Viewpoint: Can Your Retirement Meet the Reserve Price? – UnderhoodService
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Opinion

Viewpoint: Can Your Retirement Meet the Reserve Price?

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For the past five years, I have been a shopper of eBay Motors. I not only shop for parts for my project cars, but for tools. It is almost an addiction for me to find the best deal or rarest tool. In the automotive tool section, I have been noticing a disturbing type of listing.

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The listing is usually for a complete toolbox filled with top of the line tools or a major piece of shop equipment like an alignment system or lift. These auctions are typically out of my price range, but it is almost voyeuristic to look into another technician’s toolbox or shop owner’s bays. After looking at the pictures, I usually read the description and it can be almost heartbreaking.

While it is not mandatory to give a reason for the auction, almost every seller feels it is necessary. The most common reasons for the sale are that health issues are preventing the seller from using his tools or a shop owner is trying to liquidate the shop and retire.

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You can tell that a lot of these shop owners and techs are baby boomers by the listings and age of the tools. For the past 35 years, these technicians and shop owners have been building their businesses and reputations. They have built the aftermarket into a more than $250 billion a year powerhouse. But, it is now time for them to enjoy retirement, and waiting for the right bidder on eBay is not the way to go.

As a technician or shop owner, your retirement plan is up to you. There are no company-funded pensions or 401(k) plans, and you have to buy your own gold watch. So, planning a smooth transition to retirement is essential for you, and the economy of the aftermarket.

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Being able to pass on a shop intact with a healthy customer base should be a goal of every shop owner. Watching your business or toolbox getting picked apart on eBay or at an estate auction is not the way to go.

With potentially so many shop owners and technicians getting out in the future, the future of the independent or franchise shop and technician bound to change.

With a shortage of skilled and experienced technicians, we could see a shift shops going to a team system where a master technician is a diagnostician and foreman that distributes the work to lower level technicians. It could also mean the end of the flat rate system.

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Only so many shops will be passed on to sons and daughters. Also, there might be only so many people willing to buy and manage an automotive business. This has spawned some speculation within the small business community.

One prediction has been that there will be fewer shops, but the number of service bays per shop will increase. In other words, surviving shops will pick up the market share.

Another prediction has been that in the future the multi-location owner will become the norm for independents and franchises. And as these owners retire, they will sell their shops to the new “big dogs” on the block looking for more territory.

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Some even predict that this trend will snowball and all the repair shops in the country will be owned by just a few people or corporations. While this theory is far fetched, it is a possible trend that the industry should not ignore.

The plain and simple truth is that every shop owner and technician should have a plan to get out when they reach retirement age. Even if you plan to work till your last dying day, still have a plan of succession or exit.

After all, do you really want to be worrying about your retirement as the last few minutes click by of your auction on eBay?

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