If you’re a talented mechanic with an ambition to start your own business, guess what? The time to do so is now. As you likely already know, it’s not easy to make the first step. There is always some doubt, fear, or other excuse holding you back. So why now, you might ask? 

Statistics show that 25% of vehicles in the USA are at least 16 years old. That’s 1 in 4 cars you see on the streets. Older vehicles require more maintenance, which means the demand for mechanics is increasing. Without further ado, let us show you how to start your profitable mechanic shop step-by-step.

Create a Business Plan

When you want to open your own mechanic shop, there are some significant investments you’ll have to make in the beginning. A good business plan will make it easier to stay on the path. In it, you should focus on these things:

• The number of customers per day
• What kind of service will you provide
• Building a new shop or purchasing an existing one
• Going solo, or joining a franchise
• Growth plan and goals
•  Market analysis and marketing strategy
• Staff

How Much Money You’ll Need to Begin

In case you’re building a new shop instead of purchasing an existing one, you can expect your startup cost to be around $50,000. This is without salaries, budget for marketing activities, or what you’ll need to start an LLC or any other legal structure. Let’s break this down:

• Diagnostic machine—from $5,000 up to $10,000
• Toolset—around $15,000
• Lift—from $3,000 up to $4,000
• Insurance—about $4,000 a year
• Certifications—about $300
• License—up to $100

Other expenses include salaries, marketing budget, or supply costs. These go from $10,000-$20,000 per month, depending on the size of your shop.

Forming a Legal Entity

While there are multiple legal entities you can choose from, you should go with LLC. LLC’s require much less paperwork, and you won’t lose your own private equity if anything goes sour. LLC’s are different from state to state. However, for example’ sake, we’ll explain how to form an LLC in Pennsylvania.

You should begin by choosing a name for your mechanics’ shop. There are some restrictions to be aware of, such as using restricted words. They require some additional paperwork.

Moreover, some words are prohibited— mostly those that federal or state agencies already use. While choosing the company’s name, check if it has an available domain name that ends with “.com” extension. “.com” extensions make your website (and thus business) more credible. However, this domain often costs a lot or simply isn’t available. 

It makes no sense to run a business in 2020 without a representative online presence.

The Paperwork

Next in line is a registered/statutory agent. You need them for tax purposes, official correspondence, handling legal actions, and so on. You can either hire an employee or an outside individual/company, depending on your needs.

After that, you’ll have to do some paperwork:

•  Certificate of Organization and Docketing Statement with a nonrefundable $250 fee
• An EIN issued by the IRS—needed for bank accounts, tax, hiring, and so on.
• Register for sales and tax use at the State Sale Tax
• Register for Workers Compensation and General Liberty insurance
• Annual reports, with a $70 fee

Making Your Mechanical Shop More Profitable

Now that your business is running let’s see how to make it more profitable. If you did your homework and researched your competitors, you’ll notice they all stand out with different selling points. Basically, whatever makes your shop stand out from the others is a must in your branding strategy.

Does that mean more investment? Yes, without questions.

It’s not enough to exist as a mechanic shop to keep your business profitable. You have to claim your place on the market and make sure your target audience knows about you. The internet is a perfect place for this. 

Think about it—when you need a handyman, you’ll Google the best one. The same way a car owner will Google the best mechanics in the area. As we said, make sure your website is in mint condition. 

You should also invest in paid advertising on Google and social media. With Google, you will appear in the results when someone needs your services, while on social media, you will remind your audience they might need to repair their cars at your shop.

To Sum Things Up

An exciting chapter of your life is ahead of you. It won’t be easy, but it will be satisfying. You will run your own business, and your success will depend only on your work quality. 

Remember, you’re not selling just your service; you provide a customer’s experience, too. Keep in mind that it’s easier and more profitable to retain your existing customers than to find new ones.

There are many ways to add extra value to your customers, and believe us, they will appreciate it!