Mobile Mechanic Business Plan

This assignment requires you to analyze a comprehensive business plan for a mobile mechanic service. The plan outlines the company's services, target market, marketing strategy, operational details, financial projections including cash flow statements and break-even analysis. You are expected to carefully examine the information provided and assess the viability of the business model.

BUSINESS PLAN
(Mobile Mechanic Business)
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Outline of business plan
Business Idea / concept
The outline herewith is designed for explaining an idea of starting a mobile mechanic
business named as “Complete Business Solution”. The business will offer a range of auto
repairing service. For this auto repair business, it will require huge vehicle along with
mechanical tools. The mobile repairing service will be provided at very competitive prices.
Along with mobile repairing services, the business will also provide washing and painting
services of auto-mobiles. This new business will provide 24 hours emergency services. The
business idea of mobile mechanic services is designed for saving the time and money of
customers and to solve out their problems in the most convenient way.
Rationale of business concept
The rationale behind starting mobile mechanic business is to provide effective auto repair
services to the customers. There is a huge demand of auto repair service within the industry who
can quickly solve the problems (Martins, 2016). Starting of mobile mechanic business, will
require low start-up capital and it is witnessed as a profitable venture. The business is profitable
as it eliminates the cost of renting and maintaining a workshop/garage.
Business Location
The location of the mobile business will be London, UK. The people of London will be
provided effective auto repair services at the reasonable prices. The auto repair market of UK has
a lot of competition, however, almost all only offer service but new venture will differentiate
themselves by offering stocked auto mobile parts (IBIS World, 2016).
Physical outlook
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Product and services
The business entity will provide on site through making use of wide range of offers wide
range auto repair equipment. The proposed services that are going to be provided by mobile
mechanic business are as follows:
 A/C service
 Batteries change
 Engine repair
 Oil change
 Tire repair services
Products
 Batteries
 Tire, etc.
Aim and objectives
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The major aim of this venture is to offer a range of auto repairing service to the people of
London, UK. The mission of the new mobile mechanic venture is described in the following
points:
 To resolve the problem faced in respect with automobile repairing in quick and easier
manner
 To help people of London in achieving affordable auto repair services
There are financial objectives of the GYM:
 To gain 30% of profits by the end of first year of business operations
 To acquire 300+ customer by the end of first year of business operations
 To increase the customer base by 20% by the end of second year of functioning
The following headings represent the future course of work that will be done to complete
this business plan:
Market Analysis
Prior to start business plan, there will be an in-depth analysis of market, i.e. auto repair
industry of United kingdom. The analysis will include information about the opportunities for
new mobile mechanic service business, along with the possible threats that can be faced by the
new business. This section will represent the information about current demand mobile mechanic
services and its recent trends in the UK.
Market Segmentation and target customers
This section will show how that market will be segmented or what will be the
segmentation criteria to target the market. The information about target customers will be
included in this section. On the basis of market information and demand analysis, the new
business will decide the customer groups.
Competitor analysis
Competitive analysis will include the evaluation of market competition. In respect with
the present business idea, the competition level for new mobile mechanic service will be
identified. This section will include the information about the services provided by existing
rivals. The information included in this section will help in designing unique offers and deciding
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on USP of proposed business. Furthermore, the competitive analysis will help the new venture
to achieve differentiation in terms of services.
Marketing strategy
The section herewith will include the information about marketing strategies of business
and the ways through which the services of new business will be marketed. In addition, this
section will include the information about how the new business will attract large group of
customers. Going through this section, one can identify what marketing channel will be used by
the new business to create brand awareness (Starting a Mobile Auto Repair Business, 2016).
Personnel Plan
The personnel plan will include the information about the people will be involved in the
new business venture. The information of number of employees involved in business along with
their skills and job responsibilities will be included in this section.
SWOT Analysis
SWOT analysis will be an important section of this proposed business plan report. The
section will represent the information of internal nd external environment of business. This part
of report will include the internal strengths and weakness of business as well as the external
opportunities and threats. On the basis of such information, the new business can identify its
current position in the marketplace.
Pestle and Five Forces Analysis
This section will be the most important section which will conduct competitive analysis
of new mobile mechanic services within UK. This tool will be used for assessing the
attractiveness of mobile mechanic services and for evaluating the influence of five industry
factors on new venture.
