Legal Disclaimer: This article is written for informational purposes only and does not constitute professional financial advice. Please reference section179.org and a professional accountant for advice on financial planning and filing taxes.
As 2020 comes to an end, you might be thinking about all of this year's expenses and wondering what you might be able to write off on your taxes. You may even be considering whether or not to make a big purchase, weighing the tax deductions you could get if you bought it this year versus next.
Is it worth buying that new lift before the year ends? Or should you put it off until 2021?
What is Section 179?
Section 179 of the IRS tax code allows business owners to write off the entire cost of a piece of equipment, renovations, or other assets in the first year instead of writing off an asset a little bit at a time over a five, seven, fifteen, or thirty-nine year period. To give an example, if a shop owner buys a new tire machine, they could either write off the taxes over a seven-year period, or they can use Section 179 to get the entire deduction in the first year.
What Type of Costs Qualify for Section 179?
Tangible business property, including machinery and equipment
Leasehold improvements
Computer software*
*Is Tekmetric Eligible for Section 179?
Generally speaking, off-the-shelf computer software that has been purchased outright is eligible for Section 179. Because Tekmetric is a web-based software and does not make users sign a contract, it is not eligible for section 179, but it does qualify for a standard tax deduction.
What are Leasehold Improvements?
Leasehold improvements are any repairs or modifications that you make to your building or property, including adding a new roof, installing security or safety systems, and remodeling parts of your building without expanding the footprint. Without Section 179, leasehold improvements depreciate over 15 or 39 years, depending on what the improvements are. With Section 179, you can receive the entire deduction in the first year.
How Often Does Section 179 Change?
Section 179 is typically adjusted every several years. Most recently, Section 179 was adjusted in 2018 when the deduction limit was doubled and more types of purchases were made eligible. Section 179 may change again in the following years.
When Should You Use Section 179?
If you know that you’re going to pay taxes this year, and you have made a major qualifying purchase, then you may want to consider using Section 179 to save on your taxes and free up some cash flow for 2021.
If you financed a major purchase, you may want to consider how soon you plan on paying off that purchase and whether or not you would like to receive a tax deduction in the following years as you pay it off. For example, if you have a loan on a piece of equipment that you plan on paying over five or ten years, you may want to opt for the regular depreciated tax reduction so that you have money to offset those taxes in the following years.
Should You Make a Major Purchase Before the Year Ends to Use Section 179?
It’s not the wisest decision to buy something just to save money. It is true that Section 179, and tax benefits in general, are the best that they’ve been in years, but consider only making a major purchase if it is already in your plan and budget. If it is something that you already planned on buying in the next six months, then you may want to make the purchase before the end of the year to leverage Section 179’s tax deductions.
Talk to the Auto Repair Accounting Experts
Every situation is different. Take a look at what your tax rates are and ask yourself, "Is my income low enough this year where I'm actually reducing taxes at a pretty low rate? What do I think the tax rates are going to be in the future? Or will this benefit me more in the coming years when I think I'll be making more money?"
Talk to your accountant to form a game plan for all of this.
This article was written with the guidance of automotive repair industry CPA Hunt Demarest of Paar, Melis, & Associates, P.C.
Need help planning your taxes for 2020? Contact Paar, Melis, & Associates.
In today's digital world, relying solely on word-of-mouth is like trying to change a tire with a pair of pliers—it’s inefficient and frustrating. You need a modern tool, a solution designed to attract new customers to your shop. That tool is Google Ads, a Pay-Per-Click (PPC) advertising platform allowing you to target new customers when they need you most.
If you've heard the term but aren't sure how it fits into your business plan, you're in the right place. This comprehensive guide will break down everything you need to know about Google Ads for your auto repair business.
What are Google Ads (PPC)?
At its core, Google Ads is a Pay-Per-Click, or PPC, platform where advertisers pay a fee each time one of their ads is clicked. Think of it as renting a prime piece of real estate on the first page of a search engine like Google or Bing. Instead of trying to earn those top spots organically through Search Engine Optimization (SEO), which can take months or even years, you're essentially paying to jump the line.
