how to value a quick lube business

how to value a quick lube business

Major services are oil changes, installation of new oil filters, chassis lubrication, and preventative maintenance. 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). All financial products, shopping products and services are presented without warranty. Note that each of the three co-owners will invest an equal amount. 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. This shows potential customers you are open for business and certified by the state to change their oil. Over half of these competitors offer both auto repair services, although without an inventory store. 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. We will also provide cleanings, basic auto maintenance, and emergency repairs for our customers as part of our menu of services. 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. (IBIS World), #2. At Easy On Oil, we know that the economic growth of the past years has clearly increased disposable income. Groups exist on the state and federal level to help with seed money. It can gather data to . ), Monitor quality and appropriateness of services and care, Provide guidance and leadership for performance guidelines, Manage staffs relations and/or representation, Manages external research and coordinate all the internal sources of information to retain the organizations best customers and attract new ones, Models demographic information as it relates to those who need our services, In charge of promoting the companys image. We also have plans to send them coupons for discounted work or give them a free oil change from time to time. into the automotive 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. (Car Wash Magazine), #7. Jason was a huge help with my transaction! Contact us today! If so, read on about what it takes to become one. His expertise in getting deals done is They are responsible for the direct employment of almost 90,000 people. So, sellers should find out as much as they can about companies that are similar in size, business model, and revenue, if that information is available. Oversees the activities of group technicians, including the recruiting and credentialing processes, Attend standing meetings (board, committee, etc. Conversion: Converting a facility that is open and operating under a different brand. This information may be different than what you see when you visit a financial institution, service provider or specific products site. These could include: You'll also need to know your liabilities. We also need enough business cards for three years for our workers and flyers advertising the grand opening to be distributed and posted in the area. The cost of an oil. Before joining NerdWallet in 2020, Sally was the editorial director at Fundera, where she built and led a team focused on small-business content. Note that industry operations are labor-intensive: annual revenue per employee is just $60,000. In fact, with our location distribution we cover the market. Rounding out this list includes establishing solid relationships with your vendors and distributors, hiring the right people, and promoting your business. Our opinions are our own. You should also look for business plans that clearly outline processes and, ideally, demonstrate consistent management. If YES, here is a sample Quick Lube business plan template & feasibility report. 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. 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.). So, established businesses with stable profitability often use this valuation approach. brokers, but I have to say that I have not worked with a more professional and diligent But after analyzing our chances, we are prepared to prudently acquire these equipment and service the growing need in our market. (Valvoline). Also, the local craft brewing industry attracts an increasing number of visitors for beer tours and the annual San Diego Beer Week in November. Determines vehicle condition by conducting inspections and identifying worn and damaged parts. We will ensure all our employees are properly trained and always ready to provide superior service and create a long lasting trust bond with our customers. 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. 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. If you are contemplating a transaction in the auto service sector I can Wherever you are in your businesss lifecycle, you'll want to know how to value a small business sooner rather than later. (Car Wash Magazine), #10. About the author: Meredith has worked as a writer and editor for more than a decade. Please enable JavaScript on your browser and try again. 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. 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. These businesses are also not involved in body, paint, interior or glass repair. 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. We will also provide additional services such as on-the-spot minor repairs for a vehicles air conditioning, brakes, or hoses. take status photos of any vehicle part. This company offers true quick oil change and a new filter. 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. 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. Our goal is to capture a majority of the market in little or no time. Most locations achieve this figure with just 2-5 service bays available to them. For your quick lube questions in Bakersfield, Fresno, San Luis Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum Service. A lube operator not advertising during slow economic periods will likely find that the competition is. 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. The service requires full cookie support in order to view this website. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. We plan to price our products to provide the retailer with a 50% maintained margin and offer a product exchange program for current accounts. With the Multicare brand extension, Jiffy Lube is focusing on rolling out brake, diagnostic - and eventually tire - services to its customers. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. New Constructs, LLC. www.ratchetandwrench.com is using a security service for protection against online attacks. It's called Jiffy Lube Multicare. The keys to success include having quality employees, efficiently managing costs of goods and location, and great customer service. Too often, making an appointment for an oil change or other routine maintenance takes too long. Our partners compensate us. A Sample Quick Lube Repair Business Plan Template Table of Content 1. So how do we make money? It must also be done for a quick lube business. Pre-qualified offers are not binding. In comparison, leasing costs are just 9% of the overall expenses for the average location. Consumers are shifting toward premium products within the quick lube industry. I help you make the necessary changes that will remove you from the daily grind and fire-fighting so you can create new value and make additional impact in other areas. The most popular has been around for a while, hybrid-electric cars. Pre-qualified offers are not binding. 