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The answer to that question depends on a number of factors, and getting the right categorization for each part is crucial for maintaining healthy profit margins while minimizing the risk of rush orders and frustrated customers.

Inventory and Stock Management to Minimize Complexity

When you and your team are replacing parts during repairs, it’s important to consider what parts you have on hand versus what parts you’ll need to order.

If you don’t, you risk overstocking and sinking money into too many units of a particular type of part, or understocking and making a customer wait while you hope that the expedited shipping for a part pulls through.

By having the right inventory and stock management processes in place, you can make it easier for your service advisors and technicians to avoid frustrations.

Here are some best practices for inventory and stock management at your auto repair shop.

We’ve all fallen under a “fear of the unknown” spell—whether it stems from waiting for your doctor’s results to come back, or not hearing that check-in text alert from your kid while they’re out with friends. The waiting game can cause our imaginations to run wild with thoughts of “what-if’s.”

Similarly, auto repair customers like the ability to see what’s getting done to their car, if any additional issues were found, and exactly where their car is in the repair process. You can build customer loyalty and enhance your customer service by giving them the ability to see and confirm that everything is going smoothly and according to plan with their vehicle repairs.

Visibility and transparency go beyond just shop-to-customer; it also helps bridge imagination and productivity gaps within your shop.

Expanding your business into multiple locations is exciting but can come with challenges. One of these challenges being, the ability to manage data and reports across all of your shops.

To simplify this process, Tekmetric has developed Multi-Shop, our most powerful set of tools and reports to easily manage multiple shops through custom shop comparison reporting, organization-level reports and centralized data management.

Multi-Shop allows you to gain back time, make better business decisions and maximize your margins. 

When thinking about how to run an auto repair shop, we might start by thinking about a well-managed football team. The different players know what they’re responsible for, show up to accomplish their jobs, put their best effort into everything they do, and perform their best as a team. Players have each others’ backs both on the field and off the field. They can think on the fly, and move as a unit toward the end zone.

How do your players work together? When mechanic shops assemble the right team, devise the right strategy, and run the right plays, they can win, too. Service advisors can stay informed about what’s going on with every repair order at any given moment in time, switch easily between tasks even when the shop is busy, and provide excellent customer service. Technicians are able to focus on their work and spend more time turning wrenches. And customers? They’ll get their cars back fast and drive away with a good impression of your shop.

Shop owners who think more deeply about how to manage a mechanic shop are rewarded for their efforts. Well-managed shops see exponential returns. Stellar team performance leads to customer satisfaction and repeat business. The more successful your shop, the more you can invest back into your team, continuing the cycle of success for all involved.

With so many different aspects of running an independent auto repair shop, the teams that keeps cars moving through your bays and repair orders flowing through your workflow function best when they run like a cohesive unit.

Just think about your favorite sports team. The players share a common goal, whether it be scoring a touchdown or hitting a home run, and they encourage each other to always perform at their best.

But there’s usually one person on the team who everyone looks to for guidance and inspiration: the team captain. Every player in the auto repair industry is important—from the technicians to the parts managers. But service writers are like the team captain. They keep everyone on track.

If you’re ready to learn about a challenging but rewarding career where no two days are the same, you’re in the right place.

Although our goal is to help you determine the best ways you can enhance your auto repair shop profit margin, we’re still going to shoot straight with you: opening a shop isn’t easy.  You’re going to have to put in some hard work, but exceeding your goals will be well worth it. Along the way you’ll learn new things through trial and error and encounter some unexpected challenges, but who doesn’t when they step outside of their comfort zone, pursuing something they’re passionate about?

One question you may have is, "Is it even a good time to start an auto repair business?" That's a tricky question to answer. Coming off the heels of a pandemic in an economy that has seen better times might scare any new business owner. But remember, some of the most long-standing businesses were started during economic recessions.

Although there’s been better times to start an auto repair business, your shop can still be successful. And it’s clear that the demand for automotive repairs isn't going anywhere.  

Take a look at these statistics on the latest automotive repair trends:

1. In 2022, there will be an estimated 76 million vehicles aged 16 years or older in the United States.
2. It’s estimated that by 2022, 18% of American households will use an auto repair service at least once a year.
3. The number of vehicles on the road that are 12 years or older is anticipated to increase by 15%.
4. In the past decade, the average length of time that drivers own their automobiles has increased by 60%.

As you can see, the need for vehicle repairs will likely increase due to the fact that drivers are choosing to stick to their trusty ol’ vehicles rather than opting for a shinier new ride. But regardless of whether the auto repair industry’s profit trends are growing or plateauing, making smart business decisions will not only prepare your shop for future transformation but also help your shop survive disruptive trends in the future.

Let’s get to boosting your shop’s short and long-term profits.  

We’ve listed each of these tactics in the order you should take during each of your business growth phases: the seed stage, the start-up stage, the established stage, or the expansion stage. The order of these 10 tactics does not determine their importance; each tactic complements one another to put your shop in the fast lane to success.

Fast Facts

• ‍Industry size and past growth: The U.S. auto mechanics industry is worth more than $68 billion in 2022 and has seen steady growth the past five years. ‍
• Growth forecast: The U.S. auto mechanics industry is projected to experience continued growth in the coming years and expand by more than 10% by 2026.
• ‍Number of businesses: As of early 2022, 264,121 auto mechanic businesses operated in the US.
• ‍Number of people employed: As of early 2022, the United States auto repair industry employed about 561,359 workers.