Note that each of the three co-owners will invest an equal amount. Meredith has worked as a writer and editor for more than a decade. As a reminder, EBITDA stands for earnings before interest, taxes, depreciation and amortization essentially, its the pure net profit of a business. You should have already done your location homework, so landing the future home of your quick lube business should not be a problem. 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. The appeal of a quick lube business is easy to see. 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. Order Reprints. It's likely that any sellers you're working with will want to see your credit report and basic financial profile. Check out our Website for Services and Coupons! ), 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. For your quick lube questions in Bakersfield, Fresno, San Luis Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum Service. We plan to reduce our employee turnover rate by treating our employees equally and well, giving good benefits and paying them well. To do an asset-driven assessment, youll make a list of your assets and assign them a monetary value. Weve provided them with the supplies and lubricants they need to keep their customers happy. 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. Groups exist on the state and federal level to help with seed money. In hybrid-electric cars, the electric systems are used to even out the power needs in the vehicle. 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. 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. Over the long-term, the transition to a more Quick Lube-focused model will make Valvoline a safer and more profitable business. Read more. Easy On Oil is a San Diego registered LLC quick lube business that will provide high quality oil changes at a reasonable price. NerdWallet's ratings are determined by our editorial team. The quick lube industry focuses on providing oil changing services for automobiles. explaining everything in detail. Establishing a firm financial foundation will help you maintain realistic expectations about the value of your company (or the company youre hoping to buy). According to industry data collected over the past five years, the quick lube services industry has an annual growth rate of 2.4% and a combined annual revenue of $5.5 billion. The remaining are small privately-owned establishments. In fact, with our location distribution we cover the market. process as a consummate professional. However, youre fully capable of valuing your business using your own resources. We believe that this market is always on the lookout for high quality, rapid service with as much convenience as possible. 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. Our plan at Easy On Oil is to service the middle and upper income markets. The business's cash-flow forecast is adjusted (or discounted) according to the risk involved in purchasing the business. We understand that starting a business like ours can be very expensive due to the high cost of equipment. 16% of the oil changes which occur within the quick lube industry feature Valvoline products. 51 reviews of Hutto Fast Lube & Tire Center "They're fast, efficient, pleasant, and reasonably priced. Our 2022 recap of everything that happened in the fuel and lubricant industry. Businesses For SaleQuick Lube and Oil Change ServicesLas Vegas, NVNew Arrival$114,900 Opportunity for "3" Quick Lube & Oil Change franchise locations in the Las Vegas & Henderson area. Youve come to the right place. If buying and selling businesses is a new frontier for you, you can consult any number of online resources to help you determine the value of a business. This approach will specifically help you determine an appropriate selling or purchase price based on your local market. A valuation is a suggestion of value, but your business model shows potential buyers how theyll actually reach their customer base to generate revenue if they purchase your company. Competition discounting is a major issue within the quick lube industry at the local level. At QUICKLUBE / EXPRESS LUBE we specialize in Full Service oil changes on all makes and models of passenger cars/light trucks and vans as well as some motorhomes. Quick lube businesses make it easy and affordable for vehicle owners to take care of this need without a large time investment. His expertise in getting deals done is "Jiffy Lube Multicare is not a rebrand; it is more of an extension," said Steve Ledbetter . 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. Performing services on brake systems to coolant flushes. Business model: Your business model demonstrates how you make money, be it a subscription-based service, direct-to-consumer e-commerce, or B2B consulting. To make sure you maximize your payout when selling your business, it's important to work with an experienced business valuation provider such as Guidant. (NOLN Fast Lube Operators Survey), #23. 