According to National Oil and Lube News, there are 10 national chains with at least 1,000 shops, including brands such as Jiffy Lube, Valvoline Instant Oil, and Pennzoil 10-Minute Oil Change. New Constructs, LLC. into the automotive business. But buyers arent exempt from this step in the process! Before buyers can confidently make an offer on a business, theyll need to become well-versed (if not an expert) on that businesss industry. Disclaimer: NerdWallet strives to keep its information accurate and up to date. The US automotive oil change and lubrication industry includes about 5,000 companies with combined annual revenue of about $5 billion. These conservative assumptions make for a more accurate estimate of real risk. This influences which products we write about and where and how the product appears on a page. Another common method attributes value to a business based solely on its assets. However, this does not influence our evaluations. This information may be different than what you see when you visit a financial institution, service provider or specific products site. First, though, you have to get your financial information in order. Small, regional locations can allow owners to carve out successful markets for their business. To reach our local customer base, we will employ a marketing manager. You have a loyal customer base. Approaches to a successful small-business evaluation. Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or 17% compounded annually. People are graciously buying cars and comfort. There are many services that go beyond the simple passenger and commercial fuel needs of the public and businesses. I went in for just an oil change and a lube, and I'll be taking all such . 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. Our partners cannot pay us to guarantee favorable reviews of their products or services. If youre interested in learning more about the automotive business buying process and how our expert Together with our team, these experts will help ensure you get the best 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. Quick lube stations provide services ranging from basic oil changes to transmission flushes and windshield wiper replacements. Next, you'll need to outline your business plan and model. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. Business model: Your business model demonstrates how you make money, be it a subscription-based service, direct-to-consumer e-commerce, or B2B consulting. No matter what, applications must be filled out and fees paid. At some point, every vehicle requires ongoing maintenance to keep it functioning properly. Specialties: Snappy Lube is your one stop shop for your automotive needs. 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. If you're selling, your prospective buyer will need to understand how you generate revenue and will continue to. Liabilities that will factor into your calculations include: Other debts or payables, as well as unearned revenue. As 2018 kicked off, Jiffy Lube launched a new brand extension. This means intellectual property, your production line, your delivery truck if its a part of your business, you'll either need to account for it as an asset or a liability. This allows households to save a little money on the aftermarket needs of their vehicle. Our opinions are our own. Keeps equipment available for use by completing preventive maintenance schedules; installing component and part upgrades; controlling corrosion; completing winterization procedures. 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. Major companies include Jiffy Lube, Pennzoil 10-Minute Oil Change, Valvoline Instant Oil Change, and Texaco Xpress Lube. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. Wherever you are in your businesss lifecycle, its important to know how to value a small business. Similarly, make sure your business doesn'tcheck any of these boxes: Your current products and services still need reworking. 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. This information may be different than what you see when you visit a financial institution, service provider or specific products site. In 2016, 45% of consumers asked for premium products from their preferred quick lube business. explaining everything in detail. Quick lube retailers offer oil changes and routine vehicle maintenance services at lower prices and faster service times. Read more. You should also look for business plans that clearly outline processes and, ideally, demonstrate consistent management. Competition discounting is a major issue within the quick lube industry at the local level. Marketing programs at lubes should be powerful and . More on liabilities in a bit. 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. With a national footprint of more than 2,000 franchisee owned service centers across the country, Jiffy Lube offers a range of services from oil changes and tire rotations, to everything in between. First, make a detailed report of your business assets and liabilities. (Statista), #21. Please enable JavaScript on your browser and try again. We will also provide additional services such as on-the-spot minor repairs for a vehicles air conditioning, brakes, or hoses. Put your license proudly on display at your business. Regardless of the option you pursue, get the word out with our help. Another 22% of operators combine automotive repair with quick lube services. 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. Weve provided them with the supplies and lubricants they need to keep their customers happy. Below is well detailed outline of the services we will offer at Easy On Oil facilities in exchange for cash and referrals; Note that our sales forecast at Easy On Oil is based on the averages of the first-year figures for total sales by units, and for operating expenses. As franchises in the industry go, Victory Lane keeps it simple. person. Buying a quick lube allows business-savvy entrepreneurs a stable, revenue-generating opportunity due to the essential nature of the business. Plus, its crucial to demonstrate to potential buyers how your business will continue to grow and turn a profit. Quick Lube operating income is up to $162 million TTM . 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. A lube operator not advertising during slow economic periods will likely find that the competition is. Jiffy Lube International. As we mentioned earlier, a businesss SDE multiple and the method of valuation varies according to a few factors, including the strength of the industry. Car owners instead prefer to pay someone else to do it for them. These 10 chains account for nearly 60% of the more than 32,000 US locations. 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. KEYWORDS oil change Operations Quick Lube. Pre-qualified offers are not binding. Keeps shop equipment operating by following operating instructions; troubleshooting breakdowns; maintaining supplies; performing preventive maintenance; calling for repairs. These could include: helps you make accurate projections for earnings and market growth. This company offers true quick oil change and a new filter. Unless youre a natural-born business or numbers person (or, say, an accountant), business valuation isnt the easiest process. Then, you can demonstrate to potential buyers what makes your business stand out. Note that convenience, steady referrals from local mechanics, and high quality, rapid service are necessary to capture this segment of the market. 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. The remainder of the required financing will come from a ten year Small Business Administration (SBA) loan and a short-term loan. second to none. Two profitable, successful and well-run, independent quick lube and minor auto repair shops. Why do diesel exhaust fluid (DEF) prices keep rising and falling? She is based in New York City. 