(Business Wire), #16. From our cost analysis above, we need approximately $560,000 plus $1,200,000 inventory to start Easy On Oil successfully. For equipment or other depreciating assets, that value is usually somewhere between the sale price and the depreciated value. Even if you don't adjust the asset's worth according to the current market, you can still get a good sense of a businesss material value. As a first time buyer, I had a lot of extra If you want to take the income approach, you can choose between two commonly used valuation methods. However, due to the confidentiality agreements stipulated by some of our current sellers, were not able This does come at a cost though. Another common method attributes value to a business based solely on its assets. You should also look for business plans that clearly outline processes and, ideally, demonstrate consistent management. However, youre fully capable of valuing your business using your own resources. When the economy is strong and discretionary spending is high, then vehicle owners take advantage of the services provided by this industry. If youre considering acquiring a business, composing a list of your target's assets and liabilities will ground your decision in sound financial judgment and make sure you and the seller are on the same page with valuation. One Independent Quick Lube w/RE in El Dorado, KS. 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. This will help us reduce missed appointments and overbooking while also saving our business valuable time and creating a more consistent and reliable service. Let us help you stock your shops so that you can be the favorite quick lube destination in the neighborhood. Because youre familiar with your own equipment and production, you can make pretty accurate estimates of each of your assets value and depreciation. Easy On Oil has three partners, Temple Curtis, Aaron Flinch and Helen Primer. Updates job knowledge by participating in educational opportunities; reading technical and regulation publications. This offers incredible value to customers who need their cars fixed right away. Then, you can demonstrate to potential buyers what makes your business stand out. process as a consummate professional. For your quick lube questions in Bakersfield, Fresno, San Luis Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum Service. 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. In 2016, 45% of consumers asked for premium products from their preferred quick lube business. Sally Lauckner is an editor on NerdWallet's small-business team. Maintains vehicle records by annotating services and repairs. Valvoline Instant Oil Change locations number more than 1,000, as do Pennzoil 10-Minute Oil Change locations. You will be redirected once the validation is complete. automotive business brokers can help you conduct a successful, lucrative business investment, contact our team today! Approaches to a successful small-business evaluation. Bigger companies have an advantage in brand recognition, but the operations of individual locations are similar. It can be an especially useful approach for rapidly growing businesses and industries. Small, regional locations can allow owners to carve out successful markets for their business. According to reports, the industry is fragmented; the 50 biggest companies generate less than 40 percent of revenue. Additionally, franchising a business comes with an entirely different set of understandings and obligations. The business's cash-flow forecast is adjusted (or discounted) according to the risk involved in purchasing the business. This business is your one-stop shop for fast and friendly oil change & maintenance services. Generating Funding/Start up Capital for Easy On Oil. When evaluating offers, please review the financial institutions Terms and Conditions. to post every listing on the site. Asset valuations are also a great tool for internal use, and can help you keep track of spending and capital resources. This segment comprises approximately 25% of our revenue at Easy On Oil. We plan to make sure we dont ever run out of a specific part, while maximizing inventory turnover. On top of that, he communicated everything in an Application and Obtaining Tax Payers ID: Application for business license and permit: Leasing, renovating and equipping our facility: Generating part of the startup capital from the founder: Printing of Packaging and Promotional Materials: Purchase of software applications, furniture, office equipment, electronic appliances and facility facelift: Creating Official Website for the Company: Creating Awareness for the business (Business PR): Health and Safety and Fire Safety Arrangement: Establishing business relationship with banks, financial lending institutions, vendors and key players in the industry. Our 2022 recap of everything that happened in the fuel and lubricant industry. Today, the company operates as a wholly-owned subsidiary of Royal Dutch Shell within the parent company Pennzoil. 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. Let's #LineItUp from Washington State! Pre-qualified offers are not binding. 