How profitable is an auto repair shop?

With the prices I’ve paid for car repairs, I’d have to guess that the shop owners are rolling in money (a lot of it mine!). But is that the case in reality? How much would you expect the average owner of a repair shop is making?

I had my own shop in the early 80’s, I made enough to pay the bills and keep a roof over my head. I charged about half what dealers charged but I had fewer expenses, my father owned the buiding and charged me what it cost him. Some forced EPA rules then a job offer from a large airplane manufacturer and I decided to shut down my shop. I know someone that has a small shop today and I wonder how he makes ends meet. Most of his work is on older cars owned by folks that can’t always pay for the repairs. He seems to spend a lot of time in court suing to get people to pay their bills and selling the cars of those that won’t pay. He says he doesn’t work for anyone but himself and that is what makes him happy.

It’s like any other business!
Some shops are gold mines, some are sink holes for green paper.
If you keep costs down and have a waiting list for customers to get in for service, you’ll do okay for yourself.
If you have slow times, or let your costs get out of control, you’ll get hosed.
You may think that the labor rates you pay, which are likely 2-9 times what most consumers make per hour, are extortionary, but if the parts on your job are cheap, they’re the ONLY thing paying the rent, wages, insurance, training expenses and tool costs of the garage.
Any idea how much setting up even a three-mechanic garage with a decent set of tools costs?
You could make a pretty penny just tying up that $30K in the stock market!

30K? :rolleyes: I wish.
I stopped wrenching 14 years ago when I got the teaching gig. At that time I had over $80,000 in hand tools. That was in 1992 prices. In 2006 to replace those tools might run close to 100K. Hell a tool box alone can run close to 20K empty.
Remember the motto “Snap-On you can buy better, but you can’t pay more.” :smiley:
(seriously there is a difference between pro level tools, and the other stuff.)
I did not own many of the tools that a shop would need, but I do own more than many technicians.
It is expensive and difficult to run an indepedent shop nowadays.
You can easily spend $10,000 a year on literature subscriptions. Electronic diagnostic equipment can run several thousand a year. Rent, licenses, permits eat a chunk. Hand tools? How much do you have?
Can you make a good living. Yes. Is it a gold mine? Sometimes. Is it damn hard work? Yes, a good friend of mine left the dealer and opened his own shop. If I want to talk to him at 7:30PM I can call the shop, he will be there. Can you wind up going broke? Yup especially if you aren’t both a whiz at fixing cars and a good businessman.