Types of Google Ad Campaigns
Search campaigns
Paid search ads are the most common type of Google Ad campaign, allowing auto repair shops to target based on keywords. Shops can find new customers by bidding on keywords like “Oil change near me” or “Transmission shop Denver, Colorado.” This campaign type is effective because you can target local customers at the moment they are searching for help.
Display campaigns
Display PPC campaigns are another effective campaign type that shops can use to target customers with more creative ads. Display ads offer a visual component that could be a static image or a short video. Display ads can show across a wider audience and are not confined to just Google search.
Retargeting campaigns
Retargeting campaigns are exactly what they sound like. Mechanic shops can target prospects who have visited their website with ads that can display on other websites. For example, a customer could have visited your website (YourShop.com) and then bounced to Forbes.com. You can then show an ad on Forbes.com (and other websites) as they browse the web, so your shop can stay top of mind.
Video campaigns
Video campaigns are mainly used by auto repair shops to target customers on YouTube. You can target automotive DIY videos where users may run into issues and look for a shop instead.
How to set up your first Google Ad campaign
Open a Google Ads account (if you haven’t already). Fill out your business information and attach your payment method. This is also a good time to delegate account access to other employees if needed.
Start your keyword research. Identify the search terms your potential customers are typing into Google when they need help (e.g., “brake repair near me,” “check engine light diagnostics,” “mechanic in Houston”). If you need help finding the right keywords, you can start by asking the next customer who walks in your door, “How did you hear about us?”.
Finalize your budget and bidding. Set the maximum amount you're willing to pay for a single click on your ad. This bid, combined with the quality and relevance of your ad, determines your ad's ranking position.
Find your audience. Select which geographical areas you want to target with your ads. Most shops select a radius around their physical location to ensure they are targeting customers nearby.
Add extensions. Extensions show up beneath your ad and can include your phone number or service-specific pages of your website. Extensions help you take up more room on Google and increase your chances of attracting a click.
Publish. Once you publish your ads, your ads will go through an approval process and either go live or be rejected. You can always make edits and resubmit your ads if they are initially rejected.
Monitor and analyze. Once your ads are running, you will be able to see clicks, impressions, cost, and other data in the Google Ads platform. You can even set up conversions and UTM tracking to see how many new customers are scheduling online appointments with your shop.
Should Mechanic shops use Google Ads?
The short answer is an emphatic yes. While many forms of marketing cast a wide net, hoping to catch a few fish, PPC marketing is like using a high-tech fish finder. For an auto repair shop, the "when" is just as important as the "who," and Google Ads excel at connecting you with customers at the moment of their highest intent.
Consider the mindset of a person who needs auto repair services. Their car is making a strange noise, a warning light is on, or worse, they're stranded on the side of the road. They aren't casually browsing; they have an urgent, specific problem that needs an immediate solution. What do they do? They pull out their phone and perform a Google search for a local mechanic.
This is where auto repair PPC shines. It allows your auto repair shop to appear at the very top of the results for those high-intent searches. You're not interrupting their day with an ad they don't care about; you are providing the exact solution they are actively looking for. This makes Google Ads one of the most effective marketing efforts for service businesses, especially in the emergency-driven auto repair industry. It levels the playing field, allowing dedicated local shops to gain immediate online visibility and compete effectively against large national chains.
Tek-Tip: Don't have enough time to run marketing campaigns? Learn more about Tekmetric Marketing, featuring online appointment booking, SEO-optimized websites, and automated review management.
Benefits of PPC Marketing for Auto Repair Shops
Integrating a well-managed PPC advertising campaign into your marketing strategy can deliver a host of powerful benefits that translate directly into more customers and higher revenue.
Immediate Traffic: Unlike email marketing or social media, a PPC campaign can start to drive traffic and generate phone calls almost overnight. Once your ad campaigns are approved, your shop can be visible to potential customers within hours, which is crucial when you have empty bays to fill.
