Premier Problems that threaten the existence/survival of an LPG Retail Outlet Business

  • ·         The tendency of your gas attendant to claim there’s no patronage while he/she usually exhausts 50kg bottles of cooking gas and goes to refill at the gas plant without your knowledge

    ·         The quality of customer service your gas attendant offers to your customers will determine if you will retain or lose your customers

    ·         The establishment of a big gas plant that sells gas at low prices near your LPG retail outlet. This will drastically reduce the number of your customers if you don’t redouble your efforts to satisfy them

    ·         The tendency of your gas attendant to short-fill your customers. This will make you lose customers who will be dissatisfied with the rate at which their cooking gas is being depleted. Meanwhile, your gas attendant is getting enriched at your expense.

    ·         Loss/reduction of patronage arising from the extra services like home service, extended opening hours and cooker/cylinder/LPG accessory repairs and maintenance, being offered by the competitors (other LPG retailers and LPG Skid Plants) in your area.

    ·         Selling LPG on credit. If you sell cooking gas on credit to the extent that it eats too deeply into your working capital, you will not be able to re-stock and this will eventually make the business to crumble. Some unscrupulous customers who have bought gas from your outlet on credit will ‘navigate’ to other places for subsequent gas refill; you might not be able to recover your money at the end of the day.

    ·         Inadequate number of 50kg cylinders. For instance, if you have just two or three 50kg cylinders, you are at risk of running out of gas if there’s any glitch in the supply process. You might end up losing customers when they get to your outlet only to discover that you don’t have gas. If this happens twice or thrice, you might lose them for good.

    ·         Your lack of financial discipline can ruin the business. If you are fond of using the capital for refilling gas for your other needs, you might end up at the plateau of only being able to refill just two out of your fifteen bottles of 50kg.