Marketing mix
The marketing mix is a crucial tool that is used when determining a product or brand's
offer. In respect with the present business idea, this section will include decision on four Ps:
price, product, promotion, and place. It will include the information about the features of services
offered by the new venture, its prices, promotional tactics as well as the distribution channels
(Berry, 2008). However, the business is going to deal in service sector therefore, the section will
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include information about 3 additional elements of marketing mix such as physical evidence,
people and process.
Financial plan
The starting capital requirement of mobile mechanic venture is £25000 that is required to
successful start the bu sines. This section will include the information about source of finance
and the possible income and expenses of new business. The section herewith will include the
sales forecasting as well as Income statement and projected case flow.
Written report on a start-up business plan
Business Idea / concept
The present business plan is all about opening a mobile mechanic business through which
the people of London, UK will be provided a range of auto repairing service. After analyzing the
need of such services, business is going to provide auto repairing services at very competitive
prices. (Blackwell, 2011)
USP (Unique Selling Prepositions)
The USP of business is that it is going to provide 24 hours emergency services along with
services such as washing and painting services of auto-mobiles. The services offered by the
business is going to save the time and money of customers and are going to solve their auto
mobiles problems with convenience. The Auto mobile mac. Services are to be provided at the
place selected by the customer. Within London, there has been found a higher level of
competition among auto repair service providers, but new venture will differentiate it by offering
stocked auto mobile parts to service users (Kraten, 2010).
Rationale of business concept
The main idea behind introducing this business concept to resolve the vehicle problems
of the people of London at anywhere and at anytime. From a fast few decades, the purchasing
power of UK people have increased as the number of cars and other automotive vehicles have
been increased in London, hence, a huge demand for auto repairing services has come across.
The people of the location are demanding for auto repairing services, which can quickly solve
their vehicle repairing problems. The Motor Vehicle Maintenance and Repair industry has a
moderate level of capital intensity, therefore, it requires limited amount in equipment and
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facilities in comparison with their labour costs (Starting a Mobile Auto Repair Business. 2016).
Hence, a Starting of mobile mechanic business will need low start-up capital which is a major
rationale behind starting this venture.
Market Analysis
In accordance to the information included in IBIS World (2016), Motor Vehicle
Maintenance and Repair industry of UK have performed moderately well over the past 5 years.
In the last previous year, the company has earned revenue of £22 bn and the growth rate of
industry is 0.3% between 2011-2016.
Revenue
£22 bn
Annual Growth 11-16
0.3%
Businesses
37,461
Employment
200,689
Table 1: Motor Vehicle Maintenance and Repair Statistics & Market Size
(Source: IBIS World, 2016)
From the market analysis of past years, it was found that economic downturn faced by
UK economy has lead to low levels of consumer and business confidence that further
discourages discouraged people from purchasing new vehicles, instead of this, people are opting
to have their existing vehicles to be repaired and maintained. Hence, there is a long witnessed
demand for auto repair and maintenance services. The triggered demand in respect to mentioned
industry services are witnessed from last five years and it continues in the future. Nonetheless, a
recent economic recovery has stirred up new car sales, which has further dragged down the
average age of motor vehicles in the UK (Bonnick, 2011). This trend is indicating a weighed
slightly on demand for vehicle/auto repair and maintenance services. The report has further
described that there is no company with a dominant market share in the Motor Vehicle
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Maintenance and Repair industry, hence, there are huge opportunities to attract customers and
expand business.
Market Segmentation and target customers
The market segmentation play a key role in deciding target market of new business. The
new venture is going to segment its customers by type of car ownership they have. Within
London, there has been seen 5 segments of car owners including New car owners, Older luxury
car owners, Sports car owners, Lifetime owners. Furthermore, the market is going to be
segmented on the basis of demographic profile of people i.e. income, occupation, etc. The
company is going to target the owners of older cars or cars in need of much maintenance, since
theses segments will provide the greatest revenue. The working people are provided with the
services anytime they want, even if the people who got sudden broke down in vehicles at any
point are going to be targeted by this new venture. In other words, it can be said that customers
of new venture are anybody with wheels.
