Quantcast
Jump to content

Thoughts on opening a second location?


Recommended Posts

Hey guys, my shop is becoming pretty successful and it runs pretty well without me being there (most of the time), should run flawlessly if I hire another advisor for when I'm not there.

 

Owner of a building of a 5 bay garage 1995 sq/ft contacted me to see if I want to rent it out for $2400/mo. Currently leasing a 3000 sq/ft 6 bay garage about 20 miles away for $4100/mo. I have a reliable employee that recently quit bc of the distance he was driving and the new location is only 15min away so I have people to work lined up and this one is 10min from my house oppesed to 45 min for my current shop. My current shop has a 5 yr lease so not planning on giving anything up.

 

I have a good brand image and a strong reputation. Google alone 82 reviews 4.9 rating.

 

Profitability wise I just got to the point of being able to pay myself salary. Is it too risky? Headache worth it? Thoughts?

Link to comment
Share on other sites

Jay, I am in a similar boat as you. The questions I had to ask myself are...

 

1. Do I have a handle on my numbers? Do I understand all of my KPIs?

 

2. Do I have the right systems in place?

 

3. Do I have the right staff in place?

 

4. Do I have enough capital or do I have access to capital?

 

5. Do I have a business plan? What is my current business plan?

 

6. Am I profitable enough at my first location?

 

7. What is my launch marketing campaign? What is my marketing budget?

 

8. Where will my staff come from? Have I been recruiting?

 

9. Can my shops operate with me not being there?

 

10. What is the demographic of the new location?

  • Like 2
Link to comment
Share on other sites

I'm by no means a wildly successful shop owner (Small, three man shop). However, knowing that you just go to where you can afford to pay yourself a salary... I'd say wait and build up a nice financial nest egg so you don't stretch yourself too thin.

 

And to repeat what mspec said, "Can my shops operate with me not being there?" - If not, I would think the clear answer is no, do not open a second location

  • Like 1
Link to comment
Share on other sites

They say when you go from owning one shop to multiple the plan needs to be getting to three pretty quickly. I can tell you that the dynamics and/or skillset of running one location to multiple is completely different. I dont know you but my some of the questions, comments and the part about just beginning to take paychecks I would think your one location is way to risky at this point. I would perfect the one operation before ever considering a second. You should be hitting a solid and consistent 20% net (after paying yourself if you work there) before ever thinking you are ready for more.

  • Like 2
Link to comment
Share on other sites

I'm almost embarrassed to reply to this. When my shop became moderately successful with lots of help from family and ATI, I had an opportunity to take over a failed shop - just the facility - no staff or equipment. They had even removed the air fittings when they left. It was a lease on a back street with no through traffic, but a nice five bay with office space. It took three years, a bunch of debt and hard work, but now that shop is neck and neck with shop one. I really had no plan going in, but that's how I roll and I don't recommend it. I am lucky to have a family who supports, no, puts up with my reckless approach and makes the most of it. Wait until the numbers at your first shop scream at you that it is time to expand.

Link to comment
Share on other sites

I'm almost embarrassed to reply to this. When my shop became moderately successful with lots of help from family and ATI, I had an opportunity to take over a failed shop - just the facility - no staff or equipment. They had even removed the air fittings when they left. It was a lease on a back street with no through traffic, but a nice five bay with office space. It took three years, a bunch of debt and hard work, but now that shop is neck and neck with shop one. I really had no plan going in, but that's how I roll and I don't recommend it. I am lucky to have a family who supports, no, puts up with my reckless approach and makes the most of it. Wait until the numbers at your first shop scream at you that it is time to expand.

 

 

would you have not made the same choice even knowing what you know now?

Link to comment
Share on other sites

Absolutely. Even though I caused myself and others some stress with my business ad-ventures, I don't regret any of it. Did the same thing with my used car lot, really putting a strain on my nerves and my wallet, but now I'm on pretty firm footing. That's the last one, though. No. Really, I mean it.

Link to comment
Share on other sites

You know, for some reason it has been much easier to run 1 or 3 or more locations than 2. I have no idea why yet, but i am thinking about it. I will share the answer once I figure it out.

 

 

I was recently at a meeting where one of the shop owners mentioned it was much easier to run run 6+ shops than 3. I think the idea is that at 6 you have an infrastructure and a corporate team at that level. When you get to 3 you start to formulate your corp team. At 2 things get tough if you have a store that is struggling or if you have staffing issues.

Link to comment
Share on other sites

We just opened our second location the Monday after Thanksgiving. It is in a small town 35 miles away from our original location. The opportunity literally "fell into our lap".

 

The shop had equipment and was essentially turn key. We did have a couple of bumps in the road, but we see that it will be worth it. Our reputation and great customer service from our first shop catapulted us in bringing in business.

 

MSpec has some great questions. When I posted the same question as you, I believe someone on that thread asked about running the two shops without relying on each others profits. That was probably the major point that ran through our minds as we were getting everything set up.

Link to comment
Share on other sites

Jay, I am in a similar boat as you. The questions I had to ask myself are...

