Steps on How to Franchise Shell Gas Station in the Philippines

Steps on How to Franchise Shell Gas Station in the Philippines

In the Philippines, specifically, fuel is one of the essential commodities of our times. In fact, there is an increase in vehicle production and demand nowadays, it’s a great opportunity to grab the chance of starting up an oil business in the country.

Talking about that, one of the most trusted names to consider in the Oil Industry is Shell. If you are an aspirant businessman and want to open a franchise of this gas station, then this article is right for you.

About Pilipinas Shell

Since 1897, Shell Philippines has been distributing kerosene in our country. By 1940, it has grown extensively that its other products were being sold with the installations and depots situated in different strategic locations nationwide.

In the 1960s, its first crude refinery was built in Batangas making Shell an established player as a manufacturer and refiner of petroleum products. 1986 was the year when Pilipinas Shell acquired the majority of the Philippine Petroleum Company, the only lube refinery in the country.

Fast forward today, Shell opened its 1,000th retail station along Eton Road in Sta. Rosa, Laguna.

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Franchise Package Inclusions

Pilipinas Shell’s franchises may be company-owned or dealer-owned. Whether you’ll choose a company-owned or dealer-owned franchise, the franchise includes:

  • Shell Brand and other trademarks
  • Location and market study
  • Layout and fitting out of service station
  • Building and equipment
  • Operating standards
  • Training for retailer and staff
  • Procurement programs
  • Pre-opening assistance
  • Grand opening assistance
  • Marketing strategies
  • Research and development
  • Business counseling

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Franchise Fees

Now this is where it gets interesting. What’s unique with the Shell franchise is that it actually doesn’t charge a franchise fee.

You heard it right, there is no franchise fee. However, you’ll have to pay the following fees to acquire and operate a Shell dealership:

  • Processing fee
  • Monthly royalty fee
  • Retailer fee

Be prepared with an initial investment cost of P3 Million to P5 Million, and other fees agreed on the business plan.

This initial cost will cover fuels inventory (2-3 day stock cover), lubricants inventory (1 month stock cover), merchandise in the Shell Shop/Select, lube/wash-bay equipment, initial operating expense (salaries, utilities, uniforms, business permit, and others), and power generator.

For the convenience store and automotive shop, these are applied separately from the franchise.

Basic Qualifications for a Franchisee

A franchise is awarded initially only to individuals.

Once the franchise application is approved, the individual may then organize a “closed corporation” provided that he or she can prove that he/she owns majority share of the corporation.

Other “pre-screening checklist” required by Pilipinas Shell include these qualifying criteria:

Can motivate his or her people towards agreed business targets

Willing to devote time to oversee day-to-day operations of the business

Willing to undergo full time training on service station operations

Able to fund the investment requirements

Earnings and Return on Investment (ROI)

A 3-year Retailer Agreement will be signed by the franchisee (retailer/dealer) with Shell and its renewal will be based on the business performance.

The average payback period is around 2-3 years, with the Return On Investment (ROI) expected to be 30%-40%.

Shell Franchising Contact Details

Interested to be a Shell franchisee / dealer / retailer? Send your application or contact the company directly for more details:

Ms. Michelle Ledesma

Email Address: michelle.ledesma@shell.com

Telephone Number: (02) 8166501

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