Precise Targeting: PPC platforms offer incredibly granular targeting options. You can show your ads to people based on:
Location: Target users within a specific mile radius of your shop, in certain zip codes, or in an entire city. This ensures you’re not paying for clicks from people who are too far away to become customers.
Keywords: You target the exact automotive services you offer, from a simple oil change to complex engine issues.
Time of Day: Only want to run ads during your business hours to ensure someone is there to answer the phone? You can do that.
Device: You can bid more for mobile users, who are more likely to be in need of immediate help and use click-to-call features.
Budgetary Control: Worried about a runaway budget? With PPC, you're in the driver's seat. You set a maximum daily or monthly ad spend, and you'll never pay more than that amount. You can start small, test the waters, and scale your investment up or down based on your return on investment.
Measurable Results: This is a major advantage over traditional advertising. Every aspect of your PPC campaigns can be tracked. You can see exactly how many people saw your ad, how many clicked it, and how many of those clicks resulted in a phone call or a contact form submission.
Increased Brand Awareness: Even when users don't click on your ad, seeing your shop's name at the top of the search results builds familiarity and trust. When they see your name repeatedly for different service-related searches, you become a recognized authority in your local area. This boost in brand awareness is a valuable byproduct of a consistent PPC presence.
Effective PPC Strategies for Auto Repair Shops
Launching a campaign is easy; launching a profitable one requires a solid strategy. Simply throwing money at Google Ads without a plan is a quick way to burn through your budget. Here are the essential strategies to ensure your PPC ads deliver results.
Keyword Research
This is the foundation of your entire campaign. You need to get inside the heads of your target audience and think of keywords they would search for. Your keyword research should include:
Service-Specific Keywords: "brake pad replacement," "transmission repair," "car AC service."
"Near Me" Keywords: These are huge for local service businesses. Google often appends "near me" automatically for mobile searchers.
Negative Keywords: Just as important is telling Google what not to show your ads for. Add negative keywords like "jobs," "training," "DIY," "parts," and "free" to avoid paying for irrelevant clicks from job seekers or people looking to do the work themselves.
You should note that each keyword has a different cost per click average depending on location and number of competitors. Bid on keywords that are important for your shop and fit your budget.
Compelling Ad Copy
Your ad copy is your 3-second elevator pitch. It needs to grab attention and persuade the user to click.
Highlight Your Strengths: What makes you different? Mention your ASE-certified technicians, warranties on parts and labor, free loaner cars, 5-star reviews, or your years of experience.
Include a Strong Call-to-Action (CTA): Be direct. Use phrases like "Call Now for a Free Estimate," "Book Your Service Online," or "Get a Quick Quote."
Use Ad Extensions: These are extra snippets of information that make your ad bigger and more useful. Use call extensions to add your phone number for easy click-to-call, and location extensions to show your address and link to Google Maps. Sitelink extensions can direct users to specific service pages on your website.
Optimized Landing Pages
A click is wasted if the user gets to your website and is confused or unimpressed. Your landing pages must be designed to convert visitors into customers.
Relevance is Key: If your ad promises "Brake Repair Services," the landing page should be all about your brake repair services, not your homepage.
Mobile-First Design: The majority of auto repair searches happen on mobile phones. Your page must load fast and be easy to navigate on a small screen.
Clear Contact Information: Your phone number and address should be prominently displayed and clickable.
Build Trust: Feature customer reviews, testimonials, photos of your shop, and logos of any certifications (ASE, AAA Approved, etc.).
Bidding and Campaign Management
Google Ads is not a "set it and forget it" strategy. To truly succeed, you need to actively manage and optimize your campaigns.
Structure Your Campaigns: Create separate PPC campaigns for each major service category (e.g., Brakes, Engine, Transmission, General Maintenance). This allows you to tailor your ads and landing pages for maximum relevance, which Google rewards with a better Quality Score and lower CPC.
Track Everything: Implement conversion tracking to monitor not just clicks, but actual leads—phone calls and form submissions. This is the only way to measure true campaign performance.
