#1. For the average business, they account for 60.7% of total expenses. KEYWORDS oil change Operations Quick Lube. We plan to offer our clients personalized service by offering convenience and rapid service. 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. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. 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. This company offers true quick oil change and a new filter. (Car Wash Magazine), #7. Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or . This is where you come in! Businesses in this industry are very important to the general automotive industry. (Business Wire), #13. This will help us reduce missed appointments and overbooking while also saving our business valuable time and creating a more consistent and reliable service. Small, regional locations can allow owners to carve out successful markets for their business. Intangible assets are crucial to your SDE multiple, so its important to identify and record their estimated value. Next, you'll need to outline your business plan and model. Sample 1 Sample 2 Sample 3 Based on 6 documents Consumers are shifting toward premium products within the quick lube industry. 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. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. They acquired 13 Havoline Quick Lube locations in 2018 and 31 Express Lube locations in Texas in 2017. 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. The average revenues generated by a single location in the quick lube industry reached almost $765,000 in 2013. Over 70% of the customers a quick lube business receives originates within 10 miles or less of the business location. Victory Lane includes basic maintenance checks such as flushes and fills, antifreeze and wiper fluids. The quick lube business may thrive on customer turnover, but quality, efficient service is what brings customers back to their favorite quick lube shops again and again. If youre interested in learning more about the automotive business buying process and how our expert Joe handled every aspect and obstacle that presented itself throughout the sales Conducting a valuation is an excellent opportunity to assess the financial health and potential of your business, or of a business youre hoping to buy. person. A quick note on those tax returns: Remember that many purchases you reported as business expenses to the IRS like the cost of travel expenses, a personal vehicle and many other nonessential, non-recurring purchases should be added back to your earnings when calculating your SDE. For equipment or other depreciating assets, that value is usually somewhere between the sale price and the depreciated value. "Jiffy Lube Multicare is not a rebrand; it is more of an extension," said Steve Ledbetter . At Easy On Oil, we will differentiate ourselves by not only offering oil change or other automotive maintenance services, but by also providing customers with a stocked lubricant and parts store. Each uses a different aspect or variable of a business to calculate its numerical value either a businesss income, assets, or using market data on similar companies. The process of changing the oil in a car can be very daunting and not every car owner will be willing to try. (Digital Dealer), #18. Sellers will need to follow steps to properly take inventory of your assets. Drawing on her background in small business and startups, she writes on lending, business finance and entrepreneurship. Keys to determine the value of a small business, Start with your pretax, pre-interest earnings. December 16, 2021. So, most hybrid-electric cars do not ever run on electricity alone. Wherever you are in your businesss lifecycle, you'll want to know how to value a small business sooner rather than later. 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. Order Reprints. Our opinions are our own. The business's cash-flow forecast is adjusted (or discounted) according to the risk involved in purchasing the business. 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. Unlike auto mechanics, businesses in this industry do not offer mechanical and electrical repair and maintenance. (Car Wash Magazine), #4. This offers incredible value to customers who need their cars fixed right away. Determines vehicle condition by conducting inspections and identifying worn and damaged parts. Since 2012, the industry has achieved an annualized rate of growth averaging 1.5%. Many or all of the products featured here are from our partners who compensate us. Before buyers can confidently make an offer on a business, theyll need to become well-versed (if not an expert) on that businesss industry. ", 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. All financial products, shopping products and services are presented without warranty. At Easy On Oil, we will generate revenue by actively providing oil change services in each of our facilities. Subscribe to our Blog. Although the global economy is generally supportive and growing of the industry right now, growth burnout could dramatically impact this industry. process as a consummate professional. The scoring formulas take into account multiple data points for each financial product and service. Some locations may provide additional vehicle maintenance services, such as radiator flushes, brake line cleaning, and power steering fluid flushing. Executive Summary 3. It's called Jiffy Lube Multicare. Over my over fifty year career, I have had the privilege of working with many other 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. explaining everything in detail. Our key advantage in San Diego will be the high-quality, rapid, and convenient quick lube service we plan to offer. Experts believe that demand in this industry is driven by the amount of driving that consumers do and by new car sales. 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. Re-opening a former auto repair or quick lube business can save significant time and money. As you can deduce from its name, the market approach to valuing a business determines a companys value based on the purchases and sales of comparable companies within the same industry. Employee outings, charitable donations, one-time purchases and your own salary can all be included in your SDE. 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. Most likely, business owners will provide you with that number, so its important to understand how the business owner reached that value, and what these values reflect about the actual business. Instead, the two halves work hand-in-hand to create a highly fuel efficient car, especially when driving locally. 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. effective manner and I never once felt like I was in the dark. If you plan to open an oil change business, you should investigate any quick lube business within your vicinity and determine how they may impact the viability of your investment. Here is a list of our partners and here's how we make money. Often, sellers keep their business liabilities and pay off their debt after their business is sold. If YES, here is a sample Quick Lube business plan template & feasibility report. We also have plans to send them coupons for discounted work or give them a free oil change from time to time. That said, doing the math is free, so go ahead and plug your earnings numbers into different formulas and compare. Note that each of the three co-owners will invest an equal amount. 