How To Become A Gasoline Jobber?

In the petroleum marketing industry, a jobber is a self-employed individual who buys gasoline, fuel oil, or other refined products from a refinery and then resells them.

A jobber frequently owns a bulk facility, as well as a gas station or a convenience shop. The refinery’s fuel is stored at the bulk facility and transported to stations or C-stores from there.

Refined products are regularly resold to commercial users, government agencies, and industrial accounts by jobbers.

A branded jobber is a jobber who displays the brand name of the refining firm from which he has purchased items at his retail shops.

In the petroleum and petroleum equipment industries, the term “jobber” has mostly fallen out of use. A jobber is a type of middleman who sits between the manufacturer and the final consumer. Because the term “middleman,” and thus “jobber,” has a bad connotation, most businesses today avoid using it.

Resellers of petroleum goods, formerly known as jobbers, are now known as marketers. The National Oil Jobbers Council, formerly known as the Petroleum Marketers Association of America, is now known as the Petroleum Marketers Association of America. The Petroleum Equipment Institute is the successor to the National Association of Oil Equipment Jobbers.

How much do fuel brokers get paid?

Fuel Jobbers are gasoline distributors that operate as a link between huge oil firms and their final consumer, the gas station. On the surface, fuel wholesalers appear to be excellent loan candidates, particularly for asset-based lenders. Even small to midsize fuel distributors will need lines of credit in the $5-$20 million range to meet their yearly revenue of $50-$150 million. Fuel brokers are known for having substantial accounts receivable balances to utilize as security and relying on inventory and fixed assets to a lesser extent.

Unfortunately, by the time a gas station receivable becomes 10 days old, the money has been spent and is unlikely to be recovered. A petrol station receives two to three supplies per week, with a typical delivery costing between $20,000 and $30,000. Customers pay for petrol at the gas station with cash or credit card, and the gas station receives funds in 0-5 days. If stringent payment terms are not followed, it’s simple to understand how a gas station can quickly accumulate a big accounts receivable total. If a lender allows 60-90 days for collateral invoice eligibility and the fuel dealer has similar terms for his clients or does not follow collection practices in order to boost sales, the lender is taking a big risk.

When a gas station converts a fuel load to cash in five days but is not compelled to pay for 60 days, there is 55 days of float available to be utilized for non-business purposes such as the purchase of additional gas stations, a new car, or to fund a gambling addiction. We’ve seen all of the above, and once the money is gone at the gas station, it’s gone for good, leaving the lender with little options.

It’s critical for a lender granting credit on accounts receivable, particularly gas station receivables, to understand the cash cycle of the borrower’s customer in order to properly build the collateral and borrowing base. Otherwise, when the lender seeks to collect on its collateral rights, all they’ll have is a borrowing base with a huge accounts receivable total but little value when it comes time to actually collect anything.

In a petrol station, what is a jobber?

A jobber, also known as a petroleum marketer, is a person or company that buys large quantities of refined fuel from refineries (such as BP, Shell, and Exxon), either to sell to retailers (such as gas stations) or to sell directly to consumers (e.g., home heating oil to homeowners, lubricating oils to industrial operations or repair shops, jet fuel to FBOs, etc.). In essence, the jobber serves as a “middleman” between people who use or sell petroleum products at retail prices and those who refine them. The jobber often owns the gasoline and the station to which it is sold, but leases the store to an operator.

What’s the best way to get wholesale fuel?

Here’s a quick guide to bulk fuel purchases and how to get the most bang for your buck.

  • LOOK FOR A RESPONSIBLE SUPPLIER. The importance of developing a strong relationship with a respected supplier in the complex petroleum market cannot be overstated.

What is a jobber contract, exactly?

In the garment business, a jobber’s agreement is a type of collective bargaining agreement.

It governs a jobber’s interaction with the contractors that make the jobber’s clothing.

The jobber undertakes to use only unionized contractors, make timely salary and bonus payments, and contribute to the contractor’s employee benefit funds under such an agreement. The agreement has nothing to do with the jobber’s connection with his or her own employees.

This pact is also known as the Hazantown pact. Danielson v. Joint Board of Coat, Suit & Allied Garment Workers’ Union, 494 F.2d 1230, 1231-32 (2d Cir. 1974), a case in which the jobber’s name was Hazantown, Inc.

