Starting little detailing business with local shop

T

Toymachine2009

New member
Okay so I live in Las Vegas there is no detailing shops around here atleast none of good quality. There is those fast car washes where you do the drive thru and then people dry it off and vacuum and put some crappy wax on and they call it a detail.



Anyways there is no REAL good detail shop or atleast not one I have seen that does good work and uses MF towels and nice ones at that.. Maybe some mobile detailers do but no shops..



I was thinking about starting one small at first with a local tint and audio shop. They just opened and are new. The owner is very excited to start a detailing branch to go along with his audio and tint shop. He says it will be our detailing division and can run specials for example for 399 get your car washed and waxed and tinted etc.



BUT!! here is the catch. It all sounds great until you hear the #'s. They are a new shop that just opened in september so they are SLOW. Maybe on a good day 4-5 cars and some days through out the week 0 cars. They have one tinter because they dont have ALOT of work yet and one Audio guy because not that much work! Then they would have one detailer (me).



They want to split earnings 50/50 on each car so if I only do 2 cars that day depending on what they want done I may be making very little a day. ALSO I would be doing this behind the shop in the back parking lot and I would need to supply everything myself. All products, pressure washer, towels etc. EVERYTHING out of my pocket. So while im splitting 50/50 with a low volume shop I am also responsible for products and what not. I am also 1099 as an independent contractor not an employee of their shop. I am 19 btw and it sounds like a good start but I am iffy and I may end up just breaking even or even loosing money. Right now I dont see lot of potential for some money there.



Whats your guys opinions? Go all out and go for it. Invest in gallon size products and a good pressure washer and steam cleaner? Or better off working out of my own Garage? Also might have a detailing job at Ford dealership I might do as well I will find out monday if I can get hired there or not.



Also I think because im 19 they think they can sucker me and get more out of me and I am thinking 50/50 is too much because first off I am not even using their shop I am using their parking lot behind it. I am paying product 100% out of my wallet. So if this detailing thing fails IM the only one to loose money not them! So for me taking all this risk yet there getting 50 percent of the reward idk....
 
Sounds like a poor deal to me. Would they require you to have insurance or would they cover your work? Will you set your own prices or will they be doing that too? Four hundred bucks for wash, wax and tint? Once the window film is taken out, plus the pay for the window tinter, you're only getting HALF of the remainder and it probably won't be much at that point. This looks like a bargain for the shop and a raw deal for you. I say pass.
 
This was the response when I asked can we split 70/30 cause im fronting all the money and my personal products power washer towels etc.



"We could work on the split a bit - the shop is covering the insurance, property taxes, space rent, credit card processing fees etc and in the event there is an issue with a vehicle that is less than our deduct we will be paying that out of pocket.



If you are willing to pay for any and all damages / carry your own insurance I could see us moving to something like 55/45 "
 
ehh...I would speak with a lawyer...just to make sure it's legal for them to include you under their umbrella or something...(basically do your hw and cover your arse)



and I mean....IF they really are covering all that, I would probably break down figures off the bat..find out exactly what costs they include and get it on paper, THEN I would probably include your breakdown of material costs per car (which in all honesty I don't know if it's all that much per car, but they still add up) or something like that and then split it 50/50 of PROFITS not of the selling price...



I guess I'm just saying you can find the answer by crunching the numbers and doing your due diligence and I mean if anything for nowit could just be a way for you to build a customer base
 
Alexshimshimhae said:
ehh...I would speak with a lawyer...just to make sure it's legal for them to include you under their umbrella or something...(basically do your hw and cover your arse)



and I mean....IF they really are covering all that, I would probably break down figures off the bat..find out exactly what costs they include and get it on paper, THEN I would probably include your breakdown of material costs per car (which in all honesty I don't know if it's all that much per car, but they still add up) or something like that and then split it 50/50 of PROFITS not of the selling price....
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I see what your saying split it 50/50 profits but idk if they would be cool with that for one and for two profit is prob very little to begin with so splitting 50/50 may just not be worth it.. IDK I think im going to pass on this business venture.
 
Put in a trial period stipulation lol figure out a means to cone up with a base reading and then say for like the first 6 months to a year we'll renegotiate just to start where it takes us
 
You gotta remember there shop is SLOW meaning I will have very few details a week anyways maybe like 4-5 a week I am guessing...



honestly working out my garage for now doing friends of friends cars and what not and profit is 100% mine sounds easier to me..



For example: I already do several neighbors cars and I do my parents friends cars and my girlfriends parents friends car. Got 3 appointments setup next week.. 1 for a neighbor and 2 for girlfriends parents friends.
 
Wait a minute. Say I do a detail for $100 dollars and I used 10 dollars in product so thats $90 dollars in profit why would I want to split the profit with them? Wouldnt I want to split the detail price $100 so I get $50 instead of $45



So I dont get why you say split the profit? Wouldnt I want to split the WHOLE detail to make more.
 
ok SO

100-10= 90/2= 45

100/2=50-10=40

The premise is that you're paying for the products out of pocket. What I'm saying is if you two can agree to kind of spread the costs it may be beneficial.



