Banks and business advice.
Your Own Business Repairing Cars.
Any Skilled mechanic with business acumen, could possibly make a better living working for himself, however there are a few pitfalls.
The first thing to consider: I have the skill and know-how, do I need the hassle? Working for yourself can be a rewarding and enlightening experience, but do not assume it is all plain sailing, there will be times when you will feel like giving up but at other times experiencing a feeling of achievement. Although becoming a millionaire will not be quickly achieved in this field.
Do not attempt to begin working this way if you are not prepared financially, an ideal situation would be to have savings backup of at least six to twelve months present earnings. The more savings you have will make the transition from paid employment to self-employed, easier.
Is your family behind you? Your family should be consulted, as your new venture will affect them first. Your domestic financial outgoings will remain; a growing family can be expensive.
A motor mechanic can expect earnings in 2005 of at least £20,000,per annum. (£384 weekly when employed,) to make it worthwhile in self-employment an estimated annual figure of£35,000 profit could be expected. To earn this, a minimum of £20 to £25 per hour labour should be charged, although profit on spares will be a bonus. This could be used to reduce labour charges to help you become more competitive.
Mobile Mechanic or Workshop.
A decision should be made at the onset to become mobile or based at premises.
If becoming a mobile mechanic appeals to you, remember you will have initial expense of a suitable van, with associated running costs also somewhere secure to park overnight.
Motor trade insurance must be obtained to insure your own and customer’s vehicles, in your care. As this type of cover enables you to drive virtually any car, this type of high risk insurance, will be an expensive item.
Over a period mechanics collect a huge assortment of equipment and tools, these must be carried in the van.
A selection of servicing parts could also be purchased and be ready for use, although until you are established most parts should be purchased as and when required.
Mobile mechanics can carry out servicing and light repairs at customers premises, mostly in drives and carparks, but more complicated difficult access work will have to be carried out in a workshop. It will be worthwhile making an arrangement with a friendly garage proprietor to provide this service to you at a discount. You may also be able to obtain extra work from this source using the garages facilities. This could be very useful during winter period, when customers garage or even outside will be a cold place to work.
To become based at a workshop could be a much more expensive option also you will need many more customers, and also to employ mechanics to make this option viable.
There will also be Commercial Insurance, Rent, Business rates, Wages, Office Expenses, Electricity, V.A.T., Telephone and Heating bills to consider.
Starting a business in Worcester.
To Become Self Employed.
Starting a business could possibly be a life changing experience. To become a self employed entrepreneur, you must be enthusiastic and dedicated, in what you do, and not want to be ordered about by an uncaring boss forever.
You should be prepared to take chances, and to be able to take the bad times with the good.
Experience and expertise.
The first requirement are you experienced enough in your job to take the plunge into self-employment?
Do your homework to find out if there is a demand for your expertise in your area. Make enquires locally to potential customers; they may be interested in what you have to offer.
Find out if there are others operating in a similar field, how busy they are and what they charge, how good a service they provide, are their customers happy?
The next requirement, have you enough money to start on your own.
Calculate how much you need for necessary tools and equipment. Find out if there is a small business start up scheme at your bank if you need funds, although banks can be reluctant to lend money for a unestablished business without security. Remortaging your home could be an option at the risk of losing your residence if the business fails.
A small business will not have to employ an auditor, before reaching an annual turnover of £300,000, although an accountant should be consulted at the onset to deal with your annual accounts.
Registering for VAT. will not be compulsory until a turnover of £58,000, although it may be to your advantage to register.
It is important to inform the Inland revenue and register for National Insurance within three months when you become self employed. You can be fined if you do not do this.
The self-employed pay income tax annually in arrears.
The tax inspector will require you to keep accurate records of all income and expenditure.
Advertising in Worcester.
A good idea is to print a flyer on your computer, describing what services or products you can offer. For a start, distribute a thousand copies in your locality. You also may want to place an advert in your local newspaper, or even a card in a shop window. These usually bring results to get your business started. Once up and running word of mouth will be the only advert you will need.
Taking the plunge.
Having done your homework and consider there is a demand for what you have in mind, you could begin by working part time, at evenings and weekends to see if things work out.
If you decide to give it a go, remember you will be leaving paid employment, your employer will have taken care of tax and insurance holiday,sick pay and even contributed to your pension.
When starting your new venture the cost of running your business should be carefully calculated, in order to charge a fair price for what you do.
It is a good idea to obtain the services of an accountant, to put your affairs in order; he will also give some good advice.
Being self employed can be a very satisfying way to earn a living, you will be your own boss and be free to work at your own pace, take holidays when you want them, and possibly make a better standard of living for you and your family.
The downside of working for yourself will be taking complete responsibility for your own actions and sometimes may mean working long hours to get your business established.
