Calling all Restoration shop owners

[eagleone1983]

I'm in a Marketing class for school and am creating a Marketing plan on a auto restoration business. I was wondering if any of you that have or had a restoration shop could give me some insight in the market. Things like profit margins and what is the going charge rate. Obviously you can PM some of this stuff and I promise none of your competitors will see it, this is strictly for my class and I have no intentions of actually starting the business. Thanks to all that help.

 

[Donny]

Interesting! I'm in that business, but my lane is small, and limited. I charge $150.00 hour for blast time. I have not figured out how to charge for pick up, delivery, prep work before and after blast time? Perhaps there is money to be made, but, right now I just charge this, this amount covers the material, and electrical costs, and after about 8 hrs I am making money after things are payed. So, this is why I'm always looking for any job, any time, and provide free p/u and delivery as added value, but, now with gasoline over $3.00 a gallon, I may start charging delivery fees...

 

[Cranky]

I have a small machine shop and am low at 50 bucks an hour if the job is fairly simple. If it's more complicated and I know I'm doing to go through some tooling, the price goes up....

 

[eagleone1983]

Donny, if a shop were to strictly use you as thier blasting source for vehicles and large parts would there be a contract with a lower rate to that shop if they had you as sole source?

As far as delivery goes you could charge by mileage kind of how the government pays me when using my personal vehicle for travel. The current rate is $.50/mile but then again as you stated free pickup and delivery is an added value to the consumer to use you instead of someone else.

 

[eagleone1983]

Same question to you Cranky and the reason I'm asking this is because part of my market plan is to come up with a comprehensive restoration environment where everything can be handled in house and by outsourcing under contract to specific companies it should help keep pricing lower.

 

[Donny]

Yes, repeat customers who use me, I lower the rate by nearly 15%, and even then I charge for a fender say 45 minutes of blast time, go to 60 minutes at no additional cost; this keeps the cost within a 95% range; so they (the customer) knows how much something will cost for budgeting purposes, but, what's under that paint is always a mystery. I look at the overall value; what do I do, what is my standard -- which is a direct correlating look at my few competitors in the area and what they do, and what their standard is. If the customer complains that an area was missed; this is a NO GO at that station for me.