LPG Refilling and Distribution Business [Archive]

mac_bolan00

Jan 23, 2002, 02:11 AM

the top-3 brands are basically the same. you will be dealing with the refillers, not the refiners, anyway. some refillers sell imported lpg which us "usually cheaper". however, the big three often give refillers and distributors rebates so as to match imported prices (and also to allow distributors to survive thereby putting the squeeze on importers).

the top refiller for shellane is island air products. that for petron is catgas. liquigas sources both domestically and imports. fortune gas corp. is primarilly petron but also sells caltex and shell.

if you want to be a neighborhood supplier, you're sure to go up against the established supplier in the area. and it's doubtful that you'll be able to "steal" his current client list. so the two most important things you must do are:

1. develop your own market. this will take researching. is there unserved demand in a given area? are new demand areas going up (like subdivisions)? now, assuming your target market has more than enough demand for both you and your competitors, your profits will all depend on...

2. the number of empty tanks you can buy. i'm not kidding. it's a capacity game. an 11-kg - capacity tank costs around 220 pesos empty. if you have a tank filled for 220 pesos and sell the contents for 270, you have a 50-peso revenue per filled tank (a 22.7% asset turnover). assuming you net something like 20 pesos per filled tank (laki na yun...) you will get a return on investment for that tank after 11 re-fills or around 1 year (when you supply families of at least 5). i know that households with only two occupants take as long as 3 months to use up an 11-kg tank. so, to make it worth your while, and to repay things like a motorcycle or tricycle or pedicab and a hired hand, you need to buy at least 900 tanks (198K pesos ---gulp!)

good luck.

hello_kitty

Jan 23, 2002, 06:43 PM

Macbolan00, you sound like an insider.

my dad owns 2 refilling plants both in central luzon.

whipcheck

If you plan on becoming a retailer, it would help if you have an existing outlet such as a sari-sari store.

Competition wise you are looking at competing against official dealers for shellane, gasul and etc, independent retailers who get their gas from independent dealers and the independent retailers themselves.

Small retailers enjoy a pretty good sales margin 10 to 20 pesos per tank, as refillers lower the price in order to compete.

Although the lpg industry is very dirty. Under filling is a common practice. Or adding water to make the tank heavier is yet another industry practice.

You need not buy your tanks, there are refillers that are willing to lend you the tanks for free, but this will reduce your bargaining powers.

So far our company has lent out around 30,000,000.00 pesos worth of tanks.

I have seen terms shorten from 30 days to 5 days.

Ask me particular questions and I will address them.

KuyaDanny

Jan 23, 2002, 07:47 PM

What would make more sense - to sell one brand exclusively (eg Gasul), or to sell three brands simultaneously?

mac_bolan00

Jan 23, 2002, 08:47 PM

all three brands since end-users no doubt have gotten used to different types (you know, the valve assembly, perceived reliability and honest filling, ect.)

which is why, i prefer to own the DIFFERENT tanks in my stock so i can put some sort of control on my brand/product mix. also, having your own tanks allows you to use it as a marketing medium (stencil-in your name, address and phone number on the side for easy correspondence with users).

this may be a surprise to some. i'm sure others have known this all the while:

BOTH RETAIL DISTRIBUTORS AND END-USERS PAY FOR 11 KILOS OF LPG PER TANK BUT USE UP ONLY 10 KILOS.

the remaining 1 kg goes back to the refiller and that refiller books it as RESIDUAL INCOME. now, now. don't you go calling up consumer guardians like joecon or even the KMU. the residual content is a necessary feature for safety's sake. the common advise given by "runung-runungans" is for one to turn his tank over when the flame dies out or give it a good shake. this isn't advisable. many consumer groups have complained about this in the past. both the gov't and the refiners say that, while it's possible to design a tank that will allow 100% depletion, it is not considered safe.

hello_kitty, what can you say to this?

hello_kitty

Jan 24, 2002, 10:58 AM

KD,

I would suggest getting only one brand. The key is that you develop a relationship with your supplier. The more you sell the larger the volume discount you can negotiate from your supplier. Your job as a retailer is to make sure that the lpg tanks delivered to you does contain 11 kilos. It does not mean that your supplier is gasul or shellane that the contents are correct. Location is very important too. :)

Macbolan_00

Based on your strategy it is obvious to me that your operations are confined in Metro Manila.

