Two Auto Repair Franchise Locations, Passaic County NJ

$2.0M

Revenue

$1.0M

SDE

1.9x

Multiple

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Full Editorial Writeup

This is a package of two franchised auto repair and service locations in Passaic County, New Jersey, being offered together at $1.9M or individually at $950k each. Combined the two shops generate roughly $1.9M to $2.4M in annual gross revenue, or about $80k to $100k in monthly gross per location, with the seller claiming approximately $500k net per location after franchise fees. Both sites operate on long leases with about 15 years of runway remaining, which removes near-term relocation and lease-renewal risk for a buyer.

Auto repair is one of the more durable service categories in the SMB world. As the car parc ages and new-vehicle prices stay elevated, drivers hold onto vehicles longer and keep spending on maintenance and repair whether the economy is up or down. A recognized franchise brand adds standardized systems, national marketing, warranty programs, and vendor pricing, which lowers the operational learning curve for a new owner relative to an independent shop.

The headline economics look aggressive: a claimed $1M combined cash flow on a $1.9M asking price implies a sub-2x multiple, which is well below typical franchised auto repair comps. That gap almost always signals either owner-add-backs that will not survive scrutiny, seller labor baked into the numbers, or optimistic revenue ranges. The wide revenue band ($1.9M to $2.4M) and the seller-stated net figures make financial verification the entire ballgame here.

Why we like it

Auto repair is genuinely recession-resistant demand. Aging vehicles, high new-car prices, and non-deferrable safety repairs keep both shops busy through downturns, and the recurring nature of maintenance provides a steady revenue base rather than one-time project income.
The lease position is a real asset. Both locations carry roughly 15 years of remaining term, which eliminates the relocation and renewal risk that kills value in retail service businesses and gives a buyer a long, stable operating window.
The franchise structure de-risks the operator learning curve. Standardized systems, brand recognition, national marketing, warranty programs, and vendor pricing lower the ramp for a new owner compared to buying an independent shop with no playbook.
Deal flexibility works in the buyer's favor. The seller will sell the package or single locations, offers financing on terms up to eight years, and wants a fast 30 to 60 day close, which creates leverage to structure around verified rather than claimed earnings.
Optionality between two sites. The seller states location two is more profitable, so a buyer can cherry-pick the stronger unit, negotiate the weaker one separately, or use the spread to price the package below the blended asking.

How to improve it

Rebuild the P&L from bank statements and franchisor sales reports before doing anything else. The claimed $1M cash flow on $2M revenue is a 50 percent margin that is far above auto repair norms, so isolate which portion is real EBITDA versus owner labor and aggressive add-backs.
Attack car count and average repair order per location. Layer in menu-based service selling, digital vehicle inspections, and disciplined technician upselling to lift ticket size and shop throughput, the two levers that move an auto shop faster than anything else.
Renegotiate the occupancy load on location two. That site carries $130k to $140k in rent, taxes, and CAM versus $80k to $85k at location one, so audit the CAM reconciliations and press the landlord on caps, because uncontrolled CAM directly compresses your margin.
Install a technician retention and staffing plan. Combined payroll of only $14k to $15k monthly across two full-service shops looks thin, so verify staffing levels and build a compensation and certification path, since tech shortages are the number one constraint on repair capacity.
Add or expand tire, alignment, and fleet-account revenue. These are high-frequency, sticky categories that smooth seasonality; landing a few local commercial fleet contracts creates predictable weekly volume that consumer walk-in traffic cannot match.
Systematize online reputation and local search. Auto repair buying decisions are driven by Google reviews and proximity, so a disciplined review-generation and local SEO program at both stores can lift high-intent traffic with minimal spend.
Implement a real financial dashboard tracking gross profit by department. Break out parts, labor, tires, and service so you can manage the business by margin rather than the seller's blended net figures, which will tighten pricing and inventory decisions.

Diligence notes

Verify the earnings claim with third-party evidence. The seller states roughly $500k net per location after franchise fees, but that must be reconciled against tax returns, franchisor royalty statements, merchant processing records, and payroll filings before any offer stands.
Confirm the franchise transfer terms and remaining agreement length. Understand transfer fees, franchisor approval requirements, required capital reinvestment or remodels, royalty and marketing fee structure, and whether both franchise agreements have enough runway to match the 15-year leases.
Scrutinize the wide revenue range and true owner involvement. A $1.9M to $2.4M band signals uncertainty; determine actual trailing-twelve revenue per location and how much of the cash flow depends on the seller working in the shop versus a hired manager.
Audit occupancy and CAM at location two. With $130k to $140k in annual rent, taxes, and CAM and stated seasonal CAM fluctuations, request the full leases, CAM reconciliations, and estoppels to confirm your fixed-cost exposure over the lease term.
Assess staffing depth and technician certifications. With reported payroll near $14k to $15k monthly, verify headcount, ASE certifications, wage rates, and turnover, because understaffing or a single-tech dependency would materially undercut the earnings story.
Pressure-test the sub-2x multiple. Franchised auto repair rarely trades this cheap on real cash flow, so treat the low multiple as a signal to find what the seller is not showing rather than as a bargain until the numbers are independently confirmed.

Source

Originally listed on BizBuySell. View original listing →