We’re in the middle of economic uncertainty and it’s important for automotive repair shops to “hoard” as much cash as possible, according to an automotive aftermarket shop coach.
Inflation is on the rise everywhere and, depending on who you speak to, we’re either in a recession or on the edge of one — and there’s general agreement that this one may hurt more than others, said Bryan Stasch, vice president of product and content development at the Automotive Training Institute.
Speaking at NAPA Expo 2022, he had one message for a room full of shop owners: “Start hoarding cash. We don’t know what this world is going to be like six months, 12 months, 18 months, 24 months down the road.”
One piece of advice he had was if you can borrow money at a low interest rate — though that’s more difficult these days as inflation rises — then do it and stash it away.
He also referenced a concept called ‘profit first.’ He also recommended books like Richest Man in Babylon and Rich Dad, Poor Dad which put a focus on budgeting, cash flow and other financial concepts. What Stasch was getting at was the fact that shops need to think about putting money aside for a rainy day — or rainy months and years.
So take some profit and put it away.
“My fear is we’re going to be entering a world here not too long from now that cash is going to be huge. And the more we can put the bank to prepare for it, [the better],” he said during his session, Finding Money by Understanding your Financial Numbers. “We don’t know what business is going to slow down or when. Hoard cash.”