Your discussion of residual was rather complete. However, I must stress that underfilling is still a rampant industry practice and that includes the big three. Residual income is an added bonus to refillers. However, the biggest expense of refillers is theft! Petron is notorious for underfilling customers are well! In a one year period we were underfilled by 8 tons; some were decanted by employees and some were underfilled by crooked employees of Petron, Caltex, Liquigazz, and Shell!

I attended an LPG refiller's association meeting some years ago, and it was kinda sad that independent refillers are hell bent on its crooked ways, and the reason for that is that its the only way for us to survive as the big oil companies are influencing govt to make it more difficult for independent refillers to do business.

I was curious, how big are your operations? Who are your customers, only end users?

KuyaDanny

Jan 24, 2002, 10:30 PM

Do the oil companies (Petron for example) run some sort of promotion to reward you for "convincing" customers to switch from other brands?

roadrage23

Jan 24, 2002, 10:57 PM

Originally posted by KuyaDanny
Do the oil companies (Petron for example) run some sort of promotion to reward you for "convincing" customers to switch from other brands?

KD, I'm not quite sure about the majors running any promotion but I do recall a new market entrant operating down south that grabbed market share by convincing consumers to switch by giving away free regulators.

mac_bolan00

Jan 25, 2002, 01:06 AM

hello_kitty,

like i said, i'm with a bank. most of our customers are SMEs. most of our LPG distributor clients get lpg from refillers and sell to end-users. yes, 700 tanks is about right for a place as sparse as northern QC.

KD,

what i know is the big-3 try to squeeze each other out by encouraging refillers to saturate an entire region --even if refillers incurr an operating loss given the resulting hike in operating expenses and the rather oligopolistic pricing: at least 16 pesos per kg (that's refiner's price, mind you).

but guess what, the big-3 are willing to cover the refiller's operating loss by giving rebates as high as P 4.0/kg. you'll ask "so why the heck don't they just cut selling prices?"

answer: an oligopoly. they want to keep the official ex-plant price high. however, they can easily match the selling prices of LPG importers (as low as P 14/kg).

in short, they kinda control the affairs of both refillers and distributors. our president is a lot more blunt: "WHY THE HELL ARE THEY LETTING ____ SCR_W THEM?"

life in these islands...

KuyaDanny

Jan 25, 2002, 01:55 AM

Is there funding available from oil companies/refillers to finance an inventory of tanks?

http://www.pinoyexchange.com/fromhell/images/fromhellsmall.jpg

whipcheck

Jan 25, 2002, 02:00 PM

Originally posted by hello_kitty
Macbolan00, you sound like an insider.

my dad owns 2 refilling plants both in central luzon.

whipcheck

You need not buy your tanks, there are refillers that are willing to lend you the tanks for free, but this will reduce your bargaining powers.

So far our company has lent out around 30,000,000.00 pesos worth of tanks.

I have seen terms shorten from 30 days to 5 days.

Ask me particular questions and I will address them.

Hello_Kitty

Your Dad's company lend tanks? I guess that will be quite helpful for start-ups. May I know your Dad's company and contact numbers.

I have contacted one refiller and each refill cost around P180. Around the figures that mc_bolan00 mentioned. It was also mentioned that if I'm a small reseller, I can make a deposit of P600 per tank.

mc_bolan00, Hello_Kitty:

I read in one of the consumer reports in the newspaper that an 11 kg cylinder (not sure if 3 mm or 2.3 mm) cost P600 from the manufacturer? Any info on the tank cost and manufacturers of 'good' tanks?

