Starting a new business can be stressful, time-consuming, and overwhelming. Luckily, we’re here to help put you at ease with some top tips for how to open a convenience store. Find out what you need to know to minimize risk and maximize profits in the c-store industry. We’ll even teach you how to identify the ideal applicants so you can start off on the right foot with an all-star team of employees!
Opening a Convenience Store
How Much Does It Cost to Open a Convenience Store?
It usually costs about $10,000 to $50,000 to open a convenience store. This includes the cost of buying or renting a space, stocking your c-store with its initial inventory, and installing necessary equipment and technology. The price can vary, though, depending on the size of your store and which route to ownership you take. You can build a new, independent c-store from the ground up, purchase an existing c-store, or open a new location under a franchise brand. If you’re new to the industry, we recommend opening a franchise location so you can receive guidance, business advice, and an established customer base. Buying a franchise location is also typically cheaper and easier than building and stocking a whole new store on your own.
Are Convenience Stores Profitable?
The average gross profit margin for convenience stores can be around $450,000, making it a potentially lucrative business venture. However, keep in mind that it takes some time to reach the tipping point of making that profit after all of the initial costs to set up your c-store. Be patient, be consistent, and be disciplined about how you approach your operating plan. With any luck, you could achieve a decent profit and be able to expand to additional locations.
Tip: Consider running a food service operation within your c-store to increase profits. Despite what the general public might think about rising gas prices, c-stores only make about two cents of profit for each dollar of gasoline they sell. Maximize your profit margin by increasing food sales instead of depending on gas and tobacco sales.
What Is the Biggest Challenge Facing C-Store?
Unfortunately, there are downsides to opening a convenience store. One of the toughest obstacles facing c-stores right now, besides supply chain issues and inflation, is high employee turnover. It can be extraordinarily difficult to hire and retain high-quality c-store associates. As soon as you onboard one associate, another could be on their way out.
How Do I Hire the Best C-Store Employees?
Once you begin hiring your first employees, you’ll quickly be able to differentiate the best from the rest. Then, the key is to find more workers like those current top performers. Ideally, you’ll want to do this as soon as possible before you get stuck in an endless cycle of employee turnover. It’s time-consuming, stressful, and cuts into your profit margin due to the cost of the traditional hiring process. Sprockets’ hiring platform removes this obstacle from your path to success by instantly revealing which applicants will succeed and stay long-term like your best c-store associates.