5 Most Common Yet Expensive Mistakes Made by New Auto Repair Businesses

Most new businesses grow from a startup and later transform into a franchise. Some businesses fizzle out over time. But don’t worry, this blog goes over the common mistakes most businesses make.

Why do auto repair businesses fail?

Every entrepreneur entering the market may not consider reasons for failure. But because they are way too enthusiastic about starting a new business, they neglect basic facts.

When a business owner learns from others’ mistakes, they are more likely to avoid failure. Let’s not be confused: Every business has to struggle for success. It’ll be challenging, mind wrecking, and difficult, but it is worth the struggle. For some auto repair shop owners, customer service becomes a big problem, while for others, it’ll be the accounting part of the business. That’s because every business is different, and every entrepreneur comes from a distinct background.

From the beginning, every business owner will be concerned about a suitable garage, quality machinery, and the location of the repair shop being close to potential customers.

In the end,  the biggest challenge and the biggest goal is the same: to set up a viable business.

Many new businesses entering the auto repair world fall into the same traps as their predecessors and shut down. So, there are some ground rules and facts for everyone to follow. We have listed down some of the most damaging mistakes businesses made that led them to failure.

Let’s have a look at them:

#1 Trying to Become Super Rich in the First Year

The ultimate goal of setting up and running a business is making money out of it. But expecting too much too soon can permanently shut it down instead. Especially in the initial phase, when you are defining processes, getting attention, and setting policies, you tend to the highest energy. Naturally, you wish and aim to accomplish everything to your fullest. But you have to be mindful of every step you take.

Trying to push yourself or your new business beyond the limits will break everything down. All the businesses that mentioned ‘haste’ as their underlying cause of failure recommended being patient for best results. Even if your competitors are making more profits, don’t compare at this moment.

Remember, all good things take time.

The initial six months or a year after setting up your business are crucial. In this time, you will either beat your business out with rash decisions or make it more stable by making the right choices.

#2 Try to get more profit out of one customer

When you aim to make money out of only a few repairs, you fail.

Let’s not deny that some customers bring more money to the table, but you have to play smart. You shouldn’t be trying to make 100% of your profit out of one sale or service. Don’t fall into the trap of overcharging.

Customers now are better informed than ever. They come to you with proper research and have the comparison of different market prices. So, don’t lose a customer by being greedy. Yes, you can upsell them. But only if it doesn’t sound pushy.

In the first visit, charge your customers the usual amount to keep them coming back. Here’s the perfect way to do that.

Showcase cards for regular maintenance services, like an oil change. Display the price as:

” Change your car’s oil now in just $75 $50.” Strike the overcharged amount to make them feel like they are getting a discount. Try it out, it works!

This technique focuses on increasing your customer base rather than trying to make a huge profit from lesser customers.

#3 Not knowing who your best customers are

In the beginning, every customer is distinct. But with time, you realize who matches your business the most. And how do you recognize them? Well, you need to have constant insights into your data using an efficient workshop management system. Consider the total profits and repairs, and then calculate ROI.

List down those ideal customers, and try to find out more like them in a wider consumer base. That’ll save you from wasting time trying to satisfy every customer. The modern way of doing this is maintaining customer personas that you revisit at least once a quarter.

The smartest entrepreneurs always understand and focus on their ideal customers. Your goal should be the same!

#4 Looming over employees

While most repair business owners are experts in solving problems, they are usually also trained technicians, so they tend to excessively interfere with their employees’ work. Of course,  the intention is to help, but when you become a business, it is considered micromanagement.

This habit often undermines long-term productivity, and your employees start feeling agitated. Unfortunately, most owners realize it when it’s too late. So, it is always recommended to keep an eye on the bigger picture, instead of bothering employees too much. When your mind is free, you can think of innovation and growing your business rather than getting bogged down by simple technical repairs.

If you feel like supervising employees, get yourself an auto repair shop software. Create everyone’s individual accounts and observe their performance.

#5 Failing to Understand that Marketing is an Investment

“If you launch it, customers will come.”

This is a wrong belief.

In fact, “if they know it, they’ll come” makes more sense.

Every new business needs to understand the importance of marketing before even launching itself in the market. There will be a few people who will visit your repair garage when they see it. But building the hype is essential. It’s not that your services are not worthy enough to bring customers,  the issue is that the competition is high.

Why do you think Walmart advertises when billions of people know about it? It is a brand, but marketing their brand helps get more consumers.

But there’s a difference.

Big brands invest in marketing to expand their business. Startups have to market to build a healthy customer base.

Living in the digital age, we have thousands of platforms to spread the word out. This may include website building, SEO, content marketing, PR, influencer marketing, Google Ads, and other forms of paid advertising. So, take a look at your options, decide what works with your business model and budget, and go for it. You’ll see a great result from your marketing strategy in the long run.

Last Words

Every new entrepreneur makes mistakes. You can’t avoid them completely. But it’s wise to learn from the failures and mistakes of others and not repeat them when plunging into the world of business. Learn from other’s errors and make your growth path a bit smoother.

Good Luck!