Frequent Asked Questns | Nayara Energy



Can I become a Franchisee/Dealer/Operator of Nayara Energy?
Any Indian National who has a suitable plot of land and is willing to lease it to Nayara Energy is eligible. In case the applicant does not have a plot of land, but is interested either in buying or taking land on lease and further leasing it to Nayara Energy for the fuel station, can also be considered to be appointed as a franchisee.
What is the selection process?
The identified plot of land is assessed for its business potential by Nayara Energy. The applicant is also screened for financial capability & business acumen. The necessary land documents and personal information is to be submitted to Nayara Energy for a review. Once the land and the applicant is found suitable, a Letter of Appointment (LOA) is issued.
Is there any application fee for becoming a dealer/franchisee?
Yes, a non-refundable amount of INR 5 Lakhs has to be submitted as application fee.
Is the Application fee refundable?
The application fee is non-refundable once the LOA is issued. It may be refunded in exceptional cases and only if there is a valid justification, such as a statutory approval being denied by a Government agency. The refund will be at the discretion of Nayara Energy.
Who will invest in construction of the retail outlet? What is the investment required by the franchisee selected?
Apart from the land, the selected franchisee has to invest in the construction and day-to-day operations of the fuel station. The cost of constructing a retail outlet is approximately ₹70 lakhs – ₹1 crore.
Who will get government permissions for the retail outlet?
The applicant has to obtain all required statutory approvals and licenses from the government to set up the retail outlet. Due help will be provided by our divisions to prepare applications in line with the government mandate and requirements.
What is the average investment in developing a fuel retail outlet and the turnaround time for completing the construction after approvals?
Apart from the cost of land, the average investment is approx. ₹70 lakhs - ₹1 crore depending on the size of the retail outlet and the amenities / services provided. After the NOC and statutory clearances are received, the retail outlet can be set up in about 3 months.
What are check lists/documents required with the application form for getting an LOA?
The application form - Expression of Interest (EOI) has to be submitted to Nayara Energy along with land papers and specific documents required to establish financial and business capability. DD for the application fee is also to be submitted with the EOI. The Territory Sales Manager and Divisional Manager will guide the applicant.
What is the pricing policy for diesel & petrol?
The prices of both petrol and diesel are comparable to market prices. The prices are revised in line with changes made in the market.
Where will the products be supplied from?
Supplies are made from Nayara Energy’s refinery, its own depots and coastal terminals. We have tied up with over 40 PSU locations to ensure seamless supply to our franchisee network.
What approvals / licenses are required for the retail outlets?
Listed below is the regular set of permissions required. However, the list can be different from one state to another: NA (Non- Agricultural) Conversion CCOE (Explosives Department) initial approval District Collector NOC, Police commissioner NOC, approval from PWD, Electricity board, Gram panchayat etc. depending on the requirement by the competent authority. Final CCOE License NH (National Highway) – access road permission. If applicable Forest NOC – In case of forest land Retail Selling licence wherever applicable Weights and Measures stamping
Does the land have to be leased to the company? Will any lease rental be paid?
Land identified for the retail outlet has to be leased to the company for a period of 29 years and 11 months, except in Maharashtra and Tamil Nadu where the requirement is 29 years and Rajasthan where it is 19 years and 11 months due to regulatory norms.
What will be my earnings and return on my investment?
Our dealership model is not only simple but also ensures a steady operating profit and return on investments. You could earn: A mutually agreed lease rental on your land for the period of the lease A performance-based return on investment @ 5% p.a. on the capital expenditure made onsite Competitive sales commission on the quantity of fuel sold
How are the payouts disbursed to the franchisee / owner / operator / dealer?
The lease rental and Return on Investment (ROI) is paid once a quarter. However, the sales commission is given in the invoice when the product is billed to your retail outlet.
What would be the period of lease? Why 30 years / 29 Years / 19years,11 months?
Our research indicates that fuel retail outlet business is a long-term business and it takes time to stabilize. In Maharashtra & Tamil Nadu, the period of lease would be 29 years and in Rajasthan it will be 19 years and 11 months due to local regulatory norms. In the other states lease period is 30 years.
Is there any exit / land de-leasing if price of the land or the product rise?
There is no exit policy and de-leasing of land is not permitted. Individual cases are reviewed by the management and the best possible solution is suggested to each franchisee.
Is there a termination clause in the agreement? If yes, when does it apply?
Yes, there is a termination clause which applies when the franchisee compromises on company standards and / or violates rules applicable to the petroleum industry.
Are there any approved contractors for petrol pump construction?
We have a set of appointed vendors and orders need to be placed with them for engineering fuel tanks, dispensing units etc. In case of civil contractors, the franchisee is free to appoint anyone of his / her choice. However, all branding and construction guidelines need to be adhered to.
Will Nayara Energy extend any assistance/help in the construction of the petrol pump?
We have a dedicated team of engineers and representatives across our divisional offices who extend their complete support in construction of the petrol pump and ensure it is being setup as per company mandate.
If I am making all the investments, what is the role of Nayara Energy?
Our business model is different. We believe in your ability to construct the retail outlet economically and in a short period of time. Nayara Energy will provide all technical and networking guidance during the construction, training for you and your staff on retail operations and offer attractive commission and incentives to perform better. The model ensures that the control and ownership of the RO remains with you. Nayara Energy also gives you a return of 5% p.a. on the normative cost of investment made in constructing the outlet. This pay-out is unique in the oil industry and makes the proposition more lucrative for you.
What will be the quality of fuel supplied to me by Nayara Energy?
Our products always meet the relevant BIS specifications. In our refinery we produce high quality Euro IV and V grade products keeping in mind best-in-class global standards.
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