Auto Parts Shop

How Profitable Is An Auto Parts Shop? (Updated for 2024)

Pat Walls

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Updated: October 6th, 2024

How Profitable Is An Auto Parts Shop? (Updated for 2024)

So you want to start an auto parts shop?

And the first question that came to your mind was, “well, are auto parts shops actually profitable?”

With a market size of $80B - there’s plenty of business to go around.

Especially considering:

You could start a auto parts shop with as low as $10,000
Based on our data, auto parts shops generate an average of $4.5M per year

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a auto parts shop.

Let’s dive in!

Is an auto parts shop profitable?

Yes, an auto parts shop is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $4.5M per year with an estimated gross margin of 43%, you could expect to recover your investment within 9 months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your auto parts shop.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your auto parts shop is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is an auto parts shop worth it?

If you’re wondering if a auto parts shop is worth it, the answer is a big YES. With auto parts shops, you have the potential to earn $4.5M per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $80B, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a auto parts shop to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful auto parts shops case studies.

Examples Of Profitable Auto Parts Shops

Here are a few examples of profitable auto parts shops, and a few more details about them:

1. Panther RV Products ($4.8M/year)

Ethan and Jacob Sweet started Panther RV Products with the guidance and financing of their father Richard Sweet, who was already running an RV repair shop. They initially sold RV parts on eBay and gradually transitioned to selling hard-to-find RV products from Europe, setting themselves apart from competitors. After years of growth, they now generate an average monthly revenue of $400K and plan to manufacture their own campervan-specific parts.

Is it profitable? Yes
How much money it makes: $4.8M/year
How much did it cost to start: $10K

How We Started A $400K/Month RV Products E-Commerce Store

Panther RV Products generates an average monthly revenue of $400K by selling a variety of campervan parts to outdoor enthusiasts and small businesses outfitting cargo vans, with a focus on hard-to-find parts for campervans, while providing technical knowledge to customers that their competitors lack and using Google Ads and SEO to drive sales, and the company has plans to start manufacturing their own products for campervan customers.

Read this case study

Read by 5,747 founders

2. The Unofficial Shopify Podcast ($108K/year)

Kurt Elster came up with the idea for his podcast, The Unofficial Shopify Podcast, after realizing the potential of content marketing and wanting a consistent way to market his ecommerce consulting services. He decided to host his own podcast after receiving positive feedback from guest appearances on other podcasts, and with the help of his business partner's editing skills, he was able to launch the podcast and grow it to 750,000 downloads and four sponsors.

Is it profitable? Yes
How much money it makes: $108K/year

How Kurt Elster Monetized And Grew A Podcast to 750K Downloads

Unofficial Shopify Podcast has generated 750,000 downloads and has four sponsors, resulting in significant monetary gain for ecommerce consultant and host, Kurt Elster, who has created a thriving business and community around his podcast.

Read this case study

Read by 5,035 founders

3. TAB Performance ($7.2M/year)

Justin Pflanz and his brother Casey started TAB Performance after recognizing a demand for louder motorcycle exhaust systems. Their best-selling product, the Zombie baffle, was created in response to customers asking for louder options. Since then, their annual sales have been doubling, reaching an impressive $4.8 million.

Is it profitable? Yes
How much money it makes: $7.2M/year

How Two Brothers Started A $4.8M/Year Motorcycle Parts Manufacturer

TAB Performance doubles annual sales with introduction of Zombie baffle, from manufacturing Harley-Davidson motorcycle exhausts, with founders attributing growth to constant evolution and listening to customers.

Read this case study

Read by 12,701 founders

Learn more about starting an auto parts shop:

Where to start?

-> How much does it cost to start an auto parts shop?
-> Pros and cons of an auto parts shop

Need inspiration?

-> Other auto parts shop success stories

Other resources

-> Auto parts shop tips

How much can you make with an auto parts shop?

With a auto parts shop, you can make an average of $4.5M revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $10,000. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 9 months.

How much does a auto parts shop make a week?

Based on our data, average weekly revenue for a auto parts shop ranges around $93.7K. As such, you could see monthly revenues of $375K.

To know if your auto parts shop achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your auto parts shop.

How much do auto parts shops owners make?

The income of an auto parts shop owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established auto parts shop is about $93.7K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as an auto parts shop owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Auto Parts Shop Profit Margins

Generally speaking, an auto parts shop can expect profit margin of around 43%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of an auto parts shop, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, auto parts shop owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, auto parts shop owners can ensure long-term sustainability and profitability for their business.

Auto parts shop owner salary

The salary of an auto parts shop owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established auto parts shop, in a prime position, might see an average weekly salary around the ballpark of $40.3K.

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, based on many of our examples, a auto parts shop may be a promising business to start - but the success of your auto parts shop mostly depends on your effort and your approach.

If you focus on these, you'll have a much higher chance of a profitable auto parts shop.

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Starting An Auto Parts Shop: Everything You Need To Know

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