SBA 7(a) Auto Repair Shop Feasibility Study in Florida

Florida repair shops: small tickets, high losses

Florida takes third place nationally on the count of 7(a) car and truck repair loans. The FY2017 to FY2026 file holds 547 of them worth $277.5 million, and repair holds seventh place when Florida's classes are ranked. Its median loan is $230,000, 1.28x the program's median for repair shops nationwide, and the central half spans $73,500 to $667,500. Franchise share is 11.2%. What distinguishes the cell is the loss record, and it is severe.

The loss floors

Cancellation of FY2017 to FY2024 approvals sits at a floor of 13.8%, unchanged when undisbursed loans are counted. Of 215 loans disbursed in FY2017 to FY2021, 11.6% are charged off to date and 8.4% went bad inside five years. These floors can only rise as open loans age, and they are high. A Florida repair shop request should be read as a loan to a business with real failure risk in its first years.

Florida lenders and where the shops are

TD Bank, National Association holds 111 loans worth $11.0 million, by far the most, while Newtek Bank, National Association holds 50 worth $11.9 million, Live Oak Banking Company 27 worth $45.9 million, BayFirst National Bank 19 worth $9.9 million and Wells Fargo Bank National Association 19 worth $4.2 million. The dollar totals show that some books are small loans in volume and others few large ones. The counts track loans on each lender's books and tell us nothing about underwriting. Broward County has 60 loans, Miami-Dade 55, Hillsborough 46, Orange and Palm Beach 40 each, Pinellas 29 and Lee 22. Approvals reached 88 in FY2025 after 35 in FY2022.

What the class includes

Heavy-duty truck shops share this record because truck service is not split from car repair. Bodywork, glass, oil changes and every other automotive repair category lie outside it, so a collision centre or lube bay is not measured here.

What a Florida repair shop study has to test

Because the losses are heavy, the study has to be sober about the business. It must test the labour supply, because skilled mechanics are scarce, along with billed hours per bay, parts margin, and the mix of walk-in, fleet and tourist customers who may not return. Seasonal swings from the winter population and storm closures should be built into the monthly cash flow. A typical loan sits near $230,000, so a purchase of real estate at South Florida prices may push beyond it and should be justified. Equipment, lifts and diagnostic tools need a replacement reserve. The ability to service the debt should be shown on a slow ramp, with a case that matches the loss floors above, and any appraisal will rest on the shop's earnings.