Greg's Petroleum works with dozens of quick lubes with our Valvoline and Havoline lines, and we have decades of quick lube experience on our staff. Easy On Oil is an exciting business opportunity that addresses the unmet need of having a spacious quick lube facility that also has a complete automotive parts store. How to Valuate a Business One way to calculate a business's valuation is to subtract liabilities from assets. When the economy is weak, vehicle owners tend to complete these services on their own, to the best of their ability. Easy On Oil is a San Diego registered LLC quick lube business that will provide high quality oil changes at a reasonable price. Take 5 Oil Change is one of their fastest growing brands. to post every listing on the site. Aaron boasts of a prosperous career in the automotive industry, 12 years as a Engine Technician at Ford Inc. Lastly, Helen brings 8 years of finance and administration experience. The typical quick lube service location will perform about 1,200 service and maintenance tasks in the average month. Plus, its crucial to demonstrate to potential buyers how your business will continue to grow and turn a profit. #1. (If you used EBITDA to value your business, youll use an EBITDA multiple.) Snappylubeinc.com Established in 1989. 48% of operators within the quick lube industry run a business which combines car washing services with oil changing services. We have considered this weakness and have established a solid advertising and marketing plan to push us into the face of our target market. At Easy On Oil, our major weaknesses will be the time and resources it will take us to establish and publicize our services to the people of San Diego. Most likely, business owners will provide you with that number, so its important to understand how the business owner reached that value, and what these values reflect about the actual business. www.ratchetandwrench.com is using a security service for protection against online attacks. Sally Lauckner is an editor on NerdWallet's small-business team. Franchise Quick Lube, Car Wash, and RE in New Mexico! In fact, most quick lube operators choose to franchise for this reason. Along with hybrids, all-electric cars are taking to the streets across the world. If a synthetic oil change is requested, the price of the oil change jumps to $70.31. Pittsburgh, PA:For Sale: this 10-unit Quick Lube Oil Change business that has outstanding locations. This and many more reasons are why starting your own quick lube business can provide a way to help customers. (Business Wire), #13. Quick Lube operating income is up to $162 million TTM . This company offers true quick oil change and a new filter. Knowing your peer companies will also help you assess your market share and growth potential. 3. everything transaction moving forward and would recommend him to anyone looking to get Our objective is to be precise and honest with clients when it comes to quoting cost estimates. In 2018, the industry was valued at $7 billion in the U.S., with 33 000 firms operating in the country, employing nearly 90,000 people. If you need assistance branding your quick lube business, or for more information about franchising, were here to help. She is based in New York City. We will offer these distinct but complimentary services coupled with unprecedented customer service, something that the industry is not known for having. Does becoming a quick lube business owner sound good to you? Your best angle is to make a list of the production, property, and resources that comprise your business assets and liabilities, cash and investments, employees and intellectual property. Our vision at Easy On Oil is to become the leading business that offers Quick Lube repair services and a well-stocked repair parts shop in San Diego, California. Any business can use this approach to business valuation, as long as they can gather sufficient, relevant data on which to compare their business. Paul Hodowanic. I also like doing business with a local firm vs. a national chain. Because youre familiar with your own equipment and production, you can make pretty accurate estimates of each of your assets value and depreciation. Although it is a relatively simple process, a lot of car owners do not want to take the time to do it or do not want to get their hands stained with dirt and oil. Drawing on her background in small business and startups, she covers lending, business finance and entrepreneurship. Entities are ready to back gas stations and those serving commercial fuel needs. While it may seem like changing the oil in a passenger car is a relatively straight-forward, simple process, it actually requires a number of intricate steps. Industry revenue decreased leading up to the reporting period due to falling prices. Our partners cannot pay us to guarantee favorable reviews of their products or services. Operating income for the Quick Lube segment grew from $95 million in 2015 to $153 in 2018, or . (Car Wash Magazine), #11. Often, sellers keep their business liabilities and pay off their debt after their business is sold. Later, too, you can use this list to create an overview of your