Update on my 1st month in business!!!

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pinoyheat551

New member
So, i've been in business now for about 1 month. My cost of doing business is about 2000 a month but for the first month in business, i've only made about 700 dollars. I have money to sustain the bills (home & business) but that is it. I am new to the area and no one really knows who i am or what i can offer. During the first year or so of owning your business, if you guys dont mind me asking, how long did you guys wait for you guys to break even? Moreover, if its not too personal, how long did it take for you guys to make a profit after hitting the break even point for the month?



I signed up for living social about 4 weeks ago and this coming weekend, my business will be featured. I am looking forward to those CHEAP price shoppers and hope that they will upgrade to a higher package. The package that i offered was a UPKEAP package - vacuum, 1-step, dress tires, dress interior. If they want to upgrade to interior shampooing, it is 50 dollars more. So, for this deal to work, i have to make 70 to 80 dollars in a day (my break even point). I work 9 hour days. If i get 200 deals and lets say they all upgrade to the next package, i am a happy man. But not everyone will upgrade so i am accounting for that. If 1 in 3 decides to upgrade, that will take me to my break even point. The next 2 customers after the 1st is all profit. If the 2nd or 3rd customer upgrade, i willl be a very happy man.



I also employed robert keppel from SEO for detailers. No joke, he helped me a lot. My website was literally up for 2 weeks and he got me ON FIRST PAGE ON GOOGLE IN ABOUT 10 TO 14 DAYS!!! Amazing...After hiring him, i got my first FULL DETAIL CUSTOMER that paid 250 dollars.



My shop is also luckily next to a body shop. From time to time, the owner throws me a car every now and then. He pays the dealership fee for most in the east coast which is 85 dollars. Again, 1 car from him and i am breaking even for that day.



After 10 years in the NAVY, i am finding auto detailing to be my true calling!!! I hated dumb bosses calling all the shots. Now, i am the boss and make every call. This is the best thing about owning your own business. Now, i just hope that i can make enough money to keep the doors open...
 
I think your plan to hard up-sell on the living social might get you into more trouble. People shopping for a _DEAL_ don't want to hear about up-sell anything. They usally have pie in the sky ideas about how amazing their car will look. I'd consider shopping your customers, you'll likely have two types, the type that just wants their trashed car clean for cheap and another that might become a regular customer. Treat each accordingly.



And last but not least, I think there is a real niche in the market between tunnel washes and extreme details. Most people are tired of the crap tunnel washes but don't want extreme details or prices. Anyway, good luck with your ventures!
 
I just ran a deal on livingsocial for a basic express detail, with no machine polish or shampoo. Most people have been pretty open to upselling, but not to another entire package. I have had alot of success adding services onto the deal, such as a carpet shampoo, leather treatment, or a quick machine polish. But when I try to push a package upgrade they don't want to spend the extra $.



As yakky states above, I have definitely had both different types of people. Some cars have been completely trashed and the people expect the world for a 50% off deal and it's obvious they will never be back and will not be happy no matter what you do. But there have also been plenty of nicer cars whose owners take care of them and will likely be back for more detailing. You will definitely get all different types of people buying the deal, but for the most part they will be price shoppers who would never have bought a detail if not for the 50% off deal. But make them see the quality and value of a good detailer and they could very well become regular customers. Most of them are very uneducated about what a detail really is.



Also, if you are going into the livingsocial deal trying to make $ off the deal, good luck. The way I approached it was a way to get my name out there and get the word of mouth going. So far, so good. Make sure you give these people as many of you business cards and other literature as you can. If you do a good job and make them happy, they will tell people and so far I have gotten a few full paying details just from their word of mouth. Also, livingsocial will not supply you with their email or mailing addresses, so make sure you get this info from everyone so you can mail them future specials and coupons.



Good luck!
 
It might not be a bad deal to sell a really cheap package maybe just a hand wash to get people through the door and recommend a higher service for next visit with an appointment.
 
JohnKleven said:
It might not be a bad deal to sell a really cheap package maybe just a hand wash to get people through the door and recommend a higher service for next visit with an appointment.
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I wonder how offering to do a "test correction" area would work out. Make a 1x1' square really pop.
 
yakky said:
I wonder how offering to do a "test correction" area would work out. Make a 1x1' square really pop.
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That could work out badly, you do one spot and the customer sees how bad the rest of the car is and expects you to "fix" it because it sticks out.



Granted a super dirty rag could probably do that easily, but still.
 
smoknfastlegend said:
That could work out badly, you do one spot and the customer sees how bad the rest of the car is and expects you to "fix" it because it sticks out.



