If you are interested in pursuing business ownership by opening an auto franchise, you’ll need to learn how much an auto franchise costs to move forward.
Entrepreneurship puts you in the driver’s seat of your career and can build a legacy for your family. But striking out on your own can be a nerve-wracking endeavor. Understanding all the franchise costs upfront will provide reassurance and allow you to plan a path to profitability.
Moran Family of Brands is a trusted name in the auto repair market and understands how important startup costs are to people exploring business ownership. Moran is the franchisor of six different concepts in the aftermarket auto and window tinting industries, including Mr. Transmission, Milex Complete Auto Care, and Turbo Tint.
If you are interested in owning an auto franchise, Moran’s franchise business consultants can help you learn what an auto franchise costs and what fees you can expect to pay as you get started.
- Location. One of the biggest expenses you will incur as an aftermarket auto franchisee is finding the right location for your business. There are also insurance, equipment, and other pre-opening expenses. Moran helps franchisees with site selection and lease negotiation. They can also help you trim location costs by offering co-branding opportunities. Co-branding allows franchisees to operate two brands under the same roof. In addition to being a one-stop shop for all of the car care needs of people in your local community, a co-branded location will generate higher ticket prices.
- Franchise Fees. Operating a business with brand recognition, training, and support will help you generate a profit quickly. But it does come with a price tag. Franchises all require an initial fee to get started. The initial franchise fee for a Moran brand is $50,000. While some budding business owners may balk at paying for a brand name, it offers reassurance of success and generates higher customer volumes.
- Working Capital. It’s also important not to forget that you will need some working capital to give you time to build your customer base and start turning a profit. You will be responsible for paying rent, costs associated with hiring employees, and inventory. Moran’s training program helps franchisees navigate new business ownership. You can also rely on your network of peers at Moran for guidance. Receiving guidance from someone who has walked in your shoes can be a helpful way to learn best practices.
Tap Key Financial Resources
The initial franchise cost for a Moran repair shop starts at $118,000. Moran franchisees need to have a net worth of $250,000 and $65,000 cash to be considered. While franchising does require a significant cash investment, there are many options to help get the engine running on your new venture. Here are some of the common financing options franchisees use to help pay for startup costs.
Work with the Franchisor. Many franchisors work with lenders to create custom financing programs to cover startup costs. For example, Moran offers significant discounts and incentives to veterans who want to open a franchise through the VetFran program.
Commercial Bank Loan. To qualify for a commercial bank loan, potential franchisees may have to submit a business plan and receive a credit check. The loan will come with terms and conditions franchisees need to meet. Many people use their 401k as collateral for a commercial bank loan.
Get Creative. Sometimes potential business owners need to get creative to get their business started. Securing a business partner, crowdfunding, or relying on mission-driven lenders is always an option. Mission-driven lenders typically have a stake in helping foster economic growth in the local community.
Tap Your Resources. The U.S. Small Business Administration has been helping new business owners get started for nearly 70 years by guaranteeing a portion of payment for a loan, which helps to reduce interest rates.
We want our franchise owners to understand the investment and costs of doing business to enable their locations to profit, but it’s not all about the money at Moran. Our franchise business consultants are looking for budding entrepreneurs with an interest in the auto industry who have management and sales experience. We want people who are independent thinkers and are committed to providing superior customer service. Our franchisees are driven, confident and self-assured, and they are committed to building a legacy for the future.
Current Events Propel Industry Growth
When you are adding up the numbers, it’s also important to have confidence you are choosing a franchise in the right industry. Thanks to high new car prices caused by supply chain issues, the aftermarket auto industry is booming. The industry is on track to reach $950.1 billion by 2027, compared with $721.2 billion in 2021. Poor road conditions and the rising age of cars on the road are helping fuel the industry’s growth, according to Precedence Research, a market research firm. The average age of cars on the road hit 12.1 years in 2021, up from 11.9 years in 2020.
Current events are also contributing to the aftermarket auto industry’s growth. Following the pandemic outbreak, manufacturers reduced the production of new cars to cut costs. Demand for new cars came to a grinding halt when dealerships were forced to temporarily close their doors to comply with government shutdown orders. The shaky economy and massive layoffs prompted many Americans to conserve spending and hold on to their existing vehicles. As the economy improved, supply chain issues hampered new car sales, CNN reported.
Learn More About Moran
Visit the Moran website to learn more about our lineup of automotive franchises and understand the auto franchise cost, visit www.moranfamilyofbrands.com to request franchise info and connect with one of our franchise business consultants.