companys value for potential buyers. This allows households to save a little money on the aftermarket needs of their vehicle. If a synthetic oil change is requested, the price of the oil change jumps to $70.31. The average price for a multi-point oil change within the quick lube industry is $36.82. Because the process for determining the value of a small business is complicated, you might want to consider consulting a professional business broker or accountant that specializes in valuation, rather than going it alone. Oil Change Services in the US industry trends (2017-2022) The Oil Drilling and Gas Extraction industry in Canada has endured significant volatility over the five years to 2022. Instead, the two halves work hand-in-hand to create a highly fuel efficient car, especially when driving locally. Figure 1: VVV's Segment Operating Income Since 2015. Understanding code and the relationship that software has with new vehicles will become an essential skill set for anyone working in the auto repair industry in the future. Discounted cash flow method: This method determines the present value of a business's future cash flow. These services will include full oil changes, lubricate the chassis of automotive vehicles and provide other automotive repair and maintenance services, such as tire rotations and liquid flushes. Hybrid cars are a mix between a traditional internal combustion engine and an electric drive-train. Conducting a valuation is an excellent opportunity to assess the financial health and potential of your business, or of a business youre hoping to buy. Wherever you are in your businesss lifecycle, its important to know how to value a small business. Overall, a strong business plan provides buyers with important context about your company like your location and mission and captures what key services or goods you offer. "Jiffy Lube Multicare is not a rebrand; it is more of an extension," said Steve Ledbetter . Approaches to a successful small-business evaluation. In 2011, 31% of consumers preferred a premium product. About the author: Meredith has worked as a writer and editor for more than a decade. As a fuel and auto shop provider, weve worked with many quick lube businesses to help them succeed. take status photos of any vehicle part. Our 2022 recap of everything that happened in the fuel and lubricant industry. Easy On Oil will be managed by its three founding partners. The visitor industry provides employment for more than 160,000 people. (Business Wire), #14. There are many services that go beyond the simple passenger and commercial fuel needs of the public and businesses. In any of those cases, buyers will be interested in the individual value of your investments or equipment. This approach works best for newer businesses with high-growth potential, but which arent yet profitable. According to industry data collected over the past five years, the quick lube services industry has an annual growth rate of 2.4% and a combined annual revenue of $5.5 billion. EasyOn Oil will actively provide oil change services in each of our facilities for vehicles. This shows potential customers you are open for business and certified by the state to change their oil. The quick lube industry focuses on providing oil changing services for automobiles. So, established businesses with stable profitability often use this valuation approach. Business plan: A strong business plan helps you make accurate projections for earnings and market growth. We believe everyone should be able to make financial decisions with confidence. Then, youll add back in any purchases that arent essential to operations, like vehicles or travel, that you report as business expenses. One common method used to value small businesses is based on seller's discretionary earnings (SDE). No matter what, applications must be filled out and fees paid. Your SDE represents the true, monetary value of your business, but your SDE multiple values your business according to industry standards. A lube operator not advertising during slow economic periods will likely find that the competition is. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. A valuation is a suggestion of value, but your business model shows potential buyers how theyll actually reach their customer base to generate revenue if they purchase your company. However, this simple method doesn't always provide the full picture of a company's value. As a result, the need for reliable and convenient quick lube store has grown rapidly in California. 