How to Start Your Own Auto Repair Shop

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Auto repair

Business is booming in the auto repair industry. With over 279 million vehicles operating in the United States, the automotive industry is the highest it’s every been – and it’s only expected to go higher.

This is good news for auto repair shops as it means more business for them. If you’re looking to get a piece of that profit and open your own repair shop, here’s what you should know.

Create Your Business Plan

Any good business should start with a good business plan. This should include research on the industry, a summary of your business, a strategic marketing and financial plan, and your company’s profile.

Creating your business plan can also help you estimate whether or not this is a profitable business. Opening an auto repair shop has many costs, including:

  • Licensing: $50-100
  • Certifications: $30-80
  • Insurance: $4,000/year
  • Rental fees: starting at $1,500 per month
  • Tools: starting at $15,000
  • Equipment: starting at $15,000

In short, you could be spending at least $50,000 on your first year. This could vary, like if you decided to open an auto repair shop in your garage as a home-based business rather than renting out your own place. But it’s unwise to sacrifice quality for less costs.

Establish Your Business Location

Where you establish your garage can affect your revenue. If you convert your home garage into a repair shop and you live out of the way, your market may be limited to friends, family, and neighbors who don’t have to go out of their way to get your services. Unfortunately, you might be missing out on potential customers that other car repair shops closer to them.

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Ideally, you’ll want to find somewhere close to main roads and highways. Not only does it make your business more visible, but it can drive business in terms of emergency repairs. Towing services usually charge by the mile, so if there happens to be a car that stops near you, they’re likely to go to your shop for repairs.

Define Your Business’ Scope

Small auto repair shops don’t usually offer all repair services. To limit the cost of operations, it’s best to focus on services that you’re good at and/or services that aren’t provided by a lot of repair shops in the area.

For example, you can limit your clientele to only regular cars, trucks, or motorcycles. You can offer the basic repair and maintenance services to cut costs on equipment reserved for more specialized services. Or, if there’s a demand for it but no nearby shop offering it, you can provide more comprehensive services like collision repair and engine maintenance.

Decide If You Should Hire

Car mechanics

Small repair shops can survive as a one-person business. But while you might be equipped and certified to handle the actual service of the company, consider if you need someone to handle the other aspects of running a business.

You may need someone to handle the bookkeeping and the secretarial tasks of running the business. If you want to keep operations running even during days when you’re not around, you might also want to hire another mechanic.

Opening a repair shop properly can help you establish your business and start our strong with a steady flow of customers. There are a lot more steps you need to take, but these four can help you assess just how much money, time, and effort you need to start your shop and whether or not it’s really a venture you want to explore.

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