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Liability insurance/issues for home mechanics?

Old 10-20-21, 08:35 PM
  #26  
Vintage Schwinn
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Zandoval has excellent advice. The Federal SMALL BUSINESS ADMINISTRATION (SBA) has retired & active CPA's & attorneys who volunteer their time towards helping folks navigate the smoothest path to both steps involved in creating & running a business. They also can give you expert advice as to whether what you actually have amounts to a business. The fact that you are advertising your services, would lead me to best guess that, most would consider that you are indeed making an attempt to conduct business.

Another person did inquire about whether a typical Craigslist bike Flipper would have the same LIABILITY for said bicycles that he/she sells. My best qualified guess is NO, that such a FLIPPER, can be essentially completely protected by specifically stating that the item(bicycle) is AS-IS, WHERE IS, & SELLER MAKES NO GUARANTEE THAT SAID BICYCLE IS CURRENTLY IN FULLY FUNCTIONAL & SAFE OPERATIONAL CONDITION, THE PURCHASER ACKNOWLDGES THIS AND ASSUMES THE FULL RISK THAT SAID BICYCLE MAY POSSIBLY CAUSE INJURY OR HARM A RIDER IN IT'S PRESENT AS-IS CONDITION.

Now, when one provides an advertised service to Repair Bicycles where one is charging a monetary fee for said service, the customer(person who paid to have his bike repaired) has a reasonable assumption that said repair(s) were done reasonably well in a manner that jibes with generally accepted methods/proceedures and that the re-assembly has been done to a prudent reasonable standard which would be safe enough to ride. (e.g. NO LOOSE BOLTS, MISSING PARTS, OR OTHER POTENTIALLY DANGEROUS ERRONEOUS CONGLOMERATION OF PARTS & SETTINGS).
Now, for example, failure of an existing OLD PART later on, or of a Used Replacement Part does not imply that said Repair was anything less than perfectly done, if the customer accepted the use of a USED replacement part.
Typically if said SERVICE FACILITY (you) did provide a reasonable standard of care and the bicycle was received (picked-up) by the customer in fully functional, operational condition, it becomes much much more difficult for the customer to prevail in any dispute where there is a some incident/crash/new problem that arises more than 72 hours after the customer takes possession of said repaired bicycle. Now, if indeed the problem is the exact same original problem that was the reason said bicycle was in for repairs, well that is somewhat different. This is where "realistic & reasonable" would be perhaps the determining factor as to whether one would have a legitimate complaint-grievance with said shop. You cannot expect said repair to essentially be warranted forever. The auto industry sees this every single day. Automatic transmissions, fuel pumps, A/C compressors, alternators..

My best guess is that in a near-perfect world, you would have no potential problems that would arise but just look at some of the goof-balls that make it their life's work to flim-flam and fleece money from businesses by pretending to have gotten the short end of the stick, when they actually received ouststanding service/perfect quality goods. There are folks who specialize in doing just this on Ebay to sellers who may be naive and not aware of such nefarious practices. The goof-ball cries foul and claims said item arrived either with minor damage or totally damaged, or not as described, and then demands a full refund with the aim of also keeping said item that they received. 99% of folks are honest and do not engage in fraudulent schemes, but those very few who do, are experienced pros in such schemes.
FOR THIS REASON, YOU DO NEED TO CONSULT WITH A PROFESSIONAL, TO INSURE THAT YOU ARE GONNA BE OKAY....
I wil not hire anyone or any business that is not fully licensed, bonded, & insured to do any type of work at my residence, my beach house, or at my former office property or other investment properties. There is simply too much risk. There is the deep pockets theory whereby the injured worker's attorney is gonna go after any owner or affiliated party with deep pockets to extract as much as they can. They are gonna be like a tough dog with a bone.......they aren't gonna let go if they determine there is significant money to tap in to. I would urge anyone with significant assets to do the same. Yes, you'll pay more for such qualified tree professionals, contractors, roofing professionals, painting contractors, plumbers, brick & tile masons, pool maintenance, yard maintenance & landscaping but you protect yourself somewhat by only hiring fully licensed, bonded & insured professionals rather than just jacklegs with a pickup truck & tool box, or some guy with a chainsaw, extentension ladder, rakes, leafblower, edger and lawnmower. Also make certain that you follow all the applicable local regulations that require Permits being obtained before substantial renovations.
Insurers today are much more lean & mean than the warm and friendly good neighbor than they would like you to believe that they are. They will play hardball like you will not believe in a belief that you will capitulate without first consulting an attorney. I am just saying that often attorneys are unfairly thought of as being the equivalent of number two but realistically sometimes their professional services are exactly what you need to protect your rights or / and to obtain an acceptable settlement.
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Old 10-20-21, 08:42 PM
  #27  
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I flipped bikes for awhile without any problems but it only takes one event to turn your world upside down.