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. The profitability of individual companies depends on convenient location and good marketing. 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. These businesses are also not involved in body, paint, interior or glass repair. Franchised Oil Change & Repair Shop in Solano County. About Your Results What often separates one lube shop from another is its creative marketing strategies. It is part of the San DiegoTijuana conurbation, the second-largest trans-border agglomeration between the U.S. and a bordering country after DetroitWindsor, with a population of 4,922,723 people. In comparison, leasing costs are just 9% of the overall expenses for the average location. Temple worked as a top sales rep at Chevrolet for over 13 years. Large businesses generally use EBITDA calculations to value their businesses, and small businesses typically use SDE, since small-business owners often expense personal benefits. Let's #LineItUp from Washington State! If so, read on about what it takes to become one. Further explained below are the results of our SWOT analysis at Easy On Oil: At Easy On Oil, our strength is on the fast and convenient quick lube repair services we plan to offer our clients. When it comes to all-electric cars, consumers either have an inexpensive car with very low range or a very expensive car with comparable range to an ICE car. 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. 65% of business owners report that their competitors offer discounting to obtain new customers within their own service radius. Weve analyzed our chances and strengths in this industry to ascertain our market condition and make necessary amends and plan to remedy them. There are many things that go into running a quick lube business, but there are three key items you should focus on if you want to retain customers. buying and selling) over the last 15 years. In the United States, about 450 million oil changes are performed each year. 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. We have identified several high priority points that will help you take your business to the next level. Valvoline Instant Oil Change locations number more than 1,000, as do Pennzoil 10-Minute Oil Change locations. The keys to success include having quality employees, efficiently managing costs of goods and location, and great customer service. Easy On Oil will be managed by its three founding partners. In total, Driven Brands has 1,100-plus locations across North America. Consumers are shifting toward premium products within the quick lube industry. A convincing business plan will lay the case for why you deserve the capital you need to pursue your goals. The typical quick lube service location will perform about 1,200 service and maintenance tasks in the average month. Small companies can compete successfully by owning favorable locations. For equipment or other depreciating assets, that value is usually somewhere between the sale price and the depreciated value. A Sample Quick Lube Repair Business Plan Template Table of Content 1. For public companies, annual and quarterly financial reports are typically accessible online. 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. Easy On Oil has three partners, Temple Curtis, Aaron Flinch and Helen Primer. We will create strong vendor relationships with the most reputable vendors in terms of shipping time of major parts. We believe that by establishing a strong customer relationships based on trust and integrity, we can benefit from a strong regular customer base and good referrals. Business plan: A strong business plan helps you make accurate projections for earnings and market growth. Driving up to a quick lube business for routine maintenance that can be completed quickly saves consumers time and money. Then, youll add back in any purchases that arent essential to operations, like vehicles or travel, that you report as business expenses. Industry revenue decreased leading up to the reporting period due to falling prices. 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. We will give a guarantee on all our repairs for a certain amount of miles or time. This method is especially useful if your business mostly holds investments or real estate; isnt profitable; or if youre seeking to liquidate. 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. Below is a detailed analysis of how we want to spend our startup capital. Cost of incorporating the Business $750. If you ever want to learn . Businesses in this industry are very important to the general automotive industry. 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. Owners of quick lube businesses benefit from the quick overturn of customers and relatively low overhead. #1. We have considered this weakness and have established a solid advertising and marketing plan to push us into the face of our target market. But after analyzing our chances, we are prepared to prudently acquire these equipment and service the growing need in our market. Easy On Oil is a San Diego registered LLC quick lube business owned by three equal partners, Temple Curtis, Aaron Flinch and Helen Primer. The scoring formulas take into account multiple data points for each financial product and service. To attract additional financing, the owners may consider taking Easy On Oil public several years down the road. 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. Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or . Additionally, franchising a business comes with an entirely different set of understandings and obligations. Make sure your company checks these three boxes: You make steady profits. 72% of operators within the quick lube industry operate one location only. Also, the local craft brewing industry attracts an increasing number of visitors for beer tours and the annual San Diego Beer Week in November. 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. Every state has a different process when it comes to business licensing. Performing services on brake systems to coolant flushes. Complies with federal and state vehicle requirements by testing engine, safety, and combustion control standards. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. 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. Maintaining the website with new trends and advises. Based on currently available information, Valvoline has a total of 1,595 system-wide stores. Live for the first time at our partner ilani Casino! On the sell side, a deep understanding of your industrys trends can help you reach an informed valuation that reflects your business assets as well as the current market. Joe handled every aspect and obstacle that presented itself throughout the sales (Business Wire), #16. It's called Jiffy Lube Multicare. effective manner and I never once felt like I was in the dark. Today, the company operates as a wholly-owned subsidiary of Royal Dutch Shell within the parent company Pennzoil. Implement an ongoing training program. Make sure they know by having your license visible front-and-center. Our Products and Services 4. Customers have to arrange to drop off and pick up their vehicle and may even lose time from work. Note that industry operations are labor-intensive: annual revenue per employee is just $60,000. Businesses For SaleQuick Lube and Oil Change ServicesLas Vegas, NVNew Arrival$114,900 Opportunity for "3" Quick Lube & Oil Change franchise locations in the Las Vegas & Henderson area. Remedy them: NerdWallet strives to keep its information accurate and up to $ in. Owners to carve out successful markets for their business Content 1 matter what, must. This weakness and have established a solid advertising and marketing plan to push US into the face of our market! 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