Competitor analysis
In the London, there are number of mobile mechanic businesses, these are providing
vehicle maintenance services to the UK customers. Here, is the list of leading competitors of
“Complete Auto solutions”
Companies Address Services Prices
Garage2u 31 Kingsend, Ruislip
HA4 7DD, United
Kingdom
Quick and efficient Car Repair
and Maintenance services
Moderate
prices
Mechanic On Wheels 443 Old Trunk
Rd, Lantz, NS B2S
1T1
Product : Mobile Mechanic &
Auto Electrical
Service: Call out charge
High Prices
Mr Fix Mobile
Mechanic
Becmead ave
Harrow
The London mobile mechanic –
Specialists in Servicing, Brakes,
Moderate
prices
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HA3 8HD Suspension, Diagnostics. Home
or Work! (London Mobile
Mechanics, 2016)
It has been evident that the competition level for “Complete Auto solutions” is high but
not extreme, nonetheless, it is really important for the new venture to gain some competitive
edges for making differentiation in businesses. Major competitive advantage can be attained via
providing quick auto repair services
Marketing strategy
For attaining the objectives of business, new venture is going to use effective marketing
strategy in which each car-owning that are identified through market segmentation will be
targeted. For this, different marketing tactics are going to be used for satisfying unique needs.
Company's website is going to be designed along with it the people of UK will provide with a
mobile application from which they can book auto repair services.
Resource requirement
The Motor Vehicle Maintenance and Repair industry is considered labour intensive in
which the services are provided through workforce. The new venture is going to require staff as
vehicles are repaired, maintained, serviced and restored by people. In addition to that, the new
business will require a big vehicle and equipment self-serve or automatic bays and other
equipment that are use in maintenance and repair of vehicles. It typically involves a high level of
capital investment.
Personnel Plan
Personnel Plan Budget for salaries Roles
Owner £30000 Supervision, accounts handling
5 Mechanics £50000 Washing, denting, painting, maintenance,
repair
Other Staff £20000 Provide supportive services
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SWOT Analysis
Strengths
Huge market demand
Availability of financial sources
24*7 hours services
Weaknesses
Economic conditions and energy prices
Lack of customer loyalty in industry
Dependency of car selling market
Opportunities
Use of technology in business
Extend service hours
Use of social media promotion
Threats
Huge competition in service segment
Reduce car purchase
Additional services provided by automotive
dealers
Pestle and Five Forces Analysis
PESTLE ANALYSIS
Political - Economic
 Favorable government regulation to
open a mobile mechanic business in
UK
 Economic recession
 Increase in unemployment
 Slow growth of markets
Technological Legal
 Modern equipment used for providing
the best services
 Use of social media for business
promotions
 Vast customer information
 Consumer protection act
 other regulation pertaining to car
Market
Environmental Social and cultural factors
 Green sustainability
 Customers awareness of green
initiatives
 UK population demanding for quick
and easy auto repair services
 Opportunity to provide services in
different segment as per the customers
demand
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Porter Five Forces Analysis
 Supplier power – The bargaining power of supplier in the industry is Low in case of
price changes, the new business can shift to other suppliers. Hence, in the UK auto repair
industry suppliers do not owe the power of price change.
 Buyer power – The bargaining power of buyers is high in the industry as in case of high
prices they can switch to other competitors.
 Competitive rivalry – There is an intense competition within the industry as many
mobile mechanic businesses are there to provide competitive services to customers. In
presence of high competition, new business need to search ways for gaining competitive
advantages (Zott, Amit and Massa, 2011).
 Threat of substitution – Available auto garage in London and automobile dealers are
counted as substitutions for proposed mobile mechanic business.
 Threat of new entry – There is a free entry and free exit in Motor Vehicle Maintenance
and Repair, hence, there is a huge threat of new entry.
Marketing mix
Product Mix – The auto repair services that are provided to local people of London are
considered in this section which further include Batteries change, Engine repair and Oil change,
Tire repair services etc. In addition, products of business are Batteries, Tire, etc.
Price Mix – The here described marketing element focuses on generating sales and
profits. The new business is going to use competitive pricing approaches. The average price of
service is expected to be £100.
Place mix – The services will be provided to customer at their own places, at offices,
home etc. This is the way to distribute products and services to the customers.
People mix – This is an essential of marketing mix that focuses on use of efficient and
skilled people. The people hired for new business will be highly professional and skilled so they
can quickly solve the problems.
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Process Mix – The systems and processes that are used for delivering the services such
as machines, service vehicles and maintenance equipments will be induced in this marketing mix
(Godlevskaja, Iwaarden and Wiele, 2011).
Promotion Mix – The promotions will be done through websites, even using social
media sites and aggressive promotion will be adopte
d. In addition, print media, billboards, e-business, brochures, discount will be adopted for the
purpose of promotion.
Physical evidence – The design of service vehicle and friendly environment and an
amazing atmosphere.
