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Uncategorized @us | 26 April, 2021

Auto Repair Shop Business Plan Sample

Have you ever considered opening an automotive repair shop?  Auto shops are known as businesses that have strong cash flow, and fair profits.  In this auto repair shop business plan sample we will show you what goes into developing a strong plan.  Please remember this is merely a guide, and the best business plans are fully-customized to each individual company.

Before commencing on your auto repair shop, you may have a few questions. How profitable are auto repair shops? How to grow an auto repair business? How much does it cost to start an auto repair shop? How do I get more customers in my auto repair shop? How to market an auto repair business?

Brace yourself, because in this article, our team has prepared a comprehensive automotive repair shop business plan, which should help address these queries.

To conquer the largest auto repair companies in the USA, you must first grasp the auto repair industries intricate nuances. Automotive repair service companies in the US provide a wide range of automotive repair and mechanic services to ensure optimal performance and longevity of vehicles. Whether you are looking to start a mechanic business or small auto shop, we can help you with a customized automotive repair business plan or mechanic shop business plan, which is catered to your specific goals and requirements.

As things take shape, it will be time to paint the operational landscape of your auto repair shop. Envision the perfect location, layout, and equipment needed to manifest your vision. Map out the staffing requirements, employee training protocols, and the smooth workflow process, which will ultimately define your mechanic shop’s efficiency.

Seek out and foster relationships with trustworthy vendors and suppliers who can provide you with leading automotive parts, tools, and supplies. Engage with those who offer competitive prices, exceptional quality, and lightning-fast delivery to fortify your shop’s operations.

Navigate regulations. Familiarize yourself with local, state, and federal rules governing the auto repair industry. Obtain the necessary licenses and permits to properly operate your shop, and of course, ensure your business adheres to the highest environmental and safety standards.

In conclusion, for an ambitious entrepreneur, crafting a comprehensive business plan for your auto repair shop is your ticket to triumph in this fiercely competitive industry. We hope you enjoy this auto shop business plan example.

 

1.0 Executive Summary

“Your Canadian Auto Shop” (The Company) is a Tire and Customization Shop with nine locations spanning across British Columbia, Alberta and Saskatchewan.  Over the past ten years the company has gained recognition across Western Canada as a leader in tire, wheel, rim and accessory customization.  With a sprawling population, the City of Saskatoon has been identified as an ideal location for Your Canadian Auto Shop’s tenth Tire and Customization Shop.

 

With the support of senior management, Ralph Walzek  will open an incorporated business, and raise $122,750 through the Canada Small Business Financing Program (CSBFP) for the equipment and leasehold improvements required to successfully launch this location.  Ralph Walzek  will receive an annual management salary of $75,000, and 20% of the Saskatoon Location’s net income.

 

Given the essential role that cars, trucks and other vehicles play in everyday life, overall demand for vehicle support services is projected to expand over the next five years, in line with rising population figures and increased consumer spending.  This demand, and low-barriers to entry has resulted in a level of saturation within the industry; notwithstanding, Your Canadian Auto Shop has established a process which sets them apart in this competitive landscape.

 

By offering affordable customizations, unmatched selection, a culture of customer satisfaction, and a convenient selection of payment options, Your Canadian Auto Shop stands out in an otherwise crowded marketplace.  Regardless of this increasingly competitive landscape, the company has continued to grow year after year.  In partnership with senior management, Ralph Walzek  will utilize over two decades of professional management experience to guarantee the success of this tenth Your Canadian Auto Shop location.

 

According to Statistics Canada’s 2020 Consensus, Saskatoon is currently the third fastest growing metropolitan region in Canada.  With a thriving business sector, Saskatoon is an attractive and vibrant city that is a primary engine for the province’s wider economy.  With an experienced management team, reputable brand, profitable business model, and strong demographics, this location is positioned to be a flourishing Tire and Customization shop for many years to come.  Furthermore, Ralph Walzek  is committed to being a fair and equitable employer, to support the local labour market, and the community of Saskatoon at large.

 

2.0 Business Overview

Your Canadian Auto Shop was established 10 years ago in Edmonton, Alberta.  Since then, the company has grown to nine locations across Western Canada, and is poised to continue it’s track record of growth.  Ralph Walzek  seeks to incorporate a company and secure a $122,750 loan for the equipment and leasehold improvements of this tenth location in Saskatoon, Saskatchewan.  This incorporated business will operate under the Your Canadian Auto Shop brand in the Tire and Customization Industry.