Continuously Optimize: Regularly review your metrics. Pause keywords that aren't performing, test new ad copy, and adjust bids to focus your ad spend on what drives the best conversion rates.
How Much Should Automotive Shops Invest in Google Ads?
This is the most common question, and the answer is: it depends. The right budget for your shop is influenced by several factors, including your location's competitiveness, the specific services you're advertising, and your overall growth goals. A shop in rural Nebraska will have a much lower cost per click than one in downtown Los Angeles.
Instead of focusing on a magic number, think about your investment in terms of objectives and ROI. A good starting point for a small to medium-sized auto repair shop might be anywhere from $500 to $2,000 per month. This initial investment allows you to gather enough data to see what works.
The most important metric isn't the upfront price; it's the return on investment. If you spend $1,000 on Google Ads in a month and it brings in five new repair jobs that generate $4,000 in revenue, your marketing efforts have delivered a 4x return. From that perspective, the initial cost is more than justified.
For shops new to this space, partnering with a digital marketing agency that specializes in Google AdWords services can be a wise investment. They have the expertise to avoid common pitfalls, maximize your budget, and accelerate your path to profitability.
Final Thoughts
In a competitive market, standing still means falling behind. Pay-per-click advertising is the fuel your marketing strategy needs to accelerate past the competition. It offers an unparalleled ability to connect with customers at their moment of need, providing immediate, targeted, and measurable results.
By conducting thorough keyword research, crafting compelling ads, building high-converting landing pages, and diligently tracking your campaign performance, you can transform your online presence from a sputtering engine into a finely tuned machine that consistently delivers new customers. It’s time to take control of your lead generation and explore what a well-executed auto repair PPC campaign can do for your shop.
In auto repair, a smooth cash flow is the anchor of your business. When something is off within the shop, the first place that can give answers is the shop’s financial data. It’s not just a tool to diagnose problems or spit out a paycheck – it holds the key to unlocking greater efficiency. By taking control of your money flow, you can not only uncover bottlenecks, but also increase profitability and ultimately grow your business.
Understanding the numbers is the first step to maximizing earnings. Don’t limit your financial knowledge to just sending out paychecks and collecting payments. Instead, embrace the numbers, contextualize reports and leverage the information you gain to make strategic decisions that propel your shop’s success.
The road to profitability must include a strong understanding of your finances. Here are four ways to take control of your money flow and elevate your shop’s business:
1. Track your inward and outward flow through detailed reports
The best way you can get familiar with your money flow is by intentionally reviewing the numbers. Whether real-time or evergreen, you can use data and information in all forms to learn the direction of money flow within your shop and how to influence profitability. These numbers can provide clear insights into your shop’s performance and any adjustments you could make to grow your profit. Therefore, it’s important that you review key reports on a regular basis.
For example, when it comes to your inventory, you can review Tekmetric’s Parts Orders section for information on cores and returns. This knowledge is particularly useful for anticipatory orders and core returns that can easily be tracked and returned as needed. If you have anything eligible for return, you can review that information in real-time and make the return when your parts provider arrives to get that credit back on your statement. By strategically tracking the parts you need to keep and those you can return when unused, you can anticipate future needs and streamline cash flow into your shop.
2. Utilize real-time data to make strategic financial decisions throughout your day
Using real-time data of both posted and unposted data gives you a clearer picture of the shop’s finances in real-time, allowing you to make decisions more efficiently and generate more profit to meet your short- and long-term goals. Additionally, it enables you to adjust your operations as soon as a problem comes to light. Rather than waiting until the end of the day, week or month, you can monitor money flowing in and out of your shop in real time and make strategic decisions that directly impact your final profit.
This might include monitoring your end-of-day (EOD) report in Tekmetric and delegating tasks that can help bring in more business to meet your goals. For example, if you review your shop dashboard early in the week and see $17,000 in approved work that hasn't been finished, you can implement some strategies to close out that work by the end of the week, whether it’s calling customers to follow up on an approval or announcing a bonus for your technicians that incentivizes them to finish the work quicker.