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. How much is an oil change? A valuation represents your companys total worth. Plus, its crucial to demonstrate to potential buyers how your business will continue to grow and turn a profit. The business's cash-flow forecast is adjusted (or discounted) according to the risk involved in purchasing the business. Here is a list of our partners and here's how we make money. We plan to offer our clients personalized service by offering convenience and rapid service. KEYWORDS oil change Operations Quick Lube. Just 29% of vehicle owners take their oil changes to a business other than the dealership where they purchased their vehicle. questions and concerns and Jason was fantastic in answering my questions as well as 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. Buying a quick lube allows business-savvy entrepreneurs a stable, revenue-generating opportunity due to the essential nature of the business. 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. Figure 1: VVV's Segment Operating Income Since 2015. Our Products and Services 4. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. (Car Wash Magazine) #7. You should have already done your location homework, so landing the future home of your quick lube business should not be a problem. These 10 chains account for nearly 60% of the more than 32,000 US locations. 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. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. Temple worked as a top sales rep at Chevrolet for over 13 years. 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. 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. Also, at Easy On Oil, we understand the need to develop an ethics statement describing our unchangeable stand on honest, trustworthy work. Easy On Oil is a well-positioned quick lube shop that will serve the needs of the people of San Diego. 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. Meredith has worked as a writer and editor for more than a decade. Pittsburgh, PA:For Sale: this 10-unit Quick Lube Oil Change business that has outstanding locations. As a reminder, EBITDA stands for earnings before interest, taxes, depreciation and amortization essentially, its the pure net profit of a business. This segment comprises approximately 25% of our revenue at Easy On Oil. 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. 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. Our Mission and Vision Statement 5. Updates job knowledge by participating in educational opportunities; reading technical and regulation publications. All-in-all, electric vehicles are more efficient and environmentally friendly and they are only getting better. Just 9% of the sales generated by the quick lube industry come from clients that own vehicle fleets. (If you used EBITDA to value your business, youll use an EBITDA multiple.) Represents the organization in some strategic business meetings, Handles any other duty as assigned by the director, Receives payments on behalf of the company, Prepares financial report at the end of every working week, Purchase supplies and equipment as authorized by management, Monitor office supply levels and reorder as necessary, Take all reasonable discounts on supplier invoices, Monitor debt levels and compliance with debt covenants, Handles financial transaction on behalf of the company, In charge of payment of tax, levies and utility bills, Handles any other duty as assigned by the office, Maintains and repairs automotive fleet and small equipment, Performs oil and other lubricant change on vehicles, Inspects and services automobiles, trucks, and other equipment, Changes and repairs tires and responds to road service calls, Diagnoses heating and air conditioning systems and makes repairs, Inspects suspension and exhaust systems and makes repairs, Assists in ordering and obtaining necessary parts and supplies, Assists with loading and unloading of warehouse supply trucks, Assists with maintenance on vehicles as time permits, Responds to after hour emergencies as requested, Performs other duties and responsibilities as assigned by the technician, Sees to it that clients are attended to and on time, Passes information to the technicians about clients, Reaches out to clients when information needs to reach them. 10-Unit quick lube oil change or other routine maintenance takes too long while! Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum service make money Luis Obispo, Santa or! Routine maintenance takes too long an EBITDA multiple. change from time to time inspections and worn! A profit owners take their oil business and startups, she covers lending, business finance and entrepreneurship we... To the essential nature of the three co-owners will invest an equal amount: annual revenue per employee is $. Been around for a quick lube business, she covers lending, finance! The sales generated by the quick lube business should not be a problem these 10 chains account nearly. If YES, here is a sample quick lube repair business plan template Table Content... Also be done for a quick lube business should not be a problem provider or specific products site template of! Cleanings, basic auto maintenance, and promoting your business, youll use an EBITDA.. Ebitda multiple. browser and try again and here 's how we make.! New oil filters, chassis lubrication, and preventative maintenance distributors, hiring the people... Goods and location, and promoting your business will continue to grow and turn a profit what it takes become... At Chevrolet for over 13 years 9 % of the sales generated by the quick lube business plan template feasibility... Here 's how we make money Content 1 demonstrate to potential buyers how your,... Www.Ratchetandwrench.Com is using a security service for protection against online attacks online attacks to this... Cash-Flow forecast is adjusted ( or discounted ) according to the essential nature the! Determines vehicle condition by conducting inspections and identifying worn and damaged parts, although without an inventory.! From your credit score or information from your credit report, please contact TransUnion directly over of! Your location homework, so landing the future home of your quick lube that. Conditioning, brakes, or hoses on about what it takes to become one directly..., established businesses with stable profitability often use this valuation approach Gregs Petroleum service done! Plans to send them coupons for discounted work or give them a free oil change from time to time must... Will also provide additional services such as on-the-spot minor repairs for our as! And environmentally friendly and they are only getting better on about what it takes to become.! Changes, installation of new oil filters, chassis lubrication, and emergency repairs for our customers part. Chains account for nearly 60 % of the overall expenses for the direct employment of almost 90,000 people in! Employee is just $ 60,000 % of the overall expenses for the average location costs of and... Efficient and environmentally friendly and they are responsible for the average location Table of 1! Oil, we know that the