 

2.1 Industry Overview

North American Industry Classification System (NAICS) Code – 44132

Tire Dealerships

Establishments: 2,383

0-99 Employees: 100%

Average Revenue: $1.1 million

Profitable: 76.1%

 

This industry comprises establishments primarily engaged in retailing tires and tubes. These establishments also typically provide complementary services, such as tire mounting and wheel balancing and aligning.

 

2.2 Mission Statement

OUR MISSION IS TO PROVIDE THE CITY OF SASKATOON WITH LEADING AUTO REPAIR SERVICES.

 

2.3 Goals and Objectives

  • Approval from TD Business Banking to proceed with incorporation
  • Ralph Walzek will incorporate a business and provide documentation to CIBC
  • Secure $122,750 through the Canada Small Business Financing Program
  • Secure a location for the shop in Saskatoon, Saskatchewan
  • Purchase all equipment and inventory outlined in “6.0 Financial Plan”
  • Recruit one Sales Rep and Tire Technician from the Regina location, as agreed upon
  • Open for business on July 1, 2021

 

2.4 Key Success Factors

Safety in the Workplace: Focus on maintaining safe working conditions.  In addition to protecting our staff, our location’s image revolves around safety and consciousness.

Inventory Management Skills: Able to control stock on hand and install accurate costing systems.

Employment of Skilled Automotive Technicians: Access to skilled technicians in a workforce that is becoming more technologically advanced.

After Sales Service and Support: Provide superior customer service in a segment that can be very competitive.

Location Close to Key Markets: Location in the heart of Saskatoon, therefore determining  market size, average customer income, vehicle count, population, and competition.

 

Start your business today!

 

3.0 Staffing

AUTOMOTIVE TIRE TECHNICIAN

Objectives

  • Interact with Commercial Sales Consultants and/or Counter Sales Service Associates to obtain work orders and commercial customer service specific requirements.
  • Install, balance, rotate and repair tires at Saskatoon location in a safe and efficient manner.
  • Support fellow Tire Technicians and Sales Rep as required.
  • Install and service all tires up to qualifications.
  • Deliver customer tire maintenance program to businesses by visiting assigned locations to complete fleet checks.
  • Accurately complete all documentation/paperwork in relation to service work provided so that efficient billing can be conducted.
  • Inventory, maintenance, cleaning and other duties as assigned by management for both the shop and the service trucks.
  • Ensure service vehicle and all equipment is maintained in a safe, neat and clean manner at all times.
  • Assist the shop associates to ensure the shop and service vehicles are kept in a safe, neat and clean manner at all times both inside and outside.
  • Conduct efficient Receiving/Shipping of all inventories that enters and leaves the shop.
  • Professionally interact and communicate with customers to explain service details and advise on any additional service maintenance that has been identified.

 

Requirements

  • Internal Candidates – Intermediate PLT Skills
  • Valid Driver’s License with a clean abstract
  • Basic mechanical aptitude and previous exposure to automotive work
  • Interest in further expanding knowledge about the tire industry
  • Well developed people skills with the ability to professionally interact with customers
  • Maintain a clean and professional personal appearance and grooming.
  • Farm and small OTR tire experience preferred.

 

4.0 Products & Services

TIRES

We specialize in getting customers the right tire that suits the vehicle and application. Snowflake Rated All Terrain Tires, All-Weather Tires, All-Season Tires, Performance Tires, Track Tires, Mud Tires, All Terrain Tires, Rugged Terrains, Mud Boggers, Winter Tires, Semi, Agricultural, and the list goes on.  We are committed to providing tires for every price point.

Wheels and rims for a auto repair shop.

 

WHEELS & RIMS

Your Canadian Auto Shop has access to all types of rims and custom wheels. We are factory direct, which means huge discounts and quick turnaround times for our customers. We specialize in high offset and low offset wheels, staggered wheel fitment, American muscle, tuner cars, winter rim & tire combos, concave wheels, deep dish, and all sizes.  We are confident our offering of Armed Brand Wheels will be well received in the Saskatoon area.

wheels for a repair shop business plan.

ACCESSORIES

  • Multiple brands of lift and leveling kits
  • Multiple brands of exhaust tips
  • Multiple brands of mud flaps
  • Multiple brands of tonneau covers
  • Lugnuts
  • Fender Flares
  • Exhaust Systems
  • Multiple brand of front and rear bumpers
  • Cold air intake
  • Multiple brands of side steps

 

5.0 Operations

Securing a strategic and busy location, prominently visible within Saskatoon, will be a key element of our operations.  Not only will our shop be easily accessible, but also well positioned; therefore, increasing market exposure.

