Autobody and Contractor Franchise Startups

Top Franchises for Contractors and Auto Body Shop Owners

I have selected a few franchises listed under “Best Automotive Franchises” that range between 5,000 dollars and 50,000 dollars in startup cost.
Out of the gate, this is misleading because most of the included franchises have much greater total franchise investments.  The low figures are the out of pocket cash requirement which does not factor in-house and third party loans required to get busy.
We are not saying that opportunity does not exist, we are just identifying that it is a VERY SERIOUS proposition and anyone looking to go into it should tread carefully.

The Franchise Opportunity – What do they offer?

  • Questionable Profits – Many times the profit margins given to the prospect are before expenses, which is pretty useless and make it hard to understand actual net profit potential.
  • High Start Up Costs – non-refundable initial franchise fees, required furniture, signs, equipment etc…  These items can be very expensive since there’s NO COMPETITION on these resources.
  • Encroachment – Franchises like Line-X and other automotive franchises do not guarantee a locked radius.  So, when business is good, the opportunity to open another franchise in the area is irresistible to the franchisor.
  • Limited Independence – With a franchise, remember you are buying the business plan as well as the marketing and materials.  So, if you want to improve on your business model there is often no room to make adjustments without breaking your franchisee agreement
  • Restrictions on post term competition – When signing the franchise agreement, the business owner is many times signing away his/her rights to operate in competition with the franchisor for a number of years (5-7).  So, don’t think of going independent once you go down this road.

There is HOPE Keep Reading or go straight to the list of franchises

The difference between franchise agreements

The Noose Business

A Business Form or “Package” franchise is like a McDonalds or Dunkin Donughts where you have extremely high start-up costs, a lot of competition and very strict rules to follow. You are not your own business man, you pretty much belong to the franchisor. These days, it’s becoming more difficult to get into a franchise for a large chain. Mult-unit operators are becoming more popular as they can leverage price and typically have a better track record for succeeding in business compared to a sole proprietor with little to no experience in running a successful business. Franchisors are able to be picky these days. They don’t just want your money; they want to guarantee their own success.

Enough Rope to Hang Yourself – Product Franchise

You can still start a business and follow an existing successful model without all of the restrictions included in a franchisor-franchisee agreement.   You can use a product franchise model where the agreement is to distribute or apply a company’s product (Like Mobil or GoodYear).  This is a looser definition which mainly includes signage and product.  Your internal business is pretty much your own.  You still have franchise fees and some regulations to adhere to, but for the most part you run the business the way you see fit.

Build Your Business and Succeed

An even looser contract is one that simply provides you with material with no minimum to buy and targeted marketing to support local presence and brand awareness.  If you already have a successful business and are looking to add some alternate revenue stream you may want to look at this.

Spray-Lining offers a material’s based opportunity competing directly with Rhino Linings Line-X and Scorpion Coatings.  There are no minimums or franchise agreements.  You are investing in superior applicator technical support, a broad set of material for coatings (bedliners, floors, agriculture, industrial) and local marketing of your existing business.

Why franchises fail

  • Location selection
  • False expectations
  • Poor business decisions
  • Poor understanding of what the franchisee is responsible for
  • Unclear understanding of ROI
  • Poor franchisor selection

Expecting a substantial return on investment without a time to mature and expected sweat equity will guarantee failure.

Sweat Equity

The general rule for business is that if you are you own a business you will work 70-80 hours compared to the employed counterpart.  The benefit is that overtime the return will greatly surpass those punching a clock and there is a chance at designing your own lifestyle.  However, there is always a great investment in time and effort to get over the startup hump.  This is why many will fail whether they are a franchise or not past the first 5 years.

Let’s Get to the Review

Following is a list of 5 startups that boast under $50,000 startup.  Most these prices are startup capital for the rights to have the name and marketing associated with the franchise and DO NOT include other investments required to get your business running.
From material costs to total loan amounts that are not included in the minimal cost figure displayed.  For example, AAMCO states that the startup fee is $39,400.  However, the franchise investment required is about $250,000 dollars.

Aamco

Cash Requirement: $39,500 Total Investment: $232,000 – $299,000 As soon as you become an AAMCO franchisee, they offer:
  • Market development and site selection
  • Extensive new-franchisee orientation and training
  • Proven national advertising along with local marketing campaigns
  • Established business systems, operations support and recruiting assistance
  • Multi-unit growth and real estate acquisition opportunities
Reviews of AAMCO

Flooring and Coating Franchises

A few of the opportunities we listed here are flooring and coating franchises.  These are interesting for the automotive owner usually because the amount of specialized equipment is minimal.  A compressor and a few specialized components are required to get started and the process is familiar in regards to the autobody shops that do painting and truck bedliners.

