regulations requiring that went into effect - - the old tanks have to go and those tanks were more likely to have leaked, sometimes for years. A property to be used for residential, retail, or office purposes - - that will have to be brought to a much lower level of soil contamination. There will be vapor tests.
The big costs are when contamination has entered the groundwater and the plume is moving with groundwater flow. If there’s no groundwater contamination and minor soil contamination, you might get closure with $20-$50k, depending on how many tanks were in the ground and how close they were to the property line. Groundwater contamination? That’s the expense that keeps expending.
The closed store I mentioned above was probably the worst of all scenarios. The original gas station had been torn down and replaced with storefronts, so it couldn’t be reused as a gas station without total redevelopment. It had been a gas station all the way back in, I believe, the 50s or 60s so the tanks were probably not very advanced. And it was within a stone’s throw of a local creek.
Is the “pump” actually a pump? I thought it was just a control panel & hose/nozzle holder, and the actual pump was underground.
They make them both ways - dispenser only and with integrated pump.
“The high-flow mechanical retail units are available in pump and dispenser models.”
from here as an example:
https://www.gasboy.com/us/products/retail-dispensers/atlas-8700k-series
This is my first thought. Long ago, my platoon sergeant in the National Guard worked for for one of those companies. He was one of the maintenance people that traveled to maintain/replace their pumps.
I’m almost certain the brand you see on the canopy (Shell/Mobil/Citgo etc) owns the pumps. I know a person that owns a gas station. He’s mentioned over the years that nearly all his profit comes from the stuff inside and he only brings in about a nickel a gallon. As in, if you buy gas for $1.99/gallon, it costs him $1.94 per gallon.
IOW, the gas is just to get them there, they make their money on the concessions.
At that rate, the pumps would never pay for themselves. Even if they could buy the gas for less since they don’t have to pay for the pumps, I think you’d see a lot of pumps that never get fixed because it’s too expensive.
I remember when gas got really expensive about 10 years ago, and some stations in my area capped credit card purchases at a certain level, or they would outright lose money on the purchase. At the time, I worked with a woman who also worked at a gas station, and she couldn’t get over the people who yelled at her for the cost of gasoline (as if she had anything to do with it beyond ringing it up) and then didn’t want their pennies. :smack:
Didn’t know about pump leasing, although it makes sense. I did know that decontaminating an old gas station is very costly.
That doesn’t make sense. In general, the more you make [profit], the more it offsets credit card fees.
For example, buying 20 gallons vs 5 gallons at $4.00, making 5¢/gallon and 3% credit card fees.
1)20g x $4=$80, owner makes $79, less CC fee of 2.4, total profit, -$1.40
2)5g x $4 - $20, owner makes 25¢, less CC fee of 60¢, total profit -$0.35
Okay, yeah, I guess they’re losing more on larger sales with credit cards. It should be less (or none) with PIN based debit cards and I can’t speak to cash since I don’t have cash deposit fees on me and I don’t have an armored truck picked my cash up.
I would have guessed they were limiting how much you could buy to limit their exposure to stolen cards, maybe not.
The stores must really hate pay at the pump. I haven’t actually went inside my local Exxon more than a couple times in the last year. It was hot and I wanted a soda.
Pay at the pump eliminates the need to go inside.
My father ran the distribution side of Esso (Exxon to Americans) here in Ireland in the 70s. To confirm other’s suggestions, at least for this country at that time :- his company owned all the pumps. Once he heard an outlet was going out of business, the pumps would be retrieved ASAP :- as noted, they were expensive and easily reusable.
They must make up for it with the people that do go inside. The person I was referring to earlier just spent $3 million remodeling one of his stations, he remodeled another one and tore down and rebuilt a third one. Clearly there’s money to be made.
I don’t know if they make up for it in volume or if they’re running a 50% or even 75% margin (a ‘normal’ store runs something along the lines of 33%) or some other factor. But in any case they really are only making a nickel or so a gallon.
In fact, I have a rewards card for the local gas station chain. I think it’s pretty telling that you get 10 points per gallon, but getting some beef jerky or a soda is worth about 700 points. IOW, spend $20-$30 at the pump and get about 100 points, but spend $3.00 inside and get 700 points. And, FWIW, you can redeem points for some fairly worthwhile stuff. A $50.00 gift card to Amazon is 60k points). I also rarely buy any of that kind of stuff in the store but when it comes to points, you have to get 70 gallons of gas to get the same amount of points as a soda.
Like I said, that’s one of those things that tells me not only how much more they make on the stuff inside, but how desperately they want you to come in.
Mr.Wrekker bought a gas pump at an auction. He made a working pump for his diesel fuel he uses in tractors and such. So you can buy them.
All electronic transactions, even debit cards incur a merchant processing fee, though usually at a lower rate than a regular CC. The worse is when some CC processing merchants treat debit cards with a Visa and MC logo on it as regular credit cards. It’s been a while since I’ve seen the CC merchant rates, but anything less than a 3% fee is a really good rate.