Cycling is a popular activity in the United States, with many individuals riding bikes for recreation, fitness, and transportation. In 2015, 17.4 million motorcycles were sold in the nation. Bikes break down as they are used, and most people aren’t familiar with bicycle maintenance. When a customer’s bike breaks down, a bike repair shop repairs and refurbishes it.
Follow these ten steps to start a bike repair business:
Plan your Bike Repair Company
Make your Bike Repair Company a Legal Entity.
Register your Bike Repair Company for Taxes.
Create a Business Bank Account and a Credit Card
Create an accounting system for your bike repair business.
Get the Permits and Licenses You Need for Your Bike Repair Business
Purchase Bike Repair Business Insurance
Define your Bike Repair Company Brand
Make a website for your bike repair business.
Configure your Business Phone System
Starting a company entails more than just registering it with the state. This basic guide to beginning a bike repair company has been put together by us. These stages will guarantee that your new company is well-planned, correctly registered, and legally compliant.
STEP 1: Make a business plan.
A well-thought-out strategy is vital for entrepreneur success. It will assist you in mapping out the intricacies of your organisation and uncovering some unknowns. Consider the following crucial topics:
What are the initial and continuing expenses?
Who is your intended audience?
How much money may you charge your customers?
Fortunately, we have done a lot of the legwork for you.
What are the expenses of starting a bike repair shop?
The startup costs for starting a bicycle repair company are rather low, yet you will most likely need the following items:
Basic equipment (open wrenches, hex keys, screwdrivers, a ratchet set, wire cutters, adjustable pliers)
Specialized equipment (tire spoons, a chain breaker, a tyre pump and pressure gauge, a spoke wrench, a crank arm pulley)
True stand (for wheels)
If you don’t already have these tools, anticipate to invest a few hundred dollars on them.
A workstation and replacement components are also required for bike repairs, although both of these potential expenditures may be kept to a minimum. Many bike repair company owners began by repairing bikes in their garage or basement to avoid having to worry about leasing costs until their firm was established. Replacement parts are often included in the bills that customers pay, and customers who need pricey parts may be required to give a deposit up before. A deposit of this kind may be used to pay the cost of the necessary components.
What are the recurring costs of a bike maintenance shop?
A bike maintenance shop has relatively minimal recurring costs. They are as follows:
Lease a workspace or a storefront
Costs of utilities
Who is the intended audience?
The ideal consumer for a bike repair service is an active cyclist who does not know how or does not want to spend the time and effort to fix their own bike. Because they ride their bike often, such a client will most likely need repairs and maintenance on a regular basis, and they will be prepared to pay for the work their bike requires.
How does a bicycle repair shop generate money?
A bike repair shop generates money not just by repairing bicycles, but also by selling secondhand bicycles at a discount. Many shops opt to charge a set rate for tune-ups and then charge extra for further repairs.
How much money may you charge your customers?
Many bike repair shops charge a flat cost for simple tune-ups and charge an hourly rate for more complicated services. Wheels in Motion, for example, provides three levels of tune-ups ranging in price from $79.99 to $214.99. Repairs that beyond the scope of a tune-up are typically charged depending on the components and labour required.
How much money can a bike repair shop make?
Some bike mechanics make up to $35 per hour or more, without adding any profit from component sales. Business owners who expand their enterprises into full-time jobs might make $1,600 or more each week.
How can you increase the profitability of your company?
Bike repair shop operators may enhance their profitability and develop new income streams by conducting workshops on mending bikes and restoring antique bicycles. Some cyclists may pay for a lesson that teaches them how to maintain and repair their own bikes. Refurbishing vintage motorcycles may also be profitable since they can be sold after they’ve been fixed and are in good operating order.
STEP 2: Establish a legal entity
Sole proprietorship, partnership, limited liability company (LLC), and corporation are the most frequent business structure forms.
If your bike repair company is sued, forming a formal business organisation, such as an LLC or corporation, prevents you from being held personally accountable.
STEP 3: File your taxes
Before you can begin for business, you must register for a number of state and federal taxes.
To register for taxes, you will need to get an EIN. It’s really simple and completely free!
Taxes on Small Businesses
Depending on the business form you choose, you may have multiple choices for how your company is taxed. Some LLCs, for example, may benefit from being taxed as a S company (S corp).
These guides will teach you more about small company taxes:
Taxes on LLCs
LLC vs. sole proprietorship
Corporation vs. LLC
S Corp vs. LLC
How to Form a S Corporation
S Corporation vs. C Corporation
There may be state taxes that apply to your company. In our state sales tax guides, you may learn more about state sales taxes and franchise taxes.
STEP 4: Establish a company bank account and credit card
Personal asset protection requires the use of distinct business banking and credit accounts.