What about the regulators? Different brands have different type of regulators ...ganoon ba? Is there any brand compatible with another? How much does the regulator cost ..actual cost to refillers ...any idea?

Seems to me that there are no real promotions on the LPG companies. The end-users are left on their own to decide which brand they will use. It goes like 'whatever brand ang nasa pinakamalapit na canto!'

Tanong lang? With the present LPG brand that you are using right now, what will make you change to another one?

hello_kitty

Jan 25, 2002, 02:04 PM

KD, if you are operating a small retail store for lpgs the big oil companies does not offer any sales promotion if you have convinced other people to buy their brand. Once you buy their gas, its your responsibility to market it yourself, as mac indicated in one of his posts, the big firms do not care if you sell your product at a loss.
If say you were a larger customer such as a dealer or refiller, the big oil companies would offer discounts based on geographical competition and sales volume.

As for your second question, as a rule, big oil companies will not fund you, except for extreme cases. Such as financially bailing out a refiller closely associated with them.

roadrage23

Revalving is a common industry practice, my dad's company does it for free. The valves of major brands by the major oil companies are unique, this is by design to make it difficult for end users to switch brands, but independent refillers started refilling these tanks anyway thus cirvcumventing the strategy of the big oil companies.

hello_kitty

Jan 25, 2002, 03:09 PM

Question:
Your Dad's company lend tanks? I guess that will be quite helpful for start-ups. May I know your Dad's company and contact numbers.

Answer:
I will email you the info…..

Question:
I have contacted one refiller and each refill cost around P180. Around the figures that mc_bolan00 mentioned. It was also mentioned that if I'm a small reseller, I can make a deposit of P600 per tank.

Answer:
If you are a small retailer you have very little bargaining power and as much as possible refillers will follow the prevailing price, unless they want to start a price war, which can be costly for them.

Different refillers have different strategies for tank loaning. Some sell their tanks, and some lend tanks or both.

My dad’s policy was, he would lend you the tanks, but that means you have very little bargaining power in terms of the price. Also, you will be obliged to keep on buying from us of course. But, I am not sure what is the exact policy on tanks as of now.

mc_bolan00, Hello_Kitty:

Question:
I read in one of the consumer reports in the newspaper that an 11 kg cylinder (not sure if 3 mm or 2.3 mm) cost P600 from the manufacturer? Any info on the tank cost and manufacturers of 'good' tanks?

Answer:
Manufacturer’s will never sell to you unless you buy wholesale, they actually make tanks per order. The only one that will sell you a brand new tank is the refillers as they buy wholesale from the manufacturer.

Question:
What about the regulators? Different brands have different type of regulators ...ganoon ba? Is there any brand compatible with another? How much does the regulator cost ..actual cost to refillers ...any idea?

Answer:
The big brands like gasul or liquigaz have different regulators. The tanks used by independent refillers are compatible with each other. I am not sure what the current price levels on regulators are, but the best place to buy it is the refiller….

Question:
Seems to me that there are no real promotions on the LPG companies. The end-users are left on their own to decide which brand they will use. It goes like 'whatever brand ang nasa pinakamalapit na canto!'

Answer:
LPG is a commodity, the big companies tried to de-commoditize LPG, but they failed.

Question:
Tanong lang? With the present LPG brand that you are using right now, what will make you change to another one?

Answer:
Most end users will switch brands when the tank they bought is noticeably under filled, most of them say, “dati dati tumatagal ng 1 buwan ang tangke ko ngayon 3 lingo na lang! Most end users do not care which tank they buy as long as it lasts!

mac_bolan00

Jan 25, 2002, 06:34 PM

Originally posted by whipcheck
I have contacted one refiller and each refill cost around P180. Around the figures that mc_bolan00 mentioned. It was also mentioned that if I'm a small reseller, I can make a deposit of P600 per tank.

i know my 220 per refill is kinda outdated because of the recent rollbacks but 600 per 11-kg tank?!?!? empty?!?!?!?

