Every year there are more and more cars on the roads, despite the bans imposed by governments of different countries. According to European Union statistics, Poland has been ranked number one in the number of old cars in Europe for many years in a row.
According to Eurostat, Poland has the oldest car fleet in the European Union. The share of passenger cars aged 20 years and older in 2019 was 37.9 per cent. Estonia ranked second with a 31.5 per cent share of old vehicles in the fleet, while Finland ranked third with 26.9 per cent. The highest proportion of new cars (less than 2 years old) was seen in Ireland (28.8%). There were also many new cars in Luxembourg (23.7%), Belgium (22.9%) and Denmark (22.6%).
All this suggests that despite the active introduction of electric transport, car workshops in Poland will still be relevant for many years to come.
It is not surprising that many people are still thinking about opening a car workshop.
We have collected useful information and are happy to share the figures.
In order to calculate the efficiency of any commercial project as accurately as possible, it is necessary to draw up a business plan according to which the enterprise will operate in the future. In such a program, it is necessary to take into account all aspects of the production and economic activity of the car service station, the amount of costs for its opening and the expected financial results of its work.
What is needed to open a car service in Poland? It is necessary to register the new business object in the business register and the tax office. There are no restrictions on the choice of organizational and legal form for registering such an enterprise. Therefore, which is better to open: an Individual Entrepreneur or LLC, you have the right to decide for yourself. Registration of a legal entity will cost a bit more and may take more time than registration of an individual entrepreneur.
The next step will be to choose the location of your future car workshop.
To ensure a steady flow of customers, try to choose areas near highways, where transportation can interrupt its route by stopping. It will be effective to open a car workshop in the vicinity of a workshop or a huge parking.
When you finally decide on the location of the car service, you should proceed to register all the documents necessary to open it.
Documents required to open a car workshop
First of all, you have to find and rent a ready-made premises.Of course, you can purchase ownership of a plot of land and erect a car service building on it, but not too many people can admit such expenses at first stage.
If you prefer the option with a lease, it is necessary to pay attention to certain nuances when entering into an agreement with the owner:
- The premises for the car service should not be unauthorized. You should check the certificate of ownership of the building from its owner, which should indicate the appropriate use of the structure
- The premises must meet all sanitary and hygienic rules and regulations (lighting levels, ventilation, etc.).
- The height of the building (the floor on which the renovation work is planned) should be at least 3.5 meters, since it will be necessary to install an elevator for cars to fully operate the car repair station.
- The area of the structure should be about 100 square meters – this is enough to install two car stands.
- It is legally impossible to organize a car service in the immediate vicinity of residential buildings. The distance from the service point to the nearest house must be at least 50 meters.
In addition to the certificate of state registration of the company (LLC or IE) and the lease agreement for the premises, you must obtain:
- A certificate from the Sanitary and Epidemiological Service
- An application from the local fire inspection
- Documents for opening a car service can be supplemented with certificates of compliance with applicable standards. Certification is voluntary and at the discretion of the business owner. Having certificates for the types of work performed gives a competitive advantage, generally enhances the image of the service station.
To attract customers, you need a website on the Internet. Ideally, customers should be able to find the answer to their question directly on the site. Some advanced services allow you to know the initial cost of repair already when selecting the necessary package. For example, each car manufacturer numbers maintenance cycles – B1, B2 etc. Each of them already includes definite package of spare parts and planned working time). It is necessary to provide an option to register for online service directly at the car service center.
In what amount will it cost to open a car workshop
The lion’s share of the initial capital will have to be spent on the purchase and installation of equipment to open a car service station. Today, technical equipment and tools for car repair are presented in a fairly wide range. You can buy everything you need directly from the manufacturer over the Internet.
The cost of the equipment depends on the manufacturer you choose. The price range is very large, and it is important to realize that the most expensive – does not mean the highest quality. Domestic equipment is usually several times cheaper than imported. In any case, when buying, it is worth paying attention to the warranty period, service conditions and the possibility of getting feedback from the manufacturer.