 

5.1 Safety

Ensuring a safe and healthy workplace will be our highest priority.  Owner and Location Manager, Ralph Walzek  has extensive experience in ensuring the health and safety of his team members.  “Safety starts at the top” and by utilizing over two decades of safe work practices, Ralphwill lead by example in day to day operations.  Each and every morning a safety meeting will be conducted to review best work practices, and weekly topics; while everyone on the team will be encouraged to participate.

 

5.2 Payment & Financing

  • Payment with cash
  • Payment via credit cards, point of sale machines, or EFT
  • Payment via mobile money transfer
  • We also have in place Driver Capital no credit check financing

 

5.3 Hours of Operation

Monday 9AM – 6PM

Tuesday 9AM – 6PM

Wednesday 9AM – 6PM

Thursday 9AM – 6PM

Friday 9AM – 6PM

Saturday 9AM – 5PM

Sunday – CLOSED

 

5.4 Equipment

Please refer to “6.0 Financial Plan” for a complete list of required equipment.

 

Have Questions? Looking To Get Started?

 

6.0 Market Analysis

Over the coming years, operators in the Tire Dealers industry in Canada are set to benefit from improving economic conditions, particularly within several of the industry’s key commercial markets, as the Canadian economy recovers from the COVID-19 pandemic.

 

With expected growth in corporate profit over the five years to 2025, which will be coming off a relatively low base level, many companies are expected to expand or upgrade their existing vehicle fleets and generate significant demand for retailers of tires, repair services and miscellaneous vehicle parts and accessories. Moving forward, rising levels of disposable income are expected to bolster demand for industry services, as these trends are anticipated to enable a greater number of Canadian consumers to upgrade existing vehicles, causing the industry’s customer base to expand.

 

As a result of these factors, IBISWorld projects industry revenue will increase at an annualized rate of 3.0% to $5.5 billion over the five years to 2025.

 

Commercial markets are anticipated to expand as industrial production growth is expected to occur within the Canadian economy. Moreover, corporate profit in Canada is forecast to increase at an annualized rate of 8.3% over the five years to 2025, enabling many of the industry’s transportation and wholesaling clients to increase investments in their vehicle fleets.

 

To further strengthen demand from this segment, operators are expected to grow business relationships and secure long-term distribution contracts over the next five years. For example, national and regional repair garages are expected to work to gain a competitive edge against smaller shops by entering into long-term commercial relationships with tire dealers.

 

Given the essential role that cars, trucks and other vehicles play in everyday life, overall demand for vehicle support services is projected to expand over the next five years, in line with rising population figures and increased consumer spending.

 

In turn, these positive trends are expected to support demand for industry operators. Industry profit is also expected to increase marginally over the next five years, as the profit margin is expected to recover from a low level in 2020.  At the same time, rising levels of disposable income are anticipated to encourage many consumers to purchase tires and repair services from external car dealerships or mechanics.

 

6.1 Market Trends

  • Amid COVID-19, industry profit is expected to temporarily decline
  • Despite high competition, revenue has expanded over the past five years
  • New vehicle sales are expected to grow from a low base level in 2020
  • The industry will likely benefit from consistent growth in the Canadian population
  • Small-scale operators are expected to continue entering the tire-dealer market
  • Industry profit will likely decline as operators seek to gain market share by offering discounts on products and services

 

6.2 Competitive Advantage

The following list outlines the three competitive advantages that will differentiate Your Canadian Auto Shop Saskatoon from the competition:

 

  1. We are uniquely equipped to utilize the sales from all other stores to give us substantial buying power in obtaining our products cheaper from suppliers; subsequently, allowing for more affordable and competitive pricing for customers.
  2. Through our agreement with Driver Capital No Credit Financing, we are able to appeal to a vast customer base by eliminating insufficient credit as a barrier to purchase.
  3. We will be the only dealer in Saskatoon offering the extremely popular brand, Armed Wheels.

 

6.3 Risk Analysis

Total vehicle-kilometres

Tires most often degrade from extended use and age. As a result, the more a vehicle is driven, the more often replacement tires or retreads will be required. The number of total vehicle-kilometres was expected to increase in 2020. However, due to the COVID-19 pandemic, people have reduced nonessential travel and have commuted less by car, leading to an expected decline in the number of total vehicle-kilometres driven, which poses a potential threat to the industry.

