take status photos of any vehicle part. Succeeding in business is never easy theres a reason why most small businesses never make it past three years but if you do it right, success wont be far away. possible purchase price and outline opportunities for increasing future revenue. (Car Wash Magazine), #6. At Easy On Oil, we will differentiate ourselves by not only offering oil change or other automotive maintenance services, but by also providing customers with a stocked lubricant and parts store. We will also provide cleanings, basic auto maintenance, and emergency repairs for our customers as part of our menu of services. (Car Wash Magazine), #8. (Buyers might ask about your discretionary cash flow when you offer them your valuation, so be prepared to include and value each major expense or purchase.). Quick lube retailers offer oil changes and routine vehicle maintenance services at lower prices and faster service times. Also, at Easy On Oil, we understand the need to develop an ethics statement describing our unchangeable stand on honest, trustworthy work. Meredith has worked as a writer and editor for more than a decade. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. Keeps shop equipment operating by following operating instructions; troubleshooting breakdowns; maintaining supplies; performing preventive maintenance; calling for repairs. Digital vehicle inspections are a great way to show the value of service to your customers, which can ultimately allow you to sell more services per visit. So, established businesses with stable profitability often use this valuation approach. Through 2028, the quick lube industry is expected to see lower levels of growth than in the past 5 yeas. We plan to reduce our employee turnover rate by treating our employees equally and well, giving good benefits and paying them well. She is based in New York City. Capitalization of earnings method: The capitalization of earnings method also calculates a businesss future profitability, taking into account the businesss cash flow, annual rate of return, or ROI, and its expected value. Figure 1: VVV's Segment Operating Income Since 2015. This offers incredible value to customers who need their cars fixed right away. Most locations operate two to five bays in a drive-through building, and many use basement construction so that oil can be changed below while other services are being completed above. Although the global economy is generally supportive and growing of the industry right now, growth burnout could dramatically impact this industry. The work done here is every bit as good or better than the nationals, the price seems at least a bit better, and I had a better experience overall. KEYWORDS oil change Operations Quick Lube. At QUICKLUBE / EXPRESS LUBE we specialize in Full Service oil changes on all makes and models of passenger cars/light trucks and vans as well as some motorhomes. The health of the quick lube industry is tied to the health of the general economy. Theres a different SDE multiple for every industry. That said, doing the math is free, so go ahead and plug your earnings numbers into different formulas and compare. The average age of a vehicle owned in the United States is 11.4 years. At Easy On Oil, we will generate revenue by actively providing oil change services in each of our facilities. Please enable cookies on your browser and try again. So, most hybrid-electric cars do not ever run on electricity alone. Mike has been instrumental in helping me successfully complete 4 transactions (both Our Business location provides us with a vast market and many opportunities. Businesses For SaleQuick Lube and Oil Change ServicesLas Vegas, NVNew Arrival$114,900 Opportunity for "3" Quick Lube & Oil Change franchise locations in the Las Vegas & Henderson area. Take 5 Oil Change is one of their fastest growing brands. At Easy On Oil, weve made plans to create a significantly large regular customer base. Just 29% of vehicle owners take their oil changes to a business other than the dealership where they purchased their vehicle. The visitor industry provides employment for more than 160,000 people. We plan is to grow sales through word-of-mouth. Also, the local craft brewing industry attracts an increasing number of visitors for beer tours and the annual San Diego Beer Week in November. A good rule of thumb is to estimate how much a piece of equipment would sell for today, and use that number. It's called Jiffy Lube Multicare. (Car Wash Magazine), #10. His expertise in getting deals done is Protect your EATS system with Delo 600 ADF. This method is especially useful if your business mostly holds investments or real estate; isnt profitable; or if youre seeking to liquidate. person. As we mentioned earlier, a businesss SDE multiple and the method of valuation varies according to a few factors, including the strength of the industry. Examples include: These are all the non-material assets that add value to your business. And NOLN's top ranking shows 93 chains in the US with at least 6 locations. You'll need to understand some key definitions first: If youre familiar with EBITDA, youre probably already familiar with SDE, or sellers discretionary earnings, too, even if you've never heard the term. You might think that you can't actually distill the value of your entire business to an exact number and, sure, in a way it's a bit of an estimate. Unlike EBITDA, though, youll also add back in the owners salary and owners benefits into your SDE calculation. In fact, with our location distribution we cover the market. Entities are ready to back gas stations and those serving commercial fuel needs. Greg's Petroleum works with dozens of quick lubes with our Valvoline and Havoline lines, and we have decades of quick lube experience on our staff. (NOLN Fast Lube Operators Survey), #23. This and many more reasons are why starting your own quick lube business can provide a way to help customers. Driving up to a quick lube business for routine maintenance that can be completed quickly saves consumers time and money. Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or 17% compounded annually. Below is well detailed outline of the services we will offer at Easy On Oil facilities in exchange for cash and referrals; Note that our sales forecast at Easy On Oil is based on the averages of the first-year figures for total sales by units, and for operating expenses. Regardless of the option you pursue, get the word out with our help. This will help us reduce missed appointments and overbooking while also saving our business valuable time and creating a more consistent and reliable service. Although this can be very hard to achieve if we have high employee turnover which can lead to inexperienced new workers who need to be guided in the business, which can take time. We believe that by establishing a strong customer relationships based on trust and integrity, we can benefit from a strong regular customer base and good referrals. Her prior experience includes two years as a senior editor at SmartAsset, where she edited a wide range of personal finance content, and five years at the AOL Huffington Post Media Group, where she held a variety of editorial roles. Cost for basic insurance policy covers, permits and business license $100,000, The cost of acquiring a suitable Office facility 6 months (Re Construction of the facility inclusive) $120,000, The budget for equipping the office (computers, software applications, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) $10,000, The price of purchasing of the required software applications (CRM software, Accounting and Bookkeeping software and Payroll software et al) $12, 000, The Cost of Launching our official Website $4,000, Our budget for paying at least five employees for 6 months plus utility bills $70,000, Additional Expenditure (Business cards, Signage, repair equipment, Adverts and Promotions et al) $234,000. Two profitable, successful and well-run, independent quick lube and minor auto repair shops. In the United States, about 450 million oil changes are performed each year. add technician notes to the photos. But as a seller, you have to put some number on your operation, especially if you want to be compensated for what you've built, taking into account all kinds of equity. At some point, every vehicle requires ongoing maintenance to keep it functioning properly. Like EBITDA, business owners calculate SDE to determine the true value of their business for a new owner, so your SDE will include expenses like the income you report to the IRS, non-cash expenses whatever revenue your business actually generates. Here is a list of our partners. Also our plans to make sure we maintain a referral network will give us the needed push in the industry. They are responsible for the direct employment of almost 90,000 people. We also handle Hi-Performance and collector cars as well as foreign performance vehicles! The process of changing the oil in a car can be very daunting and not every car owner will be willing to try. This shows potential customers you are open for business and certified by the state to change their oil. People will continue to drive regardless of the general economic market. You would do the same if you were to open a gas station serving commercial fuel needs, wouldnt you? In charge of creating marketing and sales strategies, etc. Re-opening a former auto repair or quick lube business can save significant time and money. Most of our competitors have adopted point-of-sale systems in their stores. Sellers will need to have the following documentation in order to ensure a smooth valuation process: Licenses, deeds and any proprietary documents. This allows the IC engine to focus on efficiency rather than trying to do everything as it does in an all-gas car. Many or all of the products featured here are from our partners who compensate us. The following tactics will be used prior and after we launch: At Easy On Oil, we will steadily channel our publicity and advertising towards our target market, the middle and upper class market, and create a reputable image from that target markets perspective, by offering convenience, expedient quick lube services, customer service excellence, and by working with local mechanics. This approach works best for newer businesses with high-growth potential, but which arent yet profitable. Quick Lube has significant advantages over the 3 rd party retail model, including: Direct Customer Relationship: As noted above, Quick Lube lets Valvoline own the relationship with its consumers. Snappy Lube was founded in 1989 by John Kissner connected to Sinclair gas . Our plan at Easy On Oil is to service the middle and upper income markets. Sally Lauckner is an editor on NerdWallet's small-business team. Intangible assets are crucial to your SDE multiple, so its important to identify and record their estimated value. (Business Wire), #14. Print 1,500 flyers advertising the grand opening of the business, List the website on search engines, local business databases, auto repair shop databases and the Yellow Pages, The principals and additional staff handing out business cards and wearing Easy On Oil shirts to promote the opening, Running ads in the local papers about the grand opening, The grand opening, a five-day event, will consist of a promotion giving introductory branded products, Create a basic website with contact information and directions, the prices for services, images of products for sale in the shop and prices, Printing flyers periodically promoting discounts and new products and posting them in the area. And beyond conducting your valuation, you'll need your finances in order to transfer business ownership, regardless. Our partners compensate us. If you are contemplating a transaction in the auto service sector I can www.ratchetandwrench.com is using a security service for protection against online attacks. Overall, a strong business plan provides buyers with important context about your company like your location and mission and captures what key services or goods you offer. Most likely, business owners will provide you with that number, so its important to understand how the business owner reached that value, and what these values reflect about the actual business. When evaluating offers, please review the financial institutions Terms and Conditions. Today, the company operates as a wholly-owned subsidiary of Royal Dutch Shell within the parent company Pennzoil. On top of that, he communicated everything in an We plan to offer our clients personalized service by offering convenience and rapid service. Over my over fifty year career, I have had the privilege of working with many other Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or . In order to see how electric cars are impacting the future of the