Auto Repair Shop Business: External Factors, SWOT, Recommendations

This report provides a comprehensive introduction to the business of an auto repair shop, focusing on the impact of external factors. It begins with an executive summary and a table of contents. The introduction outlines the auto repair shop's functions, followed by an in-depth analysis using the PESTEL framework (political, economic, social, technological, environmental, and legal factors) to assess the external environment's influence. A SWOT analysis identifies opportunities and threats. The report then offers strategic recommendations to capitalize on opportunities and mitigate threats. The report concludes with references to support the analysis, providing a detailed overview of the auto repair shop business in Canada and its operational challenges and strategic considerations.

Running head: MANAGEMENT
Introduction to Business
Name of the Student:
Name of the University:
Author Note:

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Executive Summary:
The aim of the report is to provide an overview of management in the perspective of introducing
a business. The business under discussion for this particular report is an Auto Repair Shop in
Canada. The report commences with impact of external factors that influences the business.
These factors are determined by the PESTEL analysis that primarily includes political,
economic, social, technological, environmental and legal. The report then discusses about the
opportunities and threats of the business using a SWOT analysis. The report also puts across
proposed recommendation that would not only help the business in taking advantage of the
business opportunities but also helps it in facing the potential threats.

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Table of Contents
Introduction:....................................................................................................................................3
Arguments:......................................................................................................................................3
Analysis:..........................................................................................................................................7
Conclusion:......................................................................................................................................8
References:......................................................................................................................................9

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Introduction:
The report aims at providing an introduction to business in context of an auto repair shop.
The auto repair shop represents an establishment where the automobiles get repaired by the
technicians and the auto mechanics. An auto repair shop offer both bodywork and mechanical
repair (Salazar et al., 2014). The shop that specializes in the repair of the bodywork is known as
the body shops. They also put across paintwork repairs for the scuffs, scratches, dents and the
repair of bodies of the vehicles damaged by collisions. The auto repair stores are mostly
independently owned and operated business. The report puts forward explanations of how the
external environment affects the business through the use of the PESTEL analysis. The report
also puts across potential opportunities and threats facing the business through the use of SWOT
analysis. The report also mentions proposed recommendations for helping the business in taking
advantage of the business opportunities and in helping the business face the potential threats
using results of the analysis.
Arguments:
1. Impact of External Environment Influencing the Business
Political Factors: The political factors can influence the business at the various levels.
Regulations and elections will have an impact on the auto repair business (Churchill, Agbodohu
& Arhenful, 2013). The impact can however be negative or positive depending on circumstances.
Elections can lead to the generation of the economic activity during the process of the campaign
and the changes in the elected officials can impact the business conditions (Zaridis & Mousiolis,
2014). Regulations might lead to the changes in which an auto repair business gets operated

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(Kvorning, Hasle & Christensen, 2015). For instance, implementation of the regulations like the
reporting of the serial number of the tires and the consumers to whom they are sold would have
an impact on the auto repair industry. Regulations related to the inspection of the tires of any
vehicle would have an impact on the auto repair shop. There were various shops that did this as
part of the safety inspection but finally ended in modifying the process for performing the
separate inspection.
Economic Factors: These factors act as vital economic conditions in evaluating the
impact of the overall climate of the business. The key to evaluation of the economic indicator
lies in determining the most pertinent factor to local economy and use them in the evaluation of
the economic conditions (Storey, 2017). In the current state of economy there exist various
economic indicators that might impact the auto repair business. Gross Domestic Product (GDP)
or sum total of all the goods and services provided with a country in a given year acts as the most
common indicator (Costanza et al., 2014). GDP might not be a reflection of the personal or the
local economic conditions. Measures of the local economic indicators include the employment
rates and the real estate. Local indicators act more meaningful while evaluation of the economic
circumstance surrounding the auto repairs business. When the economy is stagnant then the
consumer spending will either shrink or remain constant. The object of recognizing the economic
status lies in adapting the business practices for conserving or expanding based on
circumstances.
Social Factors: The influences of the society acts vital for the operation of an auto repair
business (Dubin, 2017). Populations might either grow quickly or slowly depending on
geographic location. The age of the population might influence the market and how the
relationships are sustained and formed. There might be demographic shifts as the young crowd

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replaces the old. An auto repair shop might undergo change with the change of these factors.
Besides, an auto repair business is influenced by the growth in population. This is because
people have a tendency to get their vehicles serviced at the shop that is closer to the place of
employment or home. The opening of new homes or building new business can have a positive
impact on the auto repair business. This indicator is vital for the evaluation of the future and the
current circumstances.
Technological Factors:
Improvements in technology leads to positive impact in the auto repair business as
competition necessitate improvements of the various areas. The repair shops seem to advance
and adjust with the advancement in the technology (Anderson et al., 2014). Although it provides
puts across various challenges but there are also various opportunities. The vital thing lies in the
recognition of the technological advancement and planning in moving forward. The impact of
technology on the automotive parts is as follows:
Advances in the Auto Components: Over the year, improvements have been made in a
manner such that the automotive parts are manufactured in a manner that last longer and does not
get replaced quite often. Besides, the advances in the automobile fluids have resulted in the
fluids that do not need to be changed frequently so that it last longer. These adaptations might
reduce the customer frequency and hence the auto repair should get adapted through expansion
of the customer base or the target markets.
Computerization: Automobiles are increasingly becoming computerized which also became
the regular part of the automotive process for applying software upgrades to the computer system