Good answers to legal questions require competent legal advice which you'll probably have to pay to receive.

However, my not to be construed as legal advice opinion with regard to "flipping" bikes and any liability associated with that is that if you have homeowners insurance and probably an umbrella liability policy, you'll be protected up to the financial limits of your policy for non-commercial sales of personal property. Problem with flipping is that if you're buying something with the intention of selling it for profit, then that's very easy to define as a commercial activity. My guess is that if someone is injured on a bike you've sold, their "in a wreck, get a check" lawyer is going to figure out pretty quick who has the deep pockets. Say, for instance, you sell an older bike with cantilever brakes where the front reflector and bracket where the bracket that went under the straddle cable has been removed. The front brake cable becomes disconnected somehow, the straddle cable hits the front tire and the buyer/rider is thrown from the bike and suffers substantial injuries. Yep, that bracket holding the front reflector going under the straddle cable was a safety feature. Maybe not a very good safety feature but it was made that way for a reason. Now, Mr. Ambulance Chaser lawyer will look for the deepest pockets. Say it was a Trek so they'll try to figure out how to get money from Trek. Trek will point to the missing bracket. Next down the line, the bike shop that put a "sold by XXX bikes" sticker on the frame. XXX bikes is long gone. Those potential deep pockets are gone and now Mr. Lawyer is remembering that his client said he bought the bike from Faceplant Marketplace Flipper and here's his name and address. Even if you didn't remove the bracket, if the lawyer thinks he can squeeze you or your insurer for money, you're looking at the potential of a lawsuit. Maybe you get lucky and the lawyer decides you're not going to be a big enough payday and he tells the client success is unlikely and he no longer is willing to pursue litigation. If the lawyer is smart and hungry and reasonably efficient, you'll get a suit and an offer to settle. You'll consult a lawyer and your insurance company and maybe or maybe not, depending on how the case fits within the limits of your insurance coverage, your insurance company will handle negotiations and litigation. You could still be on the hook for any amount beyond your coverage and, if the sale of the bicycle was beyond the scope of your coverage, on the hook for everything.

So, it depends on a lot of things but mostly your tolerance for risk.

I flipped bikes for awhile without any problems but it only takes one event to turn your world upside down.
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Old 10-20-21, 08:46 PM
  #28  
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Gloom and doom aside, go for it! If you like what you do, have the expertise, and like helping others; you can call the shots. Renumeration will require some business knowledge and an accountant. You might find a small business class at a community college and an accountant can help tremendously. Liability insurance comes in many levels and cost as well as tax credits for overhead including dedicated space in a home. I've known a few folks over the years, and my wife, who have had their own business. It's work up front, but once you've got system it's not that bad. One thing I learned from a 1 man auto service is to have a bank account for the shop. It's very easy to foul up for taxes with a personal or joint account to run a shop from.

Liability depends on how to protect yourself. For used sales, do what car guys do, "sold as is no warranty expressed or implied". You can state what you've checked or repaired, but the buyer assumes all risk.
If a suit does rear it's head, it's up to the plaintiff to prove and a judge to decide if there was fraud, criminal intent, willful negligence, disregard for proper accepted methods of repair or procedure. If your experience is deep, and you care about a reputation; I doubt any questionable bike or frame will leave your shop.

The shops that have worked on our family vehicles, (for which I didn't have time or tools) were always good in that they communicated with us. Unexpected costs, delays in parts, maybe a wrong diagnosis or deeper root cause were always explained before the money was spent. That and good workmanship kept us using them for many years.

