Repair Shop Advice

If you’ve got customers looking at major repairs to get back on the road, there’s a good chance that neither of you are thrilled.  That’s because many people can’t handle a $2,000 repair bill, especially if they weren’t expecting it ahead of time.  This makes auto repair finance plans an attractive option – you get paid immediately, and your customer can get back on the road.

These plans can be dangerous, however.  Some of them take advantage of people with low credit scores by offering loans that have interest rates so high that they are unethical.  If customers end up on one of these loans and it was offered in your shop, they will blame you even if you aren’t servicing the loan.

The key offering auto repair financing is finding a plan that take care of your customers and also ensures that you get paid for your services.  Here are a few suggestions:

Ask for the details – Make sure that you understand how much you have to pay if the customer finances the purchase, and get a clear understanding of what customers will have to pay as well.

Always ask yourself “would I feel comfortable offering this loan to a customer if I was in the banking business and it was my job?”  It you were charging your customers 120% interest, you probably wouldn’t be able to sleep well at night.

Check out their reputation – Ask for references from other shops before you select an auto financing company, and make sure they don’t have a poor online reputation.  Remember that by offering financing from a company, you’re associating yourself with them.  Make sure that they make you look better and not worse!

Ask your suppliers if they have an auto repair financing option – If you’re a member of a banner program, they may offer a financing option.  Since you are doing business with these companies anyway, and they profit from each sale you make, they may offer a more attractive auto financing program.  They also have more to lose – if they hurt your customers, they might lose their status as a supplier as well as a financier!  This all makes banner programs and parts providers a great place to start asking about financing programs.

To learn more about how Repair Shop Websites can help your business succeed, call us at 866-665-1605 or email us at Team_RSW@RepairShopWebsites.com

When an investor/owner considers which repair shop to purchase, they look at a wide range of factors to determine a shop’s value.  Some of these factors are difficult to impact, such as the shop location, the age of the shop, or the number of bays and lifts that will fit in the building.  But the biggest factors can be heavily impacted by shop management.  Here are three shop value factors that you can improve today to increase the value of your repair shop.

#1 – Is the business independent from the owner?  Unless you’re planning on working for the new owners for years, you don’t want a tremendous amount of the shop’s value to be tied up in your presence.  This doesn’t mean that you can’t be active in your own shop – it does mean that someone else at your shop needs to be able to perform any of the duties you’re doing on a daily basis, whether that’s high-level repair, customer relations or earning new business for the shop.

How true is this for your shop?  If you haven’t been out of your shop for a while, take a few of days off-site to focus on company strategy, and gauge the results of your absence.  It will likely be apparent what issues need the most attention for the shop to gain self-sufficiency.

#2 – What type of work are you performing?  If your shop is focused on heavy line work such as transmissions and power-trains, your shop will be worth a higher multiple of its profit.  Shops focused on brakes and oil changes are worth less because they face heavier competition and are less able to differentiate from other shops in the area.

Also, try to ensure that all of the equipment that you’ve purchased for your shop is actually being used regularly for repairs, if possible.  New owners are reluctant to pay a good price for equipment that isn’t in use; unless they can find a way to bring it into use, it will become an investment that doesn’t generate any profit for them.

#3 – What reputation does your shop have?  If your shop’s reputation has suffered recently, owners may not be willing to pay as high a multiple as they otherwise would.  That’s because next year’s earnings may not look as good as last year’s earnings if customers stop visiting the shop.

One quick way to improve the value of your shop is to invest time in improving your publicly visible reputation.  Always ask happy customers to leave reviews online, and try to make it as easy as possible for them to do so.  If they do provide a review, make sure to thank them for their time, and ask them to spread the word if any of their friends or co-workers need auto service or repair!

To learn more about how Repair Shop Websites can help improve the value of your shop, call us at 866-665-1605 or contact us at Team_RSW@RepairShopWebsites.com.