Tire Shop Building Preparation

Last Updated on 06.08.2024 by hrushetskyy

BUILDING PREPARATION

Tire dealerships stock several types of passenger-car tires and one or two brands of truck/pickup/RV tires though this will vary by market. Smaller tires are placed on the left with progressively larger ones lined to the right. All-season 12- or 13-inch tires begin the layout usually ending with 15-inch or larger on the right. As far as possible try to place the fast-moving inventory closest to the service area and the slower-moving items farthest away alleviating some of the exertion when getting tires for customers.

You can obtain the tire tiers from tire- supply houses listed in your business-to- business Yellow Pages. These companies don’t build and install the racks for you but do supply them charging by the foot. A tire tier is simply a metal rack consisting of angle irons. They are sold in lengths up to 18 feet and are easy to assemble.

Many tire dealers paint guide lines allowing for ease of entry and exit into and out of the bays. Some companies paint a straight line from the tire stop out the door which drivers follow into the bay. Others paint lines on either side of the rack so that when mechanics are pulling in they keep the vehicle in that line. Usually there is a tire or chalk stop which is a little steel plate one foot square with two raised edges over it. This plate is bolted down onto the concrete and serves as a guide. The method you choose is purely discretionary and varies with the shop.

The major building-prep expense is the installation of the air compressor and the large machine tools it feeds (see Equipment for cost breakdown). Apart from that assuming your roof doesn’t leak and your overhead doors need minimal service or installation a good coat of paint should go a long way toward improving the looks of your place.

The increasing tendency of tire dealers to offer ancillary automotive services carries with it the need for additional equipment. This in turn can add to the building prep costs of any given operation. For this reason consider starting as a tire specialist then moving toward additional services as capital and volume permit.

LEASING PROPERTY

Leases are usually strong contracts. If you sign a lease for $1 000 per month for a period of one year you are agreeing in essence to pay $12 000 regardless of what happens to your business. Therefore some business tenants recommend starting out with the shortest lease term possible until you can see where you are going.

A one or two year lease with an option on renewal for five years at an agreed upon rental is a desirable target for most beginning retailers. The option to renew protects you from losing your lease at a good location and having to build your business from scratch at a new one.

It may not always be possible to rent premises on a year to year basis or on a short multiyear lease but you should never feel pressured to accept what’s offered to you, there will always be another site opening up elsewhere perhaps one even better suited for your business.

A good lease from your point of view is one that can easily be assigned to another tenant in the event your business fails or you need another facility. Therefore make certain it contains a provision for assignment or subletting. Such a clause will allow you to close or move your business while permitting you to get another tenant to pay your rental obligation for the balance of the lease term. It will also allow you to sell your business to a new owner who can assume your lease under the same good terms you have.

Percentage Leases

Many leases require you to pay a percentage of your gross revenue in addition to a fixed minimum monthly rent. This guarantees the landlord a definite base rent plus additional amounts as the business prospers. Whether you negotiate a basic flat-rate or a percentage lease the objective is to stay in line with the standard rent/net sales ratio (see “Rent” in Market! location) for your business.

Any deviation should be compensated for by advertising support superior (outside) management shared utility or other expenses or similar considerations. Appraise the current or projected volume of sales at the site you are considering in light of the rent being asked. Can the site produce the volume necessary to achieve the standard rent/sales ratio?

Other Terms

A lease usually covers other important matters such as any remodeling to be done who is to pay for it liabilities and duties assumed by each party and permission for the tenant to erect external signs engage in additional lines of business or make alterations in the future if needed. A lease is an important legal document and as a small-business owner you should always seek competent legal counsel before signing one.

Negotiate Before You Sign

You can negotiate the lease prepared by the lesser. It is not engraved in stone but extended to you for your consideration. If you accept it without discussion you have met his conditions entirely. By simply asking though you may be able to negotiate something much better particularly in terms of the length of the lease. If the answer is no you have lost anything. You can always look elsewhere and come back to the first location if you don’t find a better offer.

Analyze your own particular requirements thoroughly. When negotiating with the landlord ask him to make the additions or renovations to the property that you need before you rent. If he won’t bear the expense see if he will defer or abolish the rent for a beginning period.

LEASING CHECKLIST

After you have chosen a particular site check the following points before you sign the lease:

• Is there sufficient electrical power? Are there enough outlets?

• Is there enough parking spaces for customers and employees?

• Is there sufficient lighting, Heating, Air conditioning?

• How large a sign and what type can you erect at your facility?

• Will your city’s building and zoning departments allow your business to operate in the facility?

• Does your city or county health department require one or two restrooms if you have both male and female employees?

• Will the landlord allow the alterations that you deem necessary for your business?

• Must you pay for returning the building to its original condition when you move?

• If you have plate-glass windows who will pay for insurance? (This can be expensive.)