our clieNts get their tanks for less than 250. second-hand nga lang. if the current price for a brand-new tank is 600, that means payback at 20/refill is THREE YEARS!!!

whipcheck

Jan 26, 2002, 03:43 AM

As end-user, we pay for our lpg tanks. Incase of accident caused by lpg (tank), is the retailer, dealer have any sort of liability? can they be sued?

mac_bolan00

Jan 26, 2002, 03:47 AM

so that means the 600 includes the contents (11 kg of lpg). abogado and makakasagot ng tanong mo.

hello_kitty

Jan 26, 2002, 11:34 AM

Originally posted by whipcheck
As end-user, we pay for our lpg tanks. Incase of accident caused by lpg (tank), is the retailer, dealer have any sort of liability? can they be sued?

nope.....

there was a fire in the tarlac public market caused by a faulty lpg tank, and no one was ever held liable for it.

of course, time to time ERB will inspect your facilities and check if your tanks are in good condition...

legally, i just don't know...

as a retailer its your responsibility not to accept tanks that is not safe.

whipcheck

Jan 26, 2002, 12:02 PM

1] Who are the refillers of imported LPG? Locations?

2] mac_bolan00 mentioned 11-kg capacity tanks costing around 220 pesos – second hand. Just wondering on the conditions of the tanks. Are the tanks still up to Philippine Standard?

3] News in Mla Times 01 Sept 2001, mentioned battered tanks still flooding the market and are accidents waiting to happen. Another news mentioned : 44,000 tanks recalled made by Phil-Daechang Steel Inc. Dealers or retailers who markets defective lpg tanks would be fined P250,000. What defects are they talking in here? Something recognizable by common users?

4] hello_kitty mentioned that the LPG industry is very dirty? Any other reason besides under-filling and the addition of water?

hello_kitty

Jan 26, 2002, 12:43 PM

Originally posted by whipcheck
1] Who are the refillers of imported LPG? Locations?

I think all major companies refine their lpg locally....

2] mac_bolan00 mentioned 11-kg capacity tanks costing around 220 pesos – second hand. Just wondering on the conditions of the tanks. Are the tanks still up to Philippine Standard?

It varies, there are some that are still in decent condition...it can be in really really bad condition, especially the ones from korea, the japan tanks are better. but, the lpg industry as a whole is trying to avoid the use of second hand tanks, especially in metro areas. I advise you to use new tanks, for safety reasons....

also, once your tank is in the market, it does not mean you will get the exact one. you may have a new tank when you sold it, but you might get an old tank in return....

3] News in Mla Times 01 Sept 2001, mentioned battered tanks still flooding the market and are accidents waiting to happen. Another news mentioned : 44,000 tanks recalled made by Phil-Daechang Steel Inc. Dealers or retailers who markets defective lpg tanks would be fined P250,000. What defects are they talking in here? Something recognizable by common users?

the bottom ring is disfigured, not there or rusted... the top ring of the tank is disfigured, not there or rusted. the tank itself is rusted... the bottom and top rings are very important, if its not there you can easily puncture the tank!

4] hello_kitty mentioned that the LPG industry is very dirty? Any other reason besides under-filling and the addition of water?

well, running an lpg business can be dirty.

internal fraud is rampant..

but, the smaller the business, the easier it can be detected...

mell

Jan 26, 2002, 04:02 PM

Hey all,

I am no longer using the username hello_kitty, its acutally my ate's username and she does not want me using it anymore.

So, I created my own account.

KuyaDanny

Jan 26, 2002, 08:46 PM

Originally posted by hello_kitty
of course, time to time ERB will inspect your facilities and check if your tanks are in good condition...

Please clarify some things for me. At which level does ERB inspect tanks: refiller, distributor, or retailer? Does selling LPG require some sort of permit/registration from ERB?

mell

Jan 29, 2002, 12:27 PM

kd,

ERB inspects the tanks from all levels of the supply chain: retailer, dealer and refiller. ERB can actually shut down a business if they can prove that it continually uses unsafe tanks.

