Convenience Stores For Sale: How and What to Buy

Convenience Stores For Sale: How and What to Buy

Investors are always looking for the next opportunity. Whether you are new to commercial real estate investments or you have a robust portfolio already, a convenience store for sale might make a great addition to your portfolio. Convenience stores are always in demand, and are found in just about every city, town, or community across the country. A convenience store or c-store meets the essential needs of their communities and considered recession-proof, too, as customers will stop to buy what they need even if they don’t have a ton of disposable income, especially if the store is located in a good area near people’s work, home, or commute.

When you are considering convenience stores for sale, you may have many questions about how or what to buy to get a good deal. If you are looking to sell another of your properties to buy a convenience store or if you are looking to simply invest in one to add a new property to your portfolio, the process can be confusing without the right support. Keep reading to find 4 tips on how to buy a convenience store for sale and 5 considerations you need to keep in mind throughout the process.

How to Buy a Convenience Store

If convenience stores for sale is something you’re interested in purchasing and investing in for your portfolio, then there are a few steps you should follow to ensure a smooth process. By gathering the right team around you and understanding exactly what you want to get out of this deal, you will be better set up for success as you begin buying c-store stores for sale. These four tips can help you during your research on how to buy a convenience store.

Tip #1: Work with professionals to identify the best deals that will complement your real estate portfolio.

The first tip to an easy process in buying a convenience store is to work with an investment advisor. Commercial real estate professionals, especially those that specialize in convenience stores, understand the process you’ll need to follow. They also know the current listings you may be interested in, and can help guide you by asking questions that you need to consider. They may even have the inside scoop on what  c-stores will soon be on the market, so you can get ahead of the game on a new property. A professional can help ease your future headaches as you work through a commercial real estate transaction, and can make sure you meet deadlines or find the best opportunities for your goals.

Tip #2: Determine your requirements (location, size, etc.) with input for your team of real estate experts.

One of the things the c-store real estate expert can help you with is determining your requirements. There are so many considerations and questions you need to answer when making an investment in a convenience store, and your support team can help with what you need to know in order to make the best decision. They know the right questions to ask, because they’ve been through the process before. So even if you’re a complete newbie to commercial real estate and convenience stores, your broker can make sure you know what to expect.

A good commercial real estate team can help you figure out the right location, size, and area that you want to search in — as well as figure out additional info, like whether the area is safe or if there are too many competitors in the area. They can discuss your budget and what you might get for that money, so that you can go into the process with realistic expectations. By knowing more about what you are looking for, they can help you find a convenience store that meets your needs.

Tip #3: Identify the convenience stores that might make the best asset for you.

A real estate agent will help pull listings that meet your requirements, including budget and location. They can even narrow down the search for you, so instead of reviewing hundreds of listings, you may only have to see a dozen or so of the ones that best meet your needs and desires. They can find listings that will interest you, like ones with a gas station, and help you sift through all of the various choices out there. You can work with them to refine the search as you go along, too.

Your real estate agent or broker can even be a sounding board as you research each opportunity and can provide additional insight as you decide on your next investment. Maybe you’ve seen too many of something you don’t like (something you weren’t even aware of when the process started), or maybe you have changed your mind and know that you want to buy in a certain city. By letting your real estate team know, they can sort through listings and answer questions you have during the research of each property.

Tip #4: Narrow down that list of opportunities to find the one that will give you the biggest return on your investment.

After you and your real estate agent have gone through all of the listings, you’ll be able to narrow down the list of opportunities. Once you have that list narrowed down to a handful, you’ll be able to start making an offer to get the next stages of the process rolling. If one jumps out to you as more appealing than others, then discuss that opportunity with your broker.

There’s still a process to go through, but with a real estate expert by your side, you will have someone who knows what to expect at each stage of the process. A narrowed down list can help you be ready to begin moving forward on opportunities to get a return on your investment in a convenience store.

If you need help narrowing that list down, let your commercial real estate team know and they can help, and read on to see some questions to keep in mind for 5 key elements of convenience store investments.

What Is a Good Convenience Store to Buy

When considering what c-store to buy, there are 5 key things to look for as you review the listings provided to you and work with your real estate team to find the right opportunity. Each of these 5 elements can help narrow your search or understand your goals throughout the investment process. Take a look at the questions for each element, and let your team know if you can’t figure out a solid answer to any of them so they can help you bounce ideas around as you narrow down the listings to the best opportunity for you. These are the 5 main things to research, consider, and discuss as you decide on which property to invest in.

