Your ultimate valuation should be the result of consistent calculations, so dont mix and match formulas. (Valvoline). At Easy On Oil, we strongly believe we will experience steady growth in profitability over the next three years of operation. Our Products and Services 4. Implement an ongoing training program. These services will include full oil changes, lubricate the chassis of automotive vehicles and provide other automotive repair and maintenance services, such as tire rotations and liquid flushes. Entrepreneurs looking to buy an existing business should also be familiar with valuations, and feel comfortable estimating value independently of the business owner or brokers asking price. Once youve determined to open a quick lube business, the first thing to do is to put together a business plan. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. Ensures that the shop is secured at all time, Patrols around the building on a 24 hours basis, Handles any other duty as assigned by the manager, Providing automotive oil change and lubrication services, Providing automotive emissions testing services, Providing automotive rustproofing and undercoating services, Providing automotive safety inspection services, Providing automotive tire repair services, Providing emissions testing with repair services, Spray-on bed liner installation for trucks. But where the discounted cash flow method accounts for more fluctuations in a business's financial future, the capitalization method assumes that calculations for a single period of time will continue in the future. The profitability of individual companies depends on convenient location and good marketing. Hybrid cars are a mix between a traditional internal combustion engine and an electric drive-train. And while our site doesnt feature every company or financial product available on the market, were proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward and free. Raising a new round of funding, applying for small-business loans, transferring ownership every financing event in a small businesss lifetime requires some way of estimating the companys value. Through 2028, the quick lube industry is expected to see lower levels of growth than in the past 5 yeas. They are responsible for the direct employment of almost 90,000 people. The appeal of a quick lube business is easy to see. 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. These similar businesses, often referred to as comparables or "comps," can orient you within the marketplace and provide context about the sector. This does come at a cost though. And NOLN's top ranking shows 93 chains in the US with at least 6 locations. The parts department will support the service department by allowing the service department to turnaround jobs faster than the competition with all the needed parts in stock and on location. Protect your EATS system with Delo 600 ADF. Mike has been instrumental in helping me successfully complete 4 transactions (both To reach our local customer base, we will employ a marketing manager. Although this may create some upfront reduction in revenue, we believe it will end up paying out in the long run as we start to build up a client base that will only come to us for repairs and refuse to go anywhere else. 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. We will ensure we provide a full range of auto lubricant and repair parts inventory and rapid shipping capability of major parts. Your best angle is to make a list of the production, property, and resources that comprise your business assets and liabilities, cash and investments, employees and intellectual property. Industry Overview 2. 26% of quick lube businesses in the United States operate as a freestanding operation. Generating Funding/Start up Capital for Easy On Oil. 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. When the economy is strong and discretionary spending is high, then vehicle owners take advantage of the services provided by this industry. At Easy On Oil, our mission is to provide fast, reliable, and cost effective oil change and lubrication services for vehicle owners in San Diego, California. Sample 1 Sample 2 Sample 3 Based on 6 documents If buying and selling businesses is a new frontier for you, you can consult any number of online resources to help you determine the value of a business. Over my over fifty year career, I have had the privilege of working with many other Order Reprints. In the United States, about 450 million oil changes are performed each year. Here is a list of our partners and here's how we make money. 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. This approach will specifically help you determine an appropriate selling or purchase price based on your local market. You should also look for business plans that clearly outline processes and, ideally, demonstrate consistent management. Let's #LineItUp from Washington State! unconditionally recommend Mike and his team. Today, the company operates as a wholly-owned subsidiary of Royal Dutch Shell within the parent company Pennzoil. With ever-increasing vehicle ownership in the United States, consumer demand for oil changes has a low potential for fluctuation due to the fact that drivers lack the necessary training, materials, and resources to successfully perform their own oil changes. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. Franchised Oil Change & Repair Shop in Solano County. About Your Results Make sure they know by having your license visible front-and-center. Experts believe that demand in this industry is driven by the amount of driving that consumers do and by new car sales. We also plan to leverage an automotive service scheduling software program. There are about 250 million vehicles on the road which will require services at some point that can be provided by a quick lube location. Victory Lane Quick Oil Change. We plan is to grow sales through word-of-mouth. A good rule of thumb is to estimate how much a piece of equipment would sell for today, and use that number. This is where you come in! 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. 