Financial plan
Assumptions:
Start-up capital: For stating up Mobile Machine business £25000 are required as owner’s
personal funds, however, other source of finance will be £30000 for which bank loan is going to
be used.
 The revenue will increase by 10% p.a.
 Interest rate on business loan will be 7.83%.
 Marketing and promotional will be £2000 in pre- operating year, after that it will be
£1000
 Salary and wages of staff are going to be increased by 7%
 Within 3 years loan will be paid
 Service vehicle maintenance charges are going to be £5000 p.a.
 Tax rate will be of 10% of profits
 Utilities expenses (electricity, telephone etc.) are going to be increased by 10% p.a.
 Insurance of service vehicle is £600 per annum
 Website development and maintenance charges £1500 p.a.
 Miscellaneous expenses be £500, that will increase 5% p.a.
 Cost of sales 30% of sales
Table 2: Revenue Projections
Year 1 (£) Year 2(£) Year 3(£)
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Number of services
offered
3000 3300 3630
Average price 500 550 605
Revenues 1500000 1815000 2196150
Table 3: Projected cash flow statement
Cash flow statement Pre-Operating Year Year 1 (£) Year 2 (£) Year 3 (£)
CASH INFLOW
Opening Balance 0 42000 1420551 3107275
Sales 0 1500000 1815000 2196150
Owner's fund 25000
Bank Loan 30000
Total Cash Inflow 55000 1542000 3235551 5303425
CASH OUTFLOW
Working Capital 10000 0 0 0
Legal and Registration Charges 500 0 0 0
Market Research 500 0 0 0
Marketing and promotional 2000 1000 1000 1000
Utilities (Electricity & Phone) 0 500 550 605
Website development and maintenance
charges 0 1500 1500 1500
Service vehicle maintenance charges 0 5000 5500 6050
Interest on loan 2349 1566 783
Salary 0 100000 107000 114490
Miscellaneous Expenses 0 600 660 726
Insurance 0 500 500 500
Tax 0 0 0 0
Loan Repayment 0 10000 10000 10000
Total Cash Outflow 13000 121449 128276 135654
Closing Balance 42000 1420551 3107275 5167771
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Table 4: Projected Income statement
Cash flow statement Pre-Operating Year Year 1 (£) Year 2 (£) Year 3 (£)
CASH INFLOW
Opening Balance 0 42000 1420551 3107275
Sales 0 1500000 1815000 2196150
Owner's fund 25000
Bank Loan 30000
Total Cash Inflow 55000 1542000 3235551 5303425
CASH OUTFLOW
Working Capital 10000 0 0 0
Legal and Registration Charges 500 0 0 0
Market Research 500 0 0 0
Marketing and promotional 2000 1000 1000 1000
Utilities (Electricity & Phone) 0 500 550 605
Website development and maintenance
charges 0 1500 1500 1500
Service vehicle maintenance charges 0 5000 5500 6050
Interest on loan 2349 1566 783
Salary 0 100000 107000 114490
Miscellaneous Expenses 0 600 660 726
Insurance 0 500 500 500
Tax 0 0 0 0
Loan Repayment 0 10000 10000 10000
Total Cash Outflow 13000 121449 128276 135654
Closing Balance 42000 1420551 3107275 5167771
Table 5: Break Even Point
Break Even Point
Average service Price 500
Variable Cost 150
Contribution 350
Total Fixed cost 107500
Contribution 350
BEP (units) 307.1428571429
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REFERENCES
Berry, T., 2008. The Plan-as-You-Go Business Plan. Entrepreneur Press.
Blackwell, E., 2011. How to Prepare a Business Plan: Create Your Strategy; Forecast Your
Finances; Produce That Persuasive Plan. Kogan Page Publishers.
Bonnick, A., 2011. A practical approach to motor vehicle engineering and maintenance.
Routledge.
Godlevskaja, O., van Iwaarden, J. and van der Wiele, T., 2011. Moving from product-based to
service-based business strategies: Services categorisation schemes for the automotive
industry. International Journal of Quality & Reliability Management, 28(1), pp.62-94.
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Kraten, M., 2010. Business Planning and Entrepreneurship: An Accounting Approach. Business
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London Mobile Mechanics. 2016. [Online] Available through:<
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Martins, A., 2016. How to Start a Mobile Mechanic Service. [Online] Available through:<
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[Accessed On 9th March 2016].
Starting a Mobile Auto Repair Business. 2016. [Online] Available through:<
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