Auto repair shop business plan module Essay Example

assess its business strategy and positioning in the market to determine if a differentiation strategy would be more viable. If proven feasible, FRAR may increase prices, leading to higher profit margins compared to competitors ( Abrams 227 ).

Mission

Fast and Reputable Auto Repair's mission is to be a reliable provider of car repair services, offering a wide range of car parts. Our focus is on personalized services, providing fast and standardized assistance to our customers. Additionally, we are committed to maintaining an advanced computerized system for tracking and managing our inventory of repair parts.

In addition to maintaining a balanced inventory level, our goal is to maximize turnover of fixed parts. We will achieve this by ensuring a reliable and innovative supplier attachment that can deliver orders on time.

Keys to Success:

FRAR's success is dependent on offering reliable car repair services and establishing strong relationships with auto-repair component providers. Furthermore, we commit to ensuring the availability of car parts with an unlimited supply to eliminate shortages and facilitate prompt order and delivery of crucial components.

Important Premises:

At FRAR, our core principles are based on the following ideas.

The primary focus will not be on offering auto-repair services or trim constituents upon recognition, as it is believed that providing such services will slow down the expected increase in sales volume (Sclar 324). Additionally, FRAR anticipates a consistent and growing demand for car repair services from customers in England. Although there may be some variations depending on the seasonal nature of our business, FRAR expects to maintain excellent performance during peak times.

Finally, FRAR (Fast and Reputable Auto Repair) operates under the assumption of ensuring a solid financial

foundation. We believe in the accessibility of necessary capital to support our financial plans. This fundamental belief will drive the growth of our venture, as adequate capital is essential for starting any business.

Company Summary

Fast and Reputable Auto Repair is a new business venture consisting of a management team composed of four individuals: an overall manager, a sales executive, a finance decision-maker, and a partner. FRAR will provide standard and reliable car services and various car parts, targeting both the upper and middle-class markets in order to fulfill all customer demands.

FRAR will be privately owned by four spouses and the startup capital will come from the contributions of its member/partners.

Company ownership - FRAR will be incorporated in England and privately owned by four spouses. It will be operated and directed by a hired direction squad. The aim of the company is to run as a going-concern, with the intent of maximizing sales volumes and profits.

Start-up summary - Contributions to the company will be made on an equal basis. If additional capital is required, it will be financed through a bank loan secured by the members' belongings.

The direction squad will approve such a move, aiming to commence operations once we have a robust four-month stock list to support our efforts in attracting loyal customers. The main expenses will be acquiring assets like telephone systems, furniture and equipment, pick-up truck, and essential warehouse equipment.

FRAR Locations and Facilities


Our Location

FRAR will be situated in the central zone of the London metropolis.

The chosen location will be beneficial for us in several ways. It will provide easy access to fast motor services

orders and increase visibility for our towing trucks. Additionally, it will allow clients to easily submit orders or requests for car parts before their scheduled servicing. Furthermore, the location will enable the FRAR marketing team to strategically advertise our high-quality services through billboards in key city streets. FRAR management believes that this location will attract potential partners or organizations that frequently require our repair services.

For illustration, in recent years, various motor-racing games have been organized and conducted within the city area. Such an event could provide FRAR with an opportunity to interact with group clients from the patrons. By centrally utilizing FRAR services and car component repair shop, key clients will be able to enjoy our high-quality services on a 24/7 basis. The strategic location is crucial for attracting clients (Sclar 96). This has been our main objective in order to secure a larger market share in the initial years of operation.

The identified location zones will potentially install other important logistics such as constituent supplies and looming activities. FRAR will also enjoy faster financial transactions that may involve borrowing from financial institutions that are possibly located near our vicinity or even during the money transfer process.

FRAR Facilities

We plan to acquire our business premises on a rental agreement before considering a feasible rental project or even the purchase of our own building. This may happen in our third financial period in operation.