Here’s an example of a case law that defines the term:

A “Hazantown Agreement,” also known as a “Jobber’s Agreement,” is a sort of collective bargaining agreement that is only seen in the garment industry. The union does not represent the jobber’s employees under such an agreement; rather, it governs the relationship between the jobber and the contractors involved in the integrated process of creating the jobber’s clothing. In essence, the jobber promises to engage only unionized contractors and to contribute to the contractors’ employees’ benefit funds.

Is it profitable to sell gas?

  • Franchisees who pay royalties to name-brand gas refineries (ranging from 3% to 14%) in order to use their branding
  • Independent operators that own and operate generic “no-name” gas stations and purchase gas on the open market.

Because selling gas isn’t very profitable, most large oil firms have backed out of the retail market.

Gas stations make an average net margin of just 1.4 percent on their fuel, according to IBISWorld.

This is significantly lower than the 7.7% average across all industries, and it places it below other typically low-margin firms such as grocery stores (2.5%) and car dealerships (2.5%). (3.2 percent ).

Let’s take a step back and look at a typical gasoline supply chain to see why.

The profit pipeline

Gasoline starts off as crude oil, which is mostly sourced in the United States, in places like Texas and North Dakota.

This raw liquid, once taken from oil fields, is:

  • To be refined into gasoline, it is sent to refineries.
  • Flowed into bulk storage containers through pipeline, and
  • Freight vehicles transport it to gas stations, where it is stored in underground barrels with a capacity of 20,000 gallons.

Let’s say you pay $4.09 for a gallon of gas at your neighborhood station (the national average, as of April 13, 2022).

The following is a rough summary of where that money is spent:

Typically, gas stations only get a fraction of the price shown on the sign. After accounting for overhead, labor, utilities, insurance, and credit card processing fees, the average profit per gallon is between $0.03 and $0.07.

However, assuming daily sales of 4000 gallons at $0.05 a gallon, your typical station’s gas revenue might only be $200-300 per day.

Those coin-operated air machines you see at most stations, on the other hand, can make $300 to $500 per month after paying the firms that lease them out.

For starters, petrol stations are well aware that the bulk of customers make their purchasing decisions entirely on the basis of pricing.

They have an incentive to keep those statistics as consistent as possible on the board.

Even if they didn’t, they’d be kept in check by local competition: The finest locations, such as high-traffic freeway exits and on-ramps, are generally densely packed with competing stations.

In actuality, they despise it just as much as you do, owing to the fact that it creates a pricing differential. Catch-22:

  • When wholesale gas prices rise, many station owners would rather maintain their pricing and lose money than lose customers to competition.
  • Many petrol stations are wary about cutting their prices as wholesale costs fall, fearing a price war.

The real money is made inside the store

According to the National Association of Convenience Stores, 44 percent of gas station consumers enter the store. And one out of every three of them indulges in some sort of indulgence.

The products sold in these outlets, such as Doritos, sunglasses, lottery tickets, and energy drinks, account for only 30% of the average gas station’s sales but generate 70% of the profit.

Card readers are now standard on most contemporary pumps, eliminating the need to walk inside to pay. The average time spent at a gas station by a consumer is now only 2-3 minutes.

Convenience stores also have some of the highest crime rates of any industry in the United States, with average yearly robbery losses of $761 per location.

The gas station of tomorrow

In the last 20 years, we’ve seen:

  • Our total amount of miles driven has increased by 20%.
  • SUV sales have increased in the last two years, and they now outnumber cars.
  • The average monthly gas bill for a household has grown to $250.

Gas stations in the United States sold 135 billion gallons of gasoline last year, enough to fill 204 thousand Olympic-size swimming pools.

In 1995, there were 195k of them in the United States; currently, there are only 115k.

The following are some of the significant factors to this trend:

  • Natural gas is becoming increasingly affordable and popular.
  • Long-term, electric vehicles (EVs) and self-driving automobiles represent a danger to petroleum sales.
  • Urban real estate (NYC, DC, San Francisco, Boston) can be put to more profitable uses, such as condos or office projects.

Many stations have taken the pricey decision to install electric vehicle charging stations, which may cost up to $100,000 each.