Good Luck and Good Fortune!

Last edited by Greg R; 10-20-21 at 08:52 PM.
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Old 10-20-21, 08:48 PM
  #29  
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To the above add this: If someone did sue you, and you were essentially running the business without insurance, they can go after your personal assets (house, car, bank account). That's why you create a Limited Liability Corporation. To limit your personal liability. So.... do both or (as you apprently have done) retire.
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Old 10-21-21, 12:39 AM
  #30  
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Originally Posted by rydabent View Post
"upside down chain" **********???
Some single speed chains are two sided.
Google "KMC 710".

Last edited by AJW2W11E; 10-21-21 at 12:43 AM.
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Old 10-21-21, 11:31 AM
  #31  
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1. Small business insurance, about 500.00 / yr.

2. Doesn't hurt to have the 2 million insurance policy that covers everything as an umbrella - often used as a backup to a teen driver driving under the family car insurance policies.

I shy away from cutting edge stuff in my business, no carbon bars, stems, seatposts, carbon crank arms or carbon spokes. 99% aluminum alloy and a little steel and titanium. Basically the tried and true stuff that's been around for decades and established as "reliable".

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Disclaimer:

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2. I like anyone will comment in other areas.
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4. I will provide information as I always have to others that I believe will help them protect themselves from unscrupulous mechanics.
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Old 10-21-21, 11:55 AM
  #32  
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If you don't have a business set-up, with liability insurance, and probably a bond required for mechanical work, you shouldn't do it.
ANY American can be sued for faulty workmanship and the results thereof, business or not private party or not.
I started, ran and retired from my own business in Seattle.
You may be good, you may think all is great, but one day an unreasonable person with unreasonable expectations will force their misplaced angst at you. And worse, it may actually bankrupt your family. In our money grubbing society there are a high percentage of people that want to be on Judge Judy.
We like the things we like and when we become good at it, want to share or make money from it
But...
Its the bikes we like, in general, its the ignorant people that ride them that suck. Its the same in all service industries.

Personally I don't think of bikes the same as cars, Bikes are the simplest form of mechanical devices that people use and enjoy. I think everyone should learn how to maintain and repair their own bike. If for nothing else, the satisfaction of it. Especially if you like bikes enough to upgrade them or race them.

Another point to be made is that you cannot disclaimer yourself out of liability. Just because you make a sign or have someone sign a waiver does not mean you are in the clear. That is a mental tool only.
We live under liability laws which do not recognize these things unless they are all inclusive and exactly in line with State Laws.

Last edited by macstuff; 10-21-21 at 12:07 PM.
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Old 10-21-21, 02:13 PM
  #33  
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Originally Posted by macstuff View Post
Another point to be made is that you cannot disclaimer yourself out of liability. Just because you make a sign or have someone sign a waiver does not mean you are in the clear.
Word. This should be reread a few times.
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Old 10-21-21, 03:51 PM
  #34  
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Originally Posted by grizzly59 View Post
Word. This should be reread a few times.
Sometimes our industry is still lost in the "toy" mode. The ski industry learned the above 45 years ago. One can't sign away their rights. Wavers are just one more hurdle to get over and the legal trade has spent a lot of time figuring this out.

The best take away with this thread is to seek professional legal advice. Andy
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Old 10-21-21, 04:42 PM
  #35  
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Originally Posted by Andrew R Stewart View Post

The best take away with this thread is to seek professional legal advice. Andy
That'll never happen if we're also talking about just selling a used bike you no longer want anymore.
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Old 10-21-21, 05:13 PM
  #36  
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At the car lot we sell used cars "As Is", however that in no way protects us from personal injury liability. Our wrenches go through every car top to bottom and repair what needs to be repaired. Brake pads, wiper blades, and tires are always replaced. The As Is thing is simply about a mechanical failure of the product unattached to any personal injury liability.

GET INSURANCE specific to your operation whether it be flipping bikes, tune ups, handyman, etc. An umbrella policy will not protect you from personal liability. Oh, one more thing. Do yourself and your family a big favor. Set yourself up as a small biz. Totally legit with a tax license and all the other heavy handed stuff. When the crap hits the fan you will be set up correctly to deal with it provided you have a competent lawyer representing you.

