Car Wash Forum
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Unlimited Monthly
- Thread starter benny2
- Start date
Earl Weiss
Well-known member
How does it affect the average revenue per car. One would think that unless them monthly customer would wash frequently enough to lower the cost below what the regular price would be they would fall off the program.
robert roman
Bob Roman
What percent of sales (volumes) is unlimited (washing) at exterior express varies considerably.
I know operators that have several hundred members and others with over a thousand members.
If the number of visits is four times a month and the program has 1,000 members that is 48,000 washes a year (1,000 X 4 X 12).
If volume before program was 90,000 washes a year, total is 138,000.
So, 48,000 would be 35 percent.
I know operators that have several hundred members and others with over a thousand members.
If the number of visits is four times a month and the program has 1,000 members that is 48,000 washes a year (1,000 X 4 X 12).
If volume before program was 90,000 washes a year, total is 138,000.
So, 48,000 would be 35 percent.
That's not entirely accurate. You have to remember that to some degree you are cannibalizing your paying customers by turning them into unlimited members. You aren't just adding 48k washes to your 90k, because you are cannibalizing part of that 90k and turning it into that 48k.
It still does wonders for volume and revenues I just feel presenting it that way is a bit misleading.
Earl Weiss
Well-known member
Definitely. If you are already at that point, and work it backward, then absolutely! But if you are currently not doing the monthly pass program, and are thinking about implementing it, then I don't think you can work the math forward like that.
Also, Earl. To answer your question about the average revenue per car. Every site is different, so I'll answer from my own experience. For me it did not change the average revenue per car drastically. Less than 50 cents a car, however volume almost doubled. Another operator a half hour away from me actually had his revenue per car go up after implementing it.
I mentioned cannibalizing your paying customers, but that's not entirely a bad thing. Let's say your base unlimited is $19.99 a month. You are potentially taking a "paying customer" who may wash their vehicle 9 or 10 times a year and spend less than a hundred dollars a year with you and turn them into a customer spending $240 a year with you.
There will be a certain amount of customers who were loyal paying customers that you will now lose money on. The guy who washes once a week and buys your 10 dollar wash every single time is now going to sign up for the unlimited program and spend half the money with you a year. However your loyal customers like that probably make up only about 20% of your customer base. You are trying to take the other 80% of your customer base and turn them into unlimited members who now spend much more per year with you than they would have otherwise.
robert roman
Bob Roman
“What if you work it backward? 138K annual volume. 1000 monthlys at 4 x month = 48k from the 138 K leaves 90K =35%”
“Definitely. If you are already at that point, and work it backward, then absolutely! But if you are currently not doing the monthly pass program, and are thinking about implementing it, then I don't think you can work the math forward like that.”
Working forward requires different assumptions.
Assume conveyor processes 75,000 cars per year, no program.
Start program and 1,000 customer join. So, how many customers constitutes new baseline?
If customers visit an average of four times a year, theoretical customer base is 18,750 unique visitors (75,000 / 4).
(18,750 – 1,000) X 4 = 71,000 + (1,000 X 4 X 12) = 119,000
(119,000 – 71,000) / 119,000 = 40%
“Definitely. If you are already at that point, and work it backward, then absolutely! But if you are currently not doing the monthly pass program, and are thinking about implementing it, then I don't think you can work the math forward like that.”
Working forward requires different assumptions.
Assume conveyor processes 75,000 cars per year, no program.
Start program and 1,000 customer join. So, how many customers constitutes new baseline?
If customers visit an average of four times a year, theoretical customer base is 18,750 unique visitors (75,000 / 4).
(18,750 – 1,000) X 4 = 71,000 + (1,000 X 4 X 12) = 119,000
(119,000 – 71,000) / 119,000 = 40%
Earl Weiss
Well-known member
Obviously I have no frst hand experience. From what I have read, for a $3.00 Express wash the $19.99 / mo seems high. AVerage reports are 3-4 x the base. Even at 4 x the base it would seem that customers would fall off the program if they realized useage averaged less than the multiple. (Maybe they don't?) So, the factor would be the relative multiple. By that I mean if the Base is $3.00 and the monthly is $12.00 what % wash more than 4x a month and what % less . Perhaps it's a washout so there is no net effect. Thoughts?
robert roman
Bob Roman
Yeah, my thoughts are low price (i.e. $3.00), free use vacuums and unlimited washing is simply a form of competing on basis of cost.
75,000 X $8.50 = $637,500
(18,750 – 1,000) X 4 X $8.50 = $603,500
1,000 X $20 X 12 = $240,000 + 603,500 = $843,500
$843,500 / 119,000 = $7.09
Difference is about $1.50 lower average price.
75,000 X $8.50 = $637,500
(18,750 – 1,000) X 4 X $8.50 = $603,500
1,000 X $20 X 12 = $240,000 + 603,500 = $843,500
$843,500 / 119,000 = $7.09
Difference is about $1.50 lower average price.
Earl Weiss
Well-known member
A while back it seemed the unlimited price was 3 - 4 x the basic wash. A quick search now reveals one $3.00 wash at $15.00 and the rest closer to $20.00. Can't help but wonder if the lower price was an enticement for a new program to get people enrolled and then slowly ratchet it up or if the 3-4 X price was determined to be a loser. a 5-6 X price seems like a more reasonable price from the operators perspective. This would have less potential to adversely affect averages.
