Robert Auto Sales and Service (rasas) Business Background

Business Background

Robert Auto Sales and Service (RASAS) consist of four different types of business; three car dealership that sell and service American as well as Japanese cars; two auto parts stores, and a large body shop, a large auto storage yard, and car painting. Vikky Roberts, owner of RASAS is planning on expanding into the vintage car restoration business and needs assistance on evaluating this idea. She purchased a 1965 Shelby Mustang GT 350 for $50,000 and needs restoration. The idea behind this purchase is to restore the vehicle and use it as an exhibit sales and advertising and take it to an auto show in order to attract potential customers to the new business.

Proposed Business

Vikky Roberts believes that many people will be willing to pay for car restoration because they don’t have the time to run down all the old parts. Others have the capacity to pay for restoration and they want to own a vintage auto. She will like this new business to appeal two both types of customers. For the first type of customer, she will like to serve them as a supplier for old parts. In addition, she is thinking on reproducing hard to find parts or no longer exists. Vikky envisions that her business can also become and information resource for DIY. On the second type of customer, this business will provide them the convenience of restoring a vintage auto for a fee.

Roberts asked the director of service operations to prepare a report that defines what needs to be done in order to restore the mustang like when it was first manufactured. She will need to complete the restoration in 45 days in order to take it to the Detroit Auto Show.

Restoration Project

For the restoration, there is a budget of $70,000 which includes the $50,000 already spent on the purchase of the car. Due to her current financial situation, she can only spend $3,600 per week. Based on the activity report (see exhibit 1), the restoration will cost approximately $18,100 which includes the transportation of the vehicle to the auto show. Exhibit 1 also includes a list of all the tasks required for the restoration and their dependencies so the project can be done on time. In addition, the report also reflects that the restoration process could be done soon as 39 days or as late as 41 days. The critical path for this project are: ordering all the materials and parts, follow by receiving the upholstery material for seat covers, reupholster the interiors of the car, and take the vehicle to the auto show (Critical Path A-B-T-V).

Analysis of Car Restoration Business

There are two potential markets behind the idea of vintage auto restoration. Fist, serve as a supplier for NOS parts as well as restored parts not in the market anymore. Second, restore vintage vehicles for others. Analyzing RASAS business