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Thinking about opening a car repair business

Discussion in 'The Okie Corral' started by mhill, Sep 19, 2012.

  1. mhill

    mhill

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    There is an old Circle K station near me. I'm in a good part of town. I don't think getting business would be a problem. The station for sale has 4 bays and 3 lifts. Been closed for about 4 years. No tanks. I would get a no action letter for myself for any epa issues.

    The station minus needing a bunch of cleanup is pretty much ready for business. Lifts and compressor and stuff already in place.

    Started running some numbers but unless I get about 3 mechanics busy there I don't think I can make money. I wanted to start slow with just one mechanic.

    I also work a fulltime job and would just do this on the side. I would have to hire a fulltime mechanic to run the place.

    Besides the hourly rate how else would I make money? Do we mark up parts?

    I would concentrate on a quality business that completed work on time and had good communication with the customer.

    Am I crazy. Just always wanted to run a business for myself.
     
  2. wjv

    wjv Zip It Stan Lee.. . .

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    You mark up everything. But how much to mark up is the question. People are paying for the convenience so adding XX% to the cost of goods is acceptable.

    Next time you go to a quick lube place, ask them to change out your air filter and a bulb. See how much they charge you. Then see how much you could have got the part for. A $1.10 bulb cost $8 to change at our lube place. Takes them all of 1-2 minutes in labor. . . People pay for convenience.
     
    Last edited: Sep 19, 2012

  3. GIockGuy24

    GIockGuy24 Bring M&M's

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    There are plenty of cars that need repairing. Finding enough business usually isn't a problem, depending on location maybe. I have a friend that owned a repair shop for a while. He made plenty of money but didn't like dealing with all of the complaining customers. I worked at a shop once where the owner was a real jerk but he would always give in to the customers regardless if they were right or wrong. he was making plenty of money and figured it was better they left satisfied even if they lied to get something for free or less money. Blaming broken things on the shop when clearly they had been broken and rusty for a long time and things like that. There was just too much money being made to argue with them and have them complain about the shop. It was an interesting way to run a shop but as a person I didn't like the owner. He went out and got drunk every night. Some years later I heard he had stopped drinking and had totally changed but he died a couple of years after that.
     
  4. WIMPY

    WIMPY

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    Last week I went to two shops to have a problem looked at. The first one I thought was way too high. The second got it fixed quickly. The labor charge at both shops was $90 per hr. I quess that covers a lot f overhead.
     
  5. BSA70

    BSA70

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    The start up cost for what you have mentioned will be tremendous. Especially if you are hiring mechanics. You need to be there all the time, especially at start up to make sure the quality service is provided. If someone has a bad experience with you, whether it is your fault or not will greatly hurt your business.

    With all the new electronic stuff out there, I would not even think about it.

    bsa
     
  6. dango

    dango

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    Life is a gamble and in reality,if you believe in this,common sense,feasibility,risk and you still feel this passion,how can you not do this.

    My wife and I threw those proverbial dice and were a success.
    No pain,no gain .And if you are gonna go through with this burning question with no answer,what can I say?

    My wife and I had some really tough times like ,how do I separate me from all others doing the same things?

    The journey was long and painful,no PCs' back then,just word of mouth.I did some unique things and on consignment,finally got some attention.

    27 years and the first five years was a lot hard work and risk
    taking getting some attention but in the end,we had succeeded. Only you know what you can do and this was only
    my story. Choose wisely and know exactly what you'll be getting into and Good luck in whatever you choose !:cheerleader:
     
  7. ilgunguygt

    ilgunguygt Enslaved in IL

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    From your other thread:

    Im going to be honeset with you, so dont take offense at what I say. You are not ready to open a shop. If you dont understand the markup on parts and you think you could hire a mechanic to run it, you are lost. Totally clueless. I have owned my own shop and I am a dealership service manager.

    Have you thought about the rest of the startup costs? What about insurance? You realize that you will need more than one employee, especially if you wont be there full time. Running a shop is a full time and a half job, not to mention the help you will need. Your employee(s) salary will be coming straight from your pocket for a while. Business wont just come in because you are open. You have to build a reputation and relationships.

    You also have to deal with hazmat issues, getting accounts with tons of vendors, etc. As far as equipment, is there a brake lathe? What about flush machines(trans, coolant, brake, etc?). You will need these things.

    Seriously, asking the questions you are, you are heading straight for disaster. Are you a mechanic? Whats your background in auto repair?
     
  8. Wolfgang

    Wolfgang Millennium Member

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    this one is better than the other one
     
  9. sharpshooter

    sharpshooter Member Millennium Member

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    You'd be better off building a hot dog cart from scratch.
     
