An automobile service business will always remain in demand in the modern world. As a car service station owner, you will need to stock spare parts of cars, cleaning tools, etc. The car repair business market is very rich in India.
Did you know that nearly 7 million vehicles get manufactured in each of the leading countries worldwide?
Naturally, as more cars get sold in the market, the more opportunities you get to repair automobiles or supply spare parts. The increasing scope in the automobile repair industry has made the business a profitable one. To have maximum business in this field, the business owner needs to open the car repair center in a high traffic area. Getting a space may seem like a high investment, but it is worth it.
Essential Qualities to Consider for an Automobile Service Station
Before you start an automobile service station, there are some essential points of consideration the business owner’s part-
1. Skills and Experience:
Repairing a car is not a layman’s job. While opening an automobile service center, you need to hire skilled and experienced staff to deliver the best service. The person you hire needs to have a thorough idea of how the business work, different parts of an automobile, and the techniques of fixing it. Before investing in their salaries, check their work background and look for work experiences. Employees with certificates in automobile engineering are always the first choice.
Hiring employees is never enough. A business owner needs to have the requisite skills of automobile servicing themselves. Prior exposure to the industry will help you plan for the business better.
2. Market Survey:
Like every business, even the automobile service industry needs you to understand the market scenario before investing. Before you launch your business, find out the demand for a service station in your chosen area. With an extensive survey, you will understand the business opportunity and profit expectation in the market.
It is the phase to understand which services are in demand in the market, who your competitors are, and what rates they charge for their services. Awareness about the market demand and the prices people are willing to pay will help you purchase your equipment, prepare a budget and rate your services.
3. Financial Information:
Understanding the financial aspect of the business is probably the biggest thing to consider. To start an automobile service business, you need to focus on 3 basic investments-
Depending on the number of automobiles you wish to service or the services you wish to deliver, the quantity of equipment or manpower will vary. The expenses you incur in the business is also connected in the same chain.
Furthermore, you will need a better understanding of the daily expenses for business operation, initial investment amount, recurring costs, the volume of business and revenue you can expect, and ultimately the profit you make. The ROI calculation and funds in hand determine if you need a loan for business operation.
What Services Can you Offer in an Automobile Service Station?
If you plan to open an automobile service station, you need to understand all possible services that you can offer your customers. Here is a detailed list for your reference.
- Car washing
- Mechanical repair work for parts like the engine, accelerator, gear, shock-absorber, or similar
- Any electrical work requirement like fixing the lights, horn, etc.
- Servicing the car air conditioner
- Aligning and balancing the wheels
- Services related to oil changing like changing the gear oil, brake oil or steering oil.
- Body repair work of a car like fixing dents, paintwork, etc.
- Car body polishing services
- Battery repairing or charging
Prepare your service list only after checking the abilities of your service staff.
What Equipment do you Need to Run an Automobile Service Unit?
The machinery and equipment you need from an automobile service company completely depends on the services you agree to provide. You can only decide on the services after checking the abilities of your worker. In short, you need to check with your staff what all machinery or equipment operation they know.
In general, if you provide car wash services, you require a hydraulic elevator with a blowy wash gun. Every service requires equipment with advanced technology to deliver the best results.
Obtain equipment for automobile repair work is not enough to run the business. You will also require advanced software for maintaining all work records. In the majority of the cases, we recommend a customized software as every company has different operational nature. The software should be equipped to set off alerts when a customer’s car servicing is due.
You can also create a separate storage compartment where you can stock some daily usage spare parts. Selling the spare parts separately is a profit generator.
How Much Does it Cost to Open a Car Servicing Shop?
While you are planning your automobile repair business, here is a brief on the expenditures you expect in the beginning-
- Licensure: $50-$100
- ASE registration: $75
- Annual Business Insurance: $4,000 or more
- Hydraulic lift: $3,700
- Machinery for car diagnosis: $5000-$10,000
- Monthly store rental: $1500
- Tool kit for a mechanic: $15,000
In short, there can be an expense of about $50,000 to initiate the business.
The list of expenses doesn’t end here. Apart from the one-time expenses, there are ongoing monthly expenses like the monthly store rental and staff salaries. A mechanic at your store gets a flat payment of $25 per hour. The labor cost can increase to $100 per hour depending on the qualification or expertise of the mechanic or engineer. Finally, you need to remember the utility bills like electricity bills.
Starting an automobile service business requires high investment. However, it is a worthy expense if you get a shop in a high traffic area and provide quality service to your customers.