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of the vehicle when serviced. Technicians should be able to operate the specialized equipment.
Auto repair shops adapt themselves with the increase in the level of the computerization.
Diagnostics: Performing the diagnostics on the vehicles continued to become more
efficient and precise. The aspect of diagnostics depends more on the software and less on the
hardware. Such advances required investment by the automotive repair shop while providing
efficiency and effectiveness.
Environmental Factors:
Environmental Policies: This acts as another external factor that is capable of influencing
the strategy of the auto repair business (Gelbmann & Hammerl, 2015). This is because
environmental policy refers to the commitment of the business to the laws, regulations and
policy mechanisms concerned with environmental issue.
Green Agenda: This refers to the plan where the enterprise is able to manage the
operations in a manner to ensure minimum negative influence on the global or the local
environment (Pretty, 2013). To become environmentally responsible it is necessary for the
corporations in devising procedures and plans as a part of the operations.
Legal Factors:
When the proposed legislation becomes law it has a direct impact on the business which can
either be negative or positive. In a recent legislation, absence of pipeline allowed the raw
materials to get transported via trucks to refineries (Storey, 2016). Various automotive repair
shops located along the route have significantly benefited from the process. The key aspect
remains in anticipating the impact of the legislation and thereby prepare accordingly.

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2. Threats and Opportunities Facing the Business
The opportunities facing the auto repair shop include (Clements, & Kockelman, 2017).:
 Aging population of Cars
 Increase of the store expansion on a global scale
 Auto part market puts across growth opportunities
The threats facing the auto repair business includes (Kennedy, 2016):
 Impact on sales due to increase in the potential competition
 Recalls from the suppliers leads to the decline in the revenue
 Imitation of the service provided
Analysis:
1. Proposed Recommendations in Helping the Business in taking Advantage of the
Business Opportunities
1. It is recommended that a business can take advantage of business opportunities of
aging population of cars through a game of balance. The business needs to identify proper means
for deriving the maximum benefits from the opportunity.
2. It is recommended that increase of store expansion on the global scale can be
advantageous as it results in the enhanced revenue even when the markets are domestically
saturated. It also provides an exposure to the opportunities of the foreign investment that are
extremely vital for any business. Besides it also diversifies the market by bringing in stability
even when the domestic activity is slower.

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3. It is recommended that the business can take advantage of the increase in the store
expansion on the global scale by attracting newer customers especially when the business
involves introducing newer products and the services. It will also enable economies of scale
since as the business grows it helps in incentivizing the suppliers and the vendors for providing
the customers with the required discounts.
2. Proposed Recommendations in Helping the Business in Facing the Potential
Threats
1. It is recommended for monitoring the competitors in a closer manner and identifies the
areas that they does not operate in and look for suitable customer to whom they will sell the
products. It has often been seen that poor performance on part of the competitor results in
creation of opportunity for the product or the service.
2. It is also recommended that for helping the business from facing potential threats, it
should explore newer markets and look beyond the sector or the established market that helps in
opening newer business opportunities.
3. It is also recommended that for helping business in facing the potential threats it
should not only explore the newer market but also work in partnerships. This will help in
extending the market reach, allow pooling of the resources and undertake negotiation of better
deals with the suppliers.
Conclusion:
On a concluding note, it can be said that the report shows how each of the six external
factors including political, economic, social, technological, environmental and legal impacts the

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business in some way or the other. The report also discusses about the opportunities and threats
faced by the auto repair shop. One can also overview the proposed recommendations of the
report that helps the business in taking advantage of the business opportunities and face the
potential threats.

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References:
Anderson, J. M., Nidhi, K., Stanley, K. D., Sorensen, P., Samaras, C., & Oluwatola, O. A.
(2014). Autonomous vehicle technology: A guide for policymakers. Rand Corporation.
Churchill, R. Q., Agbodohu, W., & Arhenful, P. (2013). Determining factors affecting
corruption: A cross country analysis. International Journal of Economics, Business and
Finance, 1(10), 275-285.
Clements, L. M., & Kockelman, K. M. (2017). Economic effects of automated
vehicles. Transportation Research Record, 2606(1), 106-114.
Costanza, R., Kubiszewski, I., Giovannini, E., Lovins, H., McGlade, J., Pickett, K. E., ... &
Wilkinson, R. (2014). Development: Time to leave GDP behind. Nature
News, 505(7483), 283.
Dubin, R. (2017). The world of work: Industrial society and human relations. Taylor & Francis.
Gelbmann, U., & Hammerl, B. (2015). Integrative re-use systems as innovative business models
for devising sustainable product–service-systems. Journal of Cleaner Production, 97, 50-
60.
Kennedy, C. (2016). New Threats to Vehicle Safety: How Cybersecurity Policy Will Shape the
Future of Autonomous Vehicles. Mich. Telecomm. & Tech. L. Rev., 23, 343.
Kvorning, L. V., Hasle, P., & Christensen, U. (2015). Motivational factors influencing small
construction and auto repair enterprises to participate in occupational health and safety
programmes. Safety science, 71, 253-263.

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Pretty, J. (2013). The consumption of a finite planet: well-being, convergence, divergence and
the nascent green economy. Environmental and Resource Economics, 55(4), 475-499.
Salazar, N., Cely-García, M. F., Breysse, P. N., & Ramos-Bonilla, J. P. (2014). Asbestos
exposure among transmission mechanics in automotive repair shops. Annals of
Occupational Hygiene, 59(3), 292-306.
Storey, D. (2017). Six steps to heaven: Evaluating the impact of public policies to support small
businesses in developed economies. The Blackwell handbook of entrepreneurship, 176-
193.
Storey, D. J. (2016). Understanding the small business sector. Routledge.
Zaridis, A. D., & Mousiolis, D. T. (2014). Entrepreneurship and SME's organizational structure.
Elements of a successful business. Procedia-Social and Behavioral Sciences, 148, 463-
467.