How do I find out how much tint work comes from dealership partners?
Ask for sales by customer source for a full year, and split dealer work from walk-in and retail jobs. Then look at how the dealer relationships are held: by contract, by habit or by the owner’s friendship. A shop that gets most of its work from one or two dealers carries a risk you should see before you buy.
Ask the seller to produce job records sorted by who sent the work. If the shop does not track that, rebuild it from invoices for a sample period and note the method you used. The split between dealer, fleet and retail customers shapes the whole business. Ask too whether the work is done at the dealership or at the shop. On-site arrangements may depend on access that the dealer can withdraw, so find out what rules govern it and who holds them. Keep a note of every answer you are given.
Look at the trend as well as the total. Has dealer work grown, held steady or slipped? Ask whether any dealer has changed its supplier, and whether the shop has ever lost one.
Next, how are these relationships held? Ask if there are written agreements, agreed prices or only a handshake. Ask what the dealer would do if the owner left, and whether the owner would introduce you to the contacts after a confidentiality agreement is signed. Check payment terms too. Dealers often pay on account, which affects cash flow. Your accountant can review the receivables and margins on dealer jobs against retail ones, which often differ.
Key takeaways
- Sort a full year of jobs by source: dealer, fleet, walk-in and retail.
- Ask whether dealer relationships are written, or depend on the owner personally.
- Compare margins and payment timing on dealer jobs with retail work.
Related reading
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- GuideHow to buy a car dealership in Ontario: licences, ownership rules and what transfers
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- Expert answerHow do I judge a detailing studio’s dependence on dealership lot work?
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 03Business Development Bank of CanadaGovernmentWhat are financial statements?
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