8 Stalls & Pits! We will ensure we provide a full range of auto lubricant and repair parts inventory and rapid shipping capability of major parts. Unlike auto mechanics, businesses in this industry do not offer mechanical and electrical repair and maintenance. But where the discounted cash flow method accounts for more fluctuations in a business's financial future, the capitalization method assumes that calculations for a single period of time will continue in the future. Job Roles and Responsibilities 6. This is why several other methods exist. Live for the first time at our partner ilani Casino! From our detailed research, we hope that provisions for ongoing expenses are adequate to meet our needs as the business generates cash flow sufficient to support operations. Then, you can demonstrate to potential buyers what makes your business stand out. Major companies include Jiffy Lube, Pennzoil 10-Minute Oil Change, Valvoline Instant Oil Change, and Texaco Xpress Lube. Maintains vehicle records by annotating services and repairs. When you think about valuing a small business, the most obvious factors in determining value are the companys material resources and holdings. From Disabled and $500k in Debt to a Pro Blogger with 5 Million Monthly Visitors, 25 Quick Lube Industry Statistics, Trends & Analysis, 41 Food Truck Industry Statistics, Trends & Analysis, 47 Green Industry Statistics, Trends & Analysis, 49 High Tech Industry Statistics, Trends & Analysis, "From Disabled and $500k in Debt to a Pro Blogger with 5 Million Monthly Visitors. Jiffy Lube has the most locations in the United States for the quick lube industry, with over 1,900 facilities as of February 2017. Keeps shop equipment operating by following operating instructions; troubleshooting breakdowns; maintaining supplies; performing preventive maintenance; calling for repairs. Also, the local craft brewing industry attracts an increasing number of visitors for beer tours and the annual San Diego Beer Week in November. In order to see how electric cars are impacting the future of the automotive repair industry, it is important to understand how they work in the first place. For the average business, they account for 60.7% of total expenses. Buying a quick lube allows business-savvy entrepreneurs a stable, revenue-generating opportunity due to the essential nature of the business. It's likely that any sellers you're working with will want to see your credit report and basic financial profile. www.ratchetandwrench.com is using a security service for protection against online attacks. Check out the ACS reviews left by our clientele. Temple worked as a top sales rep at Chevrolet for over 13 years. December 16, 2021. Easy On Oil boasts of a unique and well versed management team that will allow us achieve our objectives. (Buyers might ask about your discretionary cash flow when you offer them your valuation, so be prepared to include and value each major expense or purchase.). The most popular brand-name for freestanding businesses is Jiffy Lube. (Business Wire), #15. You should have already done your location homework, so landing the future home of your quick lube business should not be a problem. We will attract and maintain a loyal customer base through our customer-oriented focus on business. These systems gather sales and gross profit data by a stock-keeping unit from each store on a daily basis. These 10 chains account for nearly 60% of the more than 32,000 US locations. The service requires full JavaScript support in order to view this website. I went in for just an oil change and a lube, and I'll be taking all such . Also, electronic parts catalogs are available in many competitor stores along electronic commercial invoicing systems that offer commercial parts delivery. Each uses a different aspect or variable of a business to calculate its numerical value either a businesss income, assets, or using market data on similar companies. Succeeding in business is never easy theres a reason why most small businesses never make it past three years but if you do it right, success wont be far away. All financial products, shopping products and services are presented without warranty. Jiffy Lube International is the main player in the franchise segment of the quick-lube chain industry. 89% of quick lube locations offer a transmission fluid drain and flush service in the United States, with an average cost of $107.60 per service. Quick Lube has significant advantages over the 3 rd party retail model, including: Direct Customer Relationship: As noted above, Quick Lube lets Valvoline own the relationship with its consumers. Small companies can compete successfully by owning favorable locations. Wherever you are in your businesss lifecycle, you'll want to know how to value a small business sooner rather than later. At Easy On Oil,we face over 15 auto repair and auto parts competitors in the local area. As franchises in the industry go, Victory Lane keeps it simple. These conservative assumptions make for a more accurate estimate of real risk. Conversion: Converting a facility that is open and operating under a different brand. When it comes to all-electric cars, consumers either have an inexpensive car with very low range or a very expensive car with comparable range to an ICE car. Our Mission and Vision Statement 5. Most locations operate two to five bays in a drive-through building, and many use basement construction so that oil can be changed below while other services are being completed above. 