process as a consummate professional. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. 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. Short overview of your business or personal finances. The appeal of a quick lube business is easy to see. 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. But buyers arent exempt from this step in the process! Your best angle is to make a list of the production, property, and resources that comprise your business assets and liabilities, cash and investments, employees and intellectual property. 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. Our opinions are our own. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. 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. The business's cash-flow forecast is adjusted (or discounted) according to the risk involved in purchasing the business. How to Valuate a Business One way to calculate a business's valuation is to subtract liabilities from assets. 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. Overall, a strong business plan provides buyers with important context about your company like your location and mission and captures what key services or goods you offer. (Car Wash Magazine), #11. Based on 7 documents Quick Lube Business means the provision of services for changing oil, lubricants, antifreeze and other automotive fluids for passenger car and light commercial trucks and the provision of maintenance checks and related services. At Easy On Oil, weve made plans to create a significantly large regular customer base. Rounding out this list includes establishing solid relationships with your vendors and distributors, hiring the right people, and promoting your business. Groups exist on the state and federal level to help with seed money. (IBIS World), #3. Keeps supplies ready by inventorying stock; placing orders; verifying receipt. Buying a quick lube allows business-savvy entrepreneurs a stable, revenue-generating opportunity due to the essential nature of the business. Sellers will need to have the following documentation in order to ensure a smooth valuation process: Licenses, deeds and any proprietary documents. SWOT Analysis 7. The two PEGs that own Express Oil LLC now have more than 700 stores. (Car Wash Magazine), #7. 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. Sources: New Constructs, LLC and company filings. Examples include: Intangible assets: These are all the non-material assets that add value to your business. Our partners compensate us. This does come at a cost though. Next, you'll need to outline your business plan and model. The work done here is every bit as good or better than the nationals, the price seems at least a bit better, and I had a better experience overall. Going with a credit union or other financing structure might work if you cannot find a commercial lender. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. Knowing your peer companies will also help you assess your market share and growth potential. 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. A lube operator not advertising during slow economic periods will likely find that the competition is. Why do diesel exhaust fluid (DEF) prices keep rising and falling? We have considered this weakness and have established a solid advertising and marketing plan to push us into the face of our target market. Full range of Auto Lubricants and Repair Parts store. Easy On Oil is a San Diego registered LLC quick lube business owned by three equal partners, Temple Curtis, Aaron Flinch and Helen Primer. 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. Easy On Oil will be managed by its three founding partners. 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. If so, read on about what it takes to become one. 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. However, to keep capital investments low and offer quick building relocation, vehicle lifts can be used rather than basements. As a fuel and auto shop provider, weve worked with many quick lube businesses to help them succeed. 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. However, due to the confidentiality agreements stipulated by some of our current sellers, were not able We will give a guarantee on all our repairs for a certain amount of miles or time. automotive business brokers can help you conduct a successful, lucrative business investment, contact our team today! (Business Wire), #15. (IBIS World), #2. It can gather data to . It's called Jiffy Lube Multicare. The service requires full cookie support in order to view this website. 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. Industry Overview 2. Figure 1: VVV's Segment Operating Income Since 2015. "Jiffy Lube Multicare is not a rebrand; it is more of an extension," said Steve Ledbetter . Meredith has worked as a writer and editor for more than a decade. It must also be done for a quick lube business. But where the discounted cash flow method accounts for more fluctuations in a business's financial future, the capitalization method assumes that calculations for a single period of time will continue in the future. Owners of quick lube businesses benefit from the quick overturn of customers and relatively low overhead. Pittsburgh, PA:For Sale: this 10-unit Quick Lube Oil Change business that has outstanding locations. The remainder of the required financing will come from a ten year Small Business Administration (SBA) loan and a short-term loan. On top of that, he communicated everything in an Investigate numbers that dont seem right, and dont be afraid to call in an accountant for extra help. (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.). So, most hybrid-electric cars do not ever run on electricity alone. It's likely that any sellers you're working with will want to see your credit report and basic financial profile. NerdWallet Compare, Inc. NMLS ID# 1617539, NMLS Consumer Access|Licenses and Disclosures, California: California Finance Lender loans arranged pursuant to Department of Financial Protection and Innovation Finance Lenders License #60DBO-74812, Property and Casualty insurance services offered through NerdWallet Insurance Services, Inc. (CA resident license no. 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. 8 Stalls & Pits! This allows households to save a little money on the aftermarket needs of their vehicle. Then, youll add back in any purchases that arent essential to operations, like vehicles or travel, that you report as business expenses. take status photos of any vehicle part. When evaluating offers, please review the financial institutions Terms and Conditions. Through 2028, the quick lube industry is expected to see lower levels of growth than in the past 5 yeas. 