6 Tips To Start Your Auto Repair Shop Business Today

Auto-LoansSo you want to start an auto repair shop business here are 6 tips to get you started off right.

1) First as with any business you need to write a business plan:

Businesses that do not write a business plan usually fail you must know what you expect for the business. Where is it headed? Will you some day have a franchise or will you only have one location? What type of advertising should you do? How much will it cost for shop equipment employees tools lifts etc. You must write a plan to know where your business is headed. You would not plan a trip with out looking at a map would you? Make sure to map out your business to see future plans become a reality.

2) Register for a business license:

Call your local SBA they are the best place to start. They can tell you about loans, free publications and so much more. You must register your business with the local city hall. You should call the court house to find out what business licenses you will need as they vary from state to state. In my county you do not need a fictitious name if the business is in your name such as David’s Car Repair but if you want Elite Car Repair you must file with the state for a fictitious name which can be done online.

3) Open a business account:

This is very important you will need an account just for the business to pay for business expenses. This is where a lot of businesses fail they spend business profits on personal bills. In the first few years of business the business must keep 80% of income to sustain itself and grow. I know it is tempting but be careful. Contact your local bank and get a no fee checking account for your business.

4) Get insurance:

Woman, Car and Cell phoneYou must have garage insurance if you will have employees you will need worker comp insurance and you should check into what ever other liabilities there may be for your area fire, hurricanes,tornado etc. Insurance can make or break your growing business if you have insurance and the shop burns down insurance will pay to replace your shop. Or if you have disability insurance for just yourself if your a one man business. If you break your wrench hand you can sustain the business for months until you get well.

5) Pick a location:

The old adage location, location, location is true with auto repair shops. You should make sure to find a shop right by the interstate or the main highway. If you can put your shop in the middle of your busy town. If you can find a shop location by the highway it will be very lucrative for your business.

6) Advertise:

To me this is one of the most important things you can do for your shop. The old adage “when you do not advertise a funny thing happens” Nothing is true in the auto repair business. The first thing you do if your car needs repairs and you do not know any one to fix it for you. Most people would check the phone book go online check the newspaper. A good source of advertising is tow truck companies in you area. What do truck drivers see daily that is right broken down vehicles. Offer them a referral fee for every customer they send you. You could pick up 10 or more repair jobs a month from them alone. Marketing is very important in any business get creative have fun and always under promise and over deliver and you will be successful.

Starting An Auto Repair Business On A Shoe String – Costly Mistakes You Must Avoid

Grabbed-Auto-SalesWhat is your greatest hurdle when starting an auto repair business on a shoe string? Beyond your tools, beyond your space, beyond the constant need to check and double check your books your biggest hurdle will be getting the word out.

How do I know this? Because I work with shops who have been in business for decades and they still have a problem keeping the car count up!

In this day and age word of mouth (WoM) is the most powerful tool you have. However, WoM has changed. We’re now seeing reports from shop owners, in the same place servicing the same customers for over 35 years who are seeing drop offs in their numbers.

Is this how you want to launch your new venture?

Starting An Auto Repair Business On A Shoe String – #1 Mistake You Must Avoid

Before I give you some information on what you should look into in order to be successful starting an auto repair business on a shoe string, there is one thing you must NOT do.


The phonebook is the #1 way you will dump scads of cash down the drain and never see any return. Frequently when we interview new clients we ask them what they do to get their names out there. We hear: direct mail, coupons, internet… but very infrequently will anyone mention the phonebook.

So we ask directly. And they say “Yes, of course we’re in the phonebook!”

The phonebook has become something most shop owners ‘just do’. I have to admit, that’s some amazing persuasive force those phonebook folks have on the auto repair industry! But like so many other rituals, it has simply become a costly and completely useless tradition.

You can live without it. Like they say with drugs: Just say no.

Here are some hard, cold facts about phonebook advertising:

#1: Phonebooks provide nothing in the way of relevant information. They are a list. Furthermore, they are a list which makes every company look pretty much the same. The fact is you need to stand out in a crowd if you’re going to have a prayer of surviving in this massively competitive market.

businesswoman receiving keys of her new off-road car#2: Your customers are not going to find you in the phonebook. Almost every man, woman and child in America is using the internet to find information. Be there. But be there correctly. (More on this later)

#3: Phonebook readership has declined by an insane amount in the past 5 years. Sure they mail one out to every home in the country, but does anyone read it? No. People use phonebooks as kindling or as something to prop up chairs.

Starting An Auto Repair Business On A Shoe String – Your Biggest Solution

Since you’re starting an auto repair business on a shoe string, you have a massive advantage over your competition. You have not yet fallen prey to the mindless, cookie-cutter advertising traditions your competition has been butchering for decades.

In fact, you may not even need to use traditional advertising to start.

Here’s a question to consider: why does word of mouth work in the first place?

We’ve started asking shop owners that question and what we’ve gotten back is pretty good. Most shop owners give variations of this: “WoM works because we did a good job. People tell their friends when they have car problems and that’s what keeps food on our plates.”

What’s wrong with this statement? Nothing. It’s 100% true. But it’s not the complete picture.