You graduated from lead technician to shop owner. Congratulations! But now what?
If you’re new to running an auto repair business, Two themes – profitability and valuation – should become a key management focus. Thankfully, we have a resource that can help!
» Want to grow your auto repair business? Click here to schedule a demo.
AutoLeap’s Profit & Valuation Insights eBook will help your shop clean up its finances, generate more revenue, become profitable and earn high valuation marks.
Our eBook covers:
- Factors that may limit your shop’s profitabilityÂ
- The day one importance of shop valuationÂ
- How to assess what your business is worthÂ
- And much more!
Let’s cover some of the highlights.
Factors limiting your shop’s profitability
Owning a business is stressful! There’s so much to do for daily shop management. And that doesn’t even factor in the high-level planning required to grow your shop.
If you aren’t careful, three factors will impact how profitable your shop becomes. These factors include:
- Fear: Do you sometimes feel imposter syndrome? Good news, we all do! Don’t let fearful thoughts about your competitor’s brand-new shop renovations affect how you manage the shop. Stick to the strategic plan you build.Â
- Focus: Proven models for running a profitable shop exist! Our eBook covers many of these points. But they won’t matter if you aren’t focused and committed to working hard.Â
- Finances: No shop will have long-term success without financial literacy. Study every aspect of managing your shop’s finances, from your chart of accounts to parts and labor margins.Â
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» Want more profit & valuation insights? Click here to download our case study.
Steps to improve a non-profitable shop
You understand some factors that can hold your shop’s profitability back. Now it’s time to look ahead!
Here are three steps you can take to turn your shop from minimal profits to highly profitable:
1) Understand your chart of accounts
Your chart of accounts is an important place to start. How are your shop’s finances organized? Do you know your net profit (and target net profit)?Â
On a basic level, you have to know how much money your business generates and what you spend. Without this knowledge, costs may creep up even as profits rise.Â
2) Implement the 300% rule
Our eBook covers the 300% rule in detail. But the basic premise is three pillars of values for your shop to operate by.
Here are the three pillars:Â
- First 100%: We will evaluate 100% of the vehicles that enter our shop.
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- Second 100%: We will provide our customers with a detailed estimate of every repair need.
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- Third 100%: We will provide our customer with estimates, all organized by priority.
3) Sharpen your margins
Healthy parts and labor margins are everything for your business. As a shop owner, you need to spend time improving these margins.
Use a parts matrix. Determine your effective labor rate. Establish gross profit benchmarks. Go above and beyond in these areas to create margins that result in profitability and a strong shop valuation.Â
» Looking to transform your shop? Discover how AutoLeap can help.
Closing thoughts
This eBook overview is just a taste of what you can expect! Download our eBook today for all the profit and valuation insights your shop needs.
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