Disclaimer: I have been in the automotive business for 23 years, not the tech business.
I have to agree with @orangethirty comments on this page. There is not enough margin in the auto service business to let this succeed. I have known people that washed cars professionally in both small high-end detail shops and full-size car wash operations. The high volume car washes are staffed largely with people that could not get better jobs - felons, drug abusers, those with no education or other job skills. The small high end detailers were generally guys that loved cars and found happiness in polishing a Porsche for an afternoon. There was an old guy named Al that used to come by my office and spend an hour on my truck for $30. I don't know where he went, but I miss the service. You do the math on what his income was per year if he had to travel, pay for soap and supplies, and then only grossed $30 per hour. My math estimates that he couldn't be netting more than $25,000 per year.
YourMechanic will also hit this same problem. They promise 30% savings and at-your-door service. This will run into the same issues. There is not 30% margin to cut at any small auto repair shop that I have ever dealt with. For those keeping track, I sold equipment to 200 auto repair shops over a ten year period. There are many car repair problems that are not fixable in the field. The bigger problem is that auto mechanics have the same rockstar ninja aspects as software. The rockstars simply will not be doing brakes in the rain, outside of your work in the parking lot. Why would they? They can earn $100K a year at a dealer, there is no way they are going to earn less in your parking lot. In worse conditions. In the rain.
Ask the question in a different way. Would you prefer to work in a heated/cooled work environment with restrooms nearby, a break room, a place to wash your hands, specialized tools and equipment nearby, support staff to get your parts, queue up the next job, a counter guy to deal with the customer OR----- would you like to work in the rain, deal with angry customers, no restroom, not enough tools or equipment with you, doing jobs that become much harder because of location, etc etc all for 30% less money? You will not get any talented person to work for you. They have better options. Auto repair is very talent driven, especially any area that is hard like diagnostics, transmissions, or solving the problem that the last 3 shops couldn't figure out.
You wouldn't expect to produce good code in a parking lot, would you?
And then there is the classic problem of auto repair. Once you touch the car, the customer finds all sorts of things that YOU apparently did even though you didn't. Scratches, dents, missing items, the list is long and familiar to all.
"doing jobs that become much harder because of location, etc etc all for 30% less money" --- our mechanics make $75 an hour flat rate. That's 3x what they make at their respective dealerships (on an hourly basis). The fact that master technicians (all 8 ase certs, 20+ years of experience) from mercedes, ford, nissan and toyota are offering mobile car repair services and have already finished over 1000 repairs on our platform is probably a good indicator that not every mechanic thinks the way you do.
I am not claiming that you are wrong or that YourMechanic will succeed (only time will tell).
p.s. Of the 1000+ cars we have fixed, not a single customer ever came back to us claiming that our techs made the dents, scratches, stole stuff etc. I am sure we will one day run into some of those interesting people. I may be cynical and/or naive, but I happen to believe that most people are basically good.
I do hope you succeed. Congratulations on repairing 1000 cars. What sorts of repairs were they? If you pay your mechanics so well, how does the business itself make any money? Other questions that spring to mind: What equipment do they have, what repairs do you specifically avoid, How do you source parts, what happens to flat rate when the part is wrong? I looked at your website last week and don't recall seeing this information.
I have not met a shop yet that hasn't had a ridiculous customer complaint. You seem to be lucky, for the rest of the industry it is always 1% that drives you crazy. By that math you should have had 10 unreasonable customers by now. I also believe that people are inherently good. I did $2,000,000 in sales of $50 tools with Snap-on and only ended up with $6000 in bad debt on what where essentially handshake deals. A loss of $3 per thousand.
Also if you would like to have a non-public discussion, you can email me at gregpilling @ gmail.com
All those things you have listed (types of jobs to do, types of jobs to avoid, sourcing parts, not ordering the wrong parts, making money after paying mechanics really well) were all big challenges. It took us a while to figure those things out and now its our competitive advantage. There are still occasional problems, but we are getting better at it every day. Our model assumes that 2% of the customers will have unreasonable demands / ask for refunds etc. Happy to chat anytime art @ yourmechanic.
I think you make some great points. I would add a few things.
I had my car tires replace by a company that has a truck tirevan.com and comes to your home or office. The cost was more than it would have cost me to wait at a dealer which I gladly paid because of the convenience and scheduling issues. The work was professional and the driver used to work doing the same thing at a retail location and it was easy to see why, for him, this was a much better job.
So the ingredients were there to make the service successful. It was a niche though and certainly wouldn't apply to something which (as you say) needed more parts and equipment (not to mention the pricing which works well if you have a high end car but not necessarily with the Chevy crowd.)
The other issue to consider if doing a business like this as a "business" is the tax aspect. No doubt the guy coming to your house not only was taking a hit financially but was also making those dollars go further by not (speculating) paying taxes on any income (just like cleaning people that work doing that on the side or a handyman or anyone in a "cash" business). I don't know that for sure of course. He could have reported all that income. But from my experience (and I'm sure you will agree) probably not.
