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Commission agent vs franchise vs independent servo

How the main service station operating models work in Australia, and what each means for your income, risk and freedom.

Two servos with the same fuel volume can be very different businesses depending on how fuel is supplied. Here are the main models you'll see on Servo For Sale.

ModelWho owns the fuelHow you earn on fuelTypical trade-off
Commission agentThe fuel companyCents per litre commissionLow fuel risk and often lower entry price, but limited control over fuel pricing and the agreement terms.
FranchiseVaries by systemFranchise-specific modelSystems, brand and training, in exchange for fees and following the franchisor's rules.
Dealer / supply agreementYou (bought from the supplier)Your retail marginMore control over margin, but you carry fuel price and stock risk and must meet supply terms.
IndependentYouYour retail marginFreedom to choose suppliers and pricing, without a major brand's marketing or payment network.

What to ask about any model

  • How long the agreement has left, and what happens when it ends
  • How commission rates or margins can change, and who decides
  • Who pays for and maintains tanks, bowsers, canopy and signage
  • What approval the fuel company or franchisor needs to transfer the business to you

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General information only, not legal, tax or financial advice. Get advice for your situation before buying or selling.