Want to start a garage...

cjimports

Hi Guys,

I m planning to start an auto repair business. I personally feel that most of the mechanics are ripping off customers which i feel is unfair in this current ecnomic climate.

I m planning to charge less price than anybody else but i have few doubts for which i need your help.
If i charge less price will there be any problem from any motars union etc(If there is any)?
What abt SIMI ? Can they legally restrict me ?

Please let me know if there is any thing else that can restrict me from doing my business.

Thanks

CharlieCroker

Welcome to the open economy. You can do whatever you like with you're business, as long as its legal. Motor factors will only be too happy for your business!!

JHMEG

Rent a unit and off you go. Biggest impediment to small business in this country is local authority rates and repak, both of which demand protection money.

roosterman71

I think you've alot more research to do before opening a business. As long as its legal, you can do what you want. But the expenditure will be pretty high. I don't see too many millionaire mechanics around so they must be charging those prices for a reason other than making handfuls of cash.

Deciding to start a business just because you feel its unfair that others charge so much, and you hoping to charge less is very noble, but also could be very stupid.

johndaman66

I don't think you would necessarily be breaking any law or code of practice on the face of it OP. It is a free market and fair play to you for taking the initiative, the rates most of them guys out there charge is just extortion, current economic climate or otherwise. If you are taking on employess though there are considerations such are minimum wage/ PAYE/ PRSI for example which you would be legally oblige to comply with. For yourself you would have to make PAYE and VAT returns and I'm sure you may even come across other administrative aspects in the day to day running of such a business. There would be more involved in the business than just fixing cars I'm sure.

I would suggest you consider all options carefully before taking the plunge. If you don't have them already the basic necessary tools may be quite expensive never mind kitting out a garage. Realistically you may require a lift or even 2 depending on how big your going into it which I'm sure wouldn't be cheap either. If you don't have your own premises rent may be quite high depending on where you wish to establish. Insurance might be a turn off and am sure there are other costs to be considered also. Even if you do have your own premises already sitting there there is an opportunity cost associated with using it as a garage as opposed to not putting it to another use or renting it out etc. There would be undoubted merits to being your own boss but can be tough too I'm sure and would require thorough commitment and dedication.

cjimports

Thanks for your reply..

My friend rostarman.How can you justify that a basic car service cost a garage 65 and some 99+.Its only half an job.
I can understand that there are expencive but not that much that one should rip off people.

Xpro

Fair play on such a decesion mate. When you start paying taxes, your overheads,etc,etc you will soon realise that its not easy and how you need to charge more to stay in bussines:)

good luck with your new venue

roosterman71

cjimports wrote: »

Thanks for your reply..

My friend rostarman.How can you justify that a basic car service cost a garage 65 and some 99+.Its only half an job.
I can understand that there are expencive but not that much that one should rip off people.

I'm not in the business so I don't have to justify anything. I was merely pointing out some issues. Garages can charge what they want - the same as you can. And people are willing to pay it so its no problem. Each garage has different circumstances so that would contribute to the price differences.

I'm just pointing out that you need to consider everything. johndaman66 gives a very good insight in his post. Have you considered all these? Have you a reputation in the area where you'll set up so that people will bring their cars to you? Have you all the latest diagnostic equipment? Are you trained up in all car makes? Will you use the recommended oil/parts for each car?

I fear that you have rose-tinted glasses on - a vision in your head where you'll be the cheapest guy around and people will flock to your garage. And not only will you save your customers money, but you'll make a living too. I think thats wishful thinking. Setting up a business on the basis of charging less than your competitors is not a good idea. It rarely works. And in the business your starting, alot of your success will be down to people moving to you from somewhere else. Thats not going to be easy.

Mr Benevolent

roosterman71 wrote: »

I fear that you have rose-tinted glasses on - a vision in your head where you'll be the cheapest guy around and people will flock to your garage. And not only will you save your customers money, but you'll make a living too. I think thats wishful thinking. Setting up a business on the basis of charging less than your competitors is not a good idea. It rarely works. And in the business your starting, alot of your success will be down to people moving to you from somewhere else. Thats not going to be easy.

Spot on. Most customers value excellent service and will pay over the odds for it. Charging less than other companies for excellent service is not the way to go - people will assume something is dodgy. Besides, it's not cost effective. Either do it cheap with average customer service or do it well with excellent CS.

BostonB

There is a market for the cheapest price. Look at Ryanair.

The trick is doing it so you make enough money to keep going.

BostonB

JHMEG wrote: »

Rent a unit and off you go. Biggest impediment to small business in this country is local authority rates and repak, both of which demand protection money.

Protection money?

OP, are you a mechanic yourself or will you employ one ?
I would be thinking you're not a mechanic.

Big Nasty

Check the local Meerkat first! Simples!

JHMEG

BostonB wrote: »

Protection money?

Yeah, if you don't pay it you get a lot of hassle and unwanted attention.

BostonB

From local authority and repak. Seriously? About what?

Mr Benevolent

BostonB wrote: »

From local authority and repak. Seriously? About what?

Uh, because then you wouldn't be paying your bills. I assume the comment was tongue in cheek, not tabloid material...

ianobrien

OP, Just a few questions for you before rushing into things (bear in mind that I've no business qualifications, but these are things I'd ask first)

• Have you a business plan done
• What's your start up costs (tools, equipment, office etc)
• What's your fixed costs - Rent, rates, Insurance etc
• Does the proposed premises have planning for a garage
• What's your variable costs - Labour (you'll want to pay yourself or somebody else if you're ill), light, heat, phone, etc
• What's the cost of the raw materials, 3 or 4 45 Gallon drums of oil (different grades etc), coolant etc (the parts would be billed to the customer)
• Can you get credit at motor factors or will it be cash only?
• When do you expect to make a profit (most start-ups loose money for the first few years)
• Where are you getting working capital
• Have you approached the bank
• Who's doing the accounts
• Are you going for Sole Trader or Private Limited Company
• What's the procedure for getting registered with the company's office (I haven't a clue!)
• How many other garages are in the area, and what's their business model
• Etc, etc....

Have a long and careful look is all I'd say

Prenderb

Honestly, I would suggest speaking with somebody in your local county enterprise board.

http://www.enterpriseboards.ie/index.aspx

These people will help you get all the boxes ticked, all the i's crossed and all the t's dotted, and might even help you to decide whether or not you can make money at it. They'll help you with thinking about all of the things you need to think about when setting up a business and point you in the right direction. Like ianobrien says, there's a long list!

Authorities will need planning and possibly building control permission, and there are waste licences to be considered as well if you're dealing with waste oil, brake pads, old parts etc.

BostonB

Confab wrote: »

Uh, because then you wouldn't be paying your bills. I assume the comment was tongue in cheek, not tabloid material...

Didn't make any sense to me. It brings to light the issue of disposing of fluids like oil etc.