Learn How to Start an Automotive Repair Business from the Ground Up
Do you love cars and have a great passion for automotive repair? You might want to consider pursuing a career in this field. Perhaps you could start off as a mechanic or automotive engineer before setting up an independent auto repair shop. In case you make it to this stage, AutoLeap is an vehicle inspection checklist software that you can deploy for simple and easy operational management.
In this article, you’ll come across some useful tips that will set you on your way to starting and running a successful auto repair business. Give it a read for important entrepreneurial advice regarding automobile repair.
- Making a Plan & Laying the Foundations for Your Business
For solid foundations, you need to have a proper and detailed business plan. Essential for automotive repair success, this plan should include (but not be limited to) the following areas.
- Initial Startup & Operational Costs
When beginning operations, your initial startup costs will include diagnostic equipment, business insurance, licensing fees, rent of your premises, hydraulic lift, ASE (Automotive Service Excellence) certifications, and specialist auto repair tools.
Also, you’ll have certain operational expenses (variable). Work on the data and make calculations to find out how long your automobile repair shop is likely to take to break even and ultimately become profitable.
- Skills & Experiences Required
Behind every successful automotive repair shop are individuals having some specific skills and experiences. In addition to acquiring basic and advanced automotive education, they undergo specialist mechanic training and earn industry-relevant certifications. Previous professional experience as a mechanic or engine builder is also important.
- Shop Name & Identification of Target Audience
Many owners ignore this part, to their own peril. An unattractive name coupled with lack of clarity about the target audience is a recipe for failure.
Hence, it’s crucial to take these two things seriously. Research extensively to understand EXACTLY where your target market is. Do the same when coming up with a name for your shop. Picking a relatable and catchy name is a first step on the road to auto repair success.
- Registering As a Legal Entity for Taxation Purposes
Your need to register your mechanic shop as a separate legal entity with the Internal Revenue Service (IRS). After that, it will be considered a tax-paying company by the authorities and you’ll be eligible for the various tax breaks offered from time to time.
Ensure the completion of this registration procedure within a few months after coming into business. Following are some conditions to be met in this regard.
- Apply for your shop’s registration in the form of a unique legal entity.
- No shareholder in your business should have a stake or controlling interest in a similar venture in this industry.
- None of your partners (if any) must be fake individuals.
- Business Bank Account
To streamline financial matters, open a separate bank account for your automobile repair shop. This will make recording income and expenses super-simple while you would also be able to file taxes without any issues.
- Business Accounting System
You’ll need a user-friendly and efficient accounting system to organize all financial data, manage income and costs, plan for expansion, and file tax returns. The right approach would be to have the accounting software installed and ready to go BEFORE you start operations.
If you implement such a system after your shop is already fully functional, it might cause operational bottlenecks and confusion among your employees. This will certainly be the case in the beginning when they’re still getting the hang of the new system.
- Business Insurance
Like any other business, your automotive repair shop will have to deal with its share of challenges, difficulties, and threats. Protection against such occurrences is important, which is why you’re advised to get your business insured from the very beginning.
The tips and tricks in this piece on automotive repair can get your shop off to a flying start. Success for your venture will just be a matter of time if you implement the ideas mentioned here in the right way.
