For those interested in purchasing an auto repair business, here are two statistics worth noting: in 2020, there will be 76 million cars aged 16 years or older in circulation, and average length of time Americans are holding on to cars has increased 60 percent in the last decade. Older cars require more care, so this is good news for the aftercare automotive market in general and auto repair shops in particular. As with other independently owned businesses, success depends on providing personalized customer service, investing in a profitable niche, and adapting to overall industry changes.
Auto Repair: Fix It, and They'll Come
How much of the shop's equipment is currently in good repair? Small Business Chron places the value of basic auto repair shop equipment at roughly $30,000, the single biggest expense.
What is the annual revenue? The average owner/mechanic can net $54,753 a year in the first two years of operation.
Do you know the biggest market share in the industry? Tires account for the single largest share, at 33.48 percent.
Do you know the shop's customer base? Household customers make up 75 percent of the industry share.
According to CNBC, money is flooding into the hospitality industry, with growth expected at 108 percent from 2016 to 2026. Restaurant industry sales alone are predicted to reach $1.2 trillion by 2030, and the industry will employ 17 million workers. One of the key sub-sectors is sustainable food providers. Restaurant owners who can adapt to the changing needs of working Americans, including flexible meal time options and a variety of delivery services, are also poised to fare well.
Restaurants: Customer Service Is King
What is the start up cost? $275,00 is the median cost, or $95 per square foot on average.
Are there conditions attached to the lease? Some leases require additional red tape from new owners.
Do customers love the food? You want to vet the local reputation as carefully as possible.
Does the place already have a liquor license? It will increase profit margins, but the cost of the license itself can be up to $400,000 in some states.
Overall, the hotel industry is expected to experience flat growth in 2020. Independent hotels and motels are an exception to this trend. Their ability to cater to guest needs within a niche market, combined with the fact that millennials are looking for a more authentic travel experience, give independent motels a significant advantage over chain motels and franchises, making them a great business opportunity.
Motels: Host an Authentic Travel Destination
Do you know the competition? Perform research on local occupancy rates, types of accommodation, and area reviews before you buy.
Have you talked to the city planner's office? New zoning laws and long-term construction projects can impact your business.
Do you have the financial records? You are entitled to view the records going back three years, according to Small Business Chron.
Is the establishment up to code? You'll need a good inspection report to make sure there are no violations and that things are functioning properly.
Owning a gas station can be challenging due to fluctuating oil prices and the rise of EVs. Awareness of these challenges is critical to success; owners who can create a more customer- centric model, use digital tools to build brand loyalty, and embrace innovation —including investing in EV infrastructure — are poised to create a profitable enterprise. For entrepreneurs willing to adapt and become innovators, there is great potential in this multi-billion dollar industry.
Gas Stations: Profit at the Pumps
What else are you planning to sell? Eighty percent of convenience stores in the United States also have fuel pumps.
What about the tanks and pumps? It's important to find out if this essential piece of gas station equipment is in good shape and meets the rules and guidelines for your state.
Do you know the station's environmental history? According to the EPA, the average cost to clean up a problem is $130,000.
Is it worth investing in the infrastructure? EV will transform the gas station industry in the coming years, and you need to decide how proactive you will be.
Overall, the hospitality industry is booming, and bars are no exception. This $27.5 billion industry has grown 2.9 percent since 2015 and has outpaced the growth of other sectors in food service and accommodations. As with restaurants, awareness of key trends is crucial. Customers are looking for sustainability, embracing carbonated beverages, longing for a return to classic cocktails, and inbibing substitute liquors in order to get the taste without its inebriating effects.
Bars: Bottom's Up to a New Venture
Do you know the average sales price? The cost of buying an established bar can be as low as $20,000 -- but popular nightclubs for sale will be pricier.
What type of bar do you want to own? There are nightclubs, Irish pubs, neighborhood bars, and live music venues -- to name just a few.
Will the liquor license transfer over to you? Many states do allow the transfer, but you need to check your jurisdiction.
Do you know your target market? Unless you'll planning to rebrand, you'll need to cater to the tastes of the existing client base.
Despite the trend of repurposing and reviving brick and mortar shopping malls, 12,000 retail stores were slated to close in 2019, and growth in the global retail market is predicted to be flat through 2023. Contrast that with ecommerce, which did $3.53 trillion worth in sales in 2019, a figure that is expected to double by 2023. For the small business owner, ecommerce offers the ability to make direct contact with customers, use and collect their data, and offer custom brands. The combination of this much control with low operating costs makes this an attractive industry for investors.
Online Businesses: Real Fortune, Virtual Setting
Do you understand the niche? Since you'll be involved in branding and marketing decisions, it's good to understand the service or product behind the website.
Is it a proven money maker? Ecommerce, social media consulting, and aflliliate marketing are among the top online businesses cited by Business News Daily.
Have you checked the metrics thoroughly? It's particularly important to look for consistent monthly revenue and traffic to the site.
Do you know what you'll be getting? An online business sale should at least include the domain, website, social accounts, and customer list.
Finding the right location is the single biggest factor in purchasing a liquor store; within the same city, some stores thrive, while others fail. Due to increased competition from convenience stores, liquor store owners must also find ways to boost profitability, including hosting events to spur sales and catering to local tastes. In general, the sale of alcoholic beverages is expected to grow at an annual rate of 2.5 percent through 2023.
Liquor Stores: The Consummate Corner Store
Do you know the local, state, and federal laws? Liquor stores are heavily legislated, and even if you are purchasing a pre-existing business, you have to file the necessary applications and meet eligibility requirements.
Have you researched the location carefully? When it comes to liquor stores, location has a huge impact on potential cash flow.
Have you factored in the cost of inventory? Due to the control distributors have over product, so you won't have much negotiating room.
Are you willing to be a community staple? Successful mom and pop stores tend to give back to their communities.