The Entrepreneur Forum | Financial Freedom | Starting a Business | Motivation | Money | Success

Experience running a smog shop?

The Entrepreneur's Forum for learning how to build wealth and financial freedom the Fastlane way!

Say "NO" to mediocre living rife with jobs, ascetic frugality, and suffocating savings rituals— learn how to build a Fastlane business that pays both freedom and lifestyle affluence. Join our forum with more than 70,000 entrepreneurs who are making it happen.
Join for FREE Today
Get the books
Remove ads? Join Fastlane INSIDERS
(Registration removes this block)

Denim Chicken

Silver Contributor
Read Fastlane!
Speedway Pass
Jun 5, 2010
425
932
California
Does anyone have any experience running a smog station or owning a franchise of them?

My dad is soon to retire in a few years and while he will get a small pension he's also thinking of things to do once he stops working his normal 9-5.

A friend of his owns a local smog shop and has mentioned in passing that it might be a good opportunity for him as there's a smog shop close to my dad that is looking for a change in ownership.

I don't think it's listed for sale but it's one of those gas station+smog shop deals and the owner owns multiple gas stations and he wants out of the smog shop portion of it because he has too much to manage.

From a cursory conversation with my dad, his friend said if he wants he will train my dad at his own shop even if it's 1 day a week on a Saturday to help him get certified and from there he can coach my dad on running his own shop.
In return, he would get a % of sales almost like a franchise but with no dues just a straight % that scales with revenue. but honestly the conversation didnt get that far. It was just something he mentioned in passing.

Now for the numbers, his friend mentioned that if there's 1 rack a single small smog shop makes about $3000 in profit/mo after rent and overhead is paid. Rent is around $3000/mo and the equipment (dyno, computer, etc.) is for sale around $10k at this local place he's talking about. It's not enough to be fastlane but usually these businesses scale with multiple locations.


My dad is curious if this will be a good opportunity for him to start as a way to transition in retirement. It's not physically demanding to run a test only smog center.



I'm also good with SEO and do web design and digital marketing so that would be something I can help with.

From what I'm reading, smog shops have a CAP in their earnings (i.e. ceiling) due to how many cars can be serviced every day depending on the # of racks available. So assuming it takes 20-30 mins/car per dyno, it would limit the shop to say 15 cars/day MAX... so

$70/smog x 15 = $1050/day x 20 (business days) = $21000 gross revenue at full capacity. MINUS overhead and wages.

You would have to factor in downtime, free re-tests, and so forth so I'd like to see an actual P&L to get a better idea.


The other consideration is one that is a double edged sword.
Smog is required by the government particularly here in CA all vehicles are required to re-smog every 2 years, and any time you sell a vehicle.

However, emissions regulations continually change and while there is artificial demand that also means there's a quite a lot of test only smog places around here. If this business model were to scale, 1 regulation that makes the test machines obsolete would be a large capital expenditure for each shop under management.


Anyone have experience owning/running auto service shop or chain? or a be a tire shop, brake services, quick oil change shop, etc. Anything that's a similar business model
 
Don't like ads? Remove them while supporting the forum: Subscribe to Fastlane Insiders.

Post New Topic

Please SEARCH before posting.
Please select the BEST category.

Post new topic

New Topics

Fastlane Insiders

View the forum AD FREE.
Private, unindexed content
Detailed process/execution threads
Ideas needing execution, more!

Join Fastlane Insiders.

Must Read Books...

Explore books recommended by MJ DeMarco and other members of the Fastlane entrepreneurial community.
Fastlane Bookstore
Top