Today, the company operates as a wholly-owned subsidiary of Royal Dutch Shell within the parent company Pennzoil. Let's #LineItUp from Washington State! Please enable JavaScript on your browser and try again. Home Statistics 25 Quick Lube Industry Statistics, Trends & Analysis. Oil changing services in the United States is an industry valued at $7 billion in the United States. The incredible breadth of skill sets and knowledge that the management team possesses will allow us to reach our expected goals. Every state has a different process when it comes to business licensing. Most locations achieve this figure with just 2-5 service bays available to them. 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. Our partners cannot pay us to guarantee favorable reviews of their products or services. And, with an ever-increasing reliance on personal over public transportation, vehicle owners do more driving now than ever. Joe handled every aspect and obstacle that presented itself throughout the sales About 70% of the revenues generated by the average quick lube location come from oil changes when multiple services are available for consumers. Why do diesel exhaust fluid (DEF) prices keep rising and falling? (Digital Dealer), #20. 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. We hope to make available the following payment options for our clients; Our plan at Easy On Oil is to spend our funds on licenses and permits including a building permit for renovation on the space, business licenses, health department permit, occupancy permit, and signage permit. 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 more thorough you are in this step of the valuation process, the more confident youll be in your calculations. Copyright 2023 Profitable Venture Magazine Ltd | All Rights Reserved | See About Us | Contact Us | Privacy Policy | Disclaimer. Live for the first time at our partner ilani Casino! 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. Home Business Plans Automotive Sector. Franchised Oil Change & Repair Shop in Solano County. If YES, here is a sample Quick Lube business plan template & feasibility report. Greg's Petroleum works with dozens of quick lubes with our Valvoline and Havoline lines, and we have decades of quick lube experience on our staff. Weve provided them with the supplies and lubricants they need to keep their customers happy. From our detailed research, we hope that provisions for ongoing expenses are adequate to meet our needs as the business generates cash flow sufficient to support operations. Industry Overview 2. Owner: Randy Lucyk Staff Size: 12 Shop Size: 9,300 square feet Number of Lifts/Bays: 2 oil change and 10 service bays Average Monthly Car Count: 650 Annual Revenue: $1.78 million. 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. Subscribe to our Blog. Do not sell or share my personal information. Maintaining the website with new trends and advises. OK92033) Property & Casualty Licenses, NerdWallet | 55 Hawthorne St. - 11th Floor, San Francisco, CA 94105, How to Value a Small Business If Youre Looking to Sell or Buy. Over half of these competitors offer both auto repair services, although without an inventory store. ", 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. One Independent Quick Lube w/RE in East-Central South Dakota! into the automotive business. The most popular brand-name for freestanding businesses is Jiffy Lube. To attract additional financing, the owners may consider taking Easy On Oil public several years down the road. (IBIS World), #3. In 2013, there were an average of 37.8 vehicles serviced per location, with 32.9 oil changes performed per day. Rounding out this list includes establishing solid relationships with your vendors and distributors, hiring the right people, and promoting your business. This offers incredible value to customers who need their cars fixed right away. Car owners instead prefer to pay someone else to do it for them. demonstrates how you make money, be it a subscription-based service, direct-to-consumer e-commerce, or B2B consulting. Order Reprints. 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. Major companies include Jiffy Lube, Pennzoil 10-Minute Oil Change, Valvoline Instant Oil Change, and Texaco Xpress Lube. In order to see how electric cars are impacting the future of the automotive repair industry, it is important to understand how they work in the first place. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. Performing services on brake systems to coolant flushes. All these were analysed based on per-unit revenue, per-unit cost, and fixed costs. Updates job knowledge by participating in educational opportunities; reading technical and regulation publications. (Car Wash Magazine), #11. 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.). However, youre fully capable of valuing your business using your own resources. In any of those cases, buyers will be interested in the individual value of your investments or equipment. unconditionally recommend Mike and his team. Along with hybrids, all-electric cars are taking to the streets across the world. Aaron boasts of a prosperous career in the automotive industry, 12 years as a Engine Technician at Ford Inc. Lastly, Helen brings 8 years of finance and administration experience. This influences which products we write about and where and how the product appears on a page. Also our plans to make sure we maintain a referral network will give us the needed push in the industry. Large businesses generally use EBITDA calculations to value their businesses, and small businesses typically use SDE, since small-business owners often expense personal benefits. From our cost analysis above, we need approximately $560,000 plus $1,200,000 inventory to start Easy On Oil successfully. 