What should I check in a gas station’s fuel supply agreement before buying?

At a branded gas station, the fuel supply agreement often decides what you are really buying. It can tie the site to one supplier, set how much fuel must move, and require upgrades to the brand’s standards. The seller’s summary of it may be short or out of date, so ask for the signed agreement, every amendment, and any side letters. Then read it with your lawyer.

How long it runs and what it commits you to

Find the date the agreement ends and any renewal terms. A short remaining term means you may be negotiating with the supplier soon after closing, while a long one binds you to whatever it says. Look for volume commitments, minimum purchases and what happens if the site falls short. Ask whether the supplier can change pricing methods or supply terms during the term, and how.

Exclusivity, branding and image duties

Check whether you must buy all fuel from the supplier, and whether the exclusivity reaches the store, the car wash or other services on the site. Branding clauses often require signage, canopy and pump upgrades on a set schedule. Ask the seller which upgrades are done, which are overdue, and what the supplier has said in writing about the work still outstanding.

Consent, incentives and what to ask the supplier

Many agreements need the supplier’s consent before a new operator takes over, and some carry a right to step in on a sale. Look for incentives or contributions the seller received that must be repaid, or that fall away, on a transfer. Then ask the supplier what it requires from a new operator, what the approval takes, and whether it will confirm in writing that the seller is in good standing.

• The signed agreement, all amendments and side letters.
• The date it ends and the renewal terms.
• Volume commitments, exclusivity and branding duties.
• Supplier consent steps for a new operator.
• Incentives that may need to be repaid.

Environmental questions on a fuel site are separate and matter just as much, so read what environmental checks you need alongside this.