Disclaimer: I am not a lawyer, nor do I pretend to be one on TV, but I have been down this road once and understand it.
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Old 10-21-21, 07:13 PM
  #37  
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Originally Posted by Sy Reene View Post
That'll never happen if we're also talking about just selling a used bike you no longer want anymore.
I agree with there being a difference between selling a single bike. But if the victim can show that this is something you've done a number of times, and maybe have bought bikes to have to later sell, then the court could easily see you as something other than a one off seller and thus someone who has positioned themselves to do bike flipping.

This is somewhat like the Uber type lift services drivers that initially started out as "contractors" and sought ways to avoid the cost of a taxi business. We all are willing to give a friend a lift for free (or maybe share gas $). But when we advertise and charge $ the game changes a lot. Andy
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Old 10-21-21, 10:22 PM
  #38  
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lol I love lawyers and law firms. Especially the big box firms that have hundreds of them, all trying to climb the ladder. I can just imagine them trying to turn a bad brake pad into a 300k lawsuit . The bike owner who crashed will claim that he or she can no longer perform “marital services” or something equally ambiguous and hard to document. Once the lawyers realize the pad was made by a vendor that went under in the Far East, they’ll come after the easiest target. That would be Mr. Nice Guy who charged $10 for the repair and threw in a new inner tube.

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Old 10-22-21, 12:30 AM
  #39  
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My Dad owned a one-man auto body/repair shop. Mostly he just wanted to restore his own old cars, but took in some insurance work and cars from working class or poor folk around westbank New Orleans. His liability was $900/year. I think once you start advertising/taking payment you represent yourself as having knowledge and skill, so your actions will be compared to what's expected from a skilled mechanic.

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Old 10-22-21, 08:09 AM
  #40  
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Glad I read this thread. My take is don't sell used bikes. The few hundred dollars isn't worth it.
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Old 10-22-21, 01:02 PM
  #41  
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Originally Posted by 2old View Post
Glad I read this thread. My take is don't sell used bikes. The few hundred dollars isn't worth it.
As the OP, I'm glad I posted and read every response. No more bike shop in the garage, and no more flipping for profit. I've got 3 bikes on cl/fb now. After that I'm done.

I don't think even setting myself up as a business with insurance would make me totally comfortable after reading all this.
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Old 10-22-21, 01:55 PM
  #42  
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Originally Posted by AJW2W11E View Post
lol I love lawyers and law firms. Especially the big box firms that have hundreds of them, all trying to climb the ladder. I can just imagine them trying to turn a bad brake pad into a 300k lawsuit . The bike owner who crashed will claim that he or she can no longer perform “marital services” or something equally ambiguous and hard to document. Once the lawyers realize the pad was made by a vendor that went under in the Far East, they’ll come after the easiest target. That would be Mr. Nice Guy who charged $10 for the repair and threw in a new inner tube.
Behind every greedy lawyer is a greedy complainant, those people are your neighbours, family members or even some of you! It's much easier to demonize a small group and blame them for society's ills rather than take individual responsibility.
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Old 10-22-21, 04:29 PM
  #43  
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For whatever it's worth, I carry liability insurance for my arborist business here in Florida, and $500,000 worth of coverage in a business that could easily result in a tree getting dropped on someone's house costs me about $100 a month.

Just make sure that the insurance you purchase actually covers the services you provide. It's not all interchangeable, and that matters.
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Old 10-22-21, 04:31 PM
  #44  
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Originally Posted by cyrano138 View Post
, and $500,000 worth of coverage in a business that could easily result in a tree getting dropped on someone's house .
Ok, I'm intrigued. What business has trees being carried over houses?
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Old 10-22-21, 04:34 PM
  #45  
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Originally Posted by Sy Reene View Post
Ok, I'm intrigued. What business has trees being carried over houses?
Arborist. We work mostly in urban and suburban areas here trimming or removing large oaks, pines, and palms that grow near or over buildings. Make the wrong call and you could drop a 1000lb branch on someone's roof.
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Old 10-24-21, 04:13 PM
  #46  
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OK, I'm going to throw out one more question for all you mechanics that have thousands of posts (Andrew has 15K+) and probably more hours wrenching - how did you get all your experience? I've wondered about this for years, and always assumed we have a lot of pro mechanics ringing in on the various threads.

do/did you work at shops?
fixing/modding your own bikes?
fixing other people's bikes?
flipping bikes?
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Old 10-24-21, 08:13 PM
  #47  
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I think you open yourself to a ton of risk running a bike repair business from your garage. One snapped brake cable or slipped brake cable that results in a crash and your life is altered forever.