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. These systems gather sales and gross profit data by a stock-keeping unit from each store on a daily basis. Unlike EBITDA, though, youll also add back in the owners salary and owners benefits into your SDE calculation. 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. Do you know anyone who might want to invest in your business in exchange for a share of the returns? 3. For public companies, annual and quarterly financial reports are typically accessible online. And beyond conducting your valuation, you'll need your finances in order to transfer business ownership, regardless. (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.). As revenues have increased, however, net profits have decreased by 2.3%. 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. 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. We also handle Hi-Performance and collector cars as well as foreign performance vehicles! Check out our Website for Services and Coupons! Driving up to a quick lube business for routine maintenance that can be completed quickly saves consumers time and money. 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. 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. 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. (If you used EBITDA to value your business, youll use an EBITDA multiple.) to post every listing on the site. 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. (Thats why this number is subtracted from the SDE in valuation calculations.) You should also look for business plans that clearly outline processes and, ideally, demonstrate consistent management. 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. Executive Summary 3. Particularly if this is your first company, or if you run a family-owned and operated business, take care to approach valuation as objectively as possible to come to an accurate number. Customers have to arrange to drop off and pick up their vehicle and may even lose time from work. ), 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. Make sure your company checks these three boxes: You make steady profits. Regardless of the option you pursue, get the word out with our help. Discounted cash flow method: This method determines the present value of a business's future cash flow. As 2018 kicked off, Jiffy Lube launched a new brand extension. At the end, the information is used to help formulate pricing, marketing and merchandising strategies. Mike has been instrumental in helping me successfully complete 4 transactions (both Over the long-term, the transition to a more Quick Lube-focused model will make Valvoline a safer and more profitable business. With the Multicare brand extension, Jiffy Lube is focusing on rolling out brake, diagnostic - and eventually tire - services to its customers. But if you have more financial information on hand, you can try a more comprehensive business valuation tool that includes both profit and revenue, as well as assets and liability, in the calculation. (IBIS World), #2. 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. Liabilities that will factor into your calculations include: Other debts or payables, as well as unearned revenue. Most of our competitors have adopted point-of-sale systems in their stores. 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. That said, doing the math is free, so go ahead and plug your earnings numbers into different formulas and compare. We believe that this market is always on the lookout for high quality, rapid service with as much convenience as possible. Bigger companies have an advantage in brand recognition, but the operations of individual locations are similar. Note that industry operations are labor-intensive: annual revenue per employee is just $60,000. (Business Wire), #15. In fact, most quick lube operators choose to franchise for this reason. If so, read on about what it takes to become one. (Business Wire), #16. Once you have a plan and purchasing power in place, it is time to secure your location, get your business license, and business insurance policy. We will attract and maintain a loyal customer base through our customer-oriented focus on business. 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. Some locations may provide additional vehicle maintenance services, such as radiator flushes, brake line cleaning, and power steering fluid flushing. So, most hybrid-electric cars do not ever run on electricity alone. One common method used to value small businesses is based on seller's discretionary earnings (SDE). It can gather data to . Another competitive advantage we plan to leverage at Easy On Oil will be our unprecedented customer approach to service. Before buyers can confidently make an offer on a business, theyll need to become well-versed (if not an expert) on that businesss industry. 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. To start off, there are two major types of electric cars that are on the roads today. It's called Jiffy Lube Multicare. 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. Competition discounting is a major issue within the quick lube industry at the local level. Plus, its crucial to demonstrate to potential buyers how your business will continue to grow and turn a profit. The higher your SDE multiple, as you might expect, the more your business is worth. Operating expenses and labor are the two largest costs facing the quick lube industry. Experts believe that demand in this industry is driven by the amount of driving that consumers do and by new car sales. Check out the ACS reviews left by our clientele. Figure 1: VVV's Segment Operating Income Since 2015. Jiffy Lube has the most locations in the United States for the quick lube industry, with over 1,900 facilities as of February 2017. 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. We plan is to grow sales through word-of-mouth. 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