The firm: C&S MoT Testing
Stephen Pound, 43, a mechanical engineer with a hand-built business venture – C&S MoT Testing, Havant.
The Idea:
Stephen said: 'I've worked in an engineering environment since leaving school, and for the last 15 years I've watched my current business partner run his HVRC testing business in Horndean, which has stayed steady throughout the ups and downs of the market.
'We both had the idea we'd like to do something new and start a new venture, so we decided to begin an MoT testing centre in Havant, split 50-50 between us.
'When we purchased the building it was just a box, there was nothing in it. We've built the place with our own hands, everything from the plumbing, electrical sockets, testing equipment, to office, toilets, everything. And there aren't many businessmen who can say that.
'The fact is the business is pretty much recession-proof. Everyone needs cars, the government requires them to be tested, and we've built what we feel is a welcoming test centre from scratch, with free tea and coffee in the waiting room, disabled toilets, the lot.
'When we opened two months ago the mayor of Havant and about 150 friends and family came down to welcome us to the area, as a new business.'
The Execution:
Stephen said: 'Between us, it has probably cost around 400,000 to buy the site and set up everything. My partner and I have just one employee, an do an average of seven or eight cars a day.
'We want to add another test lane, which would let us expand to 24 customers daily.
'We've worked out we need to be doing a minimum of five per day to break even. The way it works in practical terms is you buy a lump of test allocations from the government, at 185 per 100 tests.
'Overheads are the mortgage, electric, water and 9,000 annual rates, but we're still getting to grips with the finances.
'There are a number of MoT centres in the area and Horndean, but we will offer discounted rates to the employees of a number of local businesses.
'Their RRP is 53 per test, but we sell at 50, and offer a 20 per cent discount to staff from Asda and B&Q, in exchange for them allowing us leaflets in their shops.
'We have a website, www.csmottesting.co.uk , which comes up highly on Google for 'MoT Havant', or 'MoT Waterlooville'. We also intend to start advertising in The News.
'People will be looking for honest, friendly, welcoming centre, and in any enterprise one of the best advertisements is word of mouth.
'People have to remember that nowadays it's not the case that we want to fail them. I can make more money doing a 45-minute MoT than doing an hour of repair work. About 50 per cent of people fail, but it's often on minor things like headlight lamp bowls, which don't take much work.
'Over the course of a year, I'd say we're looking at taking 160,000, with a profit margin of around 50 per cent.
'If things go well, we have ambitions to keep growing and buy the neighbouring property.'
The Verdict:
Paul Goehlert, managing director of Mercator Cargo Systems, Portsmouth.
I think most people's mind's eye turns to premises such as Mitchell's Motors in EastEnders when MoT testing centres are mentioned, so what a ray of sunshine to see such a clean, tidy and welcoming garage.
I take my hat off to the hard work and dedication needed to build such an infrastructure.
The profit on a 50 MoT is not big, so a large, growing client base and plenty of throughput every day are vital.
Four important ways to achieve this are: good location, good service, good value and good premises.
C&S ticks all these boxes. Comfortably above the break-even point of five MoT tests per day, I suggest re-investment of profits in the business to get the daily throughput up to 24 tests with minimal increase in overheads will have C&S sitting pretty.
To further expand the client base, maybe C&S, with it's good image and professionalism, should approach both local main and non-franchised second-hand dealers to handle their MoT testing.
Caroline Collings, managing director of Portsmouth city centre business consultancy Stafford Rhodes.
Am I the only one fully aware of my impending annual MoT but choose to leave it til the last minute to book the car in?
I realise that with the test comes the ever increasing road tax, and should the darn car fail I will get a bill in hieroglyphics that I won't challenge.
Beware the 'recession-proof' quote. I would be looking for service, efficiency, availability and, would be tempted to stay with a recommended, established firm.
However, C&S MoT Testing is pushing its customer service to the fore and is based in a thriving catchment area. Their enthusiasm paralleled with their financial awareness is refreshing, and their experience in the engineering industry and their energy should merit this business success. I would advise that the projected workload would have to be met with further employment, and rather than acquiring a second site, more emphasis should be on finding an accomplished engineer.
'This is something I should envisage being a short-term priority as the partnership relies on you both being on site 24/7.
Lizz Clarke, managing director of LCM Ltd, a PR and marketing agency serving regional and international clients.
You clever man – you're in a business that provides a necessity, and I'm impressed with how you're marketing it. Before you start growing those overheads, though, do two things.
Firstly, get absolutely in control of your finances. Solent Synergy is a not-for-profit organisation that helps firms (www.solentsynergy.co.uk) and it is running a free finance for non-financial managers morning on September 23 – get along to that or find something similar, and you'll start the process of holding the financial reins of your company.
Secondly, you need a robust business plan. Start by researching market trends over the next 10-20 years, which I presume is when you'd need to think of selling the business to someone else so that you can retire. Havant Borough Council's executive team is committed to supporting Havant businesses – ask to join the Havant Business & Prosperity Forum.
You'll learn about south Hampshire's green agenda, which includes plans to cut traffic. Doing research will help you to control and direct your expansion towards market need.
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