Lease a building vs working from home?? Please help!

B

B.G.

New member
Hey guys, I am new to the boards but not new to detailing. Ive been detailing cars as a side hobby for the past 5 years and have taken quite a liking to it:spot I recently quit my corporate job, moved from md to tx with my fiance and am now trying to pursue detailing more passionately. I have recently been looking into the option of leasing out a shop, but with no prior client base and a montly expense of around $2600 a month, im not sure if I should take the plunge. The spot I am looking at is in a prime area but faces the competition of a booming drive through handwash car establishment less than a mile away. My plans were to offer detailing, window tinting, and custom wheels/accessories. I am working with limited startup capital (20k) and am fearful that I will get in this and be way in over my head:wall The landlord has offered me 3 free months of rent, but really is that enough to get on your feet and running:o



My question to you guys is, should I start small working out of my garage. Or possibly start with mobile detailing. Then look into the possibility of setting up shop down the road when I have more money and the economy is better. I just hate that if i work from my garage or mobile, advertising is 10x more difficult as opposed to having a 2 bay shop right off a busy street. Also, the perception that people often have with someone detailing their vehicle out of a garage as opposed to a shop (people can be foolish at times).



Have those who have physical locations (outside of their own garage) seen any drastic changes due to the economy? Am I setting myself up for disappointment for jumping into this thing head first during these times? You guys input would be awesome! Thanks in advance!
 
Honestly, I would say it depends on how market savvy you are? but as a generality, I would probably start with say a mobile detailing business, figure with 20k you can properly fit your truck/vehicle or w.e. to look like a proper professional mobile business (plus, I mean...a lot of people are lazy? lol so I mean, if you can show up early on a saturday morning and get working before they even wake up and have it done by the time they're ready to go out that day, then why not?)



In the end there are a ton of other factors to consider, like how's your credit? what's your financial situation look like? how comfy are you with business loans, avg. disposable income of the area, type of people(white collar, blue collar etc)





lol my vote in terms of "I don't know specifics" generality, start mobile, get your name out there and when you have a customer base to where you think you can consistently have business, then by all means take the jump
 
2600/month?????????? forget that!!!! you have to clear a week of work just to make the rent...not to mention the bills from working and payroll, etc.



i would pass for sure



i am "kinda" looking for a shop to have 4 cars going at a time, but only for 1000 or so per week
 
toyotaguy said:
2600/month?????????? forget that!!!! you have to clear a week of work just to make the rent...not to mention the bills from working and payroll, etc.



i would pass for sure



i am "kinda" looking for a shop to have 4 cars going at a time, but only for 1000 or so per week
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that doesnt make sense you told him to turn down a building with 2600 rent A MONTH when you said your looking at one for 1,000 a week which will end up 4,000 a month?? did I miss something...
 
toymachine2009 said:
that doesnt make sense you told him to turn down a building with 2600 rent A MONTH when you said your looking at one for 1,000 a week which will end up 4,000 a month?? did I miss something...
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He must have meant $1000 a month.



$2600 a month in a building lease does sound like quite a bit of money. How large is the place ? 3 months should give you enough time to get business drummed up, especially if you're going to be offering the variety of services that you mentioned. Mobile is an option, but then you're dependant on weather and many other factors that you just don't have to worry about when you have your own shop. IMO, having a shop also speeds things up. Your products are out and ready to go all the time, you can have larger equipment like a professional carpet extractor, you can have a washer / dryer so you can do you own laundry whenever you need to without hitting the laundromat up. There are LOTS of advantages to having a fixed location. But, there is of course a cost. That is something you have to decide on. In my opinion, and in my experience, if you want to turn out more volume per day, you need to have a fixed location and start hiring employees.
 
I want to work at a high end detailing shop.. There is none in Vegas just quick washes and what not with dirty rags. I think it would be a good idea if Vegas had a high end detail shop they would be the only one in town so no real competition.. Except against those crappy gas station car washes.





I am trying to get something going at a local tint shop/ audio shop.. But they want 50 percent of my earnings for using their location and what not.. They just opened and are pretty slow maybe 4 cars a day somedays and 0 other days with one tinter and one audio guy and I would be the only detailer..So there not a big shop at all yet bet they are working on it..
 
The building is roughly 1,300 sq feet. It has a small waiting area with a bathroom and what would be my office and 2 full size working bays. Rent is only $1,900 a month, but after NNN's and utilities, im expecting it to be right around $2,600. Yeah man plans are to offer mobile as well, that way im catoring to the those who want the convenience as well. My thoughts exactly. I feel like having a shop (esp if the location is good) is adverstising in itself. What to do, what to do!
 
do you have to sign the lease for like 6 months or something? you said first 3 months are free so you can test your water with the first 3 months and if its bringing in big money keep it open if it is not close it down..
 
risk vs. benefit is the age old.

Do your homework.

I would look up:

Avg income of the people in the area,

Breakdown of the demographics

Look up avg disposable income, lifestyle

Areas with higher natural traffic and the $ amt per sqft of those areas.



This is my own personal feelings

I think typical placement of things like these would probably be one of the 3, near clusters of autobody/garage places, dealership row's, and high end chain clusters; but that would be a guess. I think the dealership/and repair/junking places are for exposure and the high end areas is more of a status/marketing approach...



It's really hard to tell you without knowing some basic info... I mean, you can probably make it work either route, but honestly, wouldn't you want to mitigate the potential headaches later down the line?
 