3. Provide financing options for customers
In addition to reporting, another way to influence money flow into your shop is by providing financing options for your customers. After all, if you can make a customer’s payment process easier for them, you can create a better cash flow for your shop. Providing financing options allows the customer to get the needed repair done without compromising their personal budget.
Furthermore, when you provide alternative payment methods, you increase sales. For example, at Tekmetric, we have found that a “Buy Now, Pay Later” option can help increase your average RO amount. The national average RO amounts to approximately $260. By contrast, according to Affirm, the average purchase when using a feature like “Buy Now, Pay Later” is approximately $1,800. Customers are more likely to approve higher-ticket items when they have a financial option like “Buy Now, Pay Later,” which helps increase your ARO. It’s a win-win situation for you and your customers. Not only do you reduce friction with the customer through a convenient payment option, but you also increase your cash flow into the shop.
4. Leverage outside resources to monitor your cash flow
As important as money inflow is, you must also monitor your outflow. Without understanding how both elements work together, you cannot accurately measure – or grow – your profit. This may be daunting, but you can ask for help.
Don’t hesitate to leverage outside resources to gain a better understanding of how to interpret money flow and use that information to grow your shop’s bottom line. Whether through free webinars, basic accounting courses or coaching organizations like our partners at Transformers Institute, Shop Fix Academy, Automotive Training Institute, Autoshop Answers, Elite and more, you can utilize external tools to gain invaluable knowledge that helps you run your shop more efficiently.
Bonus tip: Ask plenty of questions
Knowledge is power – and knowledge of your shop’s finances can lead directly to profit growth. Therefore, make sure to question everything. Ask for documentation, whether it’s an explanation of why a part was ordered or a receipt for a new coffee machine in your lobby. Small purchases add up, and if you do not ask questions and track them, you could end up reducing your profitability without noticing.
Do not be afraid to question the validity of transactions or ask for help in understanding the big picture of why purchases were made. Learning to control the flow of money into your shop is crucial, but implementing strategic decisions regarding money outflow is how you make a profit. By asking for help and closely monitoring your data, you will have a better understanding of the money flow in and out of your shop, leading to more efficient processes, a better customer experience and ultimately, more business.
In the fast-paced auto repair industry, delivering exceptional service and ensuring vehicle safety is paramount. This is where Tire Suite comes in — a solution that simplifies tire management, letting you save time and gain peace of mind.
Tire Suite is a comprehensive solution designed specifically for tire shops. Whether you're struggling with time-consuming DOT# registration processes, concerned about protecting your shop from risk, or looking to save money and boost profits, Tire Suite has you covered.
Streamline Your Processes, Save Valuable Time
Time is money, especially in the fast-paced world of tire shops. With Tire Suite, you can say goodbye to the days of manual paperwork and tedious DOT# registration processes. Our platform automates the entire registration process via Tiremetrix, saving you valuable time that can be better spent serving your customers or growing your business. By streamlining your processes, Tire Suite allows you to focus on what matters most – delivering exceptional service to your customers.
Our platform not only streamlines your processes for DOT# registration but also helps streamline tire sourcing. Access vehicle-specific tire specifications swiftly, facilitating seamless tire selection for your team. Easily search your inventory or seamlessly add tires as needed parts, enabling effortless tire sourcing through integrated parts ordering.
Protect Your Shop, Ensure Compliance
Compliance issues can be a nightmare for tire shop owners, leading to costly fines and penalties. With Tire Suite, you can rest easy knowing that your shop is fully compliant with DOT# regulations. Our platform simplifies the registration process and provides ongoing support, helping you avoid unnecessary risks and protect your business from potential liabilities. By investing in Tire Suite, you're investing in the long-term success and sustainability of your shop.
Take Your Tire Shop to the Next Level with Tire Suite
Ready to take your shop to new heights of efficiency and success? It's time to discover the power of Tire Suite. Say goodbye to wasted time, compliance concerns, and unnecessary expenses – and say hello to a brighter future for your shop.
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