Location and size

Are you looking to invest in a convenience store in a particular city or town? Or are you open to convenience stores across the country that are currently for sale? Do you want a c-store that’s standalone or attached to a gas station? Are there similar convenience or liquor stores nearby? Is the store located in a popular area with lots of customers? If you already know the city, town, or even neighborhood you want to invest in, that helps to narrow your search focus. But if you don’t know or you are just open to any opportunity that is the right fit, then you will have more options but will need to review the listings to find the right one. You’ll also need to consider the size of the store itself and the parking area (because, let’s face it, sometimes 3 parking spaces just won’t cover it, especially if it doubles as a gas station).

Here are some questions to consider when looking at where the store is located and size when going over listings with your commercial real estate expert:

  • Is this in an urban or rural area? Do you have a preference
  • Is this on a main road or is it set back into a neighborhood or other area
  • Is this near public transportation, a highway or interstate, or major intersection
  • Are there plenty of parking spaces for rush hour
  • Are there nearby competing liquor stores and/or convenience stores?
  • Are there parking spaces available for handicap, family, or other specialty parking
  • Will the parking lot allow for a semi truck, bus, or RV to park?
  • Inside the store, is there space for a line to form if needed?
  • Is there enough room for customers to move around inside the store, browsing or gathering the items they need?
  • Where the gas station is located relative to the c-store
  • Does the asking price make sense?

Financials and return on investment

It’s probably a given that you don’t want to invest in a business for sale that is going to lose money (unless it’s your business to turn those around and make them successful, of course). When considering a new property to invest in, no matter what type of property that is, you need to consider the financials of the business that occupies it (or potential businesses that you lease to in the future). Your return on investment will depend on their ability to pay rent or to bring in money for you. Take a look at the current and projected financial records and business plans of the tenants you plan to have in the space, so you know which properties might be the most financially rewarding to work with.

Here are 4 questions to consider for return on investment when reviewing listings from your commercial real estate broker

  1. Is the convenience store currently successful
  2. Do you want to put in the time and effort to turn it around and ensure it becomes successful? Or do you want to hire someone that can do so
  3. Looking at the area, is there a good chance this store will continue to be successful in the future?
  4. Is it standalone or is it adjacent to a gas station?

Traffic at the store and nearby

Traffic won’t necessarily be a make or break factor for everyone. Sometimes, a store can be located in a neighborhood that isn’t well traveled or doesn’t draw in a lot of visitors, but if that convenience store is located in an area that has a solid, steady customer base, it can be a great investment, especially if it’s attached to a busy gas station. However, unless the store is already well established, finding an area that is well trafficked, like off an interstate or at a busy intersection in town, can help to ensure a return on your investment. It can also help ensure that in the future, if and when you decide to sell, there will be interested buyers based on the heavily trafficked area.

Here are a few questions to consider for return on investment when going over listings for convenience stores

  • Is the store well established with a strong customer base
  • Is the store near an interstate, highway, or busy intersection
  • Is it easy to access when walking, driving, or taking public transportation?

Potential for improvement

Even if the store is currently successful, you always want to see growth in the businesses you invest in. Will this convenience store offer the potential for more growth and improvement in the future? As long as there is the ability to grow, expand, or bring in new products and customers alike, there is potential for improvement with any business. If the store is not bringing in a profit, are there immediate changes that can be made to turn things around quickly?

Here are a 2 questions to consider for future potential when reviewing c-store listings

  • Is the business currently successful, or is there a great room for improvement?
  • What are the current areas the convenience store could improve (merchandising, product selection, inventory, etc.)? 

Neighborhood and local area

You will also want to review the neighborhood and local area. There are several things to consider within the area you are looking, and you should look at each individual convenience store’s neighborhood before making a final decision. It’s important to understand the different factors affecting the area, including safety concerns, population growth, competition in the area, and local events, features, or attractions.

Here are some questions to consider with the area when looking over the convenience stores for sale listings

  • Is this a safe neighborhood?
  • How many other convenience stores or shops that may be competitors are there in the surrounding area?
  • Is the area one that is experiencing growth, with many new potential customers coming into the area?
  • Does the area host events or have any attractions that could bring in new customers in conjunction with these events?

Work with an Expert to Expand Your Real Estate Portfolio with a Convenience Store

If you are ready to move forward with finding a partner for your next investment search, the convenience store team at Sands Investment Group is here to help. Our team, dedicated to helping investors like you find the right convenience store opportunity, has decades of experience working on commercial real estate transactions. They can help with more than just the initial transaction too, with these value added services for a convenience store owner:

  • Existing real estate asset
  • Leased property ROFR
  • Operator acquisitions
  • Build to suit business development

Contact the team today by calling 844.4.SIG.NNN or sending an email to start getting your questions about how to buy convenience stores for sale and other popular commercial businesses for sale, answered.

Looking to invest in a larger  business? SIG also specializes in a variety of other reliable, big brand commercial businesses including dollar stores for sale, 7 Eleven stores for sale, and more!

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