Given that EVs presently make up of automobiles on the road, it’s a difficult cost to justify. However, the sector is rapidly growing: 4 out of 10 consumers say they’d consider buying an electric vehicle as their next vehicle, and stand-alone EV charging stations are springing up all over the country to serve them.

Stations that aren’t EV-agnostic and smaller businesses that can’t afford the upfront cost risk being left behind in the long run.

But, if everything else fails, gas stations have a hidden financial weapon in the form of those hypnotic rotating hot dog machines.


  • What’s the deal with the 9/10ths of a penny? When gas was only $0.15 per gallon almost a century ago, the government imposed a fraction of a penny gas tax. It’s no longer relevant, but station owners keep it since it makes prices appear slightly lower.
  • Explosions aren’t limited to the restroom. Each year, 4.2k flames erupt at gas stations around the country, resulting in $30 million in property damage. Cars are to blame for the majority of them. Hot dog machines are to blame for a handful of them.
  • When it comes to restrooms, a beautiful toilet can boost a gas station’s sales. According to one survey, 22.6 percent of restroom users admit to “often making an impulse purchase on the way out.”
  • KFC got its origins in a gas station. Colonel (Harland) Sanders created his first fried chicken plate while operating a gas station in North Corbin, Kentucky, in the 1930s.

How much does a gallon of gasoline cost to produce?

The process of refining crude oil into gasoline and diesel is known as refining. The cost of refining varies depending on the standards of the finished product and the additives used to improve it. Summer gasoline, for example, has low evaporation rates, which are essential to reduce excessive air pollution. Furthermore, gasoline is produced in a variety of power and performance levels known as octanes (i.e. 87, 89, and 93). The higher the octane, the higher the manufacturing cost. Detergents have been added to both gasoline and diesel to clean engines and improve performance. These additions also raise the price. Depending on whether summer or winter formulae are used, the cost of refining gasoline ranges from $.40 to $.70 per gallon. The cost of refining gasoline is $.60 per gallon in the case above. Diesel refinement costs $.49 per gallon.

What is the role of a jobber?

Jobbers, commonly referred to as “stockjobbers,” were market makers (MMs). They bought and sold assets on their own books and created market liquidity by matching investors’ buy and sell orders through their brokers, who were not allowed to make markets.

What is a subcontractor?

Any individual, other than a producer or distributor, who buys tobacco products from a distributor and distributes them to people other than the end consumers is referred to as a subjobber.

What does a dealer tank van entail?

“Adjusted Dealer Tank Wagon (ADTW)” refers to the delivered wholesale transaction price for gasoline transported by tanker truck to a retail dealer or franchisee that has been adjusted to reflect the “net cost” to the retail dealer or franchisee by subtracting all rebates or other discounts from the original dealer tank wagon (DTW) price to reflect the retail dealer or franchisee’s net cost of the gasoline.

A facility that stores and dispenses petroleum supplies, mainly jet fuel and aviation gasoline, for use in private and/or commercial aircraft is referred to as a “airport retail fuel outlet.” This definition excludes airport refueling operations that provide refueling services to military aircraft.

The liquid volume delivered by a pipeline during a certain time divided by the number of days in that period is referred to as “Average Throughput.”

“Bulk Terminal” refers to a non-public storage and distribution facility having a minimum storage capacity of 50,000 barrels that is primarily utilized for wholesale marketing of petroleum products and oxygenates.

The term “bunkering” refers to the physical transfer of marine fuels from one vessel to another.

“Cardlock Retail Fuel Outlet” refers to a facility that dispenses refined petroleum products to customers as its primary or predominant business activity, usually unattended by any operator.

A supplied wholesale price for gasoline transported by tanker truck to a retail fuel outlet is referred to as a “Dealer Tank Wagon (DTW).”

The quantity of crude oil, petroleum products, or oxygenates retained as stocks at a refinery, bulk plant, public storage facility, or tank farm at the end of a given reporting period is referred to as “ending inventory.”

A transaction in which the title or interest in petroleum products or crude oil stocks is transferred between corporations in exchange for other petroleum products or crude oil stocks is referred to as a “exchange.”

“Firm” refers to any person or entity involved in any activity listed in Title 20, Public Utilities and Energy Division 2, Chapter 3, Article 3, Section 1361 et seq. of the California Code of Regulations.