automotive repair industry, it is important to understand how they work in the first place. Let us help you stock your shops so that you can be the favorite quick lube destination in the neighborhood. In any of those cases, buyers will be interested in the individual value of your investments or equipment. (Car Wash Magazine), #5. Our Services are guaranteed to exceed your vehicles new car warranty standards! (Digital Dealer), #19. Along with that, all-electric vehicles can pose some challenges to auto mechanics. Also our product prices will be gotten after the appropriate retail is determined to make sure that the shelf price represents a value to the consumer and the retailer has a 50% margin. Determines vehicle condition by conducting inspections and identifying worn and damaged parts. In 2018, the industry was valued at $7 billion in the U.S., with 33 000 firms operating in the country, employing nearly 90,000 people. In 2011, 31% of consumers preferred a premium product. However, to keep capital investments low and offer quick building relocation, vehicle lifts can be used rather than basements. Keep up to date on our new listings and business opportunities. Jiffy Lube International is the main player in the franchise segment of the quick-lube chain industry. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. Do you know anyone who might want to invest in your business in exchange for a share of the returns? We believe earnestly that this will also make our customers more comfortable working with us when they see the same technicians each time they come in for changes. For that reason, projections of growth for the industry are as low as 0.7% within the forecast period in some markets. He will be charged with overseeing the sales and marketing of Easy On Oil. We have tapped into real estate where our competitors cannot go. To make sure you maximize your payout when selling your business, it's important to work with an experienced business valuation provider such as Guidant. Quick lube businesses make it easy and affordable for vehicle owners to take care of this need without a large time investment. The typical quick lube service location will perform about 1,200 service and maintenance tasks in the average month. Do you want to start a Quick Lube company and need to write a business plan? All these were analysed based on per-unit revenue, per-unit cost, and fixed costs. Unless youre a natural-born business or numbers person (or, say, an accountant), business valuation isnt the easiest process. These conservative assumptions make for a more accurate estimate of real risk. 16% of the oil changes which occur within the quick lube industry feature Valvoline products. Approaches to a successful small-business evaluation. As cars become more complex, even something as simple as changing the oil could require a manual. 1. Our partners cannot pay us to guarantee favorable reviews of their products or services. For a full breakdown of the quick lubes we have for sale, as well as a The quick lube industry is growing rapidly. This influences which products we write about and where and how the product appears on a page. When you partner with our AutoCenter Sales team to buy a Jiffy Lube or another oil change It can gather data to . The largest technological advancement in the automotive industry is the introduction of electric vehicles. Employee outings, charitable donations, one-time purchases and your own salary can all be included in your SDE. Here is a list of our partners and here's how we make money. Investigate numbers that dont seem right, and dont be afraid to call in an accountant for extra help. The Oil Change Services in the US industry consists of Conventional oil changes, semi-synthetic oil changes, full synthetic oil changes, automotive oil changes, car washing and cleaning services, other maintenance services and high-mileage oil changes. into the automotive business. Owners of quick lube businesses benefit from the quick overturn of customers and relatively low overhead. Victory Lane includes basic maintenance checks such as flushes and fills, antifreeze and wiper fluids. Temple Curtis represents sales/management, Helen will focus on the finance/administration section of the business and Aaron will focus on the mechanical aspect of the business. Our Products and Services 4. "Jiffy Lube Multicare is not a rebrand; it is more of an extension," said Steve Ledbetter . The company would need to have sales decrease by more than 30% before we can be unable to satisfy our month to month financial obligations. Although there will still be many different tasks to complete with your hands, we will grow and advance with this trend by employing the services of a software engineer in due time. This means intellectual property, your production line, your delivery truck if its a part of your business, you'll either need to account for it as an asset or a liability. Temple worked as a top sales rep at Chevrolet for over 13 years. One common method used to value small businesses is based on seller's discretionary earnings (SDE). (Digital Dealer), #17. San Diegos Spanish and Mexican heritage is reflected in many historic sites across the city, such as Mission San Diego de Alcala and Old Town San Diego State Historic Park. (IBIS World), #2. Electric vehicles impact the future of the automotive repair industry in many different ways. We all know this chore requires ones hands to get dirty, and for this reason alone, many car owners are perfectly okay paying a quick lube business to do the job for them. For the average business, they account for 60.7% of total expenses. Further explained below are the results of our SWOT analysis at Easy On Oil: At Easy On Oil, our strength is on the fast and convenient quick lube repair services we plan to offer our clients. Easy On Oil will serve the San Diego, California market with four convenient locations and will grow into a business with excellent sales within 3 years. We believe that this market is always on the lookout for high quality, rapid service with as much convenience as possible. If a synthetic oil change is requested, the price of the oil change jumps to $70.31. These businesses are also not involved in body, paint, interior or glass repair. Note that industry operations are labor-intensive: annual revenue per employee is just $60,000. 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