I would think the landlord would require it for a long term lease...so if it's commercial, say its a 5 year lease, the first 6 months is free lol if people offered a zero risk 3 month free trial, they would lose out on a ton of money, not to mention the HUGE scam potential
 
3 months is not enough. My lease for my building is 3600.00 a month. Now I do not cover the entire fee myself. I went in on it with another business also related to mine. There is a lot more you need to look at. Waterbill, Electric bill, Internet, Insurance, Chemicals. and whatever else. $100.00 dollars means nothing at this point. I spend that in a day with out even thinking. A shop is great , but make sure you have capitol! I haven't paid myself yet since I moved in three months ago. Its not easy. ALthough I haven't paid myself I did get some new snapon stuff as toys for the shop or me? lol You need a sign, and so much other stuff that if your doubting money, you shouldn't do it!
 
$20K will be gone in 2 months unless you have everything you need now. I opened a shop and it didn't go well but that was based on a lot of outside problems, with family and one other "friend". You don't realize how fast money goes until you start spending it on stuff you didn't realize you need to run a shop. I think you could probably get a 2 year lease but even then, you'll be pressed for cash to cover it. Find out what insurance the building requires, local laws for water run off and containment. Also storage of chemicals and supplies. Last thing you need Is to have the fire marshal shut you down because you don't have proper storage for chemicals and MSDS sheets. Around here water containment is a big deal and costs some shops $10's of thousands in fines because they didn't have proper containment. I know one mobile guy that was fined almost $10,000 for illegal dumping of reclaim water. The city also went after the building owner for allowing him to work on the property with out proper equipment. Not trying to discourage, just advising to do your homework.
 
I have been mobile for twenty five years and as far as i am concerned it is the only way to go.Your only expense is truck maintenance etc.Bad economy?If it wasn't for TV i would not even know there was a bad economy.If i have a slow day no giant overhead to worry about.I started with hand out and hit the streets.Within 6 months i was slammed and now have a clientele that will keep me busy until i am to old to do it any more.people love home or office service.No down time
 
Thanks for the input guys... Someone made a good point about if I am doubting the funds, then to not do it. That is one of my primary concerns. I mean the Ms's brings in enough to cover my small bills and hers (ER Nurse), but I dont know if throwing what could potential be another 2k+ at her works. The landlord required a 39mo lease. The demographics for the area are pretty good and its in a pretty affluent area. Like I mentioned though, there is a handwash establishment that is literally less than a mile up the road. They are always booming and to the avg consumer, their halfa$$ detail is probably worth $16 as opposed to a thorough $40 wash. I totally agree with you detailman. Although I do believe times are tough, the news plays sooo much into what society does in this "recession". I think what I need to do is take a step back, figure out a way to build up clientele by doing in my garage and possibly mobile, and go from there.
 
detailman1 said:
Within 6 months i was slammed and now have a clientele that will keep me busy until i am to old to do it any more.
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This can be a bad thing too. What happens if one day you get sick and you're not able to physically go and do these vehicles anymore ? I'm not saying that being mobile or working just for yourself is a bad thing, not at all, but there are pros and cons to it.
 
$20k investment without a very solid existing customer base and $2600 a month? No.



$2600 a month means you either need to be flipping very expensive details day in and day out or it means you are flipping a ton of washes daily. Either way, you will need employees. Full timers are going to be costly. Marketing will be costly. Insurance is costly. Supplies are costly. See where I am going here?



I say all of this as someone who got a fixed location 5 months ago.



Imho, you can make it work with $20k but you will want a smaller monthly note. You can make it on $2600 a month but man oh man it puts you behind the 8-ball. You need enough that if you don't make a dime for 8 months, all of your bills are covered. Just my opinion. Either way, I hope you do well with whatever you decide on. :cooleek:
 
^^ Thanks man... Ive never debated a decision this much in my entire life. Not even my engagement that took place last week. What keeps me going back to it is that there is really no solid detailing, tint, custom wheel & accessories shop in this part of town. I was more so looking at detailing, tinting, and ppf as a bread and butter while I establish myself as a customization shop. Thats my true passion and I have slew of quality suppliers that I have aligned myself with. Im seriously getting gray hair going back and forth over this....My biggest fear is to pass now and 3 years from now have that area be X's number one detailing,tint and custom wheel shop...



I guess I should have explained a little more about what my plans are... It would not soley be a detailing shop.
 
B.G.: Look, we can all sit here and give you our opinions on whether or not to go for it. Some of us have had bad experiences (hell, I know I have). But only you know whether you can swing this. If you think your market area is good and you think you can build the business, then I'd say go for it, but you have to figure out all your expenses, how much you need to pull in monthly, etc. Do the numbers and then make an informed decision (something WE can't do for you). Putting everything you've got into this and stretching yourself isn't a bad decision (look at other companies that have done this, like Research In Motion, or Bill Gates who dropped out of HARVARD to start Microsoft on a shoe-string), but you have to understand what's at stake and you have to be willing to put forward the effort to make it successful.
 
I really appreciate the advice and encouragement... I realize that if I want to make this thing happen, then like I need to make the decision. Thanks all who have shared their support and experience!
 
I current have a shop (Only $500 monthly, utilites included) and I aslo have a seperate mobile business. I think everyone makes valid points. It really comes down to you doing your homework and either doing it or not! We all don't know how motivated you are. Some people are handed the world and still drop the ball, while others know how to get water from a rock! I was told by people that both of my detailing businesses would fail and I am still standing! Doing very well might I add. You'll never know how far you can go until get in the car and start driving. What ever you, best of luck!
 
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