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.
Tekmetric just revealed two new tools to help shops win more customers and run a more efficient front desk. Get the full story. Watch the on-demand webinar now.
Generating new business in auto repair is hard. The industry is projected to grow just 2% over inflation annually over the next five years. The average American has 15 auto repair shops within 10 miles of their home, according to Tekmetric's internal data, meaning competition for every new customer is fierce. And across multiple industry surveys, roughly two-thirds of drivers say they don't fully trust their local repair shop — making it that much harder to win them over. The result: only one in 10 shops both grows and hits profit margins of 20% or higher.
"We know the competition to win new customers is fierce,” said Lauren Langston, president and COO, Tekmetric. “That means we need the right strategies and the right tools in order to do it."
Tekmetric's data shows that winning shops consistently focus on four outcomes: car count, average repair order (ARO), driver experience, and cycle time. Two new Tekmetric products — Tekmetric Digital Ads and Tekmetric Phones — are built to move the needle on all four.
Tekmetric Digital Ads
Winning new customers starts with being found. Tekmetric Digital Ads is an AI-powered add on that helps your shop show up where high-intent drivers are already searching for auto repair on Google Maps and Apple Maps. Because it connects directly to Tekmetric, you can see exactly how your ad spend translates into real revenue, not just clicks.
"It's really hard to see what's working. One of the superpowers of this product is that it's connected directly with Tekmetric," said Jared Haleck, chief product officer, Tekmetric.
Tekmetric Digital Ads is in early access now and rolling out to selected customers.
Tekmetric Phones
Every missed moment at the front desk has a cost. Tekmetric Phones gives your service advisors the customer context they need — instantly, the moment the phone rings — so they can spend less time looking things up and more time taking care of customers.
"Service advisors especially are loving it,” Haleck said. “It just saves them so much time. It creates so much convenience for them.”
Tekmetric Phones is in beta, available for customers on RingCentral.
Watch the On-Demand Webinar
Langston and Haleck walked through all of it — the industry data, live product demos, and what's coming next — in their webinar, "Building for the Results-Driven Repair Shop."
Running a repair shop takes more than turning wrenches. It’s booking appointments, reminding customers to show up, following up on declined jobs – all while keeping bays full and the front office running smoothly.
But for most shops, staying connected with customers feels like a second job. Some rely on a patchwork of booking tools, texting apps, and review platforms. Others don’t follow up at all. Either way, things slip through the cracks. The result? Missed appointments, lost revenue, and customers who never return.
That’s why we built Tekmetric Marketing.
Not another system to learn. Not another login to juggle. It’s built right into Tekmetric, the platform you already trust to run your shop. With online booking, reminders, campaigns, follow-ups, reviews, and even a professional website all in one place, Tekmetric Marketing helps you keep customers engaged and loyal automatically – without piling more work on your plate. And it’s designed so anyone on your team can use it. No marketing expertise required.
More Cars. Higher ARO. Steady Repeat Business.
Every repair order holds untapped potential. A declined brake job today can turn into tomorrow’s revenue. A routine oil change can become the start of a long-term relationship.
Tekmetric Marketing makes sure those opportunities don’t slip away. Customers can schedule online 24/7, filling bays while you sleep. Automated reminders cut down on no-shows and keep the calendar steady. Follow-ups on declined jobs and maintenance turn “not today” into approved work. Seasonal campaigns help you bring customers back when business slows.
And if your shop doesn’t have a website, Tekmetric can build one for you, giving customers one more way to find you, book online, and keep your bays full.
As Ryan Froats of Yorktown Auto Care put it: “As an independently-owned shop, dedicating resources towards outreach and follow-up can be challenging. Tekmetric Marketing allows me to communicate with my customer base in a variety of ways, without tying up hours of my work week.”
That’s the difference between a full schedule and an empty bay. Between a one-time job and a loyal customer.
Turn Great Service Into Lasting Loyalty
Great service doesn’t stop when the car leaves the bay. Tekmetric Marketing makes it really easy to keep the relationship going. Post-visit follow-ups that check in with customers after service, showing you care and helping you catch issues early. Review requests that boost your reputation on Google, making it easier for new customers to find and trust you. Private feedback that gives you valuable insights to improve service and address concerns before they go public
Together, these touchpoints build trust, strengthen relationships, and turn satisfied customers into loyal advocates.
One Platform. No Missed Messages.
Because Tekmetric Marketing lives inside Tekmetric, all customer communication flows through one platform – from estimates and approvals to reminders, follow-ups, and promotions. No more bouncing between systems or wondering what’s been sent. Everything is tied to the customer profile, making communication clear, consistent, and professional.
Tekmetric Marketing also works in sync with your shop’s calendar, repair orders, and payments. Bookings instantly block off availability. Reminders align with scheduled work. Everything just works without syncing headaches or double entry.
And here’s the best part: Tekmetric Marketing is designed for busy shop owners and front office staff. It’s easy to set up, runs automatically in the background, and helps you grow your business without adding more to your to-do list – or requiring a marketing degree.
As Corey Hansen of Hansen Auto Repair shared: “It’s so convenient having everything in one place, right inside Tekmetric. I already have Tekmetric open for managing the shop and invoicing, so I don’t have to switch tabs or log into something else to engage with my customers. Having it all together just makes things faster—and for me, saving time is huge.”
Auto Repair. Done Right.
Tekmetric has always been the all-in-one platform that helps shops run better — from managing repairs to taking payments. Now, with Tekmetric Marketing, it’s also the platform that helps you grow faster, keep customers loyal, and deliver a better experience at every turn.
Turn every visit into the next one. With Tekmetric Marketing, it happens automatically.
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.
.svg)
.svg)
.svg)
.svg)
.svg)
.svg)
.svg)
.svg)