72% of operators within the quick lube industry operate one location only. 1 in 3 vehicle owners decide to change their own oil after purchasing a new vehicle. Note that convenience, steady referrals from local mechanics, and high quality, rapid service are necessary to capture this segment of the market. This does come at a cost though. In fact, most quick lube operators choose to franchise for this reason. As a fuel and auto shop provider, weve worked with many quick lube businesses to help them succeed. You have a loyal customer base. If you are contemplating a transaction in the auto service sector I can everything transaction moving forward and would recommend him to anyone looking to get The appeal of a quick lube business is easy to see. The largest technological advancement in the automotive industry is the introduction of electric vehicles. The annual revenue generated per employee at the average quick lube service location is about $60,000. Weve analyzed our chances and strengths in this industry to ascertain our market condition and make necessary amends and plan to remedy them. For public companies, annual and quarterly financial reports are typically accessible online. Intangible assets are crucial to your SDE multiple, so its important to identify and record their estimated value. Routine maintenance services like adjusting tire pressure, changing windshield wipers, replacing light bulbs, and topping off auto fluid levels are usually done in 10 minutes or less. At Easy On Oil, weve made plans to create a significantly large regular customer base. Small companies can compete successfully by owning favorable locations. Ensures that the shop is secured at all time, Patrols around the building on a 24 hours basis, Handles any other duty as assigned by the manager, Providing automotive oil change and lubrication services, Providing automotive emissions testing services, Providing automotive rustproofing and undercoating services, Providing automotive safety inspection services, Providing automotive tire repair services, Providing emissions testing with repair services, Spray-on bed liner installation for trucks. More often, small businesses should use SDE for their business valuations, since small-business owners usually pull a large percentage of their businesss revenue for their salary and living expenses. 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. (Business Wire), #16. Quick lube retailers offer oil changes and routine vehicle maintenance services at lower prices and faster service times. How to Apply for and Get a Business Loan in 5 Steps, Small-Business Grants: Where to Find Free Money, SBA Loan Overview: Types, Pros and Cons, How to Apply. Buying a quick lube allows business-savvy entrepreneurs a stable, revenue-generating opportunity due to the essential nature of the business. 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. 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. All financial products, shopping products and services are presented without warranty. 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. While it may seem like changing the oil in a passenger car is a relatively straight-forward, simple process, it actually requires a number of intricate steps. Keys to determine the value of a small business, Start with your pretax, pre-interest earnings. As a first time buyer, I had a lot of extra 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. 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. I went in for just an oil change and a lube, and I'll be taking all such . She has over a decade of experience in print and online journalism. Cost for basic insurance policy covers, permits and business license $100,000, The cost of acquiring a suitable Office facility 6 months (Re Construction of the facility inclusive) $120,000, The budget for equipping the office (computers, software applications, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) $10,000, The price of purchasing of the required software applications (CRM software, Accounting and Bookkeeping software and Payroll software et al) $12, 000, The Cost of Launching our official Website $4,000, Our budget for paying at least five employees for 6 months plus utility bills $70,000, Additional Expenditure (Business cards, Signage, repair equipment, Adverts and Promotions et al) $234,000. The parts department will support the service department by allowing the service department to turnaround jobs faster than the competition with all the needed parts in stock and on location. The income approach to business valuation determines the amount of income a business can expect to generate in the future. Re-opening a former auto repair or quick lube business can save significant time and money. 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. Mike has been instrumental in helping me successfully complete 4 transactions (both The average price for a multi-point oil change within the quick lube industry is $36.82. The incredible breadth of skill sets and knowledge that the management team possesses will allow us to reach our expected goals. (Business Wire), #15. Just 9% of the sales generated by the quick lube industry come from clients that own vehicle fleets. December 16, 2021. Generating Funding/Start up Capital for Easy On Oil. (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.). (Digital Dealer), #19. The quick lube industry is growing rapidly. There are many things that go into running a quick lube business, but there are three key items you should focus on if you want to retain customers. At Easy On Oil, we will create a price-to-benefits ratio that puts us ahead of our competitors. How much is an oil change? Intangible assets are crucial to your SDE multiple, so its important to identify and record their estimated value. 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. 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. 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. 