89% of quick lube locations offer a transmission fluid drain and flush service in the United States, with an average cost of $107.60 per service. Because the process for determining the value of a small business is complicated, you might want to consider consulting a professional business broker or accountant that specializes in valuation, rather than going it alone. If you ever want to learn . (Car Wash Magazine), #5. In fact, with our location distribution we cover the market. Discounted cash flow method: This method determines the present value of a business's future cash flow. Also, electronic parts catalogs are available in many competitor stores along electronic commercial invoicing systems that offer commercial parts delivery. Along with that, all-electric vehicles can pose some challenges to auto mechanics. Wherever you are in your businesss lifecycle, you'll want to know how to value a small business sooner rather than later. A well-run business will make transitioning ownership, without losing. Meredith has worked as a writer and editor for more than a decade. Later, too, you can use this list to create an overview of your companys value for potential buyers. Pre-qualified offers are not binding. (IMR Automotive Research), #9. 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. Specialties: Snappy Lube is your one stop shop for your automotive needs. For a full breakdown of the quick lubes we have for sale, as well as a assign a green, yellow, or red status to each part. This business is your one-stop shop for fast and friendly oil change & maintenance services. This information may be different than what you see when you visit a financial institution, service provider or specific products site. Feeling confident in your appraisal will help you accurately determine how to pitch investors and raise funding, or price your business to find the right buyer. All these were analysed based on per-unit revenue, per-unit cost, and fixed costs. Regularly getting the oil changed is one of the most important maintenance tasks you can do for your car, and fortunately, it's one of the cheapest. Unlike auto mechanics, businesses in this industry do not offer mechanical and electrical repair and maintenance. In charge of creating marketing and sales strategies, etc. This offers incredible value to customers who need their cars fixed right away. "Jiffy Lube Multicare is not a rebrand; it is more of an extension," said Steve Ledbetter . Unless youre a natural-born business or numbers person (or, say, an accountant), business valuation isnt the easiest process. 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. Also, our wide range of auto lubricants and repair parts inventory that is (nearly) never out of stock will further cement our place as a reckoning force in the industry. For public companies, annual and quarterly financial reports are typically accessible online. Here, business assets include anything that adds value to your company. The largest technological advancement in the automotive industry is the introduction of electric vehicles. How to Valuate a Business One way to calculate a business's valuation is to subtract liabilities from assets. The quick lube business may thrive on customer turnover, but quality, efficient service is what brings customers back to their favorite quick lube shops again and again. Complies with federal and state vehicle requirements by testing engine, safety, and combustion control standards. Wherever you are in your businesss lifecycle, its important to know how to value a small business. Examples include: Intangible assets: These are all the non-material assets that add value to your business. Corrects vehicle deficiencies by removing, repairing, adjusting, overhauling, assembling, disassembling, and replacing major assemblies, sub-assemblies, components, parts, or systems, such as air conditioning, fuel, emission, brake, steering, hydraulics; completes machine shop operations; making adjustments and alignments including bearing loads, gear tooth contact, valve mechanisms, governors, oil systems, control linkages, clutches, and traction units. With Easy On Oil as a technologically savvy business with computerized monitoring of all automotive lubricant and repair parts inventory, we plan to make sure that parts are always in stock, while keeping a balanced level of inventory to maximize inventory turnover. 1. Conducting a valuation is an excellent opportunity to assess the financial health and potential of your business, or of a business youre hoping to buy. According to reports, the industry is fragmented; the 50 biggest companies generate less than 40 percent of revenue. We will always stress the fact that we only offer reliable services. Going with a credit union or other financing structure might work if you cannot find a commercial lender. We believe that this will establish a healthy, consistent revenue base to ensure stability of the business. All financial products, shopping products and services are presented without warranty. Youve come to the right place. (IHS Automotive), #22. (Digital Dealer), #18. Along with doing financial legwork, valuing your business also requires you to exercise control over any emotions. A Sample Quick Lube Repair Business Plan Template Table of Content 1. Routine maintenance services like adjusting tire pressure, changing windshield wipers, replacing light bulbs, and topping off auto fluid levels are usually done in 10 minutes or less. In total, Driven Brands has 1,100-plus locations across North America. Most locations achieve this figure with just 2-5 service bays available to them. Its crucial that prospective buyers understand SDE, too. Keep up to date on our new listings and business opportunities. (Car Wash Magazine) #7. However, to keep capital investments low and offer quick building relocation, vehicle lifts can be used rather than basements. Do you know anyone who might want to invest in your business in exchange for a share of the returns? 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. Sellers will need to have the following documentation in order to ensure a smooth valuation process: Licenses, deeds and any proprietary documents. The average age of a vehicle owned in the United States is 11.4 years. Quick lube stations provide services ranging from basic oil changes to transmission flushes and windshield wiper replacements. Long wait for services and parts wont b entertained at East On Oil as we strive to offer the best service and product in our market. Updates job knowledge by participating in educational opportunities; reading technical and regulation publications. Understanding code and the relationship that software has with new vehicles will become an essential skill set for anyone working in the auto repair industry in the future. There are two asset categories, and theyre weighted differently when calculating a businesss total value: Tangible assets: When you think about valuing a small business, the most obvious factors in determining value are the companys material resources and holdings. If a synthetic oil change is requested, the price of the oil change jumps to $70.31. 