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. second to none. Many or all of the products featured here are from our partners who compensate us. The most popular has been around for a while, hybrid-electric cars. Her writing has also appeared in the New Republic, BBC, Time Inc, The Paris Review Daily, JPMorgan Chase and more. According to industry data collected over the past five years, the quick lube services industry has an annual growth rate of 2.4% and a combined annual revenue of $5.5 billion. effective manner and I never once felt like I was in the dark. There are many services that go beyond the simple passenger and commercial fuel needs of the public and businesses. (Car Wash Magazine), #12. SHOP STATS: Midas Kalkaska Location: Kalkaska, Mich. . The income approach to business valuation determines the amount of income a business can expect to generate in the future. Easy On Oil is an exciting business opportunity that addresses the unmet need of having a spacious quick lube facility that also has a complete automotive parts store. Regardless of the option you pursue, get the word out with our help. At Easy On Oil, weve taken note of all these and have partnered with a renowned banking platform to help us serve our clients comfortably. Theres a different SDE multiple for every industry. 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. At Easy On Oil, our major weaknesses will be the time and resources it will take us to establish and publicize our services to the people of San Diego. This method is especially useful if your business mostly holds investments or real estate; isnt profitable; or if youre seeking to liquidate. Our diverse management have put plans in place to make sure our regulars feel appreciated by rewarding them for being loyal customers. Many owners may even pursue franchising or opening several different locations to earn extra income. 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. This approach works best for newer businesses with high-growth potential, but which arent yet profitable. (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.). We will also provide additional services such as on-the-spot minor repairs for a vehicles air conditioning, brakes, or hoses. Just 9% of customers come from a 2-mile radius. Our objective is to be precise and honest with clients when it comes to quoting cost estimates. Investigate numbers that dont seem right, and dont be afraid to call in an accountant for extra help. How to Write a Waterless Car Wash Business Plan [Sample Template], How to Write a Salvage Yard Business Plan [Sample Template], How to Write a Vehicle Testing Station Business Plan [Sample Template], How to Write an Autonomous Vehicle Production Business Plan [Sample Template], How to Write a Mobile Alloy Wheel Repair Business Plan [Sample Template], How to Write a Lubricant Oil Production Business Plan [Sample Template], How to Write a Party Bike Business Plan [Sample Template], How to Write an ATV Rental Business Plan [Sample Template], How to Write a Valet Parking Business Plan [Sample Template], How to Write a Diesel Engine Repair Shop Business Plan [Sample Template], cars are impacting the future of the automotive repair industry. 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. 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. Since 2012, the industry has achieved an annualized rate of growth averaging 1.5%. When evaluating offers, please review the financial institutions Terms and Conditions. Paul Hodowanic. We are the original home the "Oil change in a Snap!" and now have added automotive repair to line up. First, make a detailed report of your business assets and liabilities. Real estate includes two half-acre lots with two 3-bay facilities and equipment located in solid, growing middle-class communities with strong employers. In particular, the Adjusted Net Asset Method calculates the difference between a business's assets including equipment, property, and inventory, and intangible assetsand its liabilities, both of which are adjusted to their fair market values. For public companies, annual and quarterly financial reports are typically accessible online. We will ensure we provide a full range of auto lubricant and repair parts inventory and rapid shipping capability of major parts. Based on 7 documents Quick Lube Business means the provision of services for changing oil, lubricants, antifreeze and other automotive fluids for passenger car and light commercial trucks and the provision of maintenance checks and related services. Why do diesel exhaust fluid (DEF) prices keep rising and falling? If you are considering opening your own quick lube business or would like to improve the business you already own, try some of these tips. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. These could include: You'll also need to know your liabilities. We plan to reduce our employee turnover rate by treating our employees equally and well, giving good benefits and paying them well. Pittsburgh, PA:For Sale: this 10-unit Quick Lube Oil Change business that has outstanding locations. The higher your SDE multiple, as you might expect, the more your business is worth. We will always stress the fact that we only offer reliable services. The keys to success include having quality employees, efficiently managing costs of goods and location, and great customer service. At Easy On Oil, our revenues will not in any way be sensitive to the overall market condition. If so, read on about what it takes to become one. Below is a detailed analysis of how we want to spend our startup capital. The typical quick lube service location will perform about 1,200 service and maintenance tasks in the average month. Drawing on her background in small business and startups, she writes on lending, business finance and entrepreneurship. A valuation represents your companys total worth. Complies with federal and state vehicle requirements by testing engine, safety, and combustion control standards. A typical location performs about 1,200 jobs per month. 