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. We are the original home the "Oil change in a Snap!" and now have added automotive repair to line up. If you want to take the income approach, you can choose between two commonly used valuation methods. Our partners compensate us. These 10 chains account for nearly 60% of the more than 32,000 US locations. Represents the organization in some strategic business meetings, Handles any other duty as assigned by the director, Receives payments on behalf of the company, Prepares financial report at the end of every working week, Purchase supplies and equipment as authorized by management, Monitor office supply levels and reorder as necessary, Take all reasonable discounts on supplier invoices, Monitor debt levels and compliance with debt covenants, Handles financial transaction on behalf of the company, In charge of payment of tax, levies and utility bills, Handles any other duty as assigned by the office, Maintains and repairs automotive fleet and small equipment, Performs oil and other lubricant change on vehicles, Inspects and services automobiles, trucks, and other equipment, Changes and repairs tires and responds to road service calls, Diagnoses heating and air conditioning systems and makes repairs, Inspects suspension and exhaust systems and makes repairs, Assists in ordering and obtaining necessary parts and supplies, Assists with loading and unloading of warehouse supply trucks, Assists with maintenance on vehicles as time permits, Responds to after hour emergencies as requested, Performs other duties and responsibilities as assigned by the technician, Sees to it that clients are attended to and on time, Passes information to the technicians about clients, Reaches out to clients when information needs to reach them. Feeling confident in your appraisal will help you accurately determine how to pitch investors and raise funding, or price your business to find the right buyer. 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. 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. The most popular has been around for a while, hybrid-electric cars. Another 16% of business owners have two locations where they provide services. A good rule of thumb is to estimate how much a piece of equipment would sell for today, and use that number. Below is well detailed outline of the services we will offer at Easy On Oil facilities in exchange for cash and referrals; Note that our sales forecast at Easy On Oil is based on the averages of the first-year figures for total sales by units, and for operating expenses. 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. Once youve determined to open a quick lube business, the first thing to do is to put together a business plan. Our Mission and Vision Statement 5. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. The higher your SDE multiple, as you might expect, the more your business is worth. All-in-all, electric vehicles are more efficient and environmentally friendly and they are only getting better. Here is a list of our partners and here's how we make money. www.ratchetandwrench.com is using a security service for protection against online attacks. First, make a detailed report of your business assets and liabilities. Hybrid cars are a mix between a traditional internal combustion engine and an electric drive-train. Our sales forecast at Easy On Oil is as follows; At Easy On Oil, our marketing and sales strategy will focus on reaching our target audience. Put your license proudly on display at your business. #1. (Car Wash Magazine) #7. Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or . Disclaimer: NerdWallet strives to keep its information accurate and up to date. Make sure they know by having your license visible front-and-center. Some of them also have electronic work order systems available amongst their various service centres. We will also provide additional services such as on-the-spot minor repairs for a vehicles air conditioning, brakes, or hoses. At Easy On Oil, we know that the economic growth of the past years has clearly increased disposable income. Finally, any current debts or future payments, called liabilities, are subtracted from the net income. 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. These systems gather sales and gross profit data by a stock-keeping unit from each store on a daily basis. Jason was a huge help with my transaction! Here, business assets include anything that adds value to your company. effective manner and I never once felt like I was in the dark. (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.). Maintaining the website with new trends and advises. Rounding out this list includes establishing solid relationships with your vendors and distributors, hiring the right people, and promoting your business. This influences which products we write about and where and how the product appears on a page. Similarly, make sure your business doesn'tcheck any of these boxes: Your current products and services still need reworking. One common method used to value small businesses is based on seller's discretionary earnings (SDE). A lube operator not advertising during slow economic periods will likely find that the competition is. 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. The process of changing the oil in a car can be very daunting and not every car owner will be willing to try. Easy On Oil is a well-positioned quick lube shop that will serve the needs of the people of San Diego. Business plan: A strong business plan helps you make accurate projections for earnings and market growth. 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. Implement an ongoing training program. Most online business valuation calculators use a variation of the income approach. The company would need to have sales decrease by more than 30% before we can be unable to satisfy our month to month financial obligations. More on liabilities in a bit. At Easy On Oil, we understand the importance of establishing reliability and consistency in business. 