Hate to be Debbie Downer but that is reality in today's jacked up sue-happy society. I would check with your insurance company and get their take. I would start the conversation like, "I was thinking of "getting in to" repairing bikes in my garage".

As far as where I got my experience, it started back in 1975 at Al's Bike Shop in Cleveland Ohio. Al closed up shop a number of years ago. Al was one strict dude but he got me totally hooked on repairing bikes. I assembled untold number of kids bikes before he let me even look at an adult bike of any kind. Al taught me how to over-haul a Sturmey-Archer 3-speed hub as well as true wheels. I worked there for two years during high school. I worked one year during high school at the filling station across from the school, pumping gas and help the mechanic change oil, bleed brakes and scrub the floor.

I moved to NC and worked in two shops there for two summers. I went off to college in Michigan and worked at bike/ski shop there. I worked during the school year for two years then transferred.

I went back to NC and worked again in one of the shops I had worked in the previous summer. This time at their new store. The lead mechanic at that store was the brother of the guy that started Performance bike (he also started Wabi Cycles). Best mechanic I ever worked with and he taught me a LOT! Hewas a wizard making wheels, truly a wizard. Which is why Wabi wheels made up until around 2017 are just amazing and stay in true basically forever unless you hit a bad bump.

In all I think I spent 7 years working in bike shops part time ( 3 to 8 months of the year). I am also mechanically inclined and do most of my own car repairs as well...unless it's something big.

I tell you what though, YouTube is a really, really good resource. The Park Tool channel is especially good. Just work on your own bikes. Strip them down to individual parts and put it back together. Find old wheels in garage sales and true them as best you can. Stay with it and you'll learn a lot over time.


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Old 10-24-21, 11:10 PM
  #48  
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Originally Posted by sunburst View Post
OK, I'm going to throw out one more question for all you mechanics that have thousands of posts (Andrew has 15K+) and probably more hours wrenching - how did you get all your experience? I've wondered about this for years, and always assumed we have a lot of pro mechanics ringing in on the various threads.

do/did you work at shops?
fixing/modding your own bikes?
fixing other people's bikes?
flipping bikes?
A few years of fairly diligent amateur wrenching. I basically bought my first decent bike as an adult ( a Trek 520) and did EVERY recommended service procedure at every interval following directions to the T, which was actually a pretty good training regimen. Some time volunteering at a cooperative. Really this stresses the importance of being able to find service resources (nearly all of them are publicly available online) and RTFM.
UBI--pro mechanic course, suspension, wheel building, and frame building courses.
Got a job as a mechanic at shop--day 1 was building crappy kids bikes, in a couple months I was completing customer work orders and within a year I was doing relatively high end service. If you do your damn homework, learn from manufacturer sources, and make an effort to improve your work practices most employers will give you the work you are capable of doing.
I will rarely flip bikes--I did a few while away from work quarantining/on parental leave, but I agree that the legal situation is murky and don't really look to do much of it. Will look for things that are way under market value. I could also do like many in the industry and buy bikes on EP below dealer cost and flip them for pretty normal used value annually for a profit, but frankly I suck at selling stuff on a regular basis and the relatively modest margin isn't that tempting to me simply to get under the latest and greatest.

I've been at this like, I dunno, 6 years or something professionally? I am the lead mechanic of a small shop and am pretty dang good at most things--really while I could learn some more specific skills (in particular, I'm wanting more familiarity with more brands of suspension service) really where the bulk of the improvements can come for me are helping to shape the efficiency and profitability of my shop and straight up improving my own efficiency--in particular, forseeing and avoiding "traps", ie, horrible time sucks that require far more work than initially expected (or than the customer is willing to pay for).

