WELCOME TO THE CAR WASH INDUSTRY

SHOULD I BUY A CAR WASH? Many people see the car wash industry as a great business opportunity because they see it as a business that can be operated semi-absentee that produces a great return on your investment. The truth is a bit more complicated than that. It’s not exactly rocket science, but if you ask any operator he will tell you the same thing—“It’s not as easy as it looks. You can’t just put your feet up on your desk in your office and open the doors.” We are one of the largest firms in the tri-state area selling 10-15 car washes annually. You’ve probably seen many cars waiting on line each paying between $10 and $15 for a wash. You then start adding up what the owner is probably making today. You then project his sales for one year. You say to yourself, I need to get into this business. There are three main factors you need to consider when purchasing a car wash. 1. The amount of capital you want to invest 2. The amount of time you want to spend running the business 3. The amount of money you’re hoping to make The type of car wash that’s going to require the biggest investment from you, both in terms of time and money, is a full-service wash. That’s also the type that tends to generate the most revenue. But unless you have $500,000 or more to invest upfront, it’s probably not the best choice. An exterior car wash is the next highest in terms of investment, followed by an in-bay automatic car wash, and finally, a self-service car wash. How much money can you make owning a car wash? The following is the profit potential of car washes: · Full-service car wash: $400,000 to $750,000 per year · Exterior car wash: $100,000 to $375,000 per year · In-bay automatic car wash: $50,000 to $150,000 per year Self-service car wash: $25,000 to $75,000 per year

Some of the finest features of the car wash industry are:

HIGH APPRECIATION

Many car washes increased in value (hundreds of %) during the 1980’s. The car wash market has come down off its highest prices with many good deals available to the smart buyer.
Prices charged by car washes increase almost every year (keeping up with inflation) while most expenses are rather fixed. Your largest expense, labor, has actually decreased due to equipment automation.
Cash Business – No accounts receivable.
Small inventory – merchandise items (air fresheners, mats, etc.)
Today’s equipment takes very little maintenance.
Super automation – speeds up to 120 cars per hour.
Depreciation – everything including your leasehold can be amortized for depreciation.

ABSENTEE MANAGEMENT

Present day computerization makes it possible to run as many as 20 car washes out of a single office and still maintain the highest quality and profit standards.

COMPETITION

This is one of the few industries that enjoy “controlled” competition. Many years ago, before municipalities realized car washes could have long lines, car washes were permitted to open in locations that would be totally prohibited today. Thus, it has become very difficult to get permits to open new car washes.

GROWTH INDUSTRY

Professional car washes service less than 25% of the motoring public. The average consumer washes their car twice per year. Thus, a huge untapped market is available to professional car washes that have the ability to market and advertise their business.

WEATHER

Car washes are closed when it rains or snows. Closed days are generally used for maintenance and cleaning. Most of the employees are paid hourly and thus do not get paid when the business is closed. Other added profit centers (quick lube, detail center) can help with cash flow, especially on poor weather days.

ADDITIONAL PROFIT CENTERS

Quick Lubes and Detail Centers are excellent businesses that work well in conjunction with car washes. The average quick lube does 40 oil changes per day at an average of about $30 for a basic oil change. With extra services, the average sale could be as high as $65 per car. The average price for a complete detail is about $150.

WORKING HOURS

Most car washes operate between 8 am and 6 pm. Some locations open earlier and/or stay open later. There are a few operations that are open 24 hours. (Mostly located within 5 boroughs) The busiest months are January – March, May. The slowest time of the year is July – September.

TYPES OF CAR WASHES

Exterior Car Wash (Customer Stays in Car)
Cleans only the outside of the car. Most of these operations dry the car, while some do not. Exterior base prices are generally between $6.50-$9.00.

Full Service Car Wash (Customer exits their car and enters walkway)
Cleans interior of car including vacuuming floors and seats and windows as well as the exterior of the car. Full service base prices are generally between $10.00-$15.00 with packages as high as $25.00. Packages include extra service items such as triple wax, undercarriage wash and armor all.

Machine operated vs. Hand operated tunnels

Self-serve car washes

Customer pulls into a bay and washes their own car using prep guns and brushes supplied by the car wash. Payment for services is made through a machine in which customer purchases time.

In-Bay Automatic car washes

Customer stays in their car and pulls into a bay after paying for the service through an auto-cashier. Equipment (touchless or friction) then moves around the car that has been placed in park by customer.