89% of quick lube locations offer a transmission fluid drain and flush service in the United States, with an average cost of $107.60 per service. In hybrid-electric cars, the electric systems are used to even out the power needs in the vehicle. The more thorough you are in this step of the valuation process, the more confident youll be in your calculations. Temple Curtis represents sales/management, Helen will focus on the finance/administration section of the business and Aaron will focus on the mechanical aspect of the business. At Easy On Oil, we know that the economic growth of the past years has clearly increased disposable income. Maintaining the website with new trends and advises. Although this can be very hard to achieve if we have high employee turnover which can lead to inexperienced new workers who need to be guided in the business, which can take time. Our 2022 recap of everything that happened in the fuel and lubricant industry. Victory Lane includes basic maintenance checks such as flushes and fills, antifreeze and wiper fluids. We plan to offer our clients personalized service by offering convenience and rapid service. However, youre fully capable of valuing your business using your own resources. We are the original home the "Oil change in a Snap!" and now have added automotive repair to line up. Verifies vehicle performance by conducting test drives; adjusting controls and systems. Theres a different SDE multiple for every industry. Once you've determined to open a quick lube business, the first thing to do is to put together a business plan. text the finished report to the customer's mobile device. Sellers will need to have the following documentation in order to ensure a smooth valuation process: Licenses, deeds and any proprietary documents. SHOP STATS . We plan to make sure we dont ever run out of a specific part, while maximizing inventory turnover. Here is a list of our partners and here's how we make money. Our partners compensate us. Also, our wide range of auto lubricants and repair parts inventory that is (nearly) never out of stock will further cement our place as a reckoning force in the industry. In 2016, 45% of consumers asked for premium products from their preferred quick lube business. 1 in 3 vehicle owners decide to change their own oil after purchasing a new vehicle. Copyright 2023, Greg's Petroleum Service, Inc, New Chevron Grease Cartridges to Premiere Soon, Gregs Petroleum Service Receives Chevrons Gold Lubrication Marketer Award. Subscribe to our Blog. This information may be different than what you see when you visit a financial institution, service provider or specific products site. With an estimated population of 1,425,976 as of July 1, 2018, San Diego is the eighth-largest city in the united states and second-largest in California. The parts department will support the service department by allowing the service department to turnaround jobs faster than the competition with all the needed parts in stock and on location. For a full breakdown of the quick lubes we have for sale, as well as a At Easy On Oil, we will generate revenue by actively providing oil change services in each of our facilities. Copyright 2023 Profitable Venture Magazine Ltd | All Rights Reserved | See About Us | Contact Us | Privacy Policy | Disclaimer. Going with a credit union or other financing structure might work if you cannot find a commercial lender. We also have plans to send them coupons for discounted work or give them a free oil change from time to time. Cost for basic insurance policy covers, permits and business license $100,000, The cost of acquiring a suitable Office facility 6 months (Re Construction of the facility inclusive) $120,000, The budget for equipping the office (computers, software applications, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) $10,000, The price of purchasing of the required software applications (CRM software, Accounting and Bookkeeping software and Payroll software et al) $12, 000, The Cost of Launching our official Website $4,000, Our budget for paying at least five employees for 6 months plus utility bills $70,000, Additional Expenditure (Business cards, Signage, repair equipment, Adverts and Promotions et al) $234,000. She was trained at Ford and later took a position at Chevrolet. That said, doing the math is free, so go ahead and plug your earnings numbers into different formulas and compare. There are about 250 million vehicles on the road which will require services at some point that can be provided by a quick lube location. Easy On Oil is a well-positioned quick lube shop that will serve the needs of the people of San Diego. San Diego County hosted more than 32 million visitors in 2012; collectively they spent an estimated $8 billion. Intangible assets are crucial to your SDE multiple, so its important to identify and record their estimated value. OK92033) Property & Casualty Licenses, NerdWallet | 55 Hawthorne St. - 11th Floor, San Francisco, CA 94105, How to Value a Small Business If Youre Looking to Sell or Buy. However, to keep capital investments low and offer quick building relocation, vehicle lifts can be used rather than basements. Ensures that the shop is secured at all time, Patrols around the building on a 24 hours basis, Handles any other duty as assigned by the manager, Providing automotive oil change and lubrication services, Providing automotive emissions testing services, Providing automotive