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. To reach our local customer base, we will employ a marketing manager. Often, the site is good, but the former business either lost their lease, got tired of the business, or was operating without a National brand behind them. Below is a detailed analysis of how we want to spend our startup capital. Jiffy Lube has the most locations in the United States for the quick lube industry, with over 1,900 facilities as of February 2017. Jiffy Lube International. 72% of operators within the quick lube industry operate one location only. These are some of the most efficient cars to ever be driven. These could include: You'll also need to know your liabilities. Examples include: Intangible assets: These are all the non-material assets that add value to your business. She was trained at Ford and later took a position at Chevrolet. Pre-qualified offers are not binding. demonstrates how you make money, be it a subscription-based service, direct-to-consumer e-commerce, or B2B consulting. Most locations achieve this figure with just 2-5 service bays available to them. 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. 16% of the oil changes which occur within the quick lube industry feature Valvoline products. (IMR Automotive Research), #9. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. When evaluating offers, please review the financial institutions Terms and Conditions. unconditionally recommend Mike and his team. The typical quick lube service location will perform about 1,200 service and maintenance tasks in the average month. The remainder of the required financing will come from a ten year Small Business Administration (SBA) loan and a short-term loan. Home Business Plans Automotive Sector. About Your Results 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. The profitability of individual companies depends on convenient location and good marketing. Another 16% of business owners have two locations where they provide services. 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. 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. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. (Thats why this number is subtracted from the SDE in valuation calculations.) Pre-qualified offers are not binding. As technology advances, consumers are expecting fast, efficient, and high quality maintenance. Our partners cannot pay us to guarantee favorable reviews of their products or services. This method can be used to value a business for sale as well as raising capital. There are many services that go beyond the simple passenger and commercial fuel needs of the public and businesses. (NOLN Fast Lube Operators Survey), #23. second to none. Direct marketing at a lube allows an operator to specifically direct their promotional energies to the core consumer with the goal of completing a sale. Keep up to date on our new listings and business opportunities. 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. Most online business valuation calculators use a variation of the income approach. Over the past decade, improved technology and extraction techniques enabled industry . A valuation represents your companys total worth. More on liabilities in a bit. The US automotive oil change and lubrication industry includes about 5,000 companies with combined annual revenue of about $5 billion. Major companies include Jiffy Lube, Pennzoil 10-Minute Oil Change, Valvoline Instant Oil Change, and Texaco Xpress Lube. 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. If you are contemplating a transaction in the auto service sector I can 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. 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. The most popular brand-name for freestanding businesses is Jiffy Lube. All these were analysed based on per-unit revenue, per-unit cost, and fixed costs. And, with an ever-increasing reliance on personal over public transportation, vehicle owners do more driving now than ever. Read more. The average age of a vehicle owned in the United States is 11.4 years. (Car Wash Magazine), #5. Some of them also have electronic work order systems available amongst their various service centres. The income approach to business valuation determines the amount of income a business can expect to generate in the future. A well-run business will make transitioning ownership, without losing. The visitor industry provides employment for more than 160,000 people. 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. For your quick lube questions in Bakersfield, Fresno, San Luis Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum Service. Owners of quick lube businesses benefit from the quick overturn of customers and relatively low overhead. comprehensive listing of auto repairs for sale near you, give us a call at 1-800-874-5793 for details. 1 in 3 vehicle owners decide to change their own oil after purchasing a new vehicle. 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. 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. The average vehicle owner will change their oil about every 5,000 miles. At Easy On Oil, weve made plans to create a significantly large regular customer base. Mike has been instrumental in helping me successfully complete 4 transactions (both Many owners may even pursue franchising or opening several different locations to earn extra income. Meredith has worked as a writer and editor for more than a decade. 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. In charge of creating marketing and sales strategies, etc. We are the original home the "Oil change in a Snap!" and now have added automotive repair to line up. What often separates one lube shop from another is its creative marketing strategies. Entrepreneurs looking to buy an existing business should also be familiar with valuations, and feel comfortable estimating value independently of the business owner or brokers asking price. (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.). (Valvoline), #24. For a full breakdown of the quick lubes we have for sale, as well as a Specialties: Snappy Lube is your one stop shop for your automotive needs. A typical location performs about 1,200 jobs per month. Do not sell or share my personal information. People are graciously buying cars and comfort. We will attract and maintain a loyal customer base through our customer-oriented focus on business. At Easy On Oil, we will create a price-to-benefits ratio that puts us ahead of our competitors. Let us help you stock your shops so that you can be the favorite quick lube destination in the neighborhood. All financial products, shopping products and services are presented without warranty vehicle! Provides employment for more than a decade a typical location performs about 1,200 jobs per month in 2013 regular base... 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