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. We have trained and will keep training employees to focus on delivering on our promise. 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. Typically, more than 70 percent of revenue is from oil changes. At the end, the information is used to help formulate pricing, marketing and merchandising strategies. 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. With the Multicare brand extension, Jiffy Lube is focusing on rolling out brake, diagnostic - and eventually tire - services to its customers. 48% of operators within the quick lube industry run a business which combines car washing services with oil changing services. So, established businesses with stable profitability often use this valuation approach. However, to keep capital investments low and offer quick building relocation, vehicle lifts can be used rather than basements. The business's cash-flow forecast is adjusted (or discounted) according to the risk involved in purchasing the business. Marketing programs at lubes should be powerful and . Internet companies or buyers interested in the tech sector can use online directories like Crunchbase and platforms like AngelList, which provide information about startups, funding, investors, and more. NerdWallet's ratings are determined by our editorial team. Jiffy Lube International is the main player in the franchise segment of the quick-lube chain industry. Owners of quick lube businesses benefit from the quick overturn of customers and relatively low overhead. Learn more about financial projections, income statements, balance sheets and cash flow. Our Products and Services 4. Also, electronic parts catalogs are available in many competitor stores along electronic commercial invoicing systems that offer commercial parts delivery. We at Easy On Oil have analysed this and we will favorably compete by focusing on convenience and offering a high level of customer service. It must also be done for a quick lube business. ", 100 Best Side Hustles for Teens to Make Money, 10 Proven Psychological Pricing Strategies with Examples, 100 Office Etiquette Rules You Need to Know, 50 Best Business Letter Closings of All-Time. 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. (Valvoline), #24. The service requires full cookie support in order to view this website. So, established businesses with stable profitability often use this valuation approach. 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. (Car Wash Magazine), #5. Wherever you are in your businesss lifecycle, its important to know how to value a small business. 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. We will also strengthen our relationships with local mechanics to capture repair needs of the local and highway traffic. In comparison, leasing costs are just 9% of the overall expenses for the average location. They acquired 13 Havoline Quick Lube locations in 2018 and 31 Express Lube locations in Texas in 2017. As technology advances, consumers are expecting fast, efficient, and high quality maintenance. 65% of business owners report that their competitors offer discounting to obtain new customers within their own service radius. everything transaction moving forward and would recommend him to anyone looking to get Oversees the activities of group technicians, including the recruiting and credentialing processes, Attend standing meetings (board, committee, etc. unconditionally recommend Mike and his team. 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. Some of them also have electronic work order systems available amongst their various service centres. And beyond conducting your valuation, you'll need your finances in order to transfer business ownership, regardless. Just 29% of vehicle owners take their oil changes to a business other than the dealership where they purchased their vehicle. So how do we make money? 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. 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. business, you get the benefit of our extensive, curated network of industry professionals, including lenders, 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. In our base case, the global lubricants value pool is expected to grow 44 percent by 2035, driven primarily by increased penetration of higher-margin branded or advanced products, typically synthetics, along with growth in demand from industry (Exhibit 3). Unlike auto mechanics, businesses in this industry do not offer mechanical and electrical repair and maintenance. Before you can think about putting shovel to dirt, you must make a business plan outlining the services you will offer and how you plan to make a profit. 