From the blog The 6 Most Profitable Auto Repair Services
Many auto repair businesses start out offering limited services. Often, this is due to the cost of investing in repair equipment and the challenges of hiring qualified help.
In order for a repair business to flourish, it needs to grow. A large part of that growth involves offering more auto repair options in order to serve more customers.
While everyone wants to be a full-spectrum auto repair facility, that can be a lot to take on all at once. Instead, many businesses pick and choose new service offerings one or two at a time as they can afford it.
6 profitable auto repair services
Here are the 6 auto repair services you should look at first when deciding how to expand your business. We’ve also included some suggestions on how to reach and retain more customers.
As automobiles become more sophisticated and computer-driven, owner-performed diagnostics are becoming a thing of the past. Automobile owners increasingly find they need help to even know what’s wrong with their cars.
Top-of-the-line diagnostic equipment costs a pretty penny. Plus, diagnostics by themselves don’t allow for parts revenue. You’re only charging for your time. But you’re also building your business, and that’s key.
Being able to provide reliable and accurate diagnostics will attract more customers. In other words, offering diagnostic services won’t turn an instant profit, but they will make you more profitable over time.
“…performing Diagnostic services in your shop is the most costly labor operation you can perform. Here’s why: Diagnostic services don’t generate parts revenue.” – AE Tools & Computers
Determining specific problems and long-lasting solutions will:
- Help retain customers
- Increase overall business
- Lead to a long-term gain in profits
Do you live in a part of the country where there are extreme seasonal weather changes? If you do, alignment issues may affect your customers. Especially for anyone who changes back and forth between standard tires and snow tires.
“Alignments are low-risk, high-profit jobs.” – MTD
With each round of tire changes, there is an increased chance wheels may fall out of alignment which will lead to further wear on tires and steering systems.
Checking and adjusting alignment is a fairly quick procedure. You can offer it on its own or include it as part of a new tire package. And if you’re already rotating tires, it’s an easy add-on service to suggest.
The extra attention to detail will appeal to customers and encourage repeat business.
Modern suspension systems are complex and they take a beating day in, day out. Consider everything they endure. Plus, these are not the kinds of repairs the average driver is in any way equipped to handle on their own.
“[Suspension systems] take a pounding daily from potholed streets, railroad tracks, rain, snow, road salt, gravel, all manner of dirt and grime, and the occasional piece of scrap metal or other debris that drivers see too late to avoid.” – Cars.com
Suspension parts are fairly standard and easy to calculate into a repair quote. So long as you have reliable, affordable access to parts and reasonable labor costs, you should be able to maintain a positive profit margin.
A/C and heating
Drivers in southern states need reliable air conditioning. Drivers in northern states need working heat. Drivers everywhere in between need both.
There will always be a demand for air conditioning and heating maintenance. And if your shop doesn’t offer A/C or heating repair or maintenance, you’re leaving money on the table.
“A/C service and repair represents a growing revenue opportunity for shops…” – Vehicleservicepros.com
A comfortable driving environment isn’t a luxury when you consider how much time many people spend in their cars. While some vehicle owners may choose to put off A/C and heating repair for a little while, it’s something most will address as soon as they can afford it.
The oil change is essential car maintenance—even if your car is brand new.
While dedicated oil change businesses do well, there is no shortage of oil change work in full-service auto repair shops.
“…the average independent retail tire dealer performs 214 oil/lubrication service jobs per month at an average ticket of $52.47. The average annual profit is $45,813 based on a profit margin of 34%.” – MTD
But immediate profit isn’t the only advantage. You’ll also increase the chances your customers only bring their cars to you. That means you’ll be first in line for any other needed repairs.
Offering a full range of services—from oil changes and inspections to full parts replacement and service—can make you a profitable one-stop-shop.
Many car parts wear down over time. A car’s brakes are one of the most critical.
A full-service repair shop that offers brake adjustment, repair, and replacement services will never run out of brake job customers.
“Compared to other non-tire-related services, brake work is offered by more dealers than any other automotive service.” – MTD
As in the case with suspension services, most parts related to brake replacement or repair are standard off-the-shelf items and labor costs are simple to determine. Brake services are a year-round demand and should be included as part of a regular maintenance schedule leading to greater customer retention and profits.
Find out what your customers want
To get started right away, find out what your customers’ priorities are.
You have a few options when it comes to gathering customer feedback:
- Printed surveys available in the waiting area
- Directions to an online survey included with or on a service receipt
- Data analysis to determine which services are most and least requested
- Data analysis to determine which services you already offer that are the most profitable for your shop
- Talking directly to your customers
Direct feedback from customers should help you determine what your next service offering should be.
Build your reputation
What do people tell their friends about your repair services?
Are your service technicians ASE certified? Are they up to date on the ever-changing service requirements for newer vehicles? Do you have a reliable source for good, affordable parts that can be delivered quickly? Does your service center provide a quick turnaround? How comfortable is your waiting area?
Auto repair shops rely heavily on word-of-mouth to find new customers. Your shop’s reputation matters.
If you find your growth stalling, you can take simple immediate steps by making sure you’re offering the best possible service you can in a clean, professional environment. And be sure to do what you can to get solid online reviews.
Getting to growth
With a little strategic planning, you can make your shop more profitable.
- Find out what your customers want
- Assess what your technicians can do
- Assess any new equipment needs
- Ensure profitability by keeping an eye on cost/profit analytics
- Keep building your reputation to keep building profitability
If you’re looking for a place to start right now, go talk to your current customers. Talk to your techs. Seriously. Right now.
Ask them what people seem to want more of. Ask them what you don’t offer that they’d like to see. Then listen.
You could be one good conversation away from your next profit breakthrough.