In 2018 an industry report noted that convenience stores in the US made on average $4 million dollars per store. However, profit margins are affected by multiple variables such as overhead costs, labor costs and other miscellaneous operating costs. This makes it hard to pin down an exact profit margin. From a business perspective small businesses in general should make between 7% – 10% profit from their earnings. Most businesses do not make a profit in their first year of operation. According to Forbes most new businesses need 18-24 months of operation to turn a profit. Other sources say it can take 2-3 years for a small business to become profitable.
The average convenience store has between one and four employees. This number may drop in the years ahead as there are convenience stores popping up in places like Toronto where there are no cashiers at all. These stores are self-serve with one employee available to monitor the store.
Convenience stores are often in very visible, high-trafficked areas that are easily accessible. This may mean larger overhead eating into profits, but it also often results in a high volume of sales balancing out the operating costs. In the case of franchises, there are franchise fees associated which the owners must pay, whereas independent or “mom and pop” shops do not have such costs. It is challenging to find data relating to sales based on branded/franchised stores versus independent stores.
Another operating cost that eats into profits is government licensing. Each state/province/municipality has their own licensing fees and regulations as well as food labelling requirements. You must also factor in tobacco licensing and the license to sell lottery tickets. If your business is using recorded music, you must also have a license to play said recordings.