You don’t have anywhere near the number of car collection of Danny Koker from the History channel “Counting Cars,” and most certainly nowhere near what comedian and talk show host Jay Leno has. But your dream is to have a car collection someday.
Right now, you’re okay with your two-car collection: one is a Toyota Camry, and the other one a 1968 Volkswagen Beetle. You’re a finance consultant and do your work mostly from home, except when you must attend meetings. This flexible time allows you to pursue your hobby as a mechanic, which also includes restoring old cars.
Since you have more time, you’re considering putting your skills to earn more money on the side. Friends have already been encouraging you to start your automobile restoration business. You’re a confident hobby mechanic, but to provide the service professionally? You’re a little unsure of yourself. You don’t know what’s involved in terms of financing or getting new customers. How does one do it?
An Overview of the Car Body Shop Industry
The car body shop industry in America registered a strong performance with total earnings of about $50 billion as of July 2019. The number of businesses is just below 125,200. This strong performance is also mirrored by the $2 billion revenue of the classic car dealership.
Your idea seems to have merits given these figures.
From Old to New
Given the size of the classic car dealership, there seems to be a captive market for your business. Here are more things to think about when starting an automotive custom restoration service:
- Garage location. An easily noticeable location inside the city would, of course, be ideal. But leasing a space or property that’s a little bit out of the way but with a high lease price is something that you should be aiming for. If you can save big on rent, then you are already doing the right thing. Make sure that you can create the right setup for your garage with the proper height, lighting, and ventilation.
- Government compliance. Go to your county or state office and find out about the requirements for zoning, permits and licensing, and more. Make sure that you have all the necessary licenses before constructing or incorporating anything into your structure.
- Restoration specialist. Your shop isn’t just a repair shop. While a good mechanic is needed, you want someone who’s highly trained in doing restoration work. This person must not only know how to do the restoration work but would also know how to source parts and other materials, especially for old or vintage cars. If you can’t find a skilled restoration specialist, find someone who can be mentored by an expert. The goal is to transfer both knowledge and skills to the apprentice.
- Pricing. Restoring vintage cars or even relatively newer cars takes a lot of time. Typically, the labor charge is about $100 per hour. You’re going to have to charge for materials and overhead costs. Depending on the restoration project, you can expect to earn annual profits from $50,000 to $100,000. With specific projects, this could reach to about a million dollars.
Car restoration and especially vintage car restoration is a niche market. If you don’t do your marketing correctly, the flow of clients might be erratic. Consider augmenting your revenue by offering standard repair and maintenance services.