• Will the delivery and shipping of materials and goods to and from the building be easily accomplished?

• Is there any indication of roof leaks? (A heavy rain could damage your equipment and fixtures.)

• Is the cost of burglary insurance high in the area? (This varies tremendously.) Also can you secure the building at a low cost against the threat of burglary?

• If you require hot water is there a water heater?

• Will the fire department approve the operation of your business at this location?

FREESTANDING BUILDINGS

Choosing a high traffic site on a busy thoroughfare will work nicely, you’ll pay a lower fixed rent probably one based on your facility’s square footage. With lower rent your overhead will be reduced. Also when negotiating your lease you may have more freedom when dealing with a lesser eager to have you rent from him.

You also probably won’t be subject to advertising charges common area fees or regulations of your business hours or the type of merchandise you may sell. (Shopping center lesser often impose these charges and restrictions.) What the free tending store merchant loses however are the shared (and thus lower) expenses for utilities pest control security trash service maintenance advertising etc.

LEASEHOLD IMPROVEMENTS

Leasehold improvements the non-removable installations either original or the result of remodeling can represent a substantial portion of your capital investment or they can amount to a few minor repairs. Leasehold improvements in auto related strip centers can be extensive. “The tenant is really buying a piece of air when he moves into a new center” says one center developer. Often prospective operators discover (sometimes to their amazement) that the center provides only concrete walls and flooring. The finishing work comes out of the retailer’s pocket.

Finishing work on the “shell” left by builders can include such things as carpeting and other flooring, insulation, electrical wiring and plumbing, bathroom installations lighting wall partitions windows ceiling tiles painting a sprinkler system security systems some elements of interior design and sometimes heating and/or air conditioning systems.

The type of facility you have where it is (shopping strip center/freestanding regional/non-regional) and whether it is “raw” or established will primarily determine how much you spend, because the cost of improvements can vary tremendously (from $5/sq. ft. to over $50/sq. ft.) you must investigate this carefully. Because the cost can run very high some developers will partially finance lease improvements but usually only for “promising” lessees with previous success records.

Improvements on a freestanding location will be far less expensive than on a center shell. You might need to add to or change some elements of the “HVAC” (heating ventilation air conditioning) and make some design changes (including lighting) but the basic structure with insulation plumbing wiring etc. is provided.

BUYING AN EXISTING OPERATION

Taking over an existing tire center or converting an existing auto related business often seems like a simple shortcut for prospective owners. Advertisements of businesses for sale can be found through trade publications shopping center publications local newspapers and rental agents.

Shops are frequently purchased “lock and stock” including fixtures and equipment inventory as well as office and other supplies. But some prospective retailers prefer to just buy the fixtures equipment and leasehold improvements and remain free to originate their own inventory and image.

A buyer can easily go astray however by selecting a business that is already doomed perhaps by a poor location or the unfavorable reputation of the former owner. Neighborhood merchants often can provide useful information about business conditions in the area. Before buying an existing business experts suggest you should take the following steps.

• Investigate why the operation is for sale. Is the location suitable? Has damaging competition moved in?

• Examine the financial records for the last three years and for the year to date. Compare sales tax records with the owner’s claims.

• Sit is on the operation for a few days observing daily business volume and clientele.

• Determine the worth of existing equipment and fixtures. These naturally must be in good condition.

• Determine the costs of remodeling and redecorating if the retail-area decor is to be changed. Will these costs negate the advantage of buying?

• Determine what existing inventory is usable if any. Most sellers deplete their inventory to lower the business’ price; even so any undesirable stock is a waste of the buyer’s money.

PHONE AND UTILITIES

Some telephone and utility companies require deposits while others do not. A deposit may not be required if you own real estate or if you have established a payment record with the company in the past. Telephone deposits are determined by the number of phones and the type of service required. Unless you need a large number of phones and lines the deposit is likely to range from $50 to $350.

Tor to be sure there will be no problem. Deposits for gas and electricity (when required) will vary according to your projected usage. It is possible to lower them by not overestimating your initial consumption of these utilities?

Unless your business is very small with just a few people on the premises and a few phones to answer you’ll probably need a multiline (pushbutton) phone system allowing you to switch back and forth between lines while on one phone. Your local phone company’s business-sales rep should have the answers to your specific needs.

If any intended equipment or fixtures will put an unusual demand on the wiring or plumbing always check with a contract Equipment.

MAJOR EQUIPMENT NEEDS

Air Compressor

Tire stores depend on compressed air to power all major equipment tire changers the hydraulic hoist and air guns for removing tires. In addition there are air-operated ratchets and hand tools for repairing flats.

Requiring light duty maintenance a compressor has an engine and a large steel cylinder resembling a miniature oil tank. Some are horizontal others vertical with the verticals taking up less space. The size of the compressor determines the amount of air stored. Really high-volume dealer ships need tandem compressors and two tanks because they’re drawing out so much air.

