How do I tell if a locksmith’s auto key programming work is a real business line?

Ask for invoices tagged by job type so auto key work can be seen apart from home and business lockouts. Look at how many jobs there were each month, the pattern of those months and the sources, such as dealers, towing companies and walk-ins. Repeat referrals from a dealer or a fleet are a better sign than occasional emergency calls.

Next, count what the work requires. Programming equipment, software subscriptions and key blanks all cost money and need regular updating as vehicle models change. Ask what the annual cost to stay current is and whether the owner has had to decline vehicles for lack of the right tool. Check the financial statements for how those costs are recorded.

Then ask who does the work. If it depends on one technician’s training, the line leaves with that person. See whether others on the team can do it and how long it took them to learn. Ask your accountant whether the margin on this work holds up after tool and software costs, and whether lines of credit or loans were used to fund the equipment.

Key takeaways

• Pull auto key invoices apart from other work and read them month by month.
• Add up the annual cost of tools, software and key blanks.
• Find out whether more than one person can do the work.
• Identify repeat sources such as dealers or fleet customers.