There are many reasons you might want to sell your auto repair shop.
You might be ready for another venture; you might be trying to fund your retirement; or you might just be curious about the value of your business if you do decide to sell.
Whether you're actively in the market to sell your shop, or you just want to know how to value an automotive repair shop just in case, you’ve come to the right place.
How to value your auto repair shop
The industry standard for establishing a sale price for an automotive repair business is to use total owner benefit (TOB) multiplied by four (or TOBx4).
So, if you took home an average of $50,000 a year for the past three years, the price of your business will likely be valued around $200,000. Keep in mind this TOB value does not include property value.
For those who are reading this with the hopes of selling in the near future, that valuation method might seem low to you. And it is.
The good news is that you can go above and beyond the industry standard, and sell your shop for a higher value, if you stay on top of your numbers.
Not only will diligent reporting and good customer service increase your TOB, but you’ll also have more leverage when negotiating offers from buyers.
Here are three steps you can take to improve the valuation of your business and secure the money that you worked hard to earn.
Selling your automotive business
1. Be Tenacious About Gross Profit Margins (GPM)
The old business adage said it best: “It’s not what you make, it’s what you keep.”
Potential buyers know the ins and outs of how to value an automotive repair shop that’s on the market. They’ll want to see what your shop’s gross profit margins (GPMs) are, not your shop’s revenue.
Your shop’s gross profit margins will give them an idea of what you were able to take home—and by extension, what they can expect to be able to take home if they go through with the purchase.
Here are some strategies to start increasing your GPM today:
Increase prices on your parts or labor. A parts matrix and a labor matrix that’s built into a cloud-based shop management system can help you mark up your prices without sticker-shocking your customers.
Ensure all cores and unused parts are returned. Reports within a shop management system, such as Tekmetric’s Parts Purchased Report and Parts Usage Report, can give you a clear picture of how much you’re spending versus how much you’re using.
Cease ineffective marketing campaigns. Tracking the ROI you’re getting from various marketing campaigns by having your service advisors track marketing sources on each repair order can help you pinpoint what’s working and what’s not so that you can put your money where it will yield the best results.
Tekmetric’s various built-in reports can give you a clear picture of what your margins are, so you can keep adjusting your strategy to get even better margins that will impress prospective buyers.
2. Increase Your Average Written Repair Order (AWRO)
In the majority of cases, your AWRO can and should be higher than you think.
Let’s do some quick math. It costs drivers an average of 10 cents a mile to maintain their vehicles. If someone drives 15,000 miles a year, and each mile costs them around 10 cents of wear and tear, that person is looking at $1,500 in repairs each year.
Even if we stay on the conservative side, that person is looking at spending $1,000 on annual maintenance.
When you consider how often each customer visits your shop annually, do those numbers sound in line with your shop’s current AWRO?
By running thorough inspections on each vehicle, your technicians can catch all potential issues, including budding issues that will need to be addressed down the line.
Digital vehicle inspections encourage technicians to give customers a holistic overview of which issues need work immediately, which issues will need work soon, and what’s good as-is. And with these more thorough inspections, your service advisors can maximize their AWRO.
Be careful not to prioritize a high AWRO at the expense of customer trust. One great way to balance AWRO with customer trust is by showing customers what work needs to be done ASAP, and what work can wait.
3. Work to Maintain an Excellent Social Reputation Everywhere
Prospective buyers are going to look at your ratings on various platforms, including Google, Facebook, Yelp, Better Business Bureau, Indeed, and Glassdoor.
Why?
Because buyers want to invest in a shop that has a strong social reputation among customers and employees, and by extension, the broader community.
Buyers might feel uneasy purchasing a shop with bad ratings. They might back out of the sale, or even try to pay less for the purchase, citing the low ratings as a reason why.
But when you have high ratings on these platforms, you’ll have more leverage to negotiate a higher price.
With Digital Vehicle Inspections shops can go the extra mile and introduce a new level of transparency through a frictionless experience for the customer.
They can get clear pictures or videos to show them what's wrong, have the inspection results sent to their email, and approve or decline work with just the click of a button.
However, while this is super simple for the customer, for Service Advisors, finding the right inspection can be time-consuming. Especially when your shop is training new service advisors and introducing them to your standard operations.
To save your Service Advisor's time and effort, we are excited to announce our newest feature: Default Inspections.
This feature streamlines the inspection process and makes it easier for you to provide great service to your customers.
The automotive repair industry is constantly evolving, and shop owners need software that keeps pace. Tekmetric offers auto repair shops an all-in-one platform–built with firsthand shop insight–to manage workflow, customers, and profitability.
No single solution fits every business perfectly, and a variety of Tekmetric competitors offer alternative functionalities and approaches. This overview provides an honest look at Tekmetric through the lens of customer feedback and core product strengths. Whether actively comparing software options or simply exploring what’s available, this guide is designed to help you make confident, informed decisions.
What is Tekmetric?
Tekmetric is the all-in-one solution for modern auto repair shops. Tekmetric is designed to streamline operations, enhance profitability, and improve customer communication for automotive repair businesses.
An all-in-one solution, Tekmetric provides a centralized platform for managing various aspects of a repair shop's daily workflow. Its focus on real-time data and a user-friendly interface has made it a popular choice for modern automotive repair shops.
Most importantly, Tekmetric is the only auto repair shop software in the market that was created by a former shop owner – so every feature was designed with firsthand insight into what shops actually need.
Tek-Tip: Ask ChatGPT or Gemini for a summary of Tekmetric and how it could be a fit for your business.
Why choose Tekmetric?