Storage of air is computed in cubic feet. A compressor works by drawing air from the atmosphere and compressing it inside the tank. The compressed air in turn is drawn out by the machinery in the shop. Typically the pressure of a compressor is 160 to 200 pounds per square inch (psi). The real test of capacity however is in the horsepower of the engine. Smaller shops can usually get by with a 3.5 to 4 horse power engine. High volume operations may need a 10 hp compressor and in some cases two 7.5 or 9 hp compressors. Compressors are fed from 220v sources and create air to run an entire operation.

Cost for a new compressor and tank should come in at about $4 000. Used or rebuilt units should run about $2 500.

Hydraulic Lifts

Large hydraulic lifts are found in each bay consisting of car platforms that lifts the vehicles about six feet off the ground. They cost about $5 000 per bay which can run into serious money in a large operation (four or more bays). However, if going into an existing station there may already be lifts on the premises.

If buying used or new equipment opt for an above ground or hydraulic bumper lift also called a speed hoist. You bolt this unit onto the floor of the facility. This kind of lift hoists a vehicle 24 to 36 inches off the floor. There are two wide rubber pads on either side where you center the wheels of the vehicle before raising it rather than getting underneath the hoist and doing a lot of adjustments.

The first type of lift gives you the advantage of putting the car up so you can get under and inspect it totally. You have mobility and speed for changing tires or otherwise servicing the frame. The second kind is less than half as expensive and is perfectly suited to a tire specialty service. If you decide to expand the range of auto services you offer you may wish to install one pit lift and have say three speed hoists.

Tire Changer

Used to remove the old tire from the wheel and mount the new one the tire changer connects directly to the compressor via galvanized pipe and is installed in a stationary centrally located position in the shop. Some operators run the pipe underground while others run it across the ceiling or around the building.

Tire changers are about two feet tall and wide four feet long and have a threaded shaft protruding 12 to 14 inches through the center. An underside bar is activated by a pedal which causes the bar to break between the underside bead of the tire and the wheel spin around the circumference of that break and separate the tire from the wheel.

In a four bay shop you would start off with only one of these which range in price from $1 500 to $3 000. Like other pieces of tire-shop equipment it can also be leased.

Wheel Spin Balancer

Though tires when manufactured are supposedly round there may be accumulations of rubber here and there that put it “out of round.” To compensate tire shops attach lead wheel weights to the rim putting the tire in balance and giving the vehicle a ride as smooth as if the wheel were perfectly round.

When placed on the spin balancer a tire simulates the spin while on the road while a digital readout tells exactly where the tire is out of round. This is faster and more effective than using the old bubble balancer which has neither the spin capability nor electronic reading accuracy.

A spin balancer needs a 220v power source; it is not fed by air. Though it sells for around $6 500.

Hand Tools

Most air-powered hand tools are equipped with couplers that attach to flexible air hoses, these in turn are coupled to firm pipe leading from the compressor. The hoses are set up on a re-coil that spring winds to and from the ceiling. The number of hoses is limited by the number of couplers coming out of the compressor. Accordingly hand tools are routinely taken on and off the hose as needed. You may want to have more than one retractable drop cord unit coming down. The cost for bringing air from the source to each bay will run $2 to $3 per foot. Usually two tire-shop workers share one or two hoses mounted between the bays.

Used for installing and removing lug nuts onto/from the hub a reversible air gun weighs about five pounds and has an outer body of cast aluminum. Most models have flip sockets accommodating the two basic sizes of lug nuts on the market. A few imports require special sockets. Usually two tire shop workers share one gun.

An air buffer is used for fixing flats. It contains an abrasive copper disk or wire brush to clean and prepare the tire for patch repair. One is usually sufficient for most shops. Also needed for fixing flats is a flat repair tub filled with water and used to isolate tire leaks.

A blow gun is used to clean dirty brake drums or linings utilizing a nozzle that shoots bursts of compressed air.

An air chuck is used to fill tires with compressed air and fits into the same hose used to support other air powered hand tools. Most old gasoline stations have a permanent air chuck outside in front of the facility. Make use of this to quickly move any drop-in patrons who need only a quick shot of air being sure to plan well the number of couplers you’ll need coming from the compressor.

For emergencies you’ll also want a portable hydraulic jack and a pair of jack stands. A hubcap hammer to remove hubcaps is also needed along with a rubber mallet used to tap the hubcap into place without denting it.

In addition all employees will have pencil like air pressure gauges. Better quality tire machines usually have gauges built in. Though air powered tools simplify removal of lug nuts you’ll want an assortment of lug wrenches miscellaneous wrenches and ratchet tools in addition to drop or trouble lights and a few 25 or 50 foot heavy duty extension cords. To retrieve tires from the top tiers either purchase a sturdy ladder or climb the tiers as many dealers prefer to do.

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