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. The scoring formulas take into account multiple data points for each financial product and service. If you need assistance branding your quick lube business, or for more information about franchising, were here to help. Because youre familiar with your own equipment and production, you can make pretty accurate estimates of each of your assets value and depreciation. (Business Wire), #16. Our vision at Easy On Oil is to become the leading business that offers Quick Lube repair services and a well-stocked repair parts shop in San Diego, California. Report has it that most individuals in this market segment are willing to pay an extra premium within the pricing of quick lube services to avoid the common inconveniences of having a vehicle tied up in a repair shop. (If you used EBITDA to value your business, youll use an EBITDA multiple.) If you want to take the income approach, you can choose between two commonly used valuation methods. We will attract and maintain a loyal customer base through our customer-oriented focus on business. We plan to give our clients a few business cards to hand out to friends when they talk about our quick lube services or buying new parts. Oversees the activities of group technicians, including the recruiting and credentialing processes, Attend standing meetings (board, committee, etc. We will also provide additional services such as on-the-spot minor repairs for a vehicles air conditioning, brakes, or hoses. Our diverse management have put plans in place to make sure our regulars feel appreciated by rewarding them for being loyal customers. Even though quick lube locations are seeing a reduction in the number of cars being serviced each day, the number of oil changes being performed is rising. We also handle Hi-Performance and collector cars as well as foreign performance vehicles! Joe handled every aspect and obstacle that presented itself throughout the sales Franchising a quick lube business provides you with an established network of vendors and partners without the need to do the legwork yourself. (Car Wash Magazine), #6. Jiffy Lube International. Before even thinking about how to value a small business for sale, both sellers and buyers should organize their financial records thats crucial for accurate calculations. This process is automatic. Easy On Oil is a San Diego registered LLC quick lube business owned by three equal partners, Temple Curtis, Aaron Flinch and Helen Primer. Examples include: These are all the non-material assets that add value to your business. Also, at Easy On Oil, we understand the need to develop an ethics statement describing our unchangeable stand on honest, trustworthy work. Maintaining the website with new trends and advises. Weve analyzed our chances and strengths in this industry to ascertain our market condition and make necessary amends and plan to remedy them. Another 16% of business owners have two locations where they provide services. Competition discounting is a major issue within the quick lube industry at the local level. These are some of the most efficient cars to ever be driven. Employee outings, charitable donations, one-time purchases and your own salary can all be included in your SDE. Please enable JavaScript on your browser and try again. One common method used to value small businesses is based on seller's discretionary earnings (SDE). person. Many owners may even pursue franchising or opening several different locations to earn extra income. effective manner and I never once felt like I was in the dark. From Disabled and $500k in Debt to a Pro Blogger with 5 Million Monthly Visitors, 25 Quick Lube Industry Statistics, Trends & Analysis, 41 Food Truck Industry Statistics, Trends & Analysis, 47 Green Industry Statistics, Trends & Analysis, 49 High Tech Industry Statistics, Trends & Analysis, "From Disabled and $500k in Debt to a Pro Blogger with 5 Million Monthly Visitors. Paul Hodowanic. Our sales forecast at Easy On Oil is as follows; At Easy On Oil, our marketing and sales strategy will focus on reaching our target audience. Keeps supplies ready by inventorying stock; placing orders; verifying receipt. second to none. Businesses in this industry change motor oil, lubricate the chassis of automotive vehicles and provide other automotive repair and maintenance services, such as tire rotations and liquid flushes. Rounding out this list includes establishing solid relationships with your vendors and distributors, hiring the right people, and promoting your business. And with hundreds of millions of vehicles on U.S. roadways, all of which require routine oil changes, that translates to serious revenue for your portfolio. LOCATION, LOCATION, LOCATION. Before joining NerdWallet in 2020, Sally was the editorial director at Fundera, where she built and led a team focused on small-business content. 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. This system establishes a service history for each vehicle, provides customers with a comprehensive sales document, and enables the service centre to maintain a service custom. (Car Wash Magazine), #4. 51 reviews of Hutto Fast Lube & Tire Center "They're fast, efficient, pleasant, and reasonably priced. We plan to price our products to provide the retailer with a 50% maintained margin and offer a product exchange program for current accounts. Then, youll add back in any purchases that arent essential to operations, like vehicles or travel, that you report as business expenses. 1 in 3 vehicle owners decide to change their own oil after purchasing a new vehicle. Also our cash flow is impaired and business hours are limited for a retail establishment (Monday through Friday 9:00 a.m. to 6:00 p.m.). When you think about valuing a small business, the most obvious factors in determining value are the companys material resources and holdings. Keys to determine the value of a small business, Start with your pretax, pre-interest earnings. The more thorough you are in this step of the valuation process, the more confident youll be in your calculations. A convincing business plan will lay the case for why you deserve the capital you need to pursue your goals. Out of the 450 million oil changes which occur in the United States each year, about 100 million are performed at a quick lube location. In any of those cases, buyers will be interested in the individual value of your investments or equipment. Cars fixed right away well-run business will make transitioning ownership, without.! 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