How a petrol pump makes money
A dealer does not set the price of petrol or diesel. The oil company sets the retail price and pays the dealer a dealer margin for every kilolitre sold, which is revised from time to time by circular. So a pump's income is mostly volume × margin, plus whatever it makes on lubricants, a shop and other services.
Profit is that income minus the cost of running the pump: salaries, electricity, rent or lease, interest, maintenance, card and UPI charges, and the stock lost to evaporation and errors.
Where to find your dealer margin
Use the margin in the latest circular from your oil company (IOCL, BPCL, HPCL, Nayara, Jio-bp or Shell). Margins are stated in rupees per kilolitre and differ between petrol and diesel. The calculator does not fill one in for you, because a margin from last year gives a wrong answer this year.
Where profit leaks
Margins are thin, so small leaks matter. One litre lost in a thousand is a real share of what a pump earns on that thousand. The usual places are:
- Cash short at shift change — see how to stop cash shortages.
- Tankers delivered short and not caught at the density and dip check.
- Credit customers who pay late or not at all.
- Stock loss above the normal level — try the stock loss calculator.
- Staff time spent on registers instead of customers.
Frequently asked questions
How much profit does a petrol pump make in India?
It depends almost entirely on volume and costs. Two pumps on the same margin can earn very different amounts because one sells three times as much fuel, or loses more to shortages. Put your own figures in the calculator above.
Is lubricant and shop income included?
Enter the profit (not the sales) from lubricants, the shop and other services under other income.