Cooking gas is an essential commodity used by many
households daily. Gas cylinders last only a limited period before they need
refilling this makes the business very lucrative.
Cooking gas retailing is a niche market that provides gas
refill for domestic and industrial purposes. Businesses that deal in essential
commodities like food, cleaning products, drinking water need gas.
Customers are compelled to patronize your business if
they want their gas cookers to work. Urban areas have a large population making
it an ideal location for your cocking gas business.
Natural gas is a clear odorless substance used for
cooking and industrial applications. A cooking gas retailer either has a large
tank farm or gas cylinders for sale.
Natural gas is a hazardous material and is handled by
trained practitioners or pipe fitting engineers.
Most
important aspect of cooking gas business
The cooking gas retailer should observe safety protocols
when handling the substance. There should be major emphases on maintenance,
storage, and distribution.
There are two categories of cooking gas vendors. The
larger business owners build gas farms where client come to refill their
cylinders.
Smaller cooking gas retailers rely on manual filling and
middlemen between gas farms and individual clients.
Carry
out a feasibility study
Do a feasibility study of the business on transportation,
storage and handling of the hazardous material. Then find a suitable location
and get certification to deal with the substance.
Other considerations is getting start up capital, writing
a business plan, learning technical skills and marketing.
How
to get start up capital
The amount of capital you need depends on the size and
scope of your business. Gas cylinder farms that offer onsite refill must
accommodate large storage tanks, and gas trucks.
The gas farm will need lots of start up capital, have
safety precautions and physical structures. The businessman can source funding from
banks, cooperatives, unions and contributory groups.
He may seek direct partnership or investors in his
business or use personal savings. A
proper feasibility study and market survey will aid your gas distribution
business.
A small gas retailer requires a small shop a few gas
cylinders and manual pressure machine and refill pipes. Unlike large gas
distribution companies the small retailer can use a bus or motorcycle to supply
gas to clients.
You need to get proper registration and certification of
your business before you start.
Locating
your business
Large gas distribution companies are not allowed to
locate in residential areas. There should be ample distance from residential
houses and a gas farm because of safety considerations.
Small gas distributors can setup in residential areas
because of the limited amount of gas cylinders he has on site. Once he abides
by strict safety precautions the small gas retailer is just fine.
Small and large gas farms should be visible and easily
accessible to customers. You need to source your gas from major gas companies
in your country.
Equipment
needed to run a gas distribution company
The equipment needed is a mode of transportation for the natural
gas. The company needs trucks, buses, or a motorcycle for smaller distributors.
They also need large storage tanks, hardware, pressure
gauges, out houses and other safety equipment. Others are rubber gas pipes,
empty gas cylinders, weighing machine, and gas regulators.
The haulage truck should be fitted with every safety
requirement and certified suitable for gas haulage. You also need a well
ventilated shop or large open landed property.
State
regulatory agencies
State regulatory agencies require a letter of approval, financial
statement, and credit worthiness. You also need to have a standard service
contract.
The regulations differ for each country so get the proper
certification and follow the rules.
Who
are your clients?
Cooking gas business is very dynamic and you have various
categories of customers. Your customer base includes hotels, manufacturing
companies, catering schools and private homes.
Other clients are guest houses, restaurants, clubs, and other
gas farms.
Owning
a Tank Farm
A gas tank farm is capital expensive and requires lots of
finance. You need a trade license and dealership with major gas companies.
The mode of getting your gas to site is either gas pipes
directly from gas companies or transporting the gas in gas-tankers.
The gas is then stored in specialized containers and
channeled to pressure pipes. Major wholesalers, retailers and individual
customers buy directly from tank farms.
To setup the farm you need technical professional to
handle the highly inflammable gas. You also need a large expanse of land,
underground tanks and sales depot.
You can buy your own tankers or rent them for haulage to
site. Gas tank farms make their money from turnover sales. So they need to sell
lots of gas to make the margin.
Marketing
your gas distribution business
A good visible location is the best form of marketing for
gas distribution companies. The location will attract customers to your
business when they require your services.
You can market your business via electronic media like
radio or television. You can use other channels like printing handbills,
posters and bill boards to get clients.
You can distribute your product directly to homes with
your trucks and buses. Cooking gas retailer business is a highly profitable
business venture.
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