buying an existing shop – No Negativity!!

[Jeremy Kahn]

I know some people are bitter and really hate their job… So, please carry on and don’t waste your time… I’m looking for true advice, not “you’re nuts”.

So, I want to buy an auto shop. An existing one that has existing customers, has been around awhile. I want to continue to buy more after that. Essentially, start making a chain/bigger company. WAIT — Don’t reply yet… Lol… So, my dream is this: Have an experienced technician, a semi experienced and a newbie (any number of this variation). As new shops are started, the experienced guy runs the new shop, the semi experienced guy becomes the experienced guy, newbie is now semi experienced, and so on..

Now here’s the catch: I am a business guy., not a mechanic. I wrench on my own stuff, but want to deal with the business end. Grow the business, ensure all of my mechanics become wealthy along with growing a strong business over time… I understand the business side, but tell me about the shop side.

What is it about a shop that I need to look out for?
I understand there isn’t much money in this. But owning 4 stores that make $20,000 is $80,000. If I can get my mechanics paid more, I’m happy.

Finally, don’t be bitter… I know things are hard. Everything is hard. If you sit and complaint, nothing will ever get done. So find solutions to your problems.. That’s why I’m on here – tired of my rat race and want to do something where I work hard, get sweaty, and come home tired from literally working… Not sitting at a desk all day.

So tell me your thoughts….

Topic

[Joe]

what you describe is the ideal situation for running a shop. However I think your lack of knowledge in the automotive industry will be your biggest obstacle. There are plenty of techs out there with an impressive resume that talk a good game about how they know tons about the trade, but won’t perform up to your needs.

Ideally you’ll want to find someone with extensive automotive knowledge to partner up with. You’ll need someone who’s been in the business for a long time to help you run the shop while you take care of the business aspect of things. You’ll need someone with experience enough to recognize other technicians’ experience to be able to fill your shop with workers that suit your needs and also knows good sources for shop supplies, waste disposal, parts sourcing, and ideally they’ll also have some connections for fleet maintenance.

Every successful shop that I know of doesn’t make it’s money solely off of individual customers. They do maintenance for local companies/organizations such as rental car companies, car dealerships, police/fire/ambulance pools, construction companies, etc. These places are your bread. Your individual customers are simply your butter on the bread.

Also, check to see what your local automotive education institution looks like. It will keep you in supply of inexperienced tire/lube technicians with basic knowledge with eagerness to learn. Generally you’ll go through these pretty quickly. As they get some repair experience and tools under their belt, they’ll move onto bigger and better things. Without a local institution to keep you in supply of educated individuals to fill this slot you’re pretty much rolling the dice on new hires. This is also the position that will end up costing you the most money. They’ll break studs, strip drain plugs, damage cars lifting them, etc. It’s going to happen. Rely on your more experienced techs to oversee the new guys and to try to minimize this as much as possible.

Lastly, educate yourself as much as possible. It would be best to go spend some time working in the field yourself just to get a sense of how work flows and things to looks out for. Working with experienced technicians will give you a good idea of what you’re looking for in a partner as well as what kind of personality you’re looking for in a partner.

There’s a lot that goes into this and there’s a reason many people fail or never even get started into this industry. Do your homework, be smart, and know how to run a business and you shouldn’t have a problem.

[Pat61]

No negativity intended, but have you given thought to buying into some sort of franchise?

[Kevin Gallich]

I think a chain of shops is a hard thing to pull off. But first I would say location. Location is a big deal to most people. Second I would say a talented tech is almost or more important then location. I would pick a specialty to set your shop apart from the “Chains”. Brakes are a dime a dozen. Oil changes eh who needs a shop that does them. That is what “Chains” are for. I think electrical trouble shooting is the key. With things getting more advanced it is starting to set shops a part of each other. I know a local guy who the dealers bring their cars to him when the tech’s can’t fix them. A solid tech will bring repeat customers. Good luck.

[Jamie]

I don’t have any really good advice as I’m not a business man, but the response from QuickNPainless was really smart.

I’m toying the idea of a shop that specializes in modern diesels that come in more and more cars. I think one thing you’d have to do to make your business successful is to do something, or specialize in something not many do, especially if its a new venture.

[Lorrin Barth]

I think the business experience will be more important than any automotive experience. Good businessmen seem to be able to make anything a success.

[Ken]

Hire the very best service adviser money can buy, and hire the very best tech money can buy.

Read as much as you possibly can. Ratchet + Wrench is a great auto care business magazine, along with others.

My boss now was never a tech, and never turned a wrench professionally in his life. And I’m not sure he even wrenches at home either. But this man is a genius when it comes to cars somehow. He stays up to date and he knows how to program and flash computers and the strangest little things and he knows how cars work inside and out, and speaks with confidence and trust to the customer.

One of the biggest mistakes entrepreneurs make is wanting to run before they can even crawl. Ever watch Shark Tank on ABC? They’re always wanting to franchise, lol! And then the sharks all start groaning and saying, “I’m out!” Better to have one amazing shop than five mediocre ones that would be a management nightmare. I know tiny tiny 4-bay shops that gross a million dollars a year, no joke. It’s all about quality, not quantity. Let Jiffy Lube take care of that.

[Author]

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