 

1. Do I have a handle on my numbers? Do I understand all of my KPIs?

 

2. Do I have the right systems in place?

 

3. Do I have the right staff in place?

 

4. Do I have enough capital or do I have access to capital?

 

5. Do I have a business plan? What is my current business plan?

 

6. Am I profitable enough at my first location?

 

7. What is my launch marketing campaign? What is my marketing budget?

 

8. Where will my staff come from? Have I been recruiting?

 

9. Can my shops operate with me not being there?

 

10. What is the demographic of the new location?

 

 

Thanks for all the replies. Been thinking a lot about this, this is off topic but who made your website?

Also, was your shop featured on a shop magazine few months ago?

Link to comment
Share on other sites

 

 

Thanks for all the replies. Been thinking a lot about this, this is off topic but who made your website?

Also, was your shop featured on a shop magazine few months ago?

 

 

We use Kukui for our website, CRM and analytics. If you need anymore more info PM me.

 

 

We were not featured in a mag a few months ago but we may be in R+W soon.

Link to comment
Share on other sites

 

 

We use Kukui for our website, CRM and analytics. If you need anymore more info PM me.

 

 

We were not featured in a mag a few months ago but we may be in R+W soon.

Thanks,

Ok yea I thought I saw you guys on R+W or Shop Owner. That's awesome though, look forward to seeing it!

Link to comment
Share on other sites

Ok well just want to give everyone an update.

 

So I submitted an offer to the owner of the building. Sometimes I think I am crazy. I don't think I'm ready but I am never satisfied and get bored easy.

 

The thought of opening a new location excites me from getting new equipment and office supplies, getting signs made and announcing yet another step forward for my business.

 

I've been sprinting non-stop it seems like from when I quit my job suddenly one day and started working out of my home garage 2 years ago. Every step of the way I've had second thoughts but went ahead with it anyway. I hope it'll work out this time too, that is if they accept my offer.... if they don't then it's an easy decision for me.

 

One thing I've learned along the way is that you can't be afraid to fail. Failure is a part of life, but at least I won't have regrets.

 

O yea, that 5 bay building was pretty crappy when I saw it but they also own a larger 6 bay building which is much nicer (but more expensive). Made an offer on the 6 bay

Edited by Jay Huh
Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Have you checked out Joe's Latest Blog?

         5 comments
      I recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
      Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
      Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
      Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
      Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”
  • Similar Topics

    • By nptrb

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.

    • By Changing The Industry
      Enhancing Shop Operations with John Heller of PartsTech
    • By Changing The Industry
      The Basics of Owning An Auto Repair Shop - Part 5
    • By carmcapriotto
      The Weekly Blitz is brought to you by our friends over at Shop Marketing Pros. If you want to take your shop to the next level, you need great marketing. Shop Marketing Pros does top-tier marketing for top-tier shops.
      Click here to learn more about Top Tier Marketing by Shop Marketing Pros and schedule a demo:https://shopmarketingpros.com/chris/
      Check out their podcast here: https://autorepairmarketing.captivate.fm/
      If you would like to join their private Facebook group go here: https://www.facebook.com/groups/autorepairmarketingmastermind
      In this episode, Chris Cotton from Auto Fix Auto Shop Coaching explores the issue of transition leaks in auto repair shops. He explains how frequent task-switching hampers productivity and energy levels for shop owners, service advisors, and technicians. Chris advocates for batch processing to consolidate similar tasks, thereby reducing transition leaks and increasing efficiency. He advises reorganizing work schedules to minimize cognitive load and suggests that while flexibility is necessary, intentional planning can greatly enhance productivity. The episode wraps up with Chris encouraging listeners to embrace growth and efficiency, thanking the sponsor, and promoting a positive work ethic.
       
      Transition Leaks (00:00:06) Explanation of the concept and its impact on auto repair shop owners, service advisors, and technicians.
       
      Impact on Efficiency (00:02:27) Discussion on how transition leaks lead to lost efficiency and diminished capacity for delivering high-quality service.
       
      Batch Processing Strategy (00:04:48) Explanation of the batch processing strategy to combat transition leaks and improve productivity.
       
      Applying the Concept (00:07:03) Guidance on analyzing and reorganizing schedules to minimize transition leaks and increase efficiency.
       
      Embracing Change (00:09:11) Encouragement to prioritize efficiency and quality by embracing a new way of organizing work schedules.
       
      Connect with Chris:
       
      [email protected]
      Phone: 940.400.1008
      www.autoshopcoaching.com
      Facebook: https://www.facebook.com/
      AutoFixAutoShopCoachingYoutube: https://bit.ly/3ClX0ae
       
      #autofixautoshopcoaching #autofixbeautofixing #autoshopprofits #autoshopprofit #autoshopprofitsfirst #autoshopleadership #autoshopmanagement #autorepairshopcoaching #autorepairshopconsulting #autorepairshoptraining #autorepairshop #autorepair #serviceadvisor #serviceadvisorefficiency #autorepairshopmarketing #theweeklyblitz #autofix #shopmarketingpros
      Click to go to the Podcast on Remarkable Results Radio
    • By Joe Marconi

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.



  • Our Sponsors



×
×
  • Create New...