Auto Repair Shop Feasibility Study in Idaho

Near the top of Idaho's SBA lending

Few asset classes draw more SBA lending in Idaho than mechanical repair. By loan count, car and truck repair shops stand 3 of 39 among Idaho's classes, and with a location quotient of 1.22x they take a bigger share of Idaho approvals than they take of the national total. Idaho itself ranks only 25 of 51 states for these loans, so the weight is relative rather than absolute: 137 approvals from FY2017 to FY2026, worth $48.0 million. None of the three measures we screen, namely the median loan and both outcome rates, departs from both Idaho's all-asset record and the national repair figure by our margin.

The loans are modest. The median Idaho shop loan was $176,000, or 0.75x what the class borrows at the median nationally; half of all Idaho shop loans sat between $50,000 and $401,000. The bottom of that band is equipment, working capital or a small business purchase; the top starts to reach a shop bought with its building. Of the approvals, 108 came under SBA 7(a) and 29 under SBA 504, and franchised shops took just 3.6%. Among 7(a) lenders, Zions Bancorporation, National Association holds 17 loans and Glacier Bank 16, yet Idaho Central CU, with 13 loans worth $12.9 million, carries far more dollars than either, which suggests it finances the larger deals. Capital Matrix, Inc. leads the 504 side with 8, ahead of East-Central Idaho Development Company with 6 and Panhandle Area Council, Inc. with 5. Ada County dominates at 43 approvals; Bonneville and Kootenai have 12 each.

Cancellations run high, losses stay low

Cancellation touched at least 14.4% of the Idaho shop loans approved in FY2017 through FY2024; because nothing from those years still awaits disbursement, the ceiling matches at 14.4%. For a borrower, that floor argues for settling the purchase price, the site's environmental history and the appraisal before the commitment letter. Funded loans have held up. Among the 61 Idaho loans disbursed between FY2017 and FY2021, charge-offs reach 3.3% so far, and the share lost within five years of approval is likewise 3.3%. Both are floors while those loans stay open.

What an Idaho shop study must test

An Idaho study begins with demand inside the shop's own drive time: vehicles registered nearby, competing bays and whether the trade area is adding households. Cost testing covers lifts, diagnostic gear and building work at current quotes. Coverage of debt service has to come from labor and parts margins at a realistic bay load, and a loan near $401,000 needs a stronger case than one at the $176,000 median. The appraisal should value the real estate on its own, since a lender gives little weight to an independent shop's goodwill.

The class has firm edges. In Idaho as everywhere, truck repair is coded together with car repair and the two cannot be told apart, while collision shops, glass installers, quick lubes and the catch-all automotive repair code are left out, so an Idaho project that pairs mechanical work with a body shop has peers in more than one class.