Starting your own automotive repair business can be one of the most rewarding experiences you will ever have. By venturing out on your own, you are able to enjoy the freedom that comes with being your own boss. Moreover, you can tap into your entrepreneurial spirit to implement new and unique ways to provide value to customers.
In this post, you’ll find four practical tips to help you get your automotive repair business off the ground.
What is an Automotive Repair Business?
An automotive repair shop is a place where mechanics and technicians repair and service cars and motorcycles. There are a variety of different ways that cars can be serviced therefore it is important to establish your vehicle repair workshop description that clearly outlines what services you offer.
Getting Started: The Pre-Planning Steps
Research
Doing your research early on will ensure that everything is in order, when you launch your business. When starting an automotive repair business you are going to need equipment and tools, so understanding what you will need and how much it will cost is a good place to start. You should also do your research to find the best deals to optimise the profitability of your business.
Location
The space and location you chose will need to be easily accessible for customers and should allow them to pull in and out of the garage without risk of causing any further damage to their automobiles. Moreover, it must allow for multiple cars to be worked on at once. In terms of height, the place needs to be able to house all your equipment and machinery.
Alternatively, think about where your target market is and how far they are willing to travel. You’ll want to be in a residential area but not where you will have to compete too heavily for customers.
Develop a Automotive Repair Business Plan
Excellent planning will often lead to success. Using your research, you should develop a formal business plan to guide your business. This might include your:
- Business objectives and goals
- Business structure
- Target market
- Competition
- Marketing strategy
You can always seek assistance from a professional accountant or business lawyer to assist you with this, if you aren’t confident in developing a business plan yourself. It’s important to revisit and review your business plan regularly.
Determine your Business Name
Now you need to decide on a business name. Once you decide on your name, you can check the availability of the business name you have chosen.
If the name is available, you can then register your business as a trademark to ensure that you have the exclusive rights to your business name throughout Australia.
Determining your Business Structure
You will need to decide on a business structure to establish your business plan. Consider whether you will operate as one of the following.
- A sole trader is someone who owns and operates a business under their personal name.
- A partnership is when two or more people come together to form a business.
- A company is when you register your business as a separate entity from your personal affairs.
You should contemplate which structure will work best for your business goals. It is important to know what the legal ramifications are of each structure and how they can affect how you operate.
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Registering your Business
You need to register for a few things in order to make your business official. For instance:
- A business name
- An Australian Business Number (ABN) to help the Australian Tax Office (ATO) and customers identify your business.
- It would be good practice to also register your business as a company (ACN) so you can benefit from limited liability.
- Register your Tax requirements.
- Ensure that all relevant licences or permits are valid.
Source Insurance
Insurance is the most important step when setting up your business. It is imperative that you protect yourself and your business from any legal action. Firstly, you will need a type of public liability insurance, this will be beneficial for you and your business when customers or staff experience injuries on site or otherwise.
Public liability insurance from insurance companies such as BizCover can help you protect your property and your employees from damage or injury.
Additionally, you will want to ensure you have worker’s compensation set up for these instances. Finally, you will need a form of coverage for all your equipment as well as customer vehicle cover to protect against loss, damage or theft.
Hire Employees
You will want to consider hiring additional staff to help ensure that your business runs smoothly, especially as it expands. You will need to decide how many employees you are looking to hire and what type of employment they will receive. Will they be full time, part time or casual workers?
You will then need the appropriate employment agreements drawn up and signed. There are different types of employees that you can hire, learn more about how they may affect your business in the Webinar below.
Marketing Your Automotive Repair Business
Now all you need to have a successful business is working on appropriate jobs. When considering how to advertise your automotive repair business to help you attract individuals or companies in need of demolition work you may want to implement a strategic marketing plan to cover all your bases. This will allow you to gain insight into your target market.
It will also be beneficial in helping you understand what is the most effective marketing method to reach your target market. Some marketing methods you may choose to use include starting a social media page or putting an advertisement in your local newspaper. Another simple and effective approach of reaching new customers is through word of mouth.
You could also utilise platforms like Facebook and Airtasker to find customers. This is a great way to get your name out there.
Having an online presence is important even for automotive repair companies. Using websites like Shopify or GoDaddy can help you create a well-established business so that your customers can easily find you. Additionally, you should set up and maintain a website which means you need to consider any website terms and conditions to ensure that your customers are safe.
Considering the Law
Motor Vehicle Repair Business Licence
In order to operate your own vehicle repair business, you must hold a motor vehicle repairer licence. You can apply for either a 1, 3 or 5 year licence and the application can be completed online.
Australian Consumer Law
In NSW as a motor vehicle repairer, you will to ensure your business complies with the Australian Consumer Law (ACL).
The ACL covers most products and services bought in Australia and relates to consumer guarantees. Moreover, work should be done with due care and skill, fit for purpose, and completed in a reasonable timeframe.
If your business fails to meet any of these guarantees, your customers can request under the ACL to:
- repair, replacement or refund; or
- cancel a service; or
- reimbursement for damages and loss.
If you would like to know more about the legal requirements in your state you can go to any of the following websites.
- ACT Office of Regulatory Services
- WA Consumer Protection Licensing Branch, Department of Commerce
- NSW Office of Fair Trading
- TAS Consumer Affairs and Fair Trading
- QLD Office of Fair Trading
- SA Consumer and Business Services
- NT Consumer Affairs
Motor Dealers and Repairers Act
The Motor Dealers and Repairers Act outline the rules you need to follow as a vehicle repairer in NSW. This is to ensure that you are not misleading your customers and the appropriate standards of conduct are followed.
Motor Dealers and Repairers Regulation
The Motor Dealers and Repairers Regulation elaborates upon the Legislation outlined above. This further details information in regard to licensing, record keeping and reporting requirements, fees, and business conduct.
Motor Vehicle Insurance and Repair Industry Code of Conduct
The code of conduct aims to promote transparent, informed and cooperative relationships between smash repairers and insurance companies. As a motor vehicle repairer you must comply with the code.
Legal Documents you will need
To get up and running, you should consider these legal documents so that you can protect your business. Some documents you should consider include:
- A Services Agreement can outline the service you provide so that your customer can know what to expect.
- A Employment Agreement can outline your employee’s responsibilities and their obligations to your business.
- A Partnership Agreement can outline the roles and responsibilities of any partners within the business.
- A Refund Policy allows for you to inform your customers of your refund policy.
- A Tax Invoice allows you to create a formal request for payment and ensure your records are up to date.
How Lawpath Can Help
At Lawpath, we can help guide you through starting your own automotive repair business. One of our Experienced Lawyers can provide you with all the legal information and requirements necessary for your business to succeed.
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