The LPG market is very popular throughout the year, making it a very lucrative business venture for individuals willing to start a gas agency dealership business. With the rising demand for domestic needs along with the growth of industries, Indians are looking forward to greener alternatives with LPG in the energy mix.
Moreover, the Indian government provides subsidies and other beneficiaries that are bringing in more customers from both urban and rural areas. Even though the business is highly profitable, the set of problems that one might face while starting or running a gas agency makes the business quite challenging.
That’s why today we will study the process of getting a dealership from the distributor, the business\'s challenges, and how to overcome them.
Stepping On Gas Industry Dealership Journey - Quick Guide
The first step in starting your LPG gas agency business is choosing a distributorship that you want to work with. These are of different categories, mainly four types of distributorship, which include the urban, rural, R-urban, and hard-to-reach areas.
It is advised to pin down the exact spot where you are thinking of setting up the organisation, and then perform a comprehensive survey in the area.
When you have selected the locations and sorted out the finance requirements, some prerequisites must be followed to get the dealership. Let’s find out:
- Age limit for gas dealership application: 21 to 60 years.
- Minimum qualification required: 10th pass from accredited board.
- No family member can be employed by a leading Oil and Gas marketing company.
- Submission of non-refundable application fee specified by the gas agency.
- Reserved funds of 20-25 lakh and land for storage facility construction are necessary.
Discovering the Obstacles in Managing an LPG Dealership
The use of LPG gas is prevalent in India. The first of the three countries that are using LPG as domestic cooking fuel are Japan, China and India. India offers LPG Gas in four different packs. For example, 5 kg and 14.2 kg are used at home and 19 kg, 47.5 kg and 425 kg for commercial and industrial applications respectively.
The demand for LPG for domestic use has been increased due to the Ujjawala scheme. The number of subscriptions for the household has gone up considerably.
So, if you are thinking to prioritise your business plan and be a well-established LPG dealer, get ready to fight the challenges:
- Compliance with Regulations and Licensing
The fuel and gas industry is deeply regulated because of safety and environmental issues. Gaining mandatory permits, letters of good intent, licences, and safety standards set by local and national authorities is quite imperative.
This might be hard, especially for a beginner in the area. So, if you work with experienced dealers like Shivgas, Super Gas, and Reliance Gas, they take care of all the dealers starting from the regulatory requirements to aiding them in streamlining the process.
- Highly Competitive Market
In India, there are multiple public sector companies and private-owned companies that work as LPG distributors for the whole country. These companies have a huge network system which contributes to the tough time in the competition.
If you are just beginning your business operation, it could be quite hard for you to find your way out of the messy market. The competition is high! However, target market identification, clear strategy, the right approach, and planned marketing propaganda along with support from a trusted LPG dealer can help your business create market space and earn ROI.
- Hiring and Training Staff
Among all the basic necessities to start your dealership, you must hire people who can handle the storage of gas, maintain safety and communicate with the customers to help them with their queries.
Finding the right skilled employees who are up to date on gas handling, safety procedures, and excellent approach to customer service is indeed a difficult task. Therefore, regular training and upskilling are a must to make sure staff have the required skills to take on the complicated gas business.
- Adapting Latest Technology
Although the adoption of technology and integration into everyday procedures may be a challenge.
Still, there should not be any barrier for traditional dealerships, implementing an online payment system, an automated booking system and efficient tracking mechanisms - Can make customer service better. So, for this, the dealership has to invest in training and improving the efficiency of the staff to follow the advanced rules and regulations.
- Supply Management
One of the main issues that any gas dealer has to face is supply chain management issues. The main reasons can be - economic crisis, religious factors, and environmental factors. LPG consumption for domestic purposes can go up during festive times and winter.
Therefore, you must know your customer behaviour, anticipate the ups and downs of the market, and learn to use the customer management software that can help you from stocking too many or few cylinders.
The Role Of Private LPG Suppliers To Set Up Your Dealership
Now, the question that may strike your mind is, “Why should I opt for a private gas dealer instead of a government LPG supplier?” Well, the choice is completely yours, but government companies need more improvement in terms of their services. The application procedure itself takes 3-4 days to process, so think about what time it can take for a complete set-up.
On the other hand, private gas companies help you in the following ways:
They Prioritise Safety Regulations and Training
Safety should not be compromised at any step of setting up the agency. Hands-on facilities, storage and transport are the key points, in this case. For this reason, the companies train and guide you fully to operate the equipment properly or to make your staff understand safety regulations very well.
Invests Time In Customer Satisfaction
Customer service and satisfaction act as a bridge for you to have better relations with your long-term consumers and as well for you to attract new customers.
When it comes to handling your customers, the trained dealers of gas agencies provide the best service that meets complaints promptly and guarantees the timely delivery of products and services. This boosts trust and satisfaction among the customers and they remain loyal.
Setting Yourself Apart in a Competitive Market
Another legitimate concern for a car dealer or a large distributor is the difficulty of being distinct in an environment where so many competitors offer the same products. When you select a reliable team of LPG gas dealers, they will share the necessary insight and approach to stay ahead of the competition.
Large Supply Chain And Distribution Network
Gas companies have a large web of dealers and distributors worldwide. The motive of private gas companies is to provide industrial, commercial and domestic gas supply whenever in need. With a complete analysis, they receive better inventory and supply management facilities.
Also Read - Navigating Through the Gas Safety Standards & Ensuring Compliance and Safety
Conclusion
LPG gas dealerships are a profitable and rewarding business - that\'s true. But, without a reliable partner, it\'s nearly impossible to pass through the difficulties of the business. Moreover, consumers enjoy private LPG gas dealerships which are more reliable in terms of service quality, pricing, convenience, and environmental responsibility. So, joining a private gas agency is an opportunity for you to gain access to unbeatable services and a smooth user experience.