Shopmonkey, AutoLeap, Mitchell 1, and other competitors offer robust features and may look similar on the surface. Researching the pros and cons of each software takes time, so we boiled it down for you and highlighted five reasons why Tekmetric is the leading shop software.
Built by a former shop owner: Tekmetric is built to solve real pain points for shops, not generic SaaS assumptions.
All-in-one solution: Tekmetric offers cloud-based shop management software, payments, marketing, mobile app and more.
Multiple integrations: 70+ integrations consolidated into one workflow.
Unlimited users + No long-term contract: Pricing model designed to scale seasonally without renegotiation.
Trusted support: U.S.-based phone, chat, and email support plus industry-leading uptime.
How Tekmetric Compares to Other Auto Repair Shop Software
While Tekmetric is a prominent software in the industry, several Tekmetric competitors provide compelling alternatives. Let's compare Tekmetric in terms of features, integrations, customer support, pricing, and customer reviews.
Features
Tekmetric offers a variety of features that cater to the diverse needs of auto repair shops. Some of its core functionalities include:
Digital Vehicle Inspections (DVIs): DVIs allow technicians to capture photos and videos on their mobile devices to visually communicate findings to customers. This transparency helps build trust and often leads to higher approval rates for recommended services.
Payments and Flexible Financing: Tekmetric Payments gives you the POS tools to get paid faster and more reliably, whether customers pay upfront or over time. With secure, encrypted transactions and flexible financing options like Buy Now, Pay Later, you can offer your customers a payment schedule that fits their budget, and get more repair orders approved in the process.
Repair Orders and Estimates: Tekmetric simplifies the creation and management of repair orders, enabling shops to quickly generate accurate estimates, track progress, and convert estimates into invoices. It can automate parts and labor calculations, improving efficiency.
Customer Communication: The software facilitates seamless customer communication through SMS and email notifications, allowing shops to provide real-time updates on vehicle status, share inspection results, and send payment links.
Inventory Management: Shop owners can efficiently manage parts inventory, track stock levels, and integrate with parts ordering platforms like PartsTech and Nexpart to streamline the procurement process.
Reporting and Analytics: The platform provides valuable insights into key performance indicators (KPIs) such as gross profit, average repair order (ARO), and close ratio, enabling shop owners to make data-driven decisions to boost profitability.
Integrations
Integrations are crucial for any efficient shop management solution. Tekmetric excels here by offering the most integrations in the industry. Tekmetric integrates with 70+ tools like ALLDATA, Advance Auto Parts, and PartsTech to streamline your workflow.
When comparing auto repair shop management software, make sure you choose a software that supports your entire workflow and can grow with your business.
Customer Support
Customer support is a vital aspect of any software solution. Tekmetric prides itself with industry-leading uptime and customer support. Our US-based support team is ready to answer your call, email, or chat message.
Don’t believe us? Our G2 reviews speak for themselves.
Pricing
Pricing structures for shop management systems can vary significantly. Some offer tiered pricing based on the number of users or repair orders, while others have flat monthly fees. Tekmetric's pricing offers a monthly subscription (no long-term contracts), unlimited users, with add-ons available for specific features.
Tekmetric starts at $179/mo, offering a competitive price and the ability to cancel at any time. We believe in earning your business every month.
How Do Customers Feel About Tekmetric?
Customer feedback, particularly from platforms like G2, provides insight into the real-world user experience. Some of the common themes in Tekmetric reviews include:
User-friendly Interface: Many users find Tekmetric intuitive and easy to navigate, which helps with quicker onboarding for staff and improved daily workflow.
Comprehensive Functionality: Customers appreciate the all-in-one nature of Tekmetric, noting its effectiveness in handling everything from digital vehicle inspections to repair orders, inventory, and customer communication.
Strong Integrations: The seamless integration with other essential tools is frequently highlighted as a major benefit, allowing for a more streamlined and efficient operation.
Responsive Customer Support: Numerous reviews commend Tekmetric's customer support team for their promptness, knowledge, and willingness to assist. This level of support contributes significantly to a positive customer experience.
Improved Efficiency and Profitability: Shop owners often report an increase in efficiency and a positive impact on their profitability due to Tekmetric's reporting capabilities and real-time insights.
Final thoughts
Choosing the right shop management software is a critical decision for any auto repair business. Tekmetric offers a powerful cloud-based solution with a strong set of features, excellent integrations, and highly-regarded customer support.
Shop owners should carefully evaluate their specific needs, budget, desired functionalities, and the importance of various integrations when considering a software solution. The goal is to find a solution that not only meets current demands but also scales with the future growth of the business, ensuring a smooth and efficient customer experience for years to come.
With this latest update, we want to deep dive into one of the most beneficial features, buy now, pay later, so shop owners can see for themselves.
Tekmerchant was designed to help shop owners, like you, to build trust with customers, close out the day faster, and turbo charge shop’s payment processing by offering them a fully integrated payments solution, all managed by a trusted team. Building off your existing Tekmetric experience, Tekmerchant is another way to supercharge both your shop’s processes and your customer’s experience at the same time.
More specifically, we're really excited to tell you about our new buy now, pay later feature , making it easier for your guests to do business with your shop -- especially on those more expensive repair orders.
With just the inclusion of Tekmerchant alone, Silver Lake Auto’s shop performance continues to grow. At the organization’s flagship store, average repair order (ARO) has increased by more than $200a month!
And we’re excited to see how much those AROs grow with buy now, pay later.
.svg)
.svg)
.svg)
.svg)
.svg)
.svg)
.svg)
.svg)