Before 1997, the LPG industry was regulated and there was a tight restriction if you wanted to refill, receive and refine lpg....

The only way back then to get a permit to operate a refilling, receiving and refinery plant(s) was to bribe the proper officials, but the bribing price was extremely steep so only a very few independent refillers existed prior to 1997.

mac_bolan00

Jan 29, 2002, 05:41 PM

the ERB is kinda vague about storage limits but most neighborhood distributors keep less than 900 filled tanks at any given time: public safety considerations.

mell

Jan 29, 2002, 06:13 PM

The LPG industry heavily employs the Just In Time Method, inventory levels are kept to a minimum.

mell

Jan 30, 2002, 11:45 AM

whipcheck,

I gave your 3000 cylinder inventory a thought, and here is what I came up with:

Given your 3000 cylinder inventory here are some reasonable assumptions we can derive when in operating your LPG retail outlet.

Assumptions:

Let us assume that you are only selling to end users
Let us further assume that it takes them a month to use up their tanks
We will also assume that you sell 1500 cylinders a day; and get back 1500 cylinders per day from your customers
Finally, we will assume that you have 26 business days in a month

Conclusions based on assumptions:

78,000 cylinder sales per month
858,000 kg lpg sales per month

This sales figure is equivalent to the sales volume of a small refilling plant.
Although, there are some dealers that have these type of volume, but these are the exception. Also, these dealers were established during the regulation period. Only a very few were able to withstand the competition after deregulation.....

whipcheck

Jan 30, 2002, 01:13 PM

Mell, KD, mc_bolan00:

Thanks for a very interesting discussion. I have set a meeting with a refiller (not one of the big 3) in 2 weeks time. Through this thread and some research, I've learned a lot but am sure it's not enough.

Anything in your thoughts that may be good to ask and find out from the re-filler? C'mmon guy's help me out again please!

Mell:
That 3,000 tank is a magic number. Pipe dream? Pero that 1,500 lpg cylinder a day would be a lot to sell in one day ... sounds like bola-bola sa kariton. Nice to think if it comes to that but it's having 39,000 end-users of one lpg brand all buying from me. What is a realistic number of houses in a town/city or province? Got to check the census group!

1500 cylinders a day may not be a realistic assumption.

mell

Jan 30, 2002, 03:11 PM

Originally posted by whipcheck
Mell, KD, mc_bolan00:

Thanks for a very interesting discussion. I have set a meeting with a refiller (not one of the big 3) in 2 weeks time. Through this thread and some research, I've learned a lot but am sure it's not enough.

Anything in your thoughts that may be good to ask and find out from the re-filler? C'mmon guy's help me out again please!

Mell:
That 3,000 tank is a magic number. Pipe dream? Pero that 1,500 lpg cylinder a day would be a lot to sell in one day ... sounds like bola-bola sa kariton. Nice to think if it comes to that but it's having 39,000 end-users of one lpg brand all buying from me. What is a realistic number of houses in a town/city or province? Got to check the census group!

1500 cylinders a day may not be a realistic assumption.

Whipcheck,

Make friends with your refiller, and develop a relationship.

When your tanks are being refilled ask them if you could observe while your tank is being refilled (this should prevent them from underfilling your tanks).

The 1500 number I gave you were based on the 3000 number that you gave me.

Our company sells approximately 50% of the number of tanks we own per day, this is the most optimal usage of the tanks possible. I don’t know where your 3000 optimal number came from, but tank prices varies, the prices are based on the international prices of metal and the dollar-peso exchage rate; my point is, you should not focus too much on your strategy based on tanks alone. As a retailer, you should sell 50% of the number of tanks you own in 3 to 7 days. If you sell only say 30% of the number of tanks you own 3 to 7 days that means you have excess inventory (commonly know as nagpapatulog ng tangke).