A car workshop expenses
Approximate estimates for the purchase of equipment and tools for car service operation (we calculate in EUR):
Car lift – EUR 5000 – 8000
Hydraulic press – EUR 1000
Oil change equipment – EUR 350
Compressor – EUR 500
Parts cleaning stand – EUR 1500
Presses, grippers and repair chairs – EUR 3000
Tool sets – EUR 3000
Workshop furniture (cabinets, shelves, locksmith tables, etc.) – EUR 3000
Renovation of premises – EUR 5000
To equip a standard car workshop, this will be sufficient. In addition to the cost of technical equipment for the car service station, the number of mandatory costs should include rent, settlements with service personnel, the cost of outdoor advertising and taxes. If you add up all the necessary costs, the total amount for opening a car service station, designed for 2 lifts, will be about EUR 25000 – 30000. In addition, the entrepreneur in the first year of operation will need a reserve capital reserve to cover monthly expenses in case the service is not sufficiently charged right away. And we’ll talk more about how much a car service earns and how quickly it can pay for itself next.
How profitable is it to open a car repair service?
To calculate the potential profit from the project, you need to know the approximate cost of car repair and maintenance services.
You should realize that the prices of service should not be at the same level as those of car dealers. It is desirable to gather information about the pricing policies of major competing companies before opening an inspection and repair facility and develop a price list, taking into account the slight difference in the cost of services. The process of data collection is called target group research and the search for competitive advantage.
The two-way work with the business client will allow us to attract a large number of customers at the initial stage. Special attention should be paid to personnel. Try to hire employees with sufficient training, adequate education and experience. Don’t expect employees to learn everything in the process. And don’t forget that even the manager at the front desk should be able to sell, not just calculate labor costs.
The list of services of a standard car service usually includes
- Oil changes
- Engine and suspension repair
- Transmission repair
- Comprehensive maintenance
When fully utilized, such a car service station, designed to work on two cars at the same time, provided the business operates on a standard basis (7 days a week from 9 a.m. to 7 p.m.), can bring in an income of up to EUR 25000 per month. This amount is calculated on the basis of the average cost of a standard labor hour in EUR 20 (in Polish currency: non-authorized workshops – from 80 to 100 PLN net, authorized workshops – from 120 to 125 PLN net) for repairing middle-class cars. To see the amount of profit, subtract the amount of expenses from the amount of income and minus the tax paid. Let’s calculate the possible net profit amount for one calendar month. To do this, determine the amount of expenses:
Rent: For undeveloped space, the cost of rent reaches EUR 15 – 20 (this is PLN 80-100) per square meter. The most expensive is to rent equipped building for an auto repair shop. Such a facility in the central districts of the capital costs from EUR 15 to 20 per square meter (about EUR 2000 per room).
Salary: EUR 16000 per month (based on 8 people with a gross salary of EUR 2000. A work schedule of 2/2, and 4 employees per shift).
Utility, cleaning and other bills – EUR 500.
Advertising costs: EUR 1500.
Transportation, gasoline and other expenses: EUR 1000.
If you add it all together, you get the costs about EUR 20000. Don’t forget to take into account taxes, accounting and insurance premiums. Round up, and the average comes out to about EUR 25000. Calculate the net profit: 30000 – 25000 = 5000. This will be the potential profit for one month of work.
To calculate the return on the project, divide the total amount of initial capital put into opening the station by the value of monthly profits.
The result is about six months. This will be the payback period of the business project we are considering. It should be understood that these values may vary depending on the region where the car service station is planned to be opened, the average cost of services and, most importantly, the flow of customers.
How to increase the efficiency of the enterprise
In order for a car service station to bring in a guaranteed stable income, it is necessary to maintain constant communication with customers. This will help optimize the quality of the service as a whole and identify additional customer needs, based on which you can make your enterprise even more efficient and profitable.
For example, in early spring and late autumn there is an increased demand for tire installation. it’s easy to calculate using the same scheme how much money you can make by opening up a service station and tire assembly business on a base.
In addition to providing additional services, you might consider the idea of opening an auto parts store to increase productivity. You, as the owner of the retail point, will be able to take advantage of discounts from suppliers by making bulk purchases, while at the same time sales of products will be guaranteed.
The customer arrives at the car service station without knowing in advance what parts he needs to replace, check-in is done during the diagnosis. When the list of consumables and spare parts to be replaced is defined, he does not have to waste time, he can buy everything he needs on the spot.
In this way you should work on increase customer loyalty and at the same time ensure a steady income.