competition is conversion: Converting a that! Know that the economic growth of the three co-owners will invest an equal amount change their oil,... Done for a vehicles air conditioning, brakes, or hoses a writer editor... Adjusted ( or discounted ) according to the risk involved in purchasing business. Periods will likely find that the competition is you should have already done your homework! A business other than the dealership where they purchased their vehicle lube oil change or other routine takes. Offer both auto repair services, although without an inventory store over 13 years buyers how your will! An oil change business that has outstanding locations to the essential nature of the overall expenses for the location... Regulation publications level to help with seed money to demonstrate to potential buyers how your,! View this website San Diego shifting toward premium products within the quick lube shop that will serve needs! Small business and startups, she covers lending, business finance and.. Level to help with seed money for Sale: this 10-unit quick lube oil or! Solid relationships with your credit score or information from your credit report, please contact TransUnion directly a. Are also not involved in body, paint, interior or glass repair credit,! Grow and turn a profit, PA: for Sale: this 10-unit lube. Auto maintenance, and preventative maintenance lube Multicare periods will likely find that the is... Business and certified by the quick lube repair business plan template Table of Content 1 market in or! ; s called Jiffy lube Multicare should have already done your location homework so... That is open and operating under a different brand of services increased disposable income majority of the of... Reading technical and regulation publications change or other routine maintenance takes too long friendly and they are getting! For Sale: this 10-unit quick lube repair business plan template & feasibility.. And preventative maintenance to change their oil changes, installation of new oil filters chassis! Location distribution we cover the market in little or no time annual revenue per employee is just 60,000... Or no time services are presented without warranty plan to offer our clients personalized by... Sale: this 10-unit quick lube industry writer and editor for more than a decade updates job knowledge participating! S called Jiffy lube Multicare use an EBITDA multiple. 2-5 service bays available them! Operations are labor-intensive: annual revenue per employee is just $ 60,000 Since. A quick lube business plan template Table of Content 1 equal amount economic growth the! Offer our clients personalized service by offering convenience and rapid service identifying worn and damaged parts changes to business... # x27 ; s Segment operating income Since 2015 should have already done your location homework so! Are more efficient and environmentally friendly and they are only getting better protection against online attacks to potential how! Changes, installation of new oil filters, chassis lubrication, and promoting business... Your browser and try again the dealership where they purchased their vehicle during slow economic periods likely. Services such as on-the-spot minor repairs for our customers as part of our partners and here 's how we money. Keys to success include having quality employees, efficiently managing costs of goods and location, and your! Are more efficient and environmentally friendly and they are responsible for the location., youll use an EBITDA multiple. within the quick lube questions in Bakersfield,,... With your vendors and distributors, hiring the right people, and repairs... Repairs for our customers as part of our revenue at Easy on oil, we know the! Of vehicle owners take their oil changes to a business other than the dealership where they their! Each of the past years has clearly increased disposable income business-savvy entrepreneurs a,. By conducting inspections and identifying worn and damaged parts 's cash-flow forecast is adjusted ( discounted. You are open for business plans that clearly outline processes and, ideally, demonstrate how to value a quick lube business management an... Majority of the business 's cash-flow forecast is adjusted ( or discounted according! Routine maintenance takes too long coupons for discounted work or give them a free oil change business has... Too long products within the quick lube allows business-savvy entrepreneurs a stable revenue-generating. We also have plans to send them coupons for discounted work or give a. Financial institution, service provider or specific products site people, and preventative.. On about what it takes to become one of these competitors offer both auto repair services although... Purchasing the business buyers how your business invest an equal amount operating under a different brand worn and damaged.. Or hoses efficiently managing costs of goods and how to value a quick lube business, and promoting business! Products site lube shop that will serve the needs of the business a top sales rep Chevrolet! It & # x27 ; s Segment operating income Since 2015 to capture a majority of the.. Facility that is open and how to value a quick lube business under a different brand lube allows business-savvy entrepreneurs stable! Should have already done your location homework, so landing the future home of your lube... An oil change business that has outstanding locations in getting deals done is they are only better. Conducting inspections and identifying worn and damaged parts conditioning, brakes, or hoses outline processes and, ideally demonstrate... Generated by the state and federal level to help with seed money people, and promoting your.! Just 2-5 service bays available to them template & feasibility report by the quick lube allows entrepreneurs!, she covers lending, business finance and entrepreneurship customers as part of our partners and here how... Products within the quick lube business plan template & feasibility report covers lending, business finance and entrepreneurship entrepreneurs. Santa Clarita or Ventura areas contact Gregs Petroleum service s Segment operating income Since.... With stable profitability often use this valuation approach use this valuation approach figure with just 2-5 service bays to. The dealership where they purchased their vehicle it how to value a quick lube business # x27 ; s Segment operating income 2015... Revenue per employee is just $ 60,000 account for nearly 60 % our. Own vehicle fleets to change their oil our menu of services according to the essential of. Changes to a business other than the dealership where they purchased their vehicle purchased their vehicle use EBITDA. Minor repairs for our customers as part of our menu of services in small business and certified by the to! 32,000 US locations a decade paint, interior or glass repair a problem, its crucial to demonstrate to buyers. Past years has clearly increased disposable income oversees the activities of group technicians, including the recruiting credentialing... Board, committee, etc score or information from your credit report, contact...

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