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. unconditionally recommend Mike and his team. Real estate includes two half-acre lots with two 3-bay facilities and equipment located in solid, growing middle-class communities with strong employers. KEYWORDS oil change Operations Quick Lube. Generating Funding/Start up Capital for Easy On Oil. 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.). Discounted cash flow method: This method determines the present value of a business's future cash flow. 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. (Car Wash Magazine), #10. www.ratchetandwrench.com is using a security service for protection against online attacks. Since 2012, the industry has achieved an annualized rate of growth averaging 1.5%. So, most maintenance on electric cars will be more software driven. When you think about valuing a small business, the most obvious factors in determining value are the companys material resources and holdings. This and many more reasons are why starting your own quick lube business can provide a way to help customers. to post every listing on the site. Note that industry operations are labor-intensive: annual revenue per employee is just $60,000. As a reminder, EBITDA stands for earnings before interest, taxes, depreciation and amortization essentially, its the pure net profit of a business. We will always stress the fact that we only offer reliable services. EasyOn Oil will actively provide oil change services in each of our facilities for vehicles. We believe that this will establish a healthy, consistent revenue base to ensure stability of the business. 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. 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. Jason was a huge help with my transaction! She was trained at Ford and later took a position at Chevrolet. 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. The US automotive oil change and lubrication industry includes about 5,000 companies with combined annual revenue of about $5 billion. Over the long-term, the transition to a more Quick Lube-focused model will make Valvoline a safer and more profitable business. Easy On Oil has three partners, Temple Curtis, Aaron Flinch and Helen Primer. Because youre familiar with your own equipment and production, you can make pretty accurate estimates of each of your assets value and depreciation. Employee outings, charitable donations, one-time purchases and your own salary can all be included in your SDE. The following tactics will be used prior and after we launch: At Easy On Oil, we will steadily channel our publicity and advertising towards our target market, the middle and upper class market, and create a reputable image from that target markets perspective, by offering convenience, expedient quick lube services, customer service excellence, and by working with local mechanics. First, make a detailed report of your business assets and liabilities. Temple Curtis represents sales/management, Helen will focus on the finance/administration section of the business and Aaron will focus on the mechanical aspect of the business. (Business Wire), #13. According to reports, the industry is fragmented; the 50 biggest companies generate less than 40 percent of revenue. We have trained and will keep training employees to focus on delivering on our promise. Car owners instead prefer to pay someone else to do it for them. person. Take 5 Oil Change is one of their fastest growing brands. (Car Wash Magazine), #4. ), 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. You might think that you can't actually distill the value of your entire business to an exact number and, sure, in a way it's a bit of an estimate. 65% of business owners report that their competitors offer discounting to obtain new customers within their own service radius. At Easy On Oil,we face over 15 auto repair and auto parts competitors in the local area. Verifies vehicle performance by conducting test drives; adjusting controls and systems. A Sample Quick Lube Repair Business Plan Template Table of Content 1. Although the global economy is generally supportive and growing of the industry right now, growth burnout could dramatically impact this industry. Theres a different SDE multiple for every industry. This method is especially useful if your business mostly holds investments or real estate; isnt profitable; or if youre seeking to liquidate. Looking to make a smart automotive business investment? Tourism alone in San Diego is a major industry owing to the citys climate, beaches, and tourist attractions such as Balboa Park, Belmont amusement park, San Diego Zoo, San Diego Zoo Safari Park, and Sea World San Diego. : The capitalization of earnings method also calculates a businesss future profitability, taking into account the businesss cash flow, annual rate of return, or ROI, and its expected value. At Easy On Oil, we will create a price-to-benefits ratio that puts us ahead of our competitors. In any of those cases, buyers will be interested in the individual value of your investments or equipment. Competition discounting is a major issue within the quick lube industry at the local level. Our key advantage in San Diego will be the high-quality, rapid, and convenient quick lube service we plan to offer. Also, at Easy On Oil, we understand the need to develop an ethics statement describing our unchangeable stand on honest, trustworthy work. At Easy On Oil, we believe that by having a high level of commuting traffic, and an equally high level of tourism traffic on local highways, our business location and shop will always bring in demand for quick lube services. In fact, even in states where electricity is produced in the dirtiest way, burning coal, all-electric vehicles are more environmentally friendly than gas-powered. You should also look for business plans that clearly outline processes and, ideally, demonstrate consistent management. About the author: Meredith has worked as a writer and editor for more than a decade. Valvoline Instant Oil Change locations number more than 1,000, as do Pennzoil 10-Minute Oil Change locations. 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. We plan to position ourselves to capitalize on the growing need of the middle and upper class market. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. Report that their competitors offer discounting to obtain New customers within their own radius... Car owners instead prefer to pay someone else to do it for them cash flow you! 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