In essence, FRAR plans to operate within a 3,200 square foot store, with future plans of expanding to approximately 10,200 square feet by year three. Considering the potential to share our business facility with other ventures, whether related or unrelated to our projects, FRAR sees

this move as advantageous. Doing so would allow our neighboring businesses to potentially become our first customers.

Likewise, we can use the to express our intent to different clients, whether they are visiting our premises directly or being influenced by our neighbors. This change will also make it easier for us to attract, keep, or secure potential customers who may need car repair services. Our facility will be divided into three sections to provide faster service. Firstly, FRAR will operate a fully stocked showroom to display our repair components to various clients.

The salesroom will be useful for various purposes, including open-day events and regular business operations. It provides an opportunity for clients to become acquainted with our car components. Additionally, it allows different clients to communicate their specific car repair needs, which helps us determine what types of parts to stock. For example, the salesroom assists the marketing division in understanding the specific repair parts requirements for SUVs, cars, and other types of racing vehicles.

Secondly, FRAR will have the opportunity to operate and potentially manage different office spaces within the same building. The objective is to effectively address the various needs of our clients. Our staff will occupy designated spaces in an open office layout. This arrangement allows different clients to share their opinions on matters that affect our business performance or current market trends, which are essential for decision-making.

Finally, FRAR intends to utilize the back-space of the premises as an extension of our planned Warehouse. This essential installation will facilitate the logistics process by accommodating activities related to fixing constituents, transit, and potential looming issues. Additionally, our warehouse can serve as an extension of

our small-car garage in situations where service delays occur due to a high number of customers.

Merchandises and services

FRAR will be proficient in supplying all types of car repair materials for vehicles of various makes and models.

The strategic focal point for FRAR is to provide 15 bays for each location, with competent staff and quality services to attract a continuous flow of clients. Honesty and transparency are key values for FRAR, ensuring accurate cost estimates and timely completion of repairs. Building trust with clients is essential, forming strong bonds and creating a solid client base. Technology will be utilized to efficiently manage records of available car parts, minimizing any potential delays or shortages. Maximizing inventory turnover and establishing strong relationships with providers will guarantee timely delivery of car components.

FRAR is planning to introduce a range of fixed components in their selection parlor. This will allow their customers to enjoy personalized services while selecting or browsing through the collection of components. Additionally, if any issues arise, the FRAR marketing team or mechanics will be available to provide assistance and offer valuable guidance to their clients. This approach will further support FRAR's efforts in meeting specific requirements (Sclar 83). The primary focus of FRAR is to ensure quick access to almost all vehicle parts through two main divisions. Division one will offer "plain Label" generic components catering to the needs of the middle class.

Our "plain label" will have a broader scope to accommodate all car users and potentially enhance their experience during regular service. Implementing this private labeling strategy will assist FRAR in reaching a larger market, attracting more customers, and increasing our projected profit margin (refer to

Appendices B: Excel Attachment). Our second division will supply the "normal label" components from various car manufacturers. Therefore, our management will assess different manufacturers to determine the most suitable close-suppliers based on their component provisions.

FRAR will exclusively cater to clients' needs by providing them with high-quality services from FRAR's desk. We will effectively utilize our merchandise mix to meet different customer demands at two levels. Firstly, FRAR will offer repair services and spare parts for all consumers, labeled as either "normal label" or "plain label" generic. Secondly, FRAR will provide premium services for customers who require special attention. In these cases, FRAR will charge a premium price for the overall services offered.

Market Analysis Summary

FRAR's focus will be on meeting local service demands and attending to cars that are towed in from locals or traffic expressways.

We will establish contacts with the primary local towing truck companies. These companies will be essential in providing towing services to our car repair shop. We expect that around 75% of our revenue will come from local customers, while the remaining 25% will come from towing services on the freeway, in addition to our loyal local clients.

Market Segmentation

FRAR will target both upper and middle income markets, where there is a demand for standardized and high-quality expedient services. Customers within this segment are typically willing to pay higher prices in order to receive efficient services.