Given the current environment of the LPG industry:

If you are a top seller, 3000 cylinder sales a day is possible for a province the size of bulacan, but it takes years of experience to get to this point.

Like I said in my earlier posts, start small, say 10 cylinders and develop a strategy based on your experience. It is better to start small.

How much is your capital anyway?

What is your strategy?

3000 is a not a pipe dream, but it takes time and inovation to get to this number. Competition is feirce, if you are ready to do battle welcome to the fray!

mac_bolan00

Jan 30, 2002, 07:45 PM

by far the most successful distributors among our bank's clients are thos who wangled a supply contract for restaurants, fast-food outlets and mall food court tenants. don't limit yourself to households. a small family might take more than a month to use up a tank and residential areas are spread out thin!

where do you live? downtown, midtown or pure-residential?

whipcheck

Jan 31, 2002, 04:21 AM

Mell:

Capital? I'm setting aside enough to start several hundred of lpg tanks and could go for more stretch if I want. But that changes also depending on opportunites that cross my way. I'm planning to invest/gamble on that OFW-Bank (see Filipinos Everywhere). But like you guy's said "start small" and see how it goes.

Why did you say that competition is fierce? Are you referring on the competion between the big-3, refillers? At the dealer and resellers level, it does not seem to exist. Well ***** di ko pa kita. But where I'm standing, nobody seems to be doing anything but wait for the end-users go to their shop and buy a refilled tank. Parang, ayan ang lpg brand that I am selling, buy it if you want, if you don't like it, go somewhere else. Like mentioned earlier, end-users are left on their own to decide what brand to use which is usually decided at a snap by whatever is in the nearest canto.

mac_bolan00:
Thanks for confirming part of my thoughts. I live in a residential area near downtown but planning to get a small shop if I push through with the lpg business.

________________

Any questions that may draw useful information from the re-filler when I meet with them?

mell

Jan 31, 2002, 11:51 AM

Originally posted by mac_bolan00
by far the most successful distributors among our bank's clients are thos who wangled a supply contract for restaurants, fast-food outlets and mall food court tenants. don't limit yourself to households. a small family might take more than a month to use up a tank and residential areas are spread out thin!

where do you live? downtown, midtown or pure-residential?

It is very hard to break into the commercial lpg market, much harder than the household market.

Usually, either independent refillers or big three refillers have dominance of this market.

I don't think a small retailer can offer the kind of discount a refiller can offer these established restaurants and fast food outlets.

Also, the commercial cylinders are more expensive.

It depends where you are, but competition in the commercial lpg market can be bloody, literally.

mell

Jan 31, 2002, 12:40 PM

Originally posted by whipcheck
Mell:

Capital? I'm setting aside enough to start several hundred of lpg tanks and could go for more stretch if I want. But that changes also depending on opportunites that cross my way. I'm planning to invest/gamble on that OFW-Bank (see Filipinos Everywhere). But like you guy's said "start small" and see how it goes.

Why did you say that competition is fierce? Are you referring on the competion between the big-3, refillers? At the dealer and resellers level, it does not seem to exist. Well ***** di ko pa kita. But where I'm standing, nobody seems to be doing anything but wait for the end-users go to their shop and buy a refilled tank. Parang, ayan ang lpg brand that I am selling, buy it if you want, if you don't like it, go somewhere else. Like mentioned earlier, end-users are left on their own to decide what brand to use which is usually decided at a snap by whatever is in the nearest canto.

mac_bolan00:
Thanks for confirming part of my thoughts. I live in a residential area near downtown but planning to get a small shop if I push through with the lpg business.

________________

Any questions that may draw useful information from the re-filler when I meet with them?

Currently, the LPG industry is saturated; many people enter and quickly exit the LPG business because they are unprofitable. If your area is not saturated with LPG retailers that deliver to households, or have any other innovative means of marketing, then I will say you are very lucky, but I seriously doubt if that is the case.