When you combine your personal and business accounts, your personal assets (your house, vehicle, and other possessions) are at danger if your company is sued. This is known as penetrating your company veil in business law.
Furthermore, understanding how to develop corporate credit may help you get credit cards and other financing in your company’s name (rather than your own), lower interest rates, larger lines of credit, and other benefits.
Establish a business bank account.
Opening a business bank account is not only required when asking for business financing, but it also:
Separates your personal assets from the assets of your firm, which is required for personal asset protection.
It simplifies bookkeeping and tax reporting.
Create a net 30 account.
Net 30 accounts are used to develop and grow company credit while also increasing cash flow. Businesses use a net 30 account to purchase items and refund the whole debt within a 30-day period.
Many net 30 credit suppliers submit information to the main business credit agencies (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how firms establish business credit in order to get approved for credit cards and other lines of credit.
Apply for a business credit card.
Obtaining a business credit card benefits you in the following ways:
Put all of your company’s costs in one location to separate personal and business spending.
Build your company’s credit history, which will be important for raising funds in the future.
STEP 5: Establish business accounting
Recording your numerous costs and sources of revenue is crucial to assessing your company’s financial status. Keeping precise and thorough accounting also makes yearly tax filing much easier.
STEP 6: Obtain all required permissions and licences
Failure to get appropriate permissions and licences may result in significant penalties or possibly the closure of your firm.
Requirements for State and Local Business Licensing
Certain state permissions and licences may be required to run a bike repair shop. Visit the SBA’s reference to state licences and permits to learn more about licencing requirements in your state.
For information on local licences and permissions, visit:
Check with the clerk’s office in your town, city, or county.
Contact one of the local organisations mentioned in the US Small Business Associations database of local business resources for help.
In most cases, a bike repair service operates out of a tiny store. A Certificate of Occupancy is often required for businesses that operate from a physical site (CO). A certificate of occupancy certifies that all building rules, zoning laws, and government requirements have been satisfied.
If you intend to rent a storefront:
In most cases, it is the landlord’s obligation to get a CO.
Before leasing, ensure that your landlord has or can get a valid CO for a bike repair company.
A new CO is often required after a big remodelling. If your location will be refurbished before opening, incorporate wording in your leasing agreement saying that lease payments would not begin until a valid CO is given.
If you intend to buy or create a new location:
It is your responsibility to secure a valid CO from a local government entity.
Examine all building laws and zoning restrictions for the location of your company to guarantee that your bike repair shop will be in compliance and able to receive a CO.
STEP 7: Obtain commercial insurance.
Insurance, like licences and permits, is required for your company to operate safely and legally. In the case of a covered loss, business insurance protects your company’s financial well-being.
There are several sorts of insurance plans designed for various types of companies with varying risks. If you are unaware about the hazards that your company may encounter, start with General Liability Insurance. This is the most popular coverage required by small companies, so it’s a good place to start for yours.
Workers’ Compensation Insurance is another important insurance product that many companies need. If your company will have workers, your state may require you to purchase Workers’ Compensation insurance.
STEP 8: Establish your brand
Your company’s brand is what it stands for, as well as how the public perceives it. A strong brand will help your company stand out from the crowd.
How to Promote and Market a Bike Repair Company
Connecting with the local cycling community is the greatest method to advertise a bike repair company. Volunteering at cycling safety events, bike races, and mountain biking trail maintenance days may help business owners achieve this goal.
Business owners should also have basic bike repair equipment on hand at all times so that they can assist riders whose bikes break down. On-the-spot repairs would almost certainly have to be offered for free, but offering to assist a rider in repairing their bike may result in a lifetime client.
How to Keep Customers Returning
Bike repair shop owners may distinguish themselves from competition by establishing a reputation as a cycling expert who understands all there is to know about bikes. Business owners that know a lot about bikes and often provide knowledge will become regarded riding gurus. Another wonderful strategy to expand your consumer base is to have a regular blog or email with relevant bike information.
STEP 9: Create your company’s website.
After you’ve defined your brand and designed your logo, the next step is to build a website for your company.
While developing a website is an important step, some may be concerned that it is out of their grasp due to a lack of website-building skills. While this was a fair concern in 2015, online technology has made significant advances in recent years, making the lives of small company owners considerably easier.
The following are the primary reasons why you should not put off developing your website:
Every genuine company has a website, period. When it comes to bringing your company online, it doesn’t matter what size or sector it is.
Social media accounts, such as Facebook pages or LinkedIn company profiles, are not a substitute for your own business website.
STEP 10: Install your company phone system.
Getting a phone for your company is one of the finest methods to keep your personal and professional lives distinct and private. That isn’t the only advantage; it also helps you automate your company, provides it legitimacy, and makes it simpler for prospective clients to identify and contact you.