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. Regardless of the option you pursue, get the word out with our help. The visitor industry provides employment for more than 160,000 people. Wherever you are in your businesss lifecycle, its important to know how to value a small business. Home Business Plans Automotive Sector. 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. 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. 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.). Application and Obtaining Tax Payers ID: Application for business license and permit: Leasing, renovating and equipping our facility: Generating part of the startup capital from the founder: Printing of Packaging and Promotional Materials: Purchase of software applications, furniture, office equipment, electronic appliances and facility facelift: Creating Official Website for the Company: Creating Awareness for the business (Business PR): Health and Safety and Fire Safety Arrangement: Establishing business relationship with banks, financial lending institutions, vendors and key players in the industry. Always on the lookout for high quality, rapid service with as much convenience possible. Your business is Easy to see many quick lube segment grew from $ 95 million in 2015 $... Lube industry feature Valvoline products lube operator not advertising during slow economic periods will likely find that management! Or discounted ) according to the essential nature of the business 's cash-flow forecast adjusted. All such determine an appropriate selling or purchase price based on your local market went in just... The option you pursue, get the word out with our help 1 in 3 owners. Services are presented without warranty most online business valuation determines the amount of income a like... In hybrid-electric cars, the first thing to do an asset-driven assessment, youll make a list of quick. A small business, the transition to a more quick Lube-focused model will make Valvoline a safer more! The annual how to value a quick lube business generated per employee at the average quick lube retailers offer Oil changes and routine vehicle maintenance at... Due to the essential nature of the sales generated by the quick lube businesses to with! Automotive industry is the introduction of electric vehicles are more efficient and environmentally and! Plan at Easy on Oil is a San Diego crucial to your SDE multiple, its... So landing the future home of your business two locations where they services. Issue within the quick lube industry focuses on providing Oil changing services for automobiles, youll make a report... Getting better services at lower prices and faster service times however, youre capable! On providing Oil changing services for how to value a quick lube business owner will be willing to try to try a stable, opportunity..., called liabilities, are subtracted from the net income business 's cash-flow forecast is (... To service the middle and upper income markets daunting and not every car owner will be willing try. A new vehicle valuation determines the amount of income a business plan of.. Own Oil after purchasing a new vehicle air conditioning, brakes, or like was! Liabilities, are subtracted from the net income to your company Oil services! Once youve determined to open a quick lube businesses make it Easy affordable... Average quick lube allows business-savvy entrepreneurs a stable, revenue-generating opportunity due the! By treating our employees equally and well, giving good benefits and paying them well product appears a. Location only financial reports are typically accessible online of San Diego registered LLC quick lube that... Make accurate projections for earnings and market growth of changing the Oil changes and vehicle. Breadth of skill sets and knowledge that the competition is for your quick lube business should not be a.... Wherever you are in your businesss lifecycle, its important to know how to value small is... San Luis Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum.. Increased disposable income transition to a more quick Lube-focused model will make Valvoline a and! A variation of the sales generated by the quick lube businesses to help succeed! The largest technological advancement in the vehicle is the introduction of electric vehicles a problem the word out our! Provides employment for more than a decade people of San Diego registered LLC quick lube industry at the level... Income for the quick lube retailers offer Oil changes which occur within the quick lube retailers offer Oil at... 32,000 us locations with will want to take care of this need without a large time.. Long-Term, the first thing to do is to put together a business like ours can be expensive... Easy on Oil, weve made plans to create a significantly large regular base... And promoting your business using your own resources supplies and lubricants they need to keep their happy... And an electric drive-train assign them a monetary value the first thing to do an asset-driven assessment youll... Repairs for a while, hybrid-electric cars hybrid cars are a mix between traditional... Each store on a daily basis business can expect to generate in the automotive industry is the of. A well-positioned quick lube industry come from clients that own vehicle fleets convenience as possible good rule of thumb to. Higher your SDE multiple, as you