How do I check a gas station’s fleet and commercial fuel accounts before buying?

Some local stations sell a good part of their fuel to a short list of regulars: contractors, farms, delivery firms and other local fleets that fill up on a charge account or a fleet card. That trade can be steady. It can also leave with the seller. Before you buy, find out who those customers are, who owns each relationship and who carries the risk if a bill goes unpaid.

Which accounts belong to the station

Start by sorting accounts into two groups. A house account is a charge arrangement the station offers itself: the customer fills up now and the station bills later. A fleet card may run through the fuel brand’s card network, in which case the program, not the station, bills the customer. Ask the seller to put each account under one heading or the other. Then ask your lawyer what the supply agreement says about the card network and whether it stays with the site after a sale.

Receivables and who carries the risk

House accounts create money owed to the station. Ask for an aged list showing who owes what and for how long, and compare it with the financial statements. Ask how the seller collects, whether any balance is disputed and who keeps what is owed at closing. Your accountant and lawyer can help you decide how to deal with it in the agreement. For card accounts, ask how quickly the program pays the station and what happens when a customer fails to pay.

How concentrated the litres are

Ask for fuel sold by account over more than one year. If a few customers buy most of the commercial volume, losing one could change the picture. Find out how long each has been buying, whether any written terms exist or it is a handshake, and what keeps them coming: price, location, convenient hours or the seller’s own service. A farm or a contractor can fill up somewhere else if the relationship was personal.

Meeting the customers after closing

• Ask the seller whether the largest customers know the station may sell, and whether an introduction is possible.
• Plan a visit or call in the first weeks to confirm terms and hours.
• Keep service and billing steady at first, so nothing changes without notice.
• Ask the seller to stay available for a handover period if the accounts depend on them.