Garage Services business - how's the future?

[YRRunner]

I'm considering buying a 20 year established, local garage services business. Other than being a parts assistant manager in a motor factors and tyre/exhaust specialist in a past life (35 years ago), I have no other engineering or mechanical "hands on" knowledge. In fact, I'd go as far as to say I'm pretty cack-handed when it comes to DIY of any kind. The business seems to do ok and has obviously established a lot of customer loyalty over the years being family run. It also has a small van rental business bolted on, plus a valeting service. Turnover circa £275k p.a., Gross £137k, net not divulged as yet. Rental vehicles leased. 3 bay industrial unit is rented at £15k p.a. including garage equipment.

I have experience in many different service orientated businesses (restaurants, care, business development) so this doesn't scare me at all, in fact it excites me to be involved in an industry I have a healthy interest in. The business appears to have good mechanics on site, so I envisage my involvement to be in "back of house" financial management, strategic development and client relations.

My question to any garage owners out there is.....
Given the evolution of modern cars these days, with their sealed this and sealed system that, hybrids, complex computer management etc., etc., how do you honestly feel the future of garage services looks? I am not looking or needing to take a fortune out of it based on the figures I have so far, but a small salary and the ability to have it run my race car would suffice.

Any thoughts and advice greatly received. Possible pitfalls or things I should be looking closely at would be very helpful.

Edited by YRRunner on Wednesday 5th November 14:14

[Bernieb]

Go work there for a month see what you think ?

[Frimley111R]

Cars still have metal engines working the same way, brakes, driveshafts, interiors, wheels etc that remain unchanged

[YRRunner]

Bernieb said:

Go work there for a month see what you think ?

I had thought of putting this to the sellers. I suspect they would want a non refundable down payment before letting somebody they don't know start being that close to the operation. I've known potential buyers of restaurants do this, then take away what they learned and start up themselves in direct competition!

[confused_buyer]

There is a good future for garage services for those who invest in skills and technology to cope with modern cars.

The constant complaint of customers with many garages is that they cannot diagnose and fix things. This is usually because they do not have the equipment or more often the skills to use it.

Too many garages think diagnostic skills is buying a Snap On reader and googling the codes (honestly, this happens a lot).

Good garages can have their staff on courses several days in every month. The public respond to this because although they might be a bit more expensive the car comes back fixed and customers eventually realise it is cheaper to pay a decent garage £60 an hour which takes 2 hours to fix something rather than someone £40 an hour for 5 hours which still leaves the fault present.

Of course, the issue with investing money in this is that if your staff have no long term interest in the business eventually they will up and leave with all their skills you've paid for and start up around the corner. If you're not even remotely hand-on you might be better ensuring at least one mechanic who is has an interest in the business as a partner.

[technodup]

I've got a couple of garages as clients and I've wondered the same. I suppose the future will depend on what we end up with as the dominant tech; electric; hydrogen; hybrid? Echo the point on diagnostics, there are apparently only two garages in Glasgow with the latest tech and staff, the others outsource to them. Opportunity there.

I am sure that bodyshops will feel more of the strain more quickly. Seeing as parking sensors, radar cruise, auto stop, lane assist, self parking etc are all here already and will filter down quickly I can't see how a typical bodyshop will be around in ten years if cars aren't crashing into one another. There's only so many nutters throwing paint stripper on cheating partners cars.

[Simpo Two]

There are two independent garages near me and both are always busy. Dealer prices are so stupid that there's plenty of room for a good indy IMHO.

[Keep it stiff]

Don't overlook quality control. Many small business work best because the owner is also the doer and with expansion owners very often keep less experienced employees under their wing. As you are not a spanner man yourself I suggest you take a careful look at the staff you will be taking on, your success will be in their hands.

As to the future of independent outlets, I would have no worries on that score.

[JimmyConwayNW]

I think a lot of garages are run by mechanics who aren't neccasarily business men.

Few garages open 7 days or beyond 5/6pm.

I think poor communication with customers and letting customers know progress is being made would offer a big bonus in a small indie garage. van rental side could be grown to. Sounds like it has lots of potential.

[GuinnessMK]

Bear in mind you'll be in a potentially difficult position with the existing mechanics.

They'll see you as the new money, but with no skills, so there is the potential for a dispute to arise. I know a guy in a similar situation who felt he had to give his mechanics a pretty sizable raise to keep them on board.