New Unique Repair Shop Help

[Rich Craig]

OK I have a question for all you career mechanics. I have been contemplating starting my own unique auto repair business. Similar to how most hair salons operate. My idea is that I would own the property and building and lease out bays on an annual basis to mechanics. I love cars and have some family in the auto repair industry but I myself am a Navy guy that has worked on planes all his life but I love cars. So I am really relying on all of your guys knowledge and complete honestly to let me know if this could work or if I am dreaming. So this is my initial plan and thoughts.

I would have a 6 bay brand new state of the art shop. I would lease 5 of the bays to mechanics on a yearly lease. They would pretty much be their own employee just leasing a space from me. I would provide all the specialty equipment; tire machine, A/C service machine, scanners, etc. All they would need to bring in is their toolboxes and their common hand tools. The 6th bay would be rented out by the hour or day or week.

Pricing: My initial thoughts are to charge customers $80/hour for labor.
I would charge the mechanic 30% of their total profits (Parts and Labor) with a minimum of $1000/week paid to me. Numbers look like this for labor only does not include parts profit in these numbers.
$80/Hour x 8 Hours/Day = $640/day
$640/Day x 5 days/week = $3200 / week
$3200 x 30% to me = $960 / week to me
$3200 x 70% to mechanic = $2240 / week to mechanic – That’s $56/hour to the mechanic

Any ideas, thoughts, comments, etc. would be greatly appreciated. Please be honest also and ask any questions you want.

Topic

[James P Grosso]

I have seen some places like this. I don’t know the details, but you will need a good lawyer to help setup the business to limit your liability, maybe a LLP or something. Then you will need to check insurance issues and cost. Not sure how you would vet the mechanics or how much deposit would be required and how contracts would be handled.
Concerns about safety, environmental issues, damaged or stolen tools, and general up-keep?

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