New Auto Repair Shop Opportunity

[Dux]

Hello Everyone,

 

My name is Robert, I own and run a transmission shop. I recently was given an opportunity to take over an auto repair shop without much investment but I don't have as much experience in the general automotive field. I don't know what kind of repairs I should be targeting or what kind of shop supplies I should stock up on. I figured I would use this shop to help with the overflow of my transmission shop just to make sure theirs income coming in. I would appreciate any kind of advice or tips.

 

 

Thanks...Robert

[phynny]

I believe that non-mechanic owners have 10x the struggle to succeed. I'd stick with what you're good at.

[HarrytheCarGeek]

I think you will be surprised to learn that general auto has lower margins than transmission repairs. But if you can pull it off, you will increase your revenues and profits.

[Elon Block]

Robert,

 

Welcome to the forum! The general services can be a perfect addition to your

current business for a number of reasons.

Is the new shop close to your existing business?

 

What do you mean by overflow? Are those jobs you're trying to turn out faster?

Or are you talking about something different? What kind of work are you doing

now? Is it retail? Is it wholesale? Is it commercial?

 

What kind of work are they currently doing out of the shop you're looking at?

 

You answers to the above questions will help to provide some suggestions

and direction.

 

 

[bstewart]

I believe that non-mechanic owners have 10x the struggle to succeed. I'd stick with what you're good at.

 

My personal opinion is the opposite.

How many former mechanic shop owners out there are struggling and failing because they have been "in the business" for so long?

They spend all day working in the business, doing things as they always have been, running on autopilot.

Instead, they should be working ON the business, watching KPIs, managing people and planning for the future.

 

I believe that non-mechanic owners have a different view of the business, look at it more like a business then a job.

Obviously training and learning how to run the business is essential, but non-mechanic owners don't get caught up in the day-to-day stuff as much IMO, they work ON the business more.

There is still a struggle, but it's a different kind of struggle.

I'm sure there's several owners on here who will agree with my opinion (Xrac I believe is one).

[phynny]

 

My personal opinion is the opposite.

How many former mechanic shop owners out there are struggling and failing because they have been "in the business" for so long?

They spend all day working in the business, doing things as they always have been, running on autopilot.

Instead, they should be working ON the business, watching KPIs, managing people and planning for the future.

 

I believe that non-mechanic owners have a different view of the business, look at it more like a business then a job.

Obviously training and learning how to run the business is essential, but non-mechanic owners don't get caught up in the day-to-day stuff as much IMO, they work ON the business more.

There is still a struggle, but it's a different kind of struggle.

I'm sure there's several owners on here who will agree with my opinion (Xrac I believe is one).

 

Basing mine of past and current experience of businesses I have purchased and currently work with. This business is not, nor will it ever be "cookie cutter" so unless you came up through the ranks it will be much tougher on non-mechanic owners. Just because xrac is doing fine really means nothing in regards to who will struggle more in this business. What you're talking about is delegating and having the right people doing the "business" side of things. Like I said, this is just from my personal experience and I've had a lot of it when it comes to dealing with failing shops. There are hundreds of better investments for non mechanics then auto repair shops, and so much less of a struggle.

Edited April 10, 2016 by phynny

[xrac]

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[phynny]

Seems as though you guys are trying to say technicians cant be businessman also? If there are 2 separate shops both with knowledgeable businessman owners and one has been a tech and one not, I'll put my money and statistics on the tech own shop any day. Right now I'm at a Midas with a non mechanic franchise owner and I see the complete opposite of what you're saying xrac, he doesn't understand why spending 1k on software updates is needed.

[Dux]

Thank you all for responding. I very much appreciate it.

 

To respond to Elon.

 

-My transmission shop is currently always backed up and we have so much carry over on a weekly basis. I was thinking of sending a few jobs down to the new shop to help raise revenue before we gain some momentum and some of the advertising campaigns kick off. Yes, I am trying to turn the jobs out faster. My shop is often having to turn off our advertising to catch up but this is on transmission repairs.

 

-My transmission shop is currently doing about 80% retail and 20% wholesale.

 

- Right now, the shop is just doing brakes, oil changes, tune ups, timing belts. I'm new to advertising and marketing general automotive.

 

Again, thank you all for your insights.

 

Thanks...Robert

[HarrytheCarGeek]

It's funny, when you know something, it seems so simple, when you are ignorant even simple explanations seem complicated.

 

Businessman-->monetizes--->Tech knowledge and labor. "Buys low and sells high, must make a profit over all his expenses to stay in business."

 

Tech---> Sells knowledge and labor to---> Businessman. Must make more money than the cost of his living expenses and necessities and taxes to work for Businessman.

 

If you are single man shop you wear many, many, many, hats. You are businessman, tech, accountant, salesman, manager, parts guy, delivery guy, janitor, etc.

 

A good businessman knows he must make a profit to stay in business. He knows his customers, and what to charge the different segments of society, i.e., a cashier driving a 1994 nissan sentra can only afford certain amount, vs the IT vice president driving the 2011 Audi S8. To the tech, changing front rotors and pads is somewhat similar between the two cars, but one thing is certain, it will consume some of the tech's time for sure. If both cars only pay 1 hour for the similar job, it does not make much difference to the tech, as he will get paid for his hour. On the other hand, the businessman has to know that the profit will be greater with the customer that has more disposable income.

 

EDIT: P.S. apologies for hijacking the thread.

Edited April 12, 2016 by HarrytheCarGeek

[xrac]

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[xrac]

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[Elon Block]

Thank you all for responding. I very much appreciate it.

 

To respond to Elon.

 

-My transmission shop is currently always backed up and we have so much carry over on a weekly basis. I was thinking of sending a few jobs down to the new shop to help raise revenue before we gain some momentum and some of the advertising campaigns kick off. Yes, I am trying to turn the jobs out faster. My shop is often having to turn off our advertising to catch up but this is on transmission repairs.

 

-My transmission shop is currently doing about 80% retail and 20% wholesale.

 

- Right now, the shop is just doing brakes, oil changes, tune ups, timing belts. I'm new to advertising and marketing general automotive.

 

Again, thank you all for your insights.

 

Thanks...Robert

Robert,

 

When you're looking at this new shop, here are a couple of things to consider:

 

1) How many loyal customers does the existing shop have? My definition of a

loyal customer is somebody who comes in two to three times, on average,

within a 12-18 month period. If you think about it, most customers are having

auto repair services done two to three times per year. So, it's important to

know how many are using THAT shop for all of their repair and maintenance

needs now?

 

2) What existing employees do you think will be staying, if any?

 

3) Would you be providing the same services as they currently offer, or would

you be adding additional services? Or subtracting any services?

 

4) How much of their sales are based on marketing, such as loss leaders? For

example, if they're doing $15,000 per week in sales, but the majority of the

sales are quick oil changes with nothing else, you're going to have to be

prepared to continue that same business model OR be prepared to educating

every single customer that you're no longer just going to be doing just the normal

20 minute oil changes. You're going to be offering a higher level of service

than they're used to.

 

Also, if their transactions are all coupon or promotion-based and the

customers aren't buying anything else... that tells you something about

how that business is perceived by the people, in that area.

 

5) That brings me to the other question, which is: are you planning on

keeping the current name? If you're keeping the name, what are the

current reviews like?

 

The biggest thing to consider is: Selling general services is a much different

business model than providing transmission services because general

service customers believe everyone does the exact same thing. So, you're

going to have to be able to communicate why they should your shop

over all of their other choices, in your area.

 

So, based on that, what is it you believe will be the reason the vehicle

owners around that shop should use it - over the many other ones

available to them?

 

Do you already know what that is?