If your shop isn't using at least one mark up matrix to get the most out of your parts sales, then you might be leaving a lot of money on the table.
In fact, auto repair shops have an amazing opportunity to maximize their profit margin on parts sales in particular. Especially when you consider the tools available to support and simplify the entire process. Gone are the days of using pen and paper or busting out the calculators.
Cloud-based shop management systems have made it easier than ever to not only manage your shop, but really get the most value out of the work you're already doing.
Using a parts matrix in particular is one of the most important aspects in making sure your shop is profitable. By building streamlined process for marking up parts, shops can ensure grow your shop’s profit margin while staying fair to customers.
What is an Auto Parts Markup Matrix?
An auto parts markup matrix is a powerful tool for optimizing your parts pricing and increasing your gross profit.
When it comes to providing parts for a repair, auto repair shops can build multiple markup matrixes to determine the best markup percentage to apply based on different factors, like how much it costs your shop to purchase the part from your selected vendor.
In our latest Auto Repair Industry Index shops were achieving an average 35% with just 3 markup matrixes. There's a lot of room to grow their profits!
Why should shops use a parts markup matrix?
It might be easy for a shop to leave parts markups up to individual service advisors. However, this can result in widely varied processes based on each employee’s unique experience.
You want to build a consistent, reliable mark-up process to save your team time, while maximizing profit yet remaining fair to your customers.
With a detailed parts markup matrix in place there’s no more second-guessing.
Instead of spending precious time figuring out the right markup for every single repair order, the perfect markup percentage can be applied every single time -- both saving time while maximizing profit margins on every repair order.
The Price is Right: Efficient Parts Shopping
Before you decide how much to mark up a part, you obviously have to buy that part (or find it in the inventory). When shopping for parts, getting good deals is important, but so is having an efficient process for finding those deals. Efficient shops strike a balance between quickly finding parts and snagging good deals.
There are various ways to quickly shop around and find the best deal on parts. Some shops still send their part’s person to the local auto parts shop or scrapyard to find those hard-to-find parts.
These days, many auto repair shops save themselves a lot of hassle by turning to shop management systems that enable them to swiftly compare prices from multiple vendors at once. With online parts houses, repair shops can earn back the time they would have spent sending someone to hunt down these parts and making these comparisons in person.
Mark Up Parts By Just the Right Amount
After comparing prices and deciding which parts to purchase, it’s time to find the markup “sweet spot,” where it’s a good deal for your customers and your business.
As a general rule of thumb, the more expensive a part is, the less you can mark it up.
Consider this: fast food companies make some of their highest profit margins off of their least expensive menu item—soda. If a cup of soda costs the fast-food company $0.25, charging a dollar for it gives them a 75% profit margin. But a 75% profit margin on a hamburger that costs the fast-food company $7 to make would hike up the price to $12.25, which is probably more than most customers are willing to spend.
If you double the price of a $10 wiper blade, the customer won’t bat an eye. But if you try to mark up the price of a $400 alternator by 100%, it’s a different story! The customer will balk at the $800 price tag and probably go ask another shop for a second opinion.
Reach the Right Pricing With a Parts Matrix
Marking up Parts with a Simple Calculation
A simple calculation is used when you markup parts in a certain price range by a specific amount.
But you can also use a compound calculation for parts markups. With a compound calculation, parts are marked up by different percentages within specific cost ranges. For example, if you sell a job for $20, you could mark up the first $10 by 10%, and the last half by 20%.
Marking up Parts with a Complex Calculation
While compound calculations are more complicated, using them for your markup matrix can give you an edge when it comes to increasing your gross profit margins. Some shop owners that use complex calculations in their parts markups have been able to increase their profit margin by about 8% to 10% when compared to using a simple calculation.
Find the Right Markup Matrix For Your Shop
Ultimately, each shop has unique needs and preferences, and it’s up to you and your team to determine which type of calculation to use when building your parts matrix. But no matter which calculation method you choose, an automotive markup matrix can be a game-changer.
Selecting the right business name for your auto repair shop can be a challenging task. Your business name will be the first impression your potential customers have of your shop and will determine how memorable your shop will be. Use the ideas below to brainstorm the perfect name for your auto repair business.
Creative auto repair shop names
On The Road Again Repairs
NextGear Auto Service
Check Engine Repairs
Torque of the Town
The Engine Room
Chrome & Steel Auto Care
Axle & Alloy Repair Co.
Peak Performance Garage
Smooth Ride Mechanics
Driven Dynamics
Velocity Auto Shop
ClearPath Automotive
Funny automotive repair shop names
The Brake-Up Shop
Motor Mouth Mechanics
Hit & Run Body Shop
Exhausted Mechanics
Hot Wife Automotive A/C Repair
Don’t Tread On Me Auto
The Laughing Lugnuts Auto Repair
Wheel Be Alright Auto Repairs
Motor Mouth LLC
Rust in Peace Repairs
Tek-Tip: Have you thought about how you will market your new business? We reccomend Shopgenie for all automotive marketing needs including websites, CRM, reviews, and more.