I was also in the automotive business for around 12 years. Most of it was spent running my own repair shops, one of which was an on-site auto service like YourMechanic. I had the same experience as the Carwash business. Not much money for too much trouble. Now, a repair garage did work out to be profitable because I'm a great mechanic. My work was always top nothch because I cared about my clients. But when things were going well my brother passed away. I had to close the shop one year later. Thats why I moved on to working on software full time. Decided to completely do away with the auto service industry, unless it has to do with software.
The world of auto mechanics is split into two categories. You have the people in the trade because they genuinely love cars and then you have the people who went into auto repair because their high school guidance counsellor said they should. The first group you could identify with as the hackers, the people that take stuff apart because they find it fascinating, and this interest level over a number of years combines to make them rockstars. This is referred to as the 10,000 hour effect on HN. With the other group, they end up doing basic work but never doing the high pay, challenging work. The common slang for this group is "Mouthbreathers" (1).
So there kind of isn't an average non-rockstar mechanic. I will try to answer your question anyway. A person changing oil and doing brake pad replacement might make between $8-12 in Tucson. This worker would not do any engine diagnostics, nor any specialty work like alignment, air conditioning service, or any problems that would be unusual. A surprising number of problems auto shops repair is unusual. Things like "What is that noise at 70 when I hit a bump" which can often be a hard puzzle to solve.
A better mechanic who can use all the equipment could earn up to $1000 per week as a base, but more typically would be paid on a flat rate basis. So you might get $25 per hour flat rate, and you pay would be $25 x #ofhourscharged . The "flat rate" is typically based on Mitchell Time Guides, which was a book and is now a DVD which lists the expected times to do a standard repair. Unusual problems are not covered in this book, which is somewhat inaccurate but is the best the industry has. (Startup idea: crowdsourced auto repair times).
Specialized skills can get you more money, like any other business. If you are fantastic at transmission repair, or at engine diagnostics, or at solving diesel problems, then you can almost set your own rate. I have a friend who could make a few hundred per hour solving engine drivability problems, but I will note that he is unique. He fixed IBM mainframes before turning to cars. He has his own shop, and works by himself. He fixes cars in a day that other shops have spent weeks on before giving up.
Dealership mechanics can make the most money. A few reasons:
- They work on new cars, so nothing is rusted or dirty. No rusted bolts to slow you down.
- they work on the same cars over and over again, they become familiar
- they have warranty work coming in, and recall work
- the dealership charges more per hour typically than an independent shop
- the dealer is forced to buy the latest equipment, and to send mechanics for training
- the automakers restrict repair information from the auto repair aftermarket
Remember that cars are complex systems now. They involve mechanical parts, electronic parts, wear items, user behavior, and you never have enough information to solve the problem. You don't get to see the source code on anything, most of the time you are diagnosing blind. There are no logs to review besides the trouble codes. Trouble Codes only tell you what the opinion of the ECU is, not reality. I sold several million dollars of equipment based on this distinction.
(1)Side note: once (1996) I won a cruise with 4000 other Snap-on Tools people. My ice-breaking question was "How many mechanics do you let work on your car?" with the typical answer being "none" or "just a couple" which is revealing if you consider that on average a Snap-on Tools dealer has 300 customers. So 1% pass the standard of a salesman who visits him once a week.
I have to agree with @orangethirty comments on this page. There is not enough margin in the auto service business to let this succeed. I have known people that washed cars professionally in both small high-end detail shops and full-size car wash operations. The high volume car washes are staffed largely with people that could not get better jobs - felons, drug abusers, those with no education or other job skills. The small high end detailers were generally guys that loved cars and found happiness in polishing a Porsche for an afternoon. There was an old guy named Al that used to come by my office and spend an hour on my truck for $30. I don't know where he went, but I miss the service. You do the math on what his income was per year if he had to travel, pay for soap and supplies, and then only grossed $30 per hour. My math estimates that he couldn't be netting more than $25,000 per year.
YourMechanic will also hit this same problem. They promise 30% savings and at-your-door service. This will run into the same issues. There is not 30% margin to cut at any small auto repair shop that I have ever dealt with. For those keeping track, I sold equipment to 200 auto repair shops over a ten year period. There are many car repair problems that are not fixable in the field. The bigger problem is that auto mechanics have the same rockstar ninja aspects as software. The rockstars simply will not be doing brakes in the rain, outside of your work in the parking lot. Why would they? They can earn $100K a year at a dealer, there is no way they are going to earn less in your parking lot. In worse conditions. In the rain.
Ask the question in a different way. Would you prefer to work in a heated/cooled work environment with restrooms nearby, a break room, a place to wash your hands, specialized tools and equipment nearby, support staff to get your parts, queue up the next job, a counter guy to deal with the customer OR----- would you like to work in the rain, deal with angry customers, no restroom, not enough tools or equipment with you, doing jobs that become much harder because of location, etc etc all for 30% less money? You will not get any talented person to work for you. They have better options. Auto repair is very talent driven, especially any area that is hard like diagnostics, transmissions, or solving the problem that the last 3 shops couldn't figure out.
You wouldn't expect to produce good code in a parking lot, would you?
And then there is the classic problem of auto repair. Once you touch the car, the customer finds all sorts of things that YOU apparently did even though you didn't. Scratches, dents, missing items, the list is long and familiar to all.