Non-Franchise Start Ups that make Money

http://www.spray-lining.com Spray-Lining is a non-franchise business agreement that focuses on bringing money to your existing business and markets your business, NOT their own.

Concrete Technology Inc

Cash Required:  $9,500 – $300,000 cash Focusing on beautification of old and/or damaged outdoor floors with Acrylic concrete solutions. A CTi Dealership is backed with stocking inventory and comes with CTi’s proven business plan that can make anyone successful. Notice the broad startup capital required…. You cannot start up for under $50,000 effectively. Location : Tampa, FL Review of contractor for CTI

Global garage floor and design

Cash required: $50,000 cash What They Do As one of the premier garage refinishing and coating companies in North America, Global Garage Flooring® and Design offers complete garage makeover solutions from custom industrial strength concrete floor coatings to top of the line cabinetry. A secondary component of our business entails a focus on commercial and industrial flooring applications. Three Lines of Revenue Stream;
  • Garage Floors
  • Commercial Floors
  • Cabinet & Storage Solutions
Full Training and Support
  • We walk you through your initial equipment, office, business and storage area set up
  • 4 Days of training at a successful Global Garage facility
  • Additional 4 Days of training at your location using your equipment
  • Manufacturer flooring training
  • Manufacturer cabinets training
  • Ongoing coaching, newsletters, meetings, etc. It’s this ongoing Motivation & Support that makes the difference!

Novus Glass Repair

Cash Required: $14,000 Investment Range: $22,975 – $206,800 Business Type: Franchise SBA: Yes Financing: In House NOVUS is Proud to Announce Our New Company-Based Finance Program! In this challenging economy, which has made it difficult for some qualified candidates to obtain bank financing, NOVUS has developed its’ own finance program. You can now own your own NOVUS franchise for $14,000 (New Repair /Replace Franchise). This down payment will be paid on your first day of training. This finance program is available to all accepted candidates. There are no pre-pay penalties if you decide to pay off your loan in full. “While the rewards of business can be great, success is never guaranteed. We made the conscious decision to buy a franchise because we wanted the best name recognition…the best business services…and an established national reputation. NOVUS® offered all these things and more”. – Bob & Linda Brendal, Missouri Operations
  • A proven business model
  • Business Operations Reference Manual
  • Franchisee-to-franchisee consultation and support
  • The industry’s highest quality products and resins
  • National warranty program
  • NOVUS Research & Development Innovation
  • Preferred provider program – Glass tool advertising buy programs.
  • Instant Credibility
  • National and international brand recognition
  • 25 Million+ satisfied customers
  Paint Bull Cash Required: no minimum required Investment Range: $5,000-$45,000 Business Type: Business Opportunity SBA: Yes Financing: 3rd Party Paint Bull Business Programs Paint Bull offers a variety of Business Programs for becoming a Paint Bull Certified Affiliate.
  1. Paint Repair Business Program: From Stone Chips to Key Scratches, Scuffed Bumpers and even damaged Rims- the Paint Repair Business Program shows you how to profit from any type of paint and clear coat damage you will ever see.
  2. Paintless Dent Repair Business Program: We’ve added basic Paint Touch Up and Clear Coat Polishing to traditional PDR Techniques to complete our unique Paintless Dent Repair Business Program.
  3. Interior Repair Business Program: Car Dealerships, hotels, restaurants, marina…the list of potential customers fixing damaged seats and furniture is endless. The Interior Repair Business Program; “it’s not just for car dealers anymore!”
Autopia Paint Bull Review

In Summary

Franchises do work in the right environment.  However, if you are an existing body shop or contractor looking to set up your future by growing your existing business be careful and do your research.  From what I can tell, if you have less than 50k to invest in a business, a franchise is a risky deal.  Look into product based businesses and opportunities that offer to expand your existing name locally.  This is the key to getting a return in your first year.  Inflated costs and extra fees and royalties associated with franchises may drown you. Also, be ready to work your ass off for the first one to five years.  It’s a reality with any business, and if you already own one then you are already onboard. So, get out there, do your research and make some money. Non-Franchise Business Opportunity

Spray-Lining Truck Bed liners, Floors, and Coatings

Cash required: $3,000 – $10,421   This is a non-franchise, product based business with local marketing for your business.  They sell high quality polyuria, polyuria hybrid, poly-hybrid based products to add to your existing contracting or auto business.  If you are in the construction or repair industry you can make good solid income with this opportunity.  The cost is not that much and the potential jobs range from a few hundred to tens of thousands.  There is never a guarantee for profitability, but this is one of the better choices when it comes to NOT failing.      

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