How to open an auto-repair business

Written by cayden conor
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For an experienced mechanic, opening an auto repair business is not difficult. But you will also need management, financial and customer-service skills to do it right.

Skill level:

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    If you intend on doing only simple things, such as working on brakes and belts and changing oil, a commercial general property will suffice. If you intend on opening a full-service auto repair business that replaces or rebuilds engines, among other things, you will, in most states, need a property zoned commercial-intensive.

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    Get the proper licenses and insurance for your business. Different states, counties and cities require different licenses. You will most likely need an operating license, another from the Department of Agriculture and a sales certificate. You should also be certified by the National Institute for Automotive Service--this goes a long way in building a customer list, as most people look for a mechanic they can trust. The ASE certification tells people that you are licensed and have the knowledge required to repair vehicles. You will need to have a garage-keeper's policy in place.

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    Purchase and set up an invoicing system, as well as and set up a business bank account. An invoicing system for an auto repair business should include a way to print work orders. Open a bank account in the business name.

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    Hire employees. You should have an office person to help with customer service and at least one additional mechanic. Go over the workplace rules with them. Make sure they understand how they are to be paid. If the mechanics are going to be working on commission, part of the workplace rules need to address comebacks. This occurs when the customer brings the vehicle back because it was not fixed properly. You need to let the employee know if he has to fix his own comebacks or if something is expected to come out of his pocket in the case of employee error. You also need to define when he should expect to get paid (once the car is picked up and paid for, or if he gets paid prior to the customer picking up the car).

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    Advertise the business. There are many ways to advertise, but local papers and coupon magazines are the best way to reach new clientele. Hold a grand opening and give something at a discount or have a freebie for new customers.

Tips and warnings

  • Advertise the grand opening at least three months in advance and advertise it at least once every two weeks.
  • Do not skimp on the garage-keeper’s policy. Auto repairs pose lots of danger, and both employees and customers could get hurt.

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