 

World price of crude oil

High gasoline prices, which are dictated by crude oil price trends, generally decrease vehicle sales and cause consumers to switch to alternative modes of transportation. For instance, consumers may use public transportation when gasoline prices are high instead of driving their own vehicles and incurring the expense of gasoline. As a result, when consumers use their cars less, they will not require tires as quickly, thus decreasing industry demand.

 

Per capita disposable income

Per capita disposable income influences the timing and value of tire purchases. Consumers with more disposable income are quicker to replace worn tires and are more likely to purchase expensive, high-performance tires. Alternatively, consumers with less disposable income may be hesitant to purchase expensive products or to replace worn tires.

 

New vehicle sales

New vehicles are sold with a set of factory-installed tires. Increases in vehicles sold boost industry revenue for the long term as it increases the base of potential vehicles that need replacement tires. In the short term, new cars typically do not need replacement tires. When consumers buy new vehicles over maintaining their current ones, industry revenue is negatively affected. As of its last update, new vehicle sales were expected to increase in 2020. Due to the coronavirus pandemic, however, consumers are expected to purchase fewer new vehicles, which represents a potential opportunity for the industry.3

 

7.0 Sales & Marketing Plan

Our Sales & Marketing Plan is founded on the strength of Your Canadian Auto Shop’ well-established brand.  The company has a proven marketing strategy that targets multiple social media platforms in order to attract an array of target customers. The Saskatoon shop will have the benefit of people already recognizing the name and stellar reputation of the Canadian Custom Autoworks’ brand.  Our Saskatoon Shop will leverage the brand through signage, placement on the company’s website, and awareness on social media.

 

7.1 Target Customers

HOUSEHOLD CONSUMERS

The Tire Dealers industry in Canada serves a broad range of customers, with everyday household consumers accounting for the vast majority of the industry’s total revenue.

  • 18 – 65 years of age
  • All income levels, as we deal in lower level, mid-level and premium level products
  • Resides in the Saskatoon Metropolitan Region (population of 325,806 – 2019 Q4)
  • Major Ethnicities (European 72.2%, Aboriginal 11.2%, South Asian 4.7%, Filipino 3.9%)4
  • Drives a motor-vehicle

 

BUSINESSES FOR END USE

Businesses for end use, including trucking companies, construction companies, farmers and mining outfits, represent the second-largest source of revenue for industry operators.

 

  • We will establish relationships with local companies, in an effort to provide wheels and tires for their fleets.

 

DEALERSHIPS

  • Kia of Saskatoon, Ens Toyota, Ens Lexus, Oakwood Nissan, Bema Autosport BMW, Porsche Centre Saskatchewan, Saskatoon Mitsubishi, Mercedes-Benz Saskatoon, Saskatoon South Hyundai, Volvo Cars Saskatoon, Acura Centre of Saskatoon, Jaguar Saskatoon, Mid City Auto Centre, Saskatoon Auto Connections Sales Centre, Wheaton GMC Buick, Subaru of Saskatoon, Studio Fiat, Mainway Mazda, Bright City Auto Sales

 

7.2 Key Channels

REFERRALS

We understand the nature of our referral based industry.  Our focus is to provide the most professional experience available, consequently laying the groundwork for a consistent stream of referrals.

 

SOCIAL MEDIA

Social media will reach our target customers in two ways; pre-established Your Canadian Auto Shop pages will drive wider brand recognition and messaging, while our location will create a Facebook page for our community of direct customers in the Saskatoon area.

 

GOOGLE MY BUSINESS

A Google My Business account will be established to receive reviews from customers, to assist customers with finding the shop, to keep the public up to date on hours of operation, and provide additional contact information.

 

GOOGLE SEARCH

The company’s website will be imperative in assisting buyers through the sales process.  By learning more about our products in one central place, people can transition from prospects to paying customers quickly.

 

Let's Get Started!

 

7.3 SWOT Analysis

SWOT analysis for a repair shop.

8.0 Financial Plan

Capital requirements for a auto repair shop.

8.1 Five Year Pro Forma Cash Flow Statement

 

 

Are you interested in seeing more business plan samples? Here is a variety of business plan samples  to help guide you through your entrepreneurial journey.  If you need any help in developing a custom business plan contact us here!