ROI - Return on Investment [E181] - Business By The Numbers

About this episode

Thanks to our partner PromotiveWhether you're thinking of buying your first auto repair shop, selling your third, or investing in new equipment, understanding return on investment (ROI) is essential—not just in theory, but in real-life dollars and decisions. In this episode of Business by the Numbers, Hunt Demarest, CPA at Paar Melis & Associates, breaks down ROI in plain English, with examples shop owners can actually use.What’s the difference between a 33% ROI and a 100% cash-on-cash return? Why are private equity firms offering double what a local buyer would? And how should your time—yes, your actual hours—factor into every decision?Hunt doesn’t just explain ROI. He exposes how it shows up in equipment purchases, business sales, and shop valuations—and how emotional decisions can cloud even the smartest investments.What You’ll Learn:Understanding ROI Beyond the Buzzword(01:52) Why ROI isn't just for Wall Street (hint: you're already using it!)(03:55) The $1,000 tool test: You know ROI even if you think you don’t(05:26) Why sellers think in multiples, but buyers think in ROIROI and Shop Sales: The Buyer vs. Seller Mindset(07:45) How a seller gets $1M, while a buyer only invests $100K(09:28) Why time and risk are everything when evaluating a shop(12:22) The $100K offer scenario: Would you take it?Active vs. Passive Investments: Where Shops Fit In(22:04) Why a 33% ROI isn’t the whole story(23:18) Cash-on-cash return: the real reason repair shops can be goldmines(25:44) So why isn’t everyone opening a shop? (Spoiler: It’s not easy money)The Private Equity Curveball(27:42) What PE firms know about ROI that most shop owners overlook(30:06) Why PE firms will pay double and still make a profit(33:07) When 18% ROI beats 33%: The power of passive ownershipROI isn't just a number—it's a decision-making framework. Whether you're a buyer, a seller, or someone trying to decide if that new alignment rack is worth the splurge, Hunt gives you the tools to take emotion out of the equation and make smarter financial calls.Thanks to our partner PromotiveIt’s time to hire a superstar for your business; what a grind you have in front of you. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit www.gopromotive.com.Paar Melis and Associates – Accountants Specializing in Automotive RepairVisit us Online: www.paarmelis.comEmail Hunt: podcast@paarmelis.comText Paar Melis @ 301-307-5413Download a Copy of My Books Here:Wrenches to Write-OffsYour Perfect Shop The Aftermarket Radio Network: https://aftermarketradionetwork.com/Remarkable Results Radio Podcast with Carm Capriotto https://remarkableresults.biz/Diagnosing the Aftermarket A to Z with Matt Fanslow https://mattfanslow.captivate.fm/Business by the Numbers with Hunt Demarest https://huntdemarest.captivate.fm/The Auto Repair Marketing Podcast with Kim and Brian Walker https://autorepairmarketing.captivate.fm/The Weekly Blitz with Chris Cotton https://chriscotton.captivate.fm/Speak Up! Effective Communication with Craig O'Neill https://craigoneill.captivate.fm/