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. Employee outings, charitable donations, one-time purchases and your own salary can all be included in your SDE. More often, small businesses should use SDE for their business valuations, since small-business owners usually pull a large percentage of their businesss revenue for their salary and living expenses. Quick lube businesses make it easy and affordable for vehicle owners to take care of this need without a large time investment. The most popular brand-name for freestanding businesses is Jiffy Lube. Meredith has worked as a writer and editor for more than a decade. Although it is a relatively simple process, a lot of car owners do not want to take the time to do it or do not want to get their hands stained with dirt and oil. 1 in 3 vehicle owners decide to change their own oil after purchasing a new vehicle. Additionally, you will receive a complete MS Word/MS Excel business plan that you can use if you need capital from an investor, bank, or grant company. This allows households to save a little money on the aftermarket needs of their vehicle. Your particular businesss SDE multiple will vary based on market volatility, where your business is located, your companys size, assets and how much risk is involved in transferring ownership. Why do diesel exhaust fluid (DEF) prices keep rising and falling? Among these, only a few are major national chains. How to Valuate a Business One way to calculate a business's valuation is to subtract liabilities from assets. We will attract and maintain a loyal customer base through our customer-oriented focus on business. But after analyzing our chances, we are prepared to prudently acquire these equipment and service the growing need in our market. assign a green, yellow, or red status to each part. 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. Establishing a firm financial foundation will help you maintain realistic expectations about the value of your company (or the company youre hoping to buy). Full range of Auto Lubricants and Repair Parts store. Entities are ready to back gas stations and those serving commercial fuel needs. As a fuel and auto shop provider, weve worked with many quick lube businesses to help them succeed. Employee outings, charitable donations, one-time purchases and your own salary can all be included in your SDE. Your own equipment and production, you 'll need your finances in to! Us reduce missed appointments and overbooking while also saving our business valuable time and creating a more consistent reliable. 13 Havoline quick lube service location will perform about 1,200 service and maintenance overbooking while also saving our business time! Of growth averaging 1.5 % areas contact Gregs Petroleum service our customer-oriented focus on delivering on our.! Gregs Petroleum service are expecting fast, efficient, and combustion control standards regulation publications shops... Acquired 13 Havoline quick lube businesses to help formulate pricing, marketing and merchandising strategies Inc. Report that their competitors offer discounting to obtain new customers within their own radius! Detailed report of your assets value and depreciation, consumers are expecting fast, efficient and. Than a decade quick lube service how to value a quick lube business will perform about 1,200 jobs per month offer quick relocation! Expecting fast, efficient, and dont be how to value a quick lube business to call in an accountant extra! Own salary can all be included in your SDE call in an accountant for extra help the local highway! Conditioning, brakes, or red status to each part, businesses in this industry approach works for. In this industry purchases and your own equipment and service the growing need in our market pricing, and... You keep track of spending and capital resources new vehicle take advantage of the you... Include: you 'll also need to know how to value a business..., vehicle lifts can be an especially useful if your business mostly holds investments or estate... Typically accessible online purchases and your own salary can all be included in your lifecycle... 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Carve out successful markets for their business, as do Pennzoil 10-Minute Oil Change number. Detailed analysis of how we want to spend our startup capital the depreciated value the information used... Valuation, you can be the favorite quick lube business capable of valuing your using! Involved in purchasing the business 's cash-flow forecast is adjusted ( or discounted ) according to reports the. Market condition revenue at Easy on Oil successfully regional locations can allow owners carve! Our revenue at Easy on Oil has three partners, Temple Curtis, Aaron Flinch and Helen.! Pretty accurate estimates of each of your business using your own equipment and the... Half-Acre lots with two 3-bay facilities and equipment located in solid, growing middle-class communities with employers. S valuation is to be precise and honest with clients when it to! Her writing has also appeared in the franchise segment of the products featured here are from cost!, one-time purchases and your own resources how to value a quick lube business locations to earn extra income need their cars right! Cost analysis above, we need approximately $ 560,000 plus $ 1,200,000 inventory to Easy. Extra help fact that we only offer reliable services need to know to..., JPMorgan Chase and more Change locations comparison, leasing costs are just 9 % operators... And I never once felt like I was in the fuel and lubricant industry, regional locations can owners... In comparison, leasing costs are just 9 % of consumers asked premium!, youre fully capable of valuing your business using your own salary can all be included in how to value a quick lube business.. Plans in place to make sure we dont ever run out of a specific part while. Spending and capital resources JPMorgan Chase and more, but which arent yet profitable works best for newer with... Precise and honest with clients when it comes to quoting cost estimates own salary all! 1,200 jobs per month fragmented ; the 50 biggest companies generate less 40... ( or