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Old 12-05-2015, 08:28 AM   #1
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Hey all, a buddy and I have been brainstorming ideas to open a car shop. We are wanting to do custom classic car restoration and get into performance work for classics only.

We already have a name and logo, but both of us are complete noobs when it comes to opening a business. Anyone here an entrepreneur or familiar with starting a business?


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Old 12-05-2015, 10:34 AM   #2
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Talk to an accountant and attorney. They will make sure you have your ducks in a row. Put an exit plan in place right away. Wish I would have had an exit plan. Very messy when I decided to leave my partnership after 12 years. We missed half our paychecks for an entire year because of people not paying us and my partner and I not agreeing how to handle it. You will probably also no longer be friends when one decides to leave but the other doesn't. Are you willing to lose the friendship?


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Old 12-05-2015, 11:12 AM   #3
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I think that Grabbers advice is right on. Partnerships can be tricky and don't always end well.
I was a General Building Contractor for about 25 years, in which I was the sole proprietor. Being in business, can be difficult at times. There are a lot of things that you must do that you do not get compensated for. Your day definitely doesn't end at 5 o'clock! And you never really get rid of your "boss" when you are self-employed. You are just trading one long-term boss for many, many short-term bosses... Your customers!
Definitely get a lawyer to draw up a comprehensive partnership agreement. That may help to avoid any misunderstandings between partners.
And a good accountant is a must in my opinion. I can tell you first-hand, dealing with the IRS is a b!tch when your bookkeeping is all f'd up.
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Old 12-05-2015, 11:16 AM   #4
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Do not set up as a sole proprietorship. That can only come back to bite you in the butt and take everything you have if something happens. LLC or C-Corp would be the most ideal way to start a business.

I agree with Grabber, get an attorney and go talk to professionals who specialize in setting up small businesses.


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Old 12-05-2015, 11:23 AM   #5
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Do not set up as a sole proprietorship. That can only come back to bite you in the butt and take everything you have if something happens. LLC or C-Corp would be the most ideal way to start a business.

I agree with Grabber, get an attorney and go talk to professionals who specialize in setting up small businesses.


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Yes!
When I said "sole proprietor" I was referring to not having any partners.
Definitely incorporate or do a Limited Liability Company.
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Old 12-05-2015, 12:21 PM   #6
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Will you be quitting your full time jobs? Do you have spouses who work and can get you on their health insurance? If not, buying your own health insurance is going to be a killer, and coverage and deductibles are going to suck.


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Old 12-05-2015, 02:24 PM   #7
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Will you be quitting your full time jobs? Do you have spouses who work and can get you on their health insurance? If not, buying your own health insurance is going to be a killer, and coverage and deductibles are going to suck.


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This is good info also.

My friend started a detailing business, like any business it was slow at first but it has picked up. But he is married and his wife most likely makes more currently and of course has better benefits. I've been helping him a little along the way since I'm studying Finance and Business Management right now, so it's good experience for me outside of the classroom.

Starting a business is tough. If you have time, look up Andy Frisella and listen to his podcasts. Great entrepreneur and he really talks about what it's all about and his experiences without sugar coating anything. Gives you great insight on what it's really like.


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Old 12-05-2015, 06:42 PM   #8
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Thanks all. I will take everyone's advice. We both have full a full time job (partners on the ambulance). We did talk about the insurance deal if we leave our full time job. I will just go on my wife's.

I know it's a lot to get into, we're taking it very slowly.


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Old 12-05-2015, 10:11 PM   #9
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One other thing to consider have you done any market research to see if there is a demand for your product/ service in your area? It's difficult to open a normal business but a specialized business such as a shop that only works on custom/ performance cars is an extremely small market. I would definitely go through a detailed research phase and develop a detailed business plan prior to spending any money.


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Old 12-05-2015, 11:18 PM   #10
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One other thing to consider have you done any market research to see if there is a demand for your product/ service in your area? It's difficult to open a normal business but a specialized business such as a shop that only works on custom/ performance cars is an extremely small market. I would definitely go through a detailed research phase and develop a detailed business plan prior to spending any money.


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This. I've been to a bunch of different military bases, for example, and it seems like every few years some high performance shop opens up run by a few guys who look like they have talent but they never stay open long. Demand is not there, reputation is not there or they just have some stupid ricer name like the last one around here did (Xclusive).

I would take a real good hard look at the sort of business you think you will get.
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Old 12-06-2015, 12:17 AM   #11
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All the stuff the guys are saying here is dead on. When I got a friend of mine a contract to build outdoor fireplaces, pizza oven, etc., etc., with a paver company out of New Jersey, I did LOADS of homework before starting it up for him. Overhead/pricing of each individual unit built, supplies, vendors, workman's comp for the guys, everything. I dissected every little operating expense over and over to make sure I didn't miss anything. I handled the phone calls, office/paperwork, delivery schedules, and he and I also built the units. We always put in WAY more hours than all the other guys, but that's expected. I worked many hours for free when it first started for a while, but doing my homework really paid off.
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Old 12-06-2015, 09:19 PM   #12
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I know there is a ton to consider here. Staying in business being one of them. My buddy says he already knows of about ten cars (from people he knows) that need work done to them. I'm definitely not going to jump into this without doing all my research and making sure there is a demand. I appreciate all of your guys' feedback so far.


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Old 12-07-2015, 01:33 AM   #13
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These guys have definitely never heard the saying "If you build it, they will come".

Typically, a business such as this, starts out very small. A side business, where you keep your day job and build up some clientele doing work in the evenings and on weekends. Many automotive shops start in someone's garage or driveway, and the business grows until the volume of work dictates renting a shop space and becoming "legitimate".
I would begin by doing the work on those ten cars that your buddy has lined up, and then see how much more work you get after those guys tell all of their friends what a great job that you guys did on their cars.
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Old 12-07-2015, 07:42 AM   #14
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These guys have definitely never heard the saying "If you build it, they will come".

Typically, a business such as this, starts out very small. A side business, where you keep your day job and build up some clientele doing work in the evenings and on weekends. Many automotive shops start in someone's garage or driveway, and the business grows until the volume of work dictates renting a shop space and becoming "legitimate".
I would begin by doing the work on those ten cars that your buddy has lined up, and then see how much more work you get after those guys tell all of their friends what a great job that you guys did on their cars.
Good advice.

It could also happen like what happened to Posi when he was doing the M112 porting. Apparently he decided it was just too much and lucky for him he was only doing it on the side and did not quit his actual job. Stopped taking new orders, finished all the ones he had already taken and bowed out.
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