Cool mechanic shop names
The Car Whisperers LLC
RoadReady Mechanics
StreetSmart Garage
GearShift Garage
Velocity Motors
Gearhead Garage
The Repair Authority
PitStop Pros
Full Throttle Repair
Trackside Garage
Unique and catchy names
Car Medic Garage
Nuts & Bolts Car Mechanics
Unleaded Car Repair
Honest Engine Repair
Auto Barn Car Care
Iron Horse Garage
Blue Ridge Auto Works
RevSync Mechanics
The Auto Vault
Summit Auto Haven
Rust & Revive Repair
Simple auto shop name ideas
Car Surgeons
The Car Guys
Engine Experts
Quick Fix Automotive Repairs
The Brake Brothers
One Stop Auto Shop
Auto Solutions Inc.
Pit Stop Garage
Turbo Tires & More
Wrench Wizards
Service-Specific shop names
Brake Check Repairs
Oil Be Back Automotive Repairs
Vivid Vehicle Body Shop
1 Hour Heat and A/C Auto Repairs
Battery Solutions LLC
Actually Discounted Tires
Renew Collision Center
30min Oil Change Shop
Restored Right Auto Body Shop
Mobile mechanic business names
Repair on Wheels
Roaming Automotive Repairs
One Stop Repair Shop
One Call Repairs
Wheels On The Way
(Insert last name) Mobile Mechanic
The Leaky Gasket Mobile Repair
1 Hour Mobile Mechanic
24/7 Mobile Mechanic
How to select the right auto repair shop name
Once you have your list of potential shop names narrowed down, it is time to do a final round of research to make sure your name is legal, optimized and ready to launch. Check out our final 6 tips and tricks below.
1. Legal checks
Before you can launch your new automotive shop name, you should check for Trademarks by visiting the US Patent and Trademark Website. Simply search your pending business name to see if it is taken or if you can proceed.
Search engine optimization for auto repair shops is an important avenue for driving brand awareness and new customers. To maximize your new business name, aim to include common keywords like “automotive”, “repair”, and “shop”. Also, try to use local terms like “Houston” to help search engines know where your services are located. Lastly, check to see if any competitors are using a similar name and determine if your name will be unique enough.
GoDaddy can check if your new automotive repair shop name is available to use. You will also be able to see how much the domain name will cost and whether it would be cheaper to use a variation of your business name.
4. KISS
Keeping your new shop name simple will help you in the long run. Potential customers will find it easier to remember (and share via word of mouth) if you keep it short and simple. Plus, shorter business names are easier to fit on business cards, advertisements, and social media.
5. Marketing
Looking down the road, your new business name should fit within your overall automotive marketing strategy. Are you planning to use a certain logo or color scheme? Make sure your name fits the theme you are aiming for and attracts your target audience. If you plan to use social media marketing, check to see if your business name is available as a social handle.
6. Set the tone
Your name is likely your first impression with your customers. Once you are ready to launch, give it one more review to make sure it conveys the right brand identity and message. Lastly, have a friend or colleague offer feedback on your business name and see how it resonates with them.
Closing Thoughts
Finding the right name for your business is a daunting task and we hope this guide has helped you brainstorm new business name ideas and narrow down your list. We recommend taking the extra time to make the right choice up front so you don’t have to rebrand down the road. As always, there is wisdom to asking for feedback from your community. Select your top 5 names and ask for help picking the best shop name for your business.
Building a startup takes time, effort, and a lot of determination. You and your team have invested in a great idea, and everyone works diligently to bring new team members, investors, and customers on board. However, the process doesn’t end once the product or service has taken off and gained popularity.
A startup can operate on a lean team, with people wearing multiple hats and taking on extra responsibilities. But as the company grows, it will be time to hire more employees and scale the company to meet demand.
How to scale the business is an enormous question that causes hesitation for many leaders. How do you expand your business offerings and your team without losing the heart and inspiration that helped the startup succeed in the first place?
In my own business, Tekmetric, which offers shop management software for auto repair businesses, I have relied on a few tactics that enabled me—and our whole team—to scale sustainably. Here are four of the most vital.
Thought Leadership
Shop Management
You’ve Built a Successful Auto Repair Shop Startup. Now What?
In auto repair, there are many moving parts to keep track of—both the literal parts your shop uses to repair vehicles, and the parts of your business that determine your shop’s efficiency, security, and ability to grow. If you want your shop to flourish, it’s crucial to devote part of your business to keeping track of the parts you order.
Many shops track parts in terms of cost of goods sold. The parts you need for the job are included on every repair order, so it’s easy to see what parts your customers are paying for as long as you have a solid process for building repair orders.
But what about in terms of accounts payable? How does your shop track how much you’re spending for parts from the supplier?
Thought Leadership
Why Match Parts from Repair Orders on Purchase Orders?
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