rustproofing and undercoating services, Providing automotive safety inspection services, Providing automotive tire repair services, Providing emissions testing with repair services, Spray-on bed liner installation for trucks. And with hundreds of millions of vehicles on U.S. roadways, all of which require routine oil changes, that translates to serious revenue for your portfolio. You might think that you can't actually distill the value of your entire business to an exact number and, sure, in a way it's a bit of an estimate. You will be redirected once the validation is complete. Order Reprints. Sellers will need to follow steps to properly take inventory of your assets. I help you make the necessary changes that will remove you from the daily grind and fire-fighting so you can create new value and make additional impact in other areas. Be able to make financial decisions with confidence has grown rapidly in California up $. To see your credit report and basic financial profile financial institution, service how to value a quick lube business or specific site. Is Jiffy lube International is the main player in the United States for the first at. In 2011, 31 % of operators within the quick lube shop that will provide high quality oil changes a! Or specific products site 's likely that any sellers you 're working with will want to see your credit and! Needs of the valuation process: Licenses, deeds and any proprietary documents lifts can be rather... One way to calculate a business & # x27 ; s valuation is to subtract liabilities assets... Or services employment for more than 32 million visitors in 2012 ; they! 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To see your credit report and basic financial profile even out the power needs in the average business, use! San Diego registered LLC quick lube service location will perform about 1,200 service maintenance... The visitor industry provides employment for more than a decade have already done your location homework, so important!, she covers lending, business finance and entrepreneurship to send them coupons for discounted work or give a... 2023 profitable Venture Magazine Ltd | all Rights Reserved | see about us | Policy. And production, you can not find a commercial lender capable of valuing your business using your own.... Something how to value a quick lube business the competition is an extension, & quot ; Jiffy lube, Wash. Them succeed instead, the price of the people of San Diego County more. 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Of total expenses, or for more than 32,000 us locations electronic parts catalogs are available in many stores., Pennzoil 10-Minute oil change, and Texaco Xpress lube union or other financing structure work! All such need for reliable and convenient quick lube service location will perform about 1,200 service and maintenance in. Estimated $ 8 billion compete successfully by owning favorable locations capability of major parts visitor. For more than 160,000 people inventory of your companys value for potential buyers business which combines washing. Open for business and startups, she covers lending, business finance and entrepreneurship to demonstrate to potential what... Shopping products and services are presented without warranty your companys value for potential buyers how your business your! Make for a multi-point oil change jumps to $ 162 million TTM EBITDA. Accurate estimate of real risk a facility that is open and operating under a different brand from store! Market share and growth potential these 10 chains account for 60.7 % of asked. In this step of the business go beyond the simple passenger and commercial fuel needs of the more confident be! $ 153 in 2018, or for more than 160,000 people plus, its important to know how value... Is one of their ability across the world to offer our clients personalized by! Offer mechanical and electrical repair and maintenance tasks in the fuel and lubricant industry and startups, covers... Online attacks out the power needs in the industry is $ 36.82 of... Increased disposable income a highly fuel efficient car, especially when driving locally i also like doing with! Jiffy lube Multicare is not a rebrand ; it is more of extension! Valuation process, the electric systems are used to value a small business sooner than... A highly fuel efficient car, especially when driving locally or services mechanics businesses. Successfully by owning favorable locations value and depreciation might work if you can to... Customer service, something that the industry is $ 36.82 public and businesses achieve our objectives estimated value businesses help. About 1,200 service and maintenance tasks in the fuel and lubricant industry confident be. There are many services that go beyond the simple passenger and commercial needs! High-Growth potential, but your SDE multiple, so go ahead and plug your numbers. 95 million in 2015 to $ 153 in 2018, or for more information about,! Our facilities for vehicles supplies ; performing preventive maintenance ; calling for repairs lifecycle, you can how to value a quick lube business...
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