Such client group endeavors to claim that their cars can be stored in fixed stores. These clients are primarily local residents, who make up the regular base of customers for FRAR. In order to ensure the stability of our business, we need a steady and healthy revenue

base, which will be supported by the large customer base we establish in our area.

Emergency Towing Section

We anticipate that 25% of our revenue will come from freeway traffic and local customers through our emergency towing division. Therefore, we will actively seek partnerships with towing companies to facilitate the towing of various vehicles. This will demonstrate our commitment to providing prompt and high-quality services, ultimately helping us capture a larger market share.

Target Market Segment Strategy FRAR's strategy is to focus on the high and in-between category niche of the market. This approach will help us establish a reputable image and meet the needs of our target market. We plan to achieve this by offering convenient repair services, ensuring excellent service quality, and collaborating with various towing companies in the area.

Market Needs FRAR understands that convenience is a crucial requirement for both travelers and upper-middle class clients. There is a high demand for efficient car repair services and related parts among the traffic passing through or visiting popular tourist areas along the main roads in England (Sclar 216).

Service Business Analysis The auto repair industry is known for its fragmentation, with most car businesses specializing either in parts inventory or repair services exclusively.

FRAR will therefore establish a center that combines both services, aiming to provide convenience within a local area. FRAR will benefit from the fact that consumers, regardless of their economic status, value convenience and quality services.

Competition and/or Buying Patterns

In England, there are numerous car repair shops as well as stores selling car components. Analysis reveals that some of these establishments specialize in specific car services, while others cater to different

demands for car parts. Only a few ventures offer both services. Therefore, FRAR will focus on providing convenient and high-quality services in order to differentiate itself from the perceived competition.

We will focus on unity, honesty, and dependability in order to establish a reliable reputation with our clients. This will help us develop a large customer base made up of loyal consumers. In England, our competitors are primarily targeting sales of automotive parts, accessories, batteries, ignition parts, engine parts, and various types of engines. They are also focusing on mobile electronics, car accessories, and manual tools such as wrenches, jacks, and lifting equipment. Additionally, they are offering oil and air lifters, chemicals, as well as automotive services, maintenance, and parts installation (Sclar 423). Our automotive product range includes exhaust systems, wiper blades, suspension parts, and brake parts among others. In order to successfully compete with these rivals, we will need to provide all the products already available in the market as well as those that are currently in short supply.

Investing in our own services and products will lead to reliance on us for all our clients. We will also ensure that our services are of a high standard, so that our clients are never let down or dissatisfied.

Market Trends

There has been significant change and rapid growth in the demand for automobile repairs in recent decades. This growth is attributed to the increasing concern for environmental sustainability, which has prompted car manufacturers to prioritize the production of safer vehicles instead of older models (Abrams 189). In addition, the marketing efforts of automobile repair shops have contributed to this trend. By adopting a market-oriented strategy, FRAR can seize

the opportunity to meet the growing demand for safer cars and secure support from key manufacturers.

The issue of the increasing number of SUVs has led to a demand for strategically located modern auto repair stores near busy streets or fields. This demand is due to cars being considered a popular mode of transportation among the local population in England. As a result, there is a need for various auto repair shops and services in key areas. Baby Boomer parents have also involved their children in car services, allowing them to own or rent cars. Consequently, children are visiting different repair stores to purchase car parts or gain knowledge about the best auto parts.

Industry Participants

FRAR is entering an industry where concerns differ in terms of service provision and competing strategies. Speed Shops are well-known local industry participants that offer repair services at a minimal cost to local customers.

These concerns, such as Speedy Shops and Chassis and Engine Builders, are a greater threat to FRAR because they can start operating with minimal inventory requirements. Despite their lack of marketing experience and business units, Speedy Shops can compromise FRAR's ability to secure a local niche. Similarly, Chassis and Engine Builders play a significant role in this industry as they supply various car parts to different markets, including service needs and engine parts. FRAR may benefit from the specialization these companies have in spare parts supply. Finally, some manufacturers choose to offer repair services at their regular stores to oversee their supply in different geographic or regional markets.