Do you know how hard it is to sell pandisal? You have bakeries all over the place, and you have people that walk the street selling their pandisal every day. So is the LPG market. There are retailers in every canto, and there are some that offer free delivery, and there are some that make follow up calls.

I really feel that the LPG industry is fierce as a whole, but I will admit that it is less turbulent at the retailer level in terms of pricing, and they often benifit if a price war errupts between refillers. I will also say that small retailers have very little bargaining power. Refillers will make sure that they maximize their profit. You think that you are only competing with other retailers? In reality you are going to compete with the dealers of the big oil companies, you will compete directly against refillers, and you will compete against your own refiller.

Whipcheck, I have seen people spend millions in this business and hire consultants and still fail. It may seem that the LPG is unsophisticated, but actually it takes a lot of time and dedication to succeed in it.

But, it is not impossible to succeed; I can only offer you this one advice. Proceed carefully and acquaint yourself to the market forces. Don’t be overly aggressive too early, and yes starting with hundreds of tanks w/o prior experience in the industry is overly aggressive; the most successful dealers that we have started slowly, and built up their sales.

Nothing I say will fully prepare you in doing business in LPG, experience is truly the best teacher.

mac_bolan00

Jan 31, 2002, 05:32 PM

i'm not so sure with distributors but refillers must establish good ties with their sources because of this rebate thingie, fueled by competition with other refiners and importers.

do refillers give rebates to distributors?

mell

Jan 31, 2002, 05:40 PM

also, it is also important for refillers to establish a relationship with more than one source just in case your supplier (one of the big 3 or others) run out of LPG. Sounds imposible, its actually quite common.

speaking of rebates, we have a program where we offer ("share")rebates if a dealer purchases a certain amount. of course only our top performers can reach this amount.

DropZite

Jul 13, 2007, 09:55 PM

any update dito? this is a good discussion...

nasa 250-300 lang yung empty 11kg lpg gas tank before (2002)? ngayon ata nasa 900-1000 na last time i checked.. ang laki ng tinaas!

Kirhat

Jul 16, 2007, 10:08 AM

I find this information very informative. I just would like to ask your permission to reprint what you have discussed here and package it and post it in a blog. I was hoping to spread the relevant info that you have given here to a more wider audience. I will do some more research also to make sure that all areas are covered, especially for those that wants to start operating this type of business.

http://seeknomore.blogspot.com/

I just wanted to make a few clarification first from the point of view of the retailer:

Initial investment will include P250-P600 per tank, plus P180 for refill, right?

How much or what is the price range for each tank if they sell it, P500-P600?

What is the average turn-over rate for each tank, 1 month for a family of 5?

On the operating cost, do you need one staff/laborer/personnel for every 100 tanks?

If you employ somebody who will deliver these tanks to the consumers, would 1 delivery man would be enough to cover 2 subdivisions, community, barangays?

Unless you have an existing business (i.e. sari-sari store, mini-mart, etc). putting up an lpg business would not be efficient because of high operating cost and initial investment cost (i.e. store space, motorbike, utilities, etc), right?

Thanks for your help.

Kirhat

Jul 16, 2007, 10:41 AM

After this household LPG business, I will have to do some research on lpg-auto business because there are lot's queries on this one and I'm still thinking of helping them draft a business plan.

nicomambo

Feb 5, 2008, 11:51 PM

Just to revive this thread. Any feedbacks on M-Gas?

Emeraldgold

Aug 14, 2008, 04:31 PM

Yes I would like to revive this thread too. How many and what govt agencies do you have to deal with in LPG retailing aside from DTI and ERB?

mell

Nov 29, 2008, 01:01 PM

wow, I cant believe there is still some interest in this thread! :D

Please feel free to ask questions.

The LPG marketplace has completely changed since 2002.

Kirhat

Dec 5, 2008, 01:00 PM

I haven't had time to come back here and draft a new post on my blog about the LPG business. I have one dealing with LPG refilling stations (http://seeknomore.blogspot.com/search/label/AutoLPG), but I need to do a follow thread to support the already rich resources contained there.