There will be times when things will not go to plan also work may become scarce.
If you become ill, paying someone else to carry out your obligations will be necessary.
A sole trader is responsible for all debts incurred. 75% of all small business’s fail during the first four years.
Remember it is sometimes better to make an attempt to improve yourself, even if you fail, you can always go back to working for a boss.
A business selling used cars.
Selling used cars even on a part time basis can make a very profitable business, as there will always be a large continuing demand for cars of all prices.
You will need a full driving licence and some selling experience may help, mechanical knowledge will be an advantage although not essential. To be successful you must have agreeable pleasant even polite manner a sense of humour can sometimes help.
The amount of capital you have may determine the quality of cars you are selling.
If you have limited capital, the cheaper end of the market is the only place to start, as you begin to sell more and more, your capital will gradually increase allowing you to go for more expensive models and obviously more profit. If you are intending to sell more expensive models remember buyers may need credit, for you to offer this a licence must be obtained from the local authority.
When buying stock, try and leave a reserve for any unexpected expenses, any cars you buy may need repairs.
You could possibly make a living selling cars from home, however having a number of cars parked in your driveway and in the street outside your house, is not going to make you popular with the neighbours. Planning permission may also be required.
Unless you own a large house with plenty of space, the best option is to obtain premises but this will obviously add to your costs.
Renting space on a garage forecourt is something else you could consider, but a small workshop to prepare cars for sale would also have to be rented.
Motor trade insurance is essential when you become a car dealer, and this can be expensive, not all agents supply commercial insurance and you may have to shop around, remember your premises will also need to be covered.
Trade plates are a convenient way to drive a car without it having a road fund licence. They are obtained from local vehicle tax authority, remember to include these on insurance policy.
A trolley jack axle stands or car ramps and car creeper will be useful when inspecting. Jump leads and a battery charger will be another essential piece of kit.
If you intend to do any minor repairs yourself, suitable hand tools will have to be acquired, buy these as and when required. Anything of a more technical nature should be left to the experts. Motor vehicles today can be complicated requiring expensive diagnostic equipment, and special tools.
Putting a value on cars.
To be able to value cars, a copy of used car price guide should be obtained from the local newsagent, many titles are available. Glasses guide is used most in the trade and you should try to procure a copy, It is usually only available to bona- fide members of the motor trade, and will only be delivered monthly to your business premises by subscription.
Buying cars from the public can be a good way to obtain stock; it may be possible to pick up a bargain.
Become a regular at the local pub or even join a club to widen contact with people.
Scan the local newspaper for cars to purchase, you could also put a used cars wanted advert in, if you do this it is best to let it run for a number of weeks to allow this method to work.
Before buying try to establish person selling is the owner of car. Always ask for any receipts for original purchase, or repairs and note address on invoice.
If there are any extras fitted, or any remaining road fund, ask if this is included in sale, if not reduce price offered.
Try the local car auction, this can be risky if you donï¿½t have a great mechanical knowledge. If you are lumbered with a rough motor you can always re-enter in the auction to hopefully get some or all of your money back.
What cars to buy.
The best cars to buy are cars that sell quickest, after a time experience will tell you which are the best sellers.
You could try to specialise in models of a certain type and price range, but this may limit supply. Best to have a variety of makes and models to suite all ages and tastes.
Try to avoid obscure foreign cars, as these will have a limited market, foreign vehicles can be expensive to insure and repair, also difficult to sell. Small family hatchbacks are usually good sellers, and hold their value.
Banks and Building Societies in Worcester.
Abbey, 4 Broad Street, Worcester. 845 765 4321
Alliance and Leicester, PLC. 59 High Street, Worcester. 01905 21404
Allied Irish Bank,(GB.)1 St. Mary’s Street, Worcester 01905 25759
Barclays Bank PLC. 54 High Street Worcester. 01905 684828
Birmingham Midshires, 59-60 Broad Street, Worcester. 0845 603 7809
Bradford and Bingley, 2 The Cross, Worcester. 01905 28541
Bristol and West PLC. 22a-23 The Cross, Worcester. 01905 726681
Cheltenham and Gloucester PLC. Mealcheapen Street, 01905 29761
Halifax PLC. 12 St. Swithin’s Street, Worcester. 08457 39 49 59
Household Bank. 42 Broad Street, Worcester. 01905 612181
HSBC. Bank PLC. 6 Broad Street, Worcester. 0845 740 4404
Lloyds TSB. Bank PLC. 4 The Cross, Worcester. 0845 072 3333
Royal Bank of Scotland, 5-9 St. Nicholas Street, Worcester. 01905 21524
The Woolwich, 52 Broad Street, Worcester. 0845 071 8141