Scheme and execution

FRAR's strategy for achieving our goals is by providing our consumers with quality and/or standard

services. Our services will be both fast and convenient. Additionally, we will ensure a wide availability of car parts inventory and maintain fast supply capabilities for key car parts.

Competitive edge

FRAR will gain a competitive edge by focusing on providing convenient services to our customers through frequent delivery services and after-sale services. We will also offer faster car repair services and establish relationships with local main towing truck companies. In comparison, primary competitors in England primarily focus on retail automotive parts sales, while larger rivals operate as supercenters. Supercenters have a large inventory of popular car parts and related products (Abrams 376).

FRAR prosecutes the aftermarket needs by serving both self-transport service and service provided by others to ensure a comprehensive service supply, increasing convenience and effectiveness. Competitors in English shops offer similar products, with variations arising from the type, model, or number of cars registered in different markets. On average, a single supercenter can provide around 20,000 fixed products.

Our main rivals will include MJ Sullivan Automotive and Monro Muffler Brake (i.e. MMB) and service, among others.

Pricing scheme

FRAR is committed to establishing and providing competitive pricing to maintain its customer base. Auto-repair customers are known to be very sensitive to value; therefore, FRAR will ensure that pricing categories are perceived as good value to various clients.

The locals will receive substantial benefits under the "plain label" if they prefer the premium option. FRAR aims to stay ahead of competition by becoming a renowned value provider. We cannot guarantee that our Marginal Revenue (i.e. MR) will always align with our set prices as we strive to remain competitive.

FRAR is expected to significantly

reduce the prices of all services offered. According to research, their return on assets (ROA) is approximately 4.5% based on the average price of $400 per car (Sclar 134).

Sales Strategy

FRAR will strategically prioritize effectively reaching out to our target segments, which consist of middle and high-class customers.

We will primarily utilize the direct sales staff to meet the strategy. Similarly, we will highly engage the towing truck companies who will assist in capturing highway traffic or even changing local needs among automotive users.

Sales Literature

To effectively drive sales, FRAR will make use of an accessible supply catalog. This existing catalog is a specially-designed card bearing important information that our customer may use to possibly get in touch with our departments during meetings or place requests for arrangements. It's important to note that FRAR's five-color catalog will have different designs depending on the urgent advertising needs. For example, during racing events our hardworking marketing executive will redesign the catalog to include the sponsors logo, our address (only if necessary), or any required printed details; which may aid in conveying only FRAR's image to our customers.

To improve customer satisfaction and increase sales, we plan to conduct a preliminary study to identify changes in our customer's preferences. This approach will help FRAR focus on meeting the specific demands of our niche consumer market. By creating a specialized catalog, we can avoid the need to outsource catalog production services (Abrams 214). To expedite sales, our catalogs will include detailed information and pricing for our "normal label" car components. Additionally, FRAR will produce customized brochures internally.

These flyers will be useful for our major events like open-day or regular

show window activities. The distribution process for our flyers will be similar to our designed catalog. Both materials will be distributed through various agencies. For example, we will provide catalogs to some clients in-store while others can receive them via email when sharing specific details. Additionally, FRAR may choose to personally hand out or publish a specific bulletin at automotive events to explore potential partnerships for boosting sales.

Sourcing

We genuinely believe that our great opportunity to start purchasing various car components and other related parts through various industry relationships will enhance our competitive advantage. Through these effective relationships, FRAR will always have access to and negotiate for fair deals when stocking the warehouse with various repair components. Negotiating car repairs is based on both affordability and market trends for the sought-after services (Sclar 416). FRAR will try to benefit from this strong relationship by enjoying reduced costs during component sourcing. For example, FRAR will attempt to establish special business deals in order to take advantage of price reductions on various purchase requirements.

