How to Start an Auto Repair Business

Saturday, April 13, 2013

How to Start an Auto Repair Business

If you enjoy working on automobiles, then starting a small auto repair business may be your true calling. However, the automobile industry carries its own economics and is changing rapidly. For example, recycling oil is one way automotive dealers, manufacturers and repair shops are helping to preserve the environment. Additionally, cars are being manufactured to run more efficiently and control emissions that affect the air. Auto repair businesses employing workers with the necessary skills and expertise to service these vehicles will likely always be in demand.

Step 1
Get training and then get certified. An accreditation as a result of adequate training is a viable marketing tool. It benefits both you and your customers.

Step 2
Visit the National Automotive Service Task Force website. This nonprofit agency is a knowledgeable resource for trends and news directly relating to the equipment and tool industry, automotive manufacturers and the automotive service industry.

Step 3
Visit the EPA On-Board Diagnostics (OBD) web page. This agency deals with how automotive repair technicians can effectively diagnose a vehicle's emissions control or engine problems.

Step 4
Visit the EPA Wastes - Resource Conversation - Common Wastes & Materials web page for tips on how small businesses can better manage used oil. Promote your business as one that practices environmental awareness by collecting and recycling its used motor oil.

Step 5

Create a business plan with a strong financial section. You will likely need to secure a commercial building location to run this type of business and this expense must be included in your start-up costs. Seek a business consultant in your area to help you write a successful plan.

Step 6
File your business with your state's secretary of state office. Make sure you have any required licenses and permits needed to operate your small auto repair business.

Step 7
Obtain the advice of a lawyer. Ask what kind of issues you might face in the automotive repair industry and what you can do to remain legally compliant. Begin by making sure your company's service policies are posted where your customers can see them when they enter your place of business.

Tip

Determine if you will specialize in servicing a specific car manufacturer's brand or become a general small auto repair business. Knowing this information may help you decide on a suitable name for your business.

Warning

Purchase an adequate amount of liability insurance to cover you and your workers.

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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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Saturday, April 13, 2013

How to Start an Auto Repair Business

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