The United States has the second largest passenger vehicle market in the world, with an estimated 290 million vehicles projected to be on the road, based on vehicle registration stats. We drive to work, school, the grocery store, errands, vacation—and we need a vehicle in good working order to enjoy these freedoms. Because of that, it stands to reason car franchises specializing in automotive maintenance, prevention, and repair—an already lucrative industry—are poised for even more growth due to the state of the economy.
Specifically, the auto industry is still feeling the effects of factory production slow-downs from 2020 and 2021 and supply chain issues. With fewer new cars readily available in inventory, the car in the driveway is the affordable alternative. Plus, due to inflation rates, it’s better for the wallet to hang on to a car and keep it running efficiently despite the mileage adding up. According to IHS Markit, the average age of a car on U.S. roads is 12.1 years, and although cars are built to last, there will always be something that goes wrong; machines do break.
Let’s face it, few of us really know how to do work on our cars, have the proper tools, nor do we have the spare time, especially when it comes to repair. When your windshield gets cracked, or the battery is dead, or the car starts making that funny noise—we have to do more than ignore the problems or turn the volume on the radio up to drown out the obvious maintenance issue. For those reasons, we need the help of after-market car repair franchises.
It’s important to note that no matter the state of the economy, auto repair franchises are considered essential. People must keep traveling, making these franchises recession-resistant. There is always someone in need of services. This means the after-market car care franchise industry has great profit potential. The proof is that the industry itself is valued at $325 billion, with growth estimates coming in at $372 billion by 2024.
Types of Car Franchises
If the auto business is something you are interested in, there are many options to choose from. Most of us think first about engine trouble, but there are many other services in the after-market car care industry that existing car owners need besides those dealing with mechanical issues. Here are just a few other options:
– Windshield repair
– Windshield tinting
– Oil changes
– Leather restoration
– Paint refinishing
– Custom painting
– Exhaust repair
– Car washes
– Auto detailing
The great thing about car franchises is that many come with an affordable price tag and a quick ramp-up, increasing your opportunity to make money faster. Typically, you do not need to be an automotive expert to run one of these businesses. That, after all, is the beauty of franchising. You have the ability to be the boss, and see your dream of business ownership come true, all with a bit of a safety net. While there are no guarantees in business, through franchising your risk is lessened because there is a proven system in place to help you succeed, and it’s in the franchisor’s best interest for you to do well as a franchisee.
What to Consider When Choosing a Franchise
When choosing a franchise to partner with, while many franchises do not require previous experience, having some knowledge of the industry will be to your advantage. Research franchises to determine the best fit for you. Do your homework, talk to current franchisees about their experience with the brand. Study the growth rate of the franchise, look at the franchise disclosure document (FDD). This is the legal disclosure outlining the franchise.
Know your financial obligations; this includes franchise fees, construction costs, lease, royalties and marketing fees. Most car franchises have fees ranging from $30,000 to upwards of $500,000 depending on the brand and services provided. Understand that just because it’s a big brand name does not necessarily mean it will be more expensive.
It’s important to know your finances, know what you can spend or what will be financially sound for you. The franchisor will require that you have a minimum in liquidity and net worth. If it’s likely that you will need help financing this business venture, often a franchisor can assist with third party lenders who are more apt to loan to someone they know is starting a business with a reputable brand name. It means there is better chance the business will thrive and the loan will be paid back. These are important details and a much simpler process than starting a business from scratch with little to no experience under your belt.
Instead, your franchise fee is your initial investment that unlocks the door to a turnkey business. The fee you pay essentially gives you a ready-made business with a proven business model that has been tested and works, a recognizable brand name and the advantages that gives you in the marketplace versus the competition. You gain training, assistance with your grand opening, on-going support, better deals with bulk purchasing of supplies and a network of like-minded franchisees who are there to assist you should you face challenges. Investing in a franchise means you open a shop with instant curb appeal with a known brand logo. It’s a big advantage when you obtain an instant customer base just for opening your doors. It’s a big responsibility, too, maintaining the brands high standards.
Franchising with AAMCO
Truer words were never spoken when it comes to a brand as iconic as AAMCO. We have been a leading automotive repair franchise for more than 50 years specializing in complex car repair. One of the biggest reasons for our staying power in the industry and what attracts customers and franchisees is that we are always positioning ourselves for the next step in the industry, always ahead of the trends, and able to adapt to changing vehicles and new innovations.
Case in point, we invest in training our franchisees and technicians to work on the latest vehicles from hybrids to electric cars. We created AAMCO University where both franchisees and their technicians receive the highest quality training. This means when a customer has an issue with their car, whether it’s a 12-year-old transmission or a second-generation electric vehicle, we are qualified to make the necessary repairs, keep up maintenance or take steps in car care prevention.
As previously mentioned, we exemplify a well-known, highly respected brand with an affordable franchise fee of $39,500. Interested entrepreneurs must have a minimum net worth of $250,000 and liquid assets of at least $50,000 per unit and can expect a total investment between $223,600-330,500 depending on real estate costs. We are committed to your success as a franchisee and provide all the instruction and ongoing support you need to get up and running and enjoy long-term success.
If you are ready to take the next step request info to receive our free franchise information report.