Granted a super dirty rag could probably do that easily, but still.
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I don't think this would be THAT much of an issue. Every so often you might find a customer like this, but most people would understand that it will cost extra to have the entire car looking the way it should.



David Fermani said:
Can you provide us a breakdown of your $2000 worth of overhead?
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I would like to second this request. With a breakdown, maybe we can help you lower some costs, or give you some ideas at least.
 
congrats bro! I also love having my own thing going on, more money and am da boss :cell::wink1:! hahah

just concentrate on working hard and be detailed, people notice things ;) don't worry about money or that u have your own business just work hard to deliver only the best, be friends with your customers and ull be just fine!
 
WAS said:
I don't think this would be THAT much of an issue. Every so often you might find a customer like this, but most people would understand that it will cost extra to have the entire car looking the way it should.
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It just depends on the people i guess.
 
Here is my 2000 break down:



1250 for rent on 2300 square feet of space

150 for insurance

40 for trash

60 for electricity (this i couldn't believe until i saw the bill)

50 for SEO

100 for CPA

100 for internet and phone

50 for water

300 for personal loan



The grand total is actually 2100 and not 2000. Does 2100 sound about right for an auto detail business??? I know in california that the rent alone could be a minimum of 2000...
 
pinoyheat551 said:
Here is my 2000 break down:



1250 for rent on 2300 square feet of space

150 for insurance

40 for trash

60 for electricity (this i couldn't believe until i saw the bill)

50 for SEO

100 for CPA

100 for internet and phone

50 for water

300 for personal loan



The grand total is actually 2100 and not 2000. Does 2100 sound about right for an auto detail business??? I know in california that the rent alone could be a minimum of 2000...
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If you can, take a basic accounting course, then you can drop the CPA and do the books yourself. If you're just running a very basic business, then doing your own books is easy.



You think the electricity is cheap or expensive ? I find it dirt cheap, lol, we pay $0.12 per kW/h, so my shop's bill is about $200 a month.



Is your phone a cellular, or landline ? What type of internet ? Could do some bundle savings there, but not much.



Your loan was for capital to start the business ?
 
i do have a bachelors in business administration however i still see the value of a CPA. These guys know the new laws year in year out. I could do it myself but i may miss to write off more items. I save every receipt for everything that i buy or pay.



Oh yes, it is dirt cheap. My garage bay has very good lighting - THE SUNLIGHT!!! LOL. All i do is open the garage bays and walla light...



My phoen is a landline. My internet is super fast - we have FIOS from verizon. Blazing speeds. I know that could be cheaper by just going with the phone but i book everything online and do everything online. I market or advertise myself online when there is no client for a certain spot of the day.



I had cash to start the business but i wanted to go with a loan to save that "just in case." So far, i have not touched that money and i am able to pay off the loan.



What is saving my business is TINTING...I get about 3 to 7 a day for detailing but i get 5 to 10 calls for tinting. In detailing, my smallest detailing package is 110 for a 1 step and vacuum (no shampoo). In tinting, i charge a minimum of 200. Detailing is more tiring but tinting is more PRECISION. I gotta be honest, tinting is more profitable to me than detailing...
 
$100 per month ($1200/yr) is way too much to pay for accounting. Save all your receipts (and I mean all) and itemize them by category. List the total of each category on a piece of paper and turn it into your accountant at the end of the year. It might cost you $300-$400 tops to have your taxes filed. You don't need to see an accountant more than that unless you have a specific question.



What are your labor and product costs like?
 
I'm actually having a hard time figuring out the costs because i bought everything in bulk (5 gallons of every chemical that i need or a gallon of compound, etc). However, i do need to make 70 a day to break even. Im guessing labor would be 50 for the day and 20 for costs of material but im not sure. On the tinting side of the biz, i can pinpoint my cost to 20 per car. 1 roll of film is 200 and it can do about 10 to 11 cars. So about 20 bucks per car.
 
Everything seems too cheap to me. $100 a month for CPA is crazy cheap IMHO. If you can actually keep your costs that low you could be sitting on a goldmine. Just know as you build your business and expand your overhead will go up dramatically.
 
QUICKBOOKS PRO.



Have your CPA set up your chart of accounts. You can enter invoices and expenses yourself.

You will know, daily, how your business is doing. Have your CPA review it quarterly, or just annually, as I do.

Over time, you'll identify trends and norms to help you manage the business. Understanding a P&L and Balance Sheet is critical to understanding the business entity.
 
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