Your One-Page Business Plan
Your time is valuable. I get it. Automotive shop owners are pulled in many directions. Add in some multi-taking and some A.D.D., and even if there is any time left, your brain is probably fried. Those “higher-level” tasks continue to get pushed aside while you work on day-to-day tasks, i.e. your comfort zone.
Whether it’s day-to-day tasks or the higher-level tasks, I’m a checklist type of person and nothing gives me as much satisfaction as checking something off of my list. That website thing? Done! Crossed off my list. One of the great joys of business ownership is that there are not always nice, neat and tidy solutions to our problems that we can cross off our lists. That website I mentioned before? Aren’t there so many different types and qualities out there? From a super basic DIY, done-in-an-hour site to a full blown e-commerce site built by one of the most reputable marketing companies, and everything in between, there are so many choices. How awesome of a website is needed, anyway?
People who know me know that I sometimes struggle with making decisions. I worry that I’ll choose the one that isn’t good enough or waste too much time and money on the one that’s overkill. It’s no secret that a majority of shop owners started out as technicians or jumped into a family business. Few of use came from a business background or got an MBA and decided auto repair was our field of choice. Kudos to those that did, though! So many of us out there, myself included, always imagine a silver bullet for any particular problem. A nice, packaged solution that will relieve us of the burden of research and choosing a solution that may be less than perfect and even cause other issues. Sometimes there are those silver bullets out there, but mostly it’s a combination of many things.
As some point someone, somewhere, has probably asked you, “What does your business plan look like?” My first plan went something like this: “I go to my shop. I fix cars. People (hopefully) pay me.” What more is there? Well, the truth is that there is much more out there in terms of business planning. Like the website, there are options ranging from the plan I just mentioned (in my head, by the way), to a 200-page written plan with projections, pro-formas, strategies, and an executive summary. Ugh, right?
If your shop is on a growth path, your size/budget is going to help determine how complex of a website, business plan, or other solution you need or can afford. I always wanted to make a choice that would serve me for many years to come. I learned along the way that sometimes I have to purchase or create something less permanent that I know will have to be redone in the future. I can’t always jump to that future benchmark and if I stall, there is a price for my inaction, as well.
All that said, a business plan can be very daunting. Where to start? So, I’m going to share one that I came across several years ago. I discovered it while spending some with some local entrepreneurs in my hometown. If you haven’t found any local groups of business-minded people in your hometown to network with, you need to. The group I found was focused on lean startups and I found them on meetup.com. The tool that the group shared is called the “Lean Canvas.”
The canvas is geared more toward startups. Most automotive shops aren’t going to be startups but their owners may have as much knowledge as a new startup business and the canvas gives a very quick overview of the whole business. It’s the easiest business plan that I’ve found, so if you have no written plan at all, why not give it a shot? Here it is below. (Full credit to strategyzer.com, shared under Creative Commons license)
I suggest you download a blank copy (widely available online) and fill it out yourself. If you get stuck on a section, leave it blank and come back to it. There are many great YouTube videos that also explain its use and give examples. Here is a brief summary of those parts:
The Customer and The Problem: Although many businesses may have been started due to passion of their founder, great businesses can’t continue to exist if they don’t solve a problem. Remembering that is a key part of this plan. Customer problems in our industry might include issues, such as customers don’t want to work on a car themselves, they desire convenience, and they want to do business with someone they can trust. Can you think of other problems our customers have? Along with the problem, we also pair up our customers. Different customers can have different problems. If your business includes multiple profit centers under one roof, consider multiple business plans. Customer segments can include people who own cars (obviously), distance from our shop, type of car owned (for specialty shops), household income, families, people who like supporting local business, and many other criteria.
Your Unique Value Proposition: Likely, you’re not the only automotive service destination in your area. Simply put, why should a customer choose your shop over the one down the street? Is your warranty better? Do you have a better reputation? Are your facilities nicer, do you offer more amenities? Do you address the customers transportation needs while their car is in for service? You get the idea.
Solution: This will be your particular “special sauce.” There are relatively few original ideas out there but collecting all of the industry’s best practices under the roof of your shop is a great start. Then add in your special touches.
Channels: This is your marketing. Do you have means to retain your existing customers? Referral programs, your website, SEO, AdWords, social media, YouTube, and mailers are all examples of channels available to reach car owners in your area. More businesses and shops are utilizing content marketing and raising their brand awareness without trying to market directly to customers. This part is huge!
Cost and Revenue Stream: Your financial plan. Most shops only sell two things: parts and labor. Your shop must sell enough parts and labor at a high enough margins to cover all of the numerous costs associated with running a business and have enough left over for growth and risk management. Easy, right? If 60 percent gross profit is your goal, write it down in the plan.
Key Metrics: What we measure to help us determine if we’re succeeding, also known as KPIs. Sales, costs, net profit, average repair order, car count, sales opportunity, profit per hour, technician efficiency and productivity, customer satisfaction, staff satisfaction.
Unfair Advantage: Alright, so this one is probably geared more for startups and tech companies but I like it anyway. All too often, we get stuck in our routines and don’t think outside the box. This entire canvas is an exercise in taking a look at our business from a fresh and broad perspective. So I’ll ask you, “What is your unfair advantage?” I’d love to hear about it.
We all have to-do lists, whether they are physical, or just in our heads. If having a business plan is on your list, take an hour or so and start here. This is not meant to be a substitute for a plan that you would share with a lender or business broker but it is a step in the direction of further business planning. Sometimes the next steps are huge and a smaller step along the way helps motivate and focus us. One thing is for sure: We have more control over our destiny than we realize. I challenge you to start looking at your business from different perspectives. You might be surprised at what you find and even more surprised using that knowledge to propel you to the next level.