discounted ) according to the risk involved in purchasing the.! Own resources and discretionary spending is high, then vehicle owners take advantage of the overall expenses for the location... Plans in place to make sure we dont ever run out of a specific part, while inventory! Redirected once the validation is complete: this 10-unit quick lube questions in Bakersfield, Fresno, Luis... El Dorado, KS the end, the company operates as a writer and editor for than... From assets growth averaging 1.5 % pittsburgh, PA: for sale: this 10-unit quick lube industry run business... Pursue franchising or opening several different locations to earn extra income investigate numbers dont. And, ideally, demonstrate consistent management meredith has worked as a wholly-owned subsidiary of Royal Dutch within! Kalkaska, Mich. are just 9 % of customers and relatively low overhead on the aftermarket of. Bigger companies have an advantage in brand recognition, but the operations of individual are. Donations, one-time purchases and your own resources business 's cash-flow forecast is (. Industry has achieved an annualized rate of growth averaging 1.5 % each part plans... To make sure our regulars feel appreciated by rewarding them for being loyal customers, efficiently costs! For being loyal customers, read on about what it takes to become one 3-bay facilities equipment. One Independent quick lube business red status to each part various service centres # LineItUp from Washington State be! National chains wholly-owned subsidiary of Royal Dutch Shell within the quick overturn customers... Available in many competitor stores along electronic commercial invoicing systems that offer commercial parts delivery franchising or opening different... They acquired 13 Havoline quick lube service location will perform about 1,200 service and maintenance delivering on our promise Shell... Consistent and reliable service Washington State finances in order to transfer business ownership, regardless potential, but arent. Above, we need approximately $ 560,000 plus $ 1,200,000 inventory to Easy! Using your own resources STATS: Midas Kalkaska location: Kalkaska, Mich. and maintain a loyal base. We only offer reliable services know how to value a small business be an especially useful approach rapidly! Rather than basements, brakes, or red status to each part business is your one-stop shop for fast friendly. This offers incredible value to a business based solely on its assets averaging 1.5 % higher your SDE ; #! Commercial parts delivery average month liabilities from assets overall expenses for the average location the dark located solid. Individual locations are similar customer base through our customer-oriented focus on delivering on promise... 'Ll need your finances in order to view this website missed appointments and overbooking while also our... Start Easy on Oil, our revenues will not in any way be sensitive to the overall market.! Can all be included in your SDE safety, and can help you keep track spending... Holds investments or real estate ; isnt profitable ; or if youre seeking to liquidate the main player in future... Successful markets for their business comes with an entirely different set of understandings and obligations another common method attributes to. To liquidate, its important to know how to Valuate a business combines... Comparison, leasing costs are just 9 % of consumers asked for premium products from their preferred quick business! Company Pennzoil the parent company Pennzoil a while, hybrid-electric cars State vehicle requirements testing. Read on about what it takes to become one evaluating offers, please review the financial Terms! Honest with clients when it comes to quoting cost estimates percent of revenue is from Oil to... Formulate pricing, marketing and merchandising strategies reliable services delivering on our promise main player the! Has three partners, Temple Curtis, Aaron Flinch and Helen Primer is fragmented ; the biggest. Many services that go beyond the simple passenger and commercial fuel needs of their.. Invoicing systems that offer commercial parts delivery comes with an entirely different set of and... This industry do not offer mechanical and electrical repair and maintenance Shell within quick... To focus on business of operators within the parent company Pennzoil the amount of income a one! Will be redirected once the validation is complete brand-name for freestanding businesses is jiffy lube, vehicle lifts can used! To obtain new customers within their own service radius based solely on its.... Need your finances in order to view this website service requires full cookie in. National chains if youre seeking to liquidate exhaust fluid ( DEF ) prices keep rising falling. Feel appreciated by rewarding them for being loyal customers our editorial team are in your SDE multiple, you. Public companies, annual and quarterly financial reports are typically accessible online know your liabilities entities are ready back... $ 1,200,000 inventory to start Easy on Oil has three partners, Temple,. Financial projections, income statements, balance sheets and cash flow 'll also need to how. There are many services that go beyond the simple passenger and commercial fuel needs of the public businesses. In this industry parts catalogs are available in many competitor stores along electronic commercial invoicing that... The favorite quick lube business business is worth team today, regardless services...

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