Thanks mell for reminding me about it.

Seek No More (http://seeknomore.blogspot.com/)
Nesting Buddy (http://nestingbuddy.blogspot.com/)

icydevil

Dec 18, 2008, 07:06 PM

gusto ko sana mag retail ng lpg here in our place but wala akong idea kng anong klase or san ako pede kumuha or knino.......need your help...tnx...

Kirhat

Dec 23, 2008, 01:07 PM

wow, I cant believe there is still some interest in this thread! :D

Please feel free to ask questions.

The LPG marketplace has completely changed since 2002.

Hi mell!

I was not able to provide a new post in my blog discussing the latest news about LPG-business, but I managed to come up with an article here (http://seeknomore.blogspot.com/2008/12/why-resist-conversion-to-lpg.html), which discusses some of the reasons for the reluctance of some drivers to convert to LPG-fuel.

Here's the link again, http://seeknomore.blogspot.com/2008/12/why-resist-conversion-to-lpg.html

http://www.affbot1.com/image-1203-16335.jpg (http://www.affbot1.com/link-0115530c0114530f08575b5d51050a5142040052425f5d1343030b0405050f06055b42525240510f?plan=458)

Seek No More (http://seeknomore.blogspot.com/)

mell

Jan 2, 2009, 07:55 AM

icydevil, where are you from?

It depends. If you have enough capital you could apply to become a dealer shell, but this is typically very pricy.

If there is an independent refilling plant in your area, you could get it there.

icydevil

Jan 18, 2009, 04:59 AM

mell

Mar 30, 2009, 07:06 AM

icy,

eto na lang...

Currently, an 11kg lpg tank is retails from P467... Independent retailers would probably give you each tank at P455...

Also, you must own your own tanks... price depende kung gamit or bago....

siguro rerefer ka ng shell sa isang dealer nila sa laguna...

kaloyz2

Mar 30, 2009, 07:20 AM

@mell
im from laguna..i already send email to shell nagreply naman sila and asking kung how much ba daw ang puede ko ilabas na capital for them... could you give me some idea kung magkano ba dapat....tnx tnx

Hi there, my advice would be to start small, maybe 10 - 15 tanks, you dont even need to put up a lot of capital. Most independent dealers are willing to lend you the tanks, you just have to pay the contents and sign a contract. There are a lot of refillers in laguna, try cabuyao or sta rosa. But there are a lot more in the Batangas area, if you are willing to take the trip.

pangyaw_69x

Apr 16, 2009, 01:35 PM

Hi Mell & Kaloyz2,

I want to put up an lpg biz din (RETAIL lang) of diverse brands (GASUL, Shellane, MGas, Liquigaz, at Total), i just called DOE-LPG division and the person I talked to asked me to acquire certification from the companies that produce each brand. Ganito ba talaga? My goal is just to resell different brands (say 4 tanks of each brand). Pwede ba yung ganitong setup? or kung gasul ka eh exclusive lang b? i've tried to search for the contact infos of each company, i only have shellane and gasul. how do i get in touch with the M-GAS, Liquigaz, and Total Gas producers?

kingmickey

Apr 27, 2009, 10:16 AM

baka maari nyo rin ako matulungan magstart up ng business na ito. Gusto ko sana makapagsimula sa konting tanks lang muna tapos kapag mabilis ang ROI ay saka namin palalakihin. Nasa residential area lang kami dito sa Laguna at mejo malayo ang bilihan ng LPG. Kung mabebenta namin sa mas mababang halaga ang LPG nakikita ko makakabenta kami ng mabilis.

San ba makakabili ng murang empty 11kg LPG tanks? Nagbrowse ako sa sulit, 600+ ata ang pinakamura at wholesale price na yun. Tapos san makakapagparefill ng mura? Sa refiller station ba may minimum number of tanks din ba na kelangan ipa-refill para makuha ang mababang price? Please help.