The fuel supply agreement is the most consequential document in a Florida gas station purchase, and the one buyers read last. It sets your cost of goods for years, dictates capital spending, and can carry a balance you inherit at closing.
This guide explains how to assess fuel supply contracts when buying a gas station in Florida, term by term, and what each provision is worth in dollars. Our fuel supply agreement advisory service performs this review on live deals.
The Terms That Set Your Margin
Start with pricing: the cents-per-gallon differential over the applicable rack or index, how the index is defined, whether pricing is DTW or rack-plus, freight allocation, payment terms and any prompt-pay discount, and credit card fee treatment. A one-cent difference on 100,000 monthly gallons is $12,000 a year — permanent, compounding, and fully negotiable at transfer.
Then term structure: length, renewal rights and whether renewal is automatic, minimum monthly or annual gallon commitments, penalties for shortfall, and exclusivity. A long term with a high differential and a volume minimum you cannot hit is a liability regardless of how strong the site looks.
Image Obligations and Inherited Balances
Branded agreements usually attach image and equipment standards with a remodel schedule. Confirm what work is required, by when, and at whose cost. Deferred image obligations transfer with the site and routinely run into six figures for canopy, signage, dispenser wraps, and lighting.
Then get the unamortized incentive or image-loan balance in writing from the supplier, along with the payback formula on early termination or debranding. This figure belongs in your price negotiation, because it is a liability you assume — not a rounding item.
Assignment, Approval, and Exit Optionality
Check whether the agreement is assignable, whether the supplier must approve you as dealer, what financial and operational criteria that approval applies, and how long it takes. Make dealer approval a written contingency with a deadline; buyers have closed on stations only to discover they could not get fuel under the existing brand.
Finally, price your exit. Model the station as-is, unbranded after expiration, and converted to another brand. If the value only works under the current contract, you are buying a contract with a station attached, and the price should reflect that. Read our comparison of Florida fuel brands next.
Frequently Asked Questions
Speak With a Florida Gas Station Specialist
Request a confidential consultation or off-market opportunities and pricing through our contact page, or call +1-305-518-1545. The Gas Station Group is headquartered at 8603 S Dixie Hwy, Miami, FL 33143. Principal: Bobby Berrido.