If you wanna wrench for money more than very part time for a short period of time, I do think the trade schools are a good idea to get in line with good commercial practices and standards, even though this does overlap with a lot of the skills a good amateur mechanic might have. Beyond that though, just get a job wrenching--they'll probably be cautiously optimistic about the training you've received, but the work you put out is the proof in the pudding. My first job as a mechanic made it clear that my attendance at UBI was both a factor in my hiring and at starting at above their entry pay rate.

People skills are also pretty important. I like to build trust with customers and give them my fair assessment of their bike with their options and let them decide. Telling someone that they actually need less work than they think helps when you tell them that they really ought to get their suspension rebuilt or whatever.

If i had another, hopefully more lucrative career (well, except for the ski instructing I do part time in the winter) I think I'd also really enjoy wrenching part time. It's a really fun job; I wish it were easier to be a stable career for those interested.
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Old 10-25-21, 08:17 AM
  #49  
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Originally Posted by sunburst View Post
OK, I'm going to throw out one more question for all you mechanics that have thousands of posts (Andrew has 15K+) and probably more hours wrenching - how did you get all your experience? I've wondered about this for years, and always assumed we have a lot of pro mechanics ringing in on the various threads.

do/did you work at shops?
fixing/modding your own bikes?
fixing other people's bikes?
flipping bikes?

My start was much like many wrenches. Got into riding (in my case it was an escape devise from my sisters) and started to take the bike apart to fix/upgrade it. I did a few overnights before getting into High School. When in High school had the sudden need for $ (crashed sister's car). Tried a couple of stock boy jobs but couldn't take the bosses. Heard that JC Penneys was looking for a bike assembly person and soon was their main guy for the local store. Brought in a few friends over the couple of years too. Winters had me transfer to the toy dept. sales floor which meant that I had to wear a tie, another lesson of what I didn't want to do. Again by word of mouth, heard of a ski/bike shop looking for help and soon was their main guy and also learned some ski stuff (still have the P Tex burn scars...). This was in 1975 and was the real step to small business world and found my place. Moved on to full time bike shops, managing shops, owning my own for 15 years (another lesson as to what I didn't like) and went back to working for good bosses.

My knowledge came from hands on first. Then getting more from co workers, bosses and customers. I sought out the shops where I could learn new stuff, (still remember being handed a lug and file and was told to "do this", did and framebuilding soon became my passion). The SBA offered some starting your own business classes, A couple of framebuilding classes helped me too. But I've never taken a true bike repair class (taught a bunch though). When I was considering working for a shop I would offer to test work a few days with no obligation. It was the shop's atmosphere and how we all got along that was more long term important to me, the shops that didn't meet this criteria were often the ones with the worst atmosphere too (funny how that works). There were more then a couple of shops that I stayed for only a few days before moving on, having found out first hand that their reputation was not what I wanted to be associated with.

Most people in the bike shop world are smart, self motivated, seek phrase, like helping others find their fun, and have found a way to live on very low wages. A successful partner helps. (What are the common three ways a bike shop owner can be profitable? Inherit the business, already be independently wealthy, and/or own the property). The half dozen people that I've met (and often interviewed for hire) who took the Barnett or UBI wrenching classes have been all across the board. From those who after graduating felt entitled to being hired over others (guess why they were passed by) to those who already knew the bike shop was their calling and wanted to gain knowledge in specific areas. While having mechanical skills is a strong element of hiring people their personal/people skills are every bit as important IMO.

I come from a highly educated family, 2 Drs, a banker and a teacher as siblings. Mother got her masters back in 1946. So the groundwork for being a professional and a helper of others is in my genes. At first my parents were disappointed that I wasn't going to follow their college path. Years later Dad told me that he thought that I was having more fun then the rest of the siblings put together. Now they are gone and I am nearly retired (only work "as needed" to fill in) and don't regret much. Andy (whose first bike paycheck was in 1974)
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Old 10-25-21, 11:32 AM
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Originally Posted by himespau View Post
With sales of a used product, can you just specify (potentially in writing in the ad) that the product is used and being sold "as-is"?
You can. However, that would not stop someone from "claiming" some wrongful act on your part and just the cost of protecting yourself in a court could be life-changing (and not necessarily in a good way
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