  10. Louisville Glocker

    Louisville Glocker Urban Redneck

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    Yeah, you should really be a mechanic yourself, and be ready to spend about 60 hrs/week minimum there for the first year. Plus have a big big bank account ready to spend. Then it should probably go ok....

    I can't give you exact startup costs, but probably 200K or so. Go to a local service station and look around. Lots of items. Many of them necessary.

    And dealing with customers isn't really a mechanic's job. That is more of a liason/customer service/manager position. Someone highly competent, and preferably YOU. You've gotta be there. Maybe, just maybe, you can find that perfect person someday, but that is risky, and should only be done down the line.

    Running a business is a TON of work. Don't let anyone tell you anything else. Been there, done that, a couple of times. (two startups, one still going 16 years later)
     
    Last edited: Sep 19, 2012
  11. ilgunguygt

    ilgunguygt Enslaved in IL

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    60 is nothing, I did 15 hour days m-f and 12 on Saturday when I had my own place.
     
  12. rayetter

    rayetter

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    I fix old metric motorcycles, as most shops around here wont touch one over ten years old. Shops typically charge 75 an hour and 3-4 times the amount of parts. I charge 45 dollars an hour and i charge 1.5 times what a part costs. I make decent money. Find something to specialize in, for instance, i do honda V-4 motors and honda three wheelers. Nobody else near me does them, so i get good business. Basically, if u can keep overhead down, maybe have some donor vehicles for parts, etc. Youll never be rich, but if you like turning wrenches, it is rewarding. Dont know if this helps at all, but if you want, pm me and i will answer your questions as best i can.

    Outdoor Hub mobile, the outdoor information engine
     
  13. HollowHead

    HollowHead Firm member

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    With those margins, you can't possibly be doing this out of a commercial space with liability coverage, inland marine, ADA compliant restrooms, fire suppression, EPA waste/coolant disposal, etc. HH
     
  14. rayetter

    rayetter

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    No i dont. I was just offering a basis for comparison. I wasnt suggesting he use the same numbers, just giving an idea trying to be helpful.

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  15. Z71bill

    Z71bill

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    The main thing - and I mean the absolute most important thing that makes the difference between starting a successful business and being a complete FAILURE.

    CAN YOU SELL -- ARE YOU A GOOD SALESPERSON?

    If you don't LIKE selling stuff to people - DO NOT START A SMALL BUSINESS YOU WILL FAIL>>>

    Selling DOES NOT mean lying - cheating - misleading - or even getting someone to buy something they don't need :shocked:

    If you don't understand what selling is - then do yourself a favor - go work for someone else - that does understand what selling is before you start up.
     
  16. devildog2067

    devildog2067

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    :wow:

    ... when I was still tutoring I was charging $75/hr and the students came to me and I had zero overhead. How can you be making money at $45/hr running a shop?
     
  17. rayetter

    rayetter

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    I was just trying to help. I do make money, not a fortune but its enough. I dont post a whole lot, now i remember why. Yall have a good night, im out.

    Outdoor Hub mobile, the outdoor information engine
     
  18. HollowHead

    HollowHead Firm member

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    Please don't take this the wrong way, but the OP asked about resurrecting a vacant commercial space with bays, lifts, storefront, etc. and you brought up working in your backyard. It's the difference between starting up WonderBread vs. a grade-school bake sale. HH
     
  19. ilgunguygt

    ilgunguygt Enslaved in IL

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    Thats right. My stealership charges 90 an hour, we are busy, and still dont make a ton of money. No ones getting rich at that rate. And, to be honest, we are a five bay shop with three full timers and a tire/lube guy. Building costs, taxes, etc.

    For example, people say, wow, you are making a killing at 90 an hour. Well, the mechanic is getting 22 of that right of the bat in salary. We are paying more in taxes on top of that. Lets just call it 26. Then you have empoloyee health benefits, vacation time, etc, that all adds up. By the time you add insurance, hazzardous waste issues, shop tool costs, shop supplies(not everything is outright recouped on a bill), etc, that labor rate isnt much money. We also have to pay me(service manager), a service writer/asst, uniform costs, towel service, cleaning supplies, power bill, etc. With 100% markup on parts you still arent making a lot of money.

    This isnt an easy business and you CAN NOT make it if you arent there working it full time. Save your money OP, otherwise you are just pissing it away.
     
  20. JMS

    JMS 02

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    So you want to own a business that needs a full time plus commitment with one mechanic that would complete work on time AND communicated with the customers.

    You are crazy.