Best Loan Options for Growing Your Automotive Repair Shop
- Jamie Azoulay
- Jun 10
- 2 min read
Why Now Is the Right Time to Expand Your Auto Repair Shop
The auto repair industry is on a steady upswing, with global market growth projected to exceed 10% through 2026. More drivers are holding onto their vehicles longer, hybrid and EV maintenance needs are rising, and dealership service departments are losing ground—opening major opportunities for independent repair shops.
But with growth comes investment. Whether you're adding service bays, upgrading diagnostics tools, or stocking more inventory, expansion requires capital—and a plan to use it wisely.
Common Expansion Costs for Auto Repair Shops
Shop owners looking to scale typically invest in:
Service bay or facility expansion
New lifts, tire machines, and diagnostic tools
Hiring and training skilled technicians
Increasing parts inventory
Marketing to attract more customers
Opening a second location
If your current cash flow can’t cover these costs, the right loan or line of credit can help you expand without disrupting daily operations.
Best Loan Options for Growing Your Shop
Here are the most popular financing tools auto shop owners use:
1. SBA Loans
Backed by the Small Business Administration, these offer low rates and long repayment terms. Ideal for major expansions—but expect a longer approval process.
2. Equipment Financing
Perfect for funding lifts, alignment machines, or EV diagnostic tools. Pay over time while your new equipment starts generating income.
3. Business Lines of Credit
Offers flexibility for variable costs—borrow what you need, when you need it. Great for overtime payroll, rush orders, or unplanned upgrades.
4. Short-Term Loans
Quick access to capital based on cash flow. Best for time-sensitive projects, though often with higher interest rates.
5. Traditional Bank Loans
If your shop has strong financials and good credit, a conventional bank loan may offer favorable terms—but be prepared for a detailed application process.
How to Get Ready for Funding
Before applying, you’ll want to:
Create a clear expansion plan with cost estimates and revenue goals
Review your financials and credit history
Prepare documentation, including tax returns, bank statements, and shop performance reports
Demonstrate ROI, showing how the funding will fuel growth, higher margins, or new customer segments
Lenders want to see a well-thought-out strategy backed by solid numbers.
Grow Smarter, Not Just Bigger
Expansion isn’t just about more square footage—it’s about being more efficient, more profitable, and better equipped to meet the needs of today’s drivers. Whether you're evolving to handle hybrid and EV servicing, adapting to labor shortages, or competing with national chains, now is the time to invest in your shop’s future.
We specialize in helping auto repair shop owners secure the capital they need to expand with confidence.
Talk to us today at (973) 200-4077 or Jyazoulay@onmarkfunding.com .
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