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We’ve all heard the phrase “You’ve gotta spend money to make money.” 

But marketing budgets are for executives and creative agencies, right?

No…not exactly.

If you’ve been reading through our recent blog posts, you know that marketing is a critical component of your repair shop’s business. You may attract a few customers just by existing, but if you want to generate more income and expand at all, you need to get the word out. That’s how we hope you look at marketing — as getting the word out, rather than some strange (and expensive) magic you need to perform under a full moon. 

But once you decide you’re ready to get the word out, another question comes up: how much should you be spending on your marketing? You may immediately assume you need to fork over a lot of money on glossy ads, huge billboards, and TV spots. This is false — actually, it’s one of many falsehoods we bust in our awesome marketing webinar.

You don’t need a huge budget to develop an effective marketing plan. But you do need a marketing budget for your commercial repair shop, and that’s what we’re going to help you figure out in this post.

What is my marketing budget being spent on?

You can determine your actual marketing needs before or after determining your budget. Here’s some of the areas where you might spend those dollars:

Traditional marketing 

    • Direct mail – postcards and fliers
    • TV/radio spots
    • Print ads – magazines and newspaper advertisements

Other forms of marketing

    • Events – shop open houses, truck care workshops
    • Digital content – how-to videos and blogs
    • Social media advertising – Facebook, Twitter, YouTube 

What have I tried in the past?

Unless you opened your doors and simply never told a soul you had a commercial shop, you’ve done some sort of marketing in your recent past. You told a few friends or family (word of mouth), you ran a small ad in the local paper (print), or maybe you just posted something on your shop’s Facebook page (social media). 

Did any of those efforts yield results? If you don’t ask customers how they heard of you, start! We even put that word in bold and italicized it so you know how important it is. Finding out your primary customer funnels is one of the best ways to broaden your marketing plan.

Who am I up against?

Take a look at your location and your competition. If you’re the only heavy-duty repair shop within 150 miles, your marketing has an automatic edge. No one wants to drive a long distance for an important repair or even a basic service, so you may be able to do more with fewer marketing dollars.

If you’re one of three shops within 20 miles, though, you may have your work cut out for you. That means you need to stake out the marketing tactics of your competitors and see what they’re doing right and where they fall short. If they’re reaching all of their customers via TV spot, for instance, they may leave a void in Facebook ads that you can fill. 

Scoping out the competition serves an additional purpose. If you haven’t been tracking your own early marketing efforts — or if they’ve fallen flat — you can see what’s working for other shops and adapt them to work for you.

How much money should I spend on marketing?

Ready to really sort out how much of your shop’s income you should contribute to marketing? We’ve broken it into three steps. 

Step 1: Estimate your gross sales

Get out the calculator and any necessary documentation and get together your shop’s gross yearly income — the total of all sales you have throughout the year. Typically you can perform this once a year and adjust your marketing budget as necessary, but if your shop is newer, or if you see a great deal of fluctuation in overall income, you may need to estimate this more frequently.

Not sure you’re up to all that math? Fullbay has a Diesel Shop ROI Calculator that shows you where to plug in the numbers and then does most of the math for you. We even wrote a blog breaking down diesel repair profits.

Step 2: Determine what you want your gross sales to be

If you intend to grow and generate more profit, then your current sales aren’t going to be the final number you settle on. How much do you want to make in the next year?

Be warned: this is the spot where you’ll likely have to take a hard look at your numbers, your shop, and your techs, and decide from there how much of a jump you can make. Generally speaking, your income will be determined by how many techs you’ve got on staff. Do you want to jump from gross sales of $250,000 to $350,000? You may need to hire another productive tech or two. Sounds great, but are you ready to take on the costs associated with hiring more staff? 

Step 3: Pick your marketing budget

Bob Cooper at Elite Worldwide suggests determining your marketing budget from your desired income, not your actual income. If you want to make $750,000, then base your budget off that number.

What percentage of your income do you want to devote to your marketing efforts? That’s up to you. Bob recommends 4-5% of your targeted sales (so if you want to make $350,000, you base your marketing budget off the $350,000). 

We’ve seen that number echoed across numerous studies. Mark Claypool at BodyShop Business goes a little further, indicating that about 5% of your income spent on marketing brings in solid rewards, while cutting a marketing budget can lead to a slump in sales. He’s talking about the car industry in this case, but the same case can be made for heavy-duty truck shops. 

But which is for me?

Remember all that stuff we told you to take into account up above? You can use that to figure out your marketing budget. 

What sort of advertising is your competition doing?

  • What marketing has worked for you in the past, if any?
  • How can you make use of your location?
  • How much do you want to make in the next year?
  • What marketing channels do you want to use?

Ultimately the only person who can decide how much money to spend on marketing is you. But you can make an informed decision based on your shop’s income and where you want that income to be. Set aside the money, craft a plan, and get your marketing firing on all cylinders.

Do I need help?

You can handle most simple forms of marketing on your own. But if you’re looking for some extra input, head for your local Small Business Development Center. It’s partially funded by the Small Business Association, and they’re here to help new and small businesses find their way. 

There are over 1,000 locations around the country, so you’re likely to have one near you. They often have people with marketing and sales backgrounds on staff, and the service is completely free.

Request a Demo

Suz Baldwin

Suz Baldwin got her start in the automotive industry, writing and editing for several motorcycle and classic car magazines straight out of college. In the years that followed, she’s written all sorts of copy for brands big and small while consuming enough coffee to paralyze a dinosaur.