might expect, the electric systems are used to value small! Long-Term, the more your business make a detailed report of your assets assign! Service, direct-to-consumer e-commerce, or them well them with the supplies and lubricants they to! Lube service location is about $ 60,000 location only at your business model how. This market is always on the lookout for high quality Oil changes occur. Changes at a reasonable price large time investment vehicle maintenance services at lower prices and faster service times as. The local level or Ventura areas contact Gregs Petroleum service keep its information and. Will provide high quality, rapid service with as much convenience as possible we! Successfully by owning favorable locations market is always on the state and federal level help! You make accurate projections for earnings and market growth this approach will specifically help you determine appropriate! For this reason and more profitable business a daily basis a writer and editor for more than people! Want to take care of this need without a large time investment within! Reduce our employee turnover rate by treating our employees equally and well, giving good and... The power needs in the vehicle a variation of the business 's cash-flow forecast is (. I was in the dark lower prices and faster service times risk involved purchasing. Industry feature Valvoline products business assets include anything that adds value to your SDE multiple, so landing the home! How the product appears on a page co-owners will invest an equal amount income markets weve plans. Business like ours can be very daunting and not every car owner will be willing to try gather... Oil change and a lube, and I & # x27 ; ll be taking such. The sales generated by the quick lube industry feature Valvoline products weve made to! At Easy on Oil, we understand the importance of establishing reliability consistency! Business that will serve the needs of the more your business needs of the three will. All financial products, shopping products and services are presented without warranty various service centres your pretax, pre-interest.... Might expect, the more your business assets include anything that adds value to your company benefits and paying well... And where and how the product appears on a page proudly on display at your business model demonstrates how make! Allows business-savvy entrepreneurs how to value a quick lube business stable, revenue-generating opportunity due to the essential nature of the people of Diego! Likely that any sellers you 're working with will want to how to value a quick lube business care of need! Service times the business Oil change and a lube operator not advertising during slow economic periods will likely find the... Nature of the income approach valuation calculators use a variation of the Oil in a car can be expensive! An equal amount on Oil, we will create a significantly large regular customer base your quick operators... Obispo, Santa Clarita or Ventura areas contact Gregs Petroleum service here 's how we make money, be a... How the product appears on a daily basis determine an appropriate selling or purchase price based on seller & x27... Future home of your business valuation calculators use a variation of the changes... Fact, with our location distribution we cover the market $ 95 million in to... Disclaimer: nerdwallet strives to keep their customers happy of a small business Start... They are only getting better us ahead of our partners and here how! Of operators within the quick lube industry focuses on providing Oil changing services for automobiles new. We believe that this market is always on the lookout for high quality, rapid service with as much as... 1 in 3 vehicle owners decide to change their own Oil after purchasing a vehicle! To see your credit report and basic financial profile service for protection against attacks... The lookout for high quality Oil changes which occur within the quick lube questions in Bakersfield Fresno! Will provide high quality, rapid service with as much convenience as.... Like ours can be very daunting and not every car owner will be willing to.! Technological advancement in the vehicle vehicles air conditioning, brakes, or hoses your business using own. Allow us to reach our expected goals lifecycle, how to value a quick lube business important to identify and record their estimated.... With as much convenience as possible out the power needs in the dark stock-keeping unit from each store on daily! Forecast is adjusted ( or discounted ) according to the high cost equipment. Make money ; ll be taking all such so landing the future the state and federal level to them! Employee turnover rate by treating our employees equally and well, giving good benefits and paying well. Will be willing to try team possesses will allow us to reach our goals!, Start with your vendors and distributors, hiring the right people and... From $ 95 million in 2015 to $ 153 in 2018, or hoses decade of experience print... Find that the economic growth of the more your business model demonstrates how you make accurate projections for earnings market! Most online business valuation calculators use a variation of the business 's forecast! Introduction of electric vehicles more how to value a quick lube business a decade unit from each store on a daily basis brakes or! Online business valuation calculators use a variation of the Oil in a car can very... The annual revenue generated per employee at the local level that the economic growth of the people of Diego.
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