“Franchisee” refers to a retailer or distributor who is authorized or licensed to use a trademark in connection with the sale, consignment, or distribution of motor fuel under the terms of a franchise.

Total crude oil production, including all crude oil consumed in the production process, is referred to as “gross production.”

“Hypermart Retail Fuel Outlet” refers to a facility with one or more operators that dispenses refined petroleum products to customers as a sideline to their main business. The sale of non-petroleum goods and services to final consumers is the most common commercial activity.

“Independent Retail Fuel Outlet Operator” refers to a company that owns or leases a retail fuel outlet and is involved in the trade or business of obtaining refined petroleum products and reselling them to consumers without significantly altering their form.

Storage tanks used to collect crude oil from producing properties before to initial sale or shipment are referred to as “Lease Storage Facilities.”

A corporation or public storage facility, excluding refiners, that owns or maintains a tank farm that stores or processes more than 50,000 barrels of crude oil at any time during the current or previous calendar year is referred to as a “major crude oil storer.”

“Major Crude Oil Transporter” refers to a company that owns or runs a trunk pipeline and has transported 20,000 barrels or more in any given month during the current or previous calendar year. End users and public storage facilities that move crude oil only between their own or leased facilities are not considered major crude oil carriers.

“Major Petroleum Products Marketer” is defined as a company that sells or sells 20,000 barrels or more of petroleum products in any month of the current or previous calendar year, excluding service stations and truck stops. An electric utility is not regarded a large petroleum products marketer unless it has sold or otherwise disposed of 20,000 barrels or more of petroleum products per month during any four months of the current or previous calendar year, other than for its own consumption.

A “major petroleum products storer” is a facility that produced or received 50,000 barrels of any combination of petroleum products or oxygenates in any month of the current or previous calendar year.

A “major petroleum products transporter” is a company that owns or runs a petroleum product pipeline, trucks, tankers, barges, or railroad cars, and transports 20,000 barrels or more of petroleum products in any month of the current or previous calendar year. End users who exclusively carry products between their own or leased facilities for their own usage are not considered major petroleum product carriers. Major petroleum product carriers are public storage facilities that transfer petroleum product only between their own and operated storage, terminal, or warehousing activities.

“Marina Retail Fuel Outlet” refers to a facility that dispenses refined petroleum products to ultimate consumers for use in recreational or commercial marine vessels, and is usually staffed by one or more operators. Businesses that dispense marine fuels through the bunkering procedure are not included in a marina retail fuel store.

An operator of a facility, other than a marine vessel or tank barge, that is utilized for the purposes of importing, exporting, storing, handling, transferring, processing, refining, or transporting crude oil or petroleum products is referred to as a “Marine Facility Operator.” The person or entity that owns the land where the marine facility is located is not considered a Marine Facility Operator unless that person or entity is participating in the operation of the marine facility.

A “Marine Fuels Distributor” is a company that owns or operates marine vessels that are used to deliver 20,000 barrels or more of marine fuels to other marine vessels during any month of the current or previous year, or a company that delivers 20,000 barrels or more of marine fuels to marine vessels from storage tanks rather than from marine vessels during any month of the current or previous year. Bunkering is the process of transporting these marine fuels.

A waterborne tanker or barge used to transport crude oil, petroleum products, or oxygenates is referred to as a “Marine Vessel.”

The largest volume of crude oil, petroleum product, or oxygenate that can be safely discharged into an individual storage tank without exceeding the high level design restrictions is referred to as “maximum storage tank capacity.”

The maximum liquid volume that may be delivered via a pipeline indefinitely without harming any pipeline equipment is referred to as “Maximum Throughput.”

The Organization of Petroleum Exporting Countries is referred to as “OPEC.” This organization’s member countries are grouped into the following geographic regions:

Is it possible for you to stock up on gasoline?

After a two-week period of decreasing prices, gas prices fell to an average of $3.871 per gallon on Tuesday. Is it possible to hoard low-cost gasoline before prices rise again?

Yes, but you must exercise extreme caution. If you don’t do it correctly, your gasoline supply may sour or explode. The EPA advises customers not to store more than 1 to 5 gallons for safety concerns, and the National Fire Protection Association recommends a limit of 25 gallons. Your stockpile’s legality is determined by local fire codes: You can’t retain more than 2.5 gallons in New York City, for example.