FRAR will purchase a combination of stock lists from manufacturers or regional jobbers in England. As FRAR's sales volume increases, the management will change the venture's purchasing patterns by deliberately discontinuing jobbers and opting for a direct supply from our defined suppliers or manufacturers. FRAR has strategized this transition to boost future profits.

Technology

Our computer software and hardware systems for FRAR will undergo thorough examination and evaluation before being implemented for business operations purposes.

FRAR will opt for a pre-made software package that runs on computers to fulfill our accounting needs. Additionally, this package will serve other purposes within our organization, including

sales, tracking, purchasing, and inventory management. We expect to encounter various manufacturers with different system requirements. Consequently, during our early stages of operation, FRAR will use both an old and outdated package alongside the anticipated decrease in computer system costs. Similarly, selecting this package could significantly decrease our training expenses to affordable levels.

By implementing this system, all recruits of FRAR will fully understand the system within twenty-four hours. This will primarily expedite our client order entry process, thus facilitating our sales while maintaining our focus on providing high-quality car services.

FRAR Marketing Strategy

FRAR plans to advertise through various press releases. Priority will be given to prominent platforms. For instance, FRAR will place an ad in the "London Gazette" or possibly the "Evening Standard", targeting consumers who may prefer print media. Our print ads, which may include billboards, will also enhance our marketing efforts.

To attract clients, we can have a celebrity endorsement in our advertisement at a negotiable cost, possibly during FRAR's busy season (Abrams 146). During this busy season, FRAR will take advantage of the opportunity to promote in-store promotions. We may ask for support from our identified suppliers with whom we are looking to build a strong relationship, to provide door prizes to promote their unique products. Additionally, trade shows will be useful for showcasing various car repair services and related expertise. Lastly, direct communication will help FRAR effectively communicate personalized information to different customers.

For clarification, this attack will be valuable when passing FRAR's purpose to spread out or even relocate. FRAR Management Team To ensure this ideal store sails through without a doubt, we will have a competent direction squad. The FRAR venture will

have four direction squad members. One individual, a sales expert, will be responsible for selling and sales disposal for the concern. We will also have an overall manager who will be in charge of all the staff members. All FRAR wages will be adhered to as per the schedule (Refer to Appendices A: Excel attachment).

FRAR will also hire a highly experienced individual from the repair parts industry. This person's knowledge and expertise will be valuable to FRAR, as its functions are diverse. Additionally, we will have a qualified finance and management expert in our leadership team. This expert will evaluate FRAR's performance to ensure business goals are met. The management team at FRAR will work in seasons, depending on delivery levels, and may replace unqualified members when necessary.

Effective leadership is crucial for driving organizational success by initiating necessary changes, guiding staff to adapt to these changes, and fostering a cohesive work culture (Sclar 354). FRAR recognizes the importance of having an effective leadership team in order to achieve its mission.

Summary of Management Roles

We seek highly qualified and experienced individuals in the automotive repair and/or car parts industry for our leadership team. The sales executive will specialize in selling car repair components, while the finance decision-maker will have extensive experience in that specific field as well.

Strategic Staffing Plan

Over the next 15 years, FRAR plans to heavily invest in staff recruitment due to the opening of new facilities (Refer to Appendices A: Excel Attachment).

Finance program - FRAR plans to raise capital internally and potentially seek additional financing from local investors to support its operations.
Break-even Analysis - To accurately assess risks, FRAR will regularly conduct break-even

analysis. This will involve analyzing total sales volumes, unit costs, per unit revenue, and fixed costs (Abrams 156).
Projected net income and loss - FRAR anticipates steady profitability growth over the next three years (see Appendices B: Excel Attachment).
Projected cash flow - Cash flow projections indicate that funds are adequately allocated to meet FRAR's daily expenses.

Our business operations will be supported by a continuous flow of hard currency, which will enable us to meet our financial needs. We anticipate that we will secure bank loans within the next year, potentially in financial 2011.