On the other hand, you're a private contractor, so tax wise, it may actually be beneficial for you to have your own expenses.



at the end of the day, it was more throwing around ideas than it was anything else--ultimately I find it really hard to tell anyone anything unless we know more about the underlying factors that really have a material effect on your decisions.
 
lol really hoping one of the seasoned veterans chime in as I've really never ran my own detailing business, and the only detailer I worked for was umm...6+ years ago? and he was a super paranoid guy...



Generally, off the top of my head, I would go along the lines of:

1. What am I providing

2. How do I want to provide it

3. What am I worth

4. What liabilities/potential liabilities are there to consider

5. What do I do to mitigate those liabilities

6. putting it all together.



Now, I'll try to skip the generics because honestly, those are really questions you need to answer yourself, but some things to consider. Tax ramifications: what's your income at, and how would this effect your income taxes/benefits (talk to a CPA--if you're a "business" I THINK consultation may go under business expense...i forget though...)

Know the allocation of costs.

Learn the basics of business law (UCC, ..I don't believe LV is a common law state but.. look into it) so you don't get nailed off of something stupid or some moron who wants to use you as a free lotto ticket.

INSURANCE--depending how what you do, how you do it, where you do it etc...the insurances you need, and the amount of the premium changes



Now ultimately, (ideally) you want to put some serious thought as to what you want out of this, and to what extent you're willing to put into it--I found most people just dismiss it wit a quick "oh pfft, I'll do whatever I need to get it done" and then when things get hard, they realized that they're in over their head.



Essentially, I would probably make up a mock up business before I actually start it. from start to finish, map it out like you're really doing it.

Actually look up the cost of a location that you would actually buy, look into the taxes associated with it, what's the asking price, find out the costs, do you the buyer pay x amount of costs? does the seller cover them?



Find out how much certain repairs/fixes/renovations would cost(and then add an extra % on top because... well S### happens)

Find out the traffic that passes by, look at the surrounding area to see the income people bring in and how much of it is spent on stuff(gives you an idea on ow willing they may be to pay for your services)

Figure out how you would market/promote etc.. and the resources you would need and find out those prices

Try your best to be conservative with your estimates--highball the expenses and lowball the income...



being hopefull is well and good, but being realistic is safer.
 
Hope I don't deter you, I've been told be numerous people, that trying/doing things when you're younger is better--because less is at stake. Ultimately, a failed business is more important to someone who's say 50 than it is to someone say, 19 because the 19 yo will make back the losses many times over; but it's still best to avoid the mines whenever possible =]
 
Well I asked if we can split the profit 50/50 and he said well i dont want to have figure out how much product is used on each detail and all that.. He says just raise your prices that way you make enough money for you and for your products.
 
Hmm

Any idea what he charges for his end? the tinting or w.e.?

I guess the only thing that would bother me is going 50/50 even when it's just your detail work that they're coming for...hence thinking along the lines of maybe putting in the contract somewhere that after x period of time, the conditions and pretty much the whole agreement would be revisited...I don't know what insurances they have, what it covers, etc... so it's hard for me to say... but also because you're an indiv contractor, maybe it's also wort looking into how this effects you tax wise too...



at the end of the day, I mean, as long as you consider all the angles you possibly can (play devil's advocate) and have them covered, you should be ok...just make sure you make sure your contingencies are actual valid points, and not a quick "I'm sure..well..I think it can go this way..."



Worst case scenario, if there's no "no-compete" clause in your agreement, then you may still be able to work your side details for just you...for instance any one who steps into that business you split

anyone you've had in the past and the people THEY bring to you personally is yours...(which you do at your house, or theirs or w.e.) but it can get sticky so be careful
 
I know he marks up his prices a lot so he can say huge sale this weekend when really there still make profit.. Which is exactly what he wants to me do with my prices is mark them up and then say this months specials are... and I can get the money I originally wanted while customer thinks he or she is getting a great deal with the monthly special when in reality those were my original prices.



As well as working for them I WILL continue to do side detailing at my house and if even that grew big enough I would stop working for them and that 50/50 crap and work for myself where 100% is mine. They want me to sign an independent contractor agreement and I assume it just states your an independent contractor for us and we split 50/50 of details. I am still free to leave anytime tho as I am an independent contractor right...
 
mmm read over the fine print....normally a contract would include more than that, like splits of liabilities expenses, losses, each party's duty and limitations,



and the markup isn't anything new
 
Alexshimshimhae said:
mmm read over the fine print....normally a contract would include more than that, like splits of liabilities expenses, losses, each party's duty and limitations,



and the markup isn't anything new
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Well he said as for liability and insurance that is why I am paying them 50% so they can cover that stuff If I do mess up a car.
 
If you are providing all the tools/equipment, supplies, and man power the only thing you are getting out of him is a place to work and possibly some insurance coverage...if you are a subcontractor his insurance would likely not cover you.



If you actually want to work out of his shop I would suggest getting your own insurance and offering to either pay him rent or do some sort of revenue sharing deal (80/20 or something)...maybe more if he does a lot of advertising that would include your detailing services.



In my opinion a straight 50/50 split of all revenue (with you supplying equipment and supplies) is crazy. He gets 50% of your work without risking anything or putting up one red cent. If you do partner up with him make sure the client list is yours so if you ever leave to set up your own shop you can take your clients with you.
 
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