Anyone ever bought or have experience w/ Hand CarWash?

[soonermajic]

I have a chance to buy one. Allegedly grosses $16---20k/no expenses of $4800/mo
Owner moving 4 States away & needs to sell.
Thoughts....?

 

[Car_Wash_Guy]

Typo on the expenses? $4800 seems...impossible.

 

[carwashireland]

Interesting thread, I have a client that is looking to set up a large franchise network in the U.S. Not sure how they can compete due to slow wash times

 

[soonermajic]

What seems impossible? Employees about $3200, rent$800, electric & water $500, soaps/chems $300. Costs are not real low cause 3 employees hand wash & vacuum.

 

[OurTown]

I'm assuming the owner does a lot of the labor.

 

[carwashireland]

3 x employees? over 7 days a week though would you not need 4 or 5 in total. So costs for labor would rise to $4,500 - $5,000? then insurance and maintenance...Pushes it up a fair bit.

 

[Rfreeman]

Ive never looked at one but I would start by doing what most of us do on ss...stalk the place to see how busy it is first. Secondly, if the current owner tipped his hand that he needs the sell i would sit and wait...let the deal come to you. Keep in mine more employees more headaches

 

[mac]

So what you really be buying? A space to rent? Minimum wage labor?

 

[Randy]

I have a chance to buy one. Allegedly grosses $16---20k/no expenses of $4800/mo
Owner moving 4 States away & needs to sell.
Thoughts....?

Hand wash, are you kidding me! I think the current owner is looking for a chump to buy him out because it's such poor business model.

 

[MANLO]

I tried it and found it difficult to move cars through at a reasonable pace. It was also difficult to set prices. Some cars were in decent shape and some were a mess. Some cars you just can't make look better. I stopped because dealing with the customers was more of a pain than normal. A guy leases a bay from me on Firdays and Saturdays now and he does okay....$500 per day....more if he does wax or headlights. I like it because I cover what would I would generate from the bay and they line up cars which I think helps bring customers in to wash.

 

[soonermajic]

So what you really be buying? A space to rent? Minimum wage labor?

Yes,buying a 10 yr old business only. NO property. 2 of 3 employees work 2/dys/week, then all 3 work other 3 busiest days of the week. Laborers get $90/day.

 

[soonermajic]

Hand wash, are you kidding me! I think the current owner is looking for a chump to buy him out because it's such poor business model.

There's actually quite a few of these in Houston, San Antonio & Austin. Seems like the Hispanic pop REALLY like these things.

 

[Car_Wash_Guy]

So what you really be buying? A space to rent? Minimum wage labor?

The good will. If the numbers are accurate, he has a 10 year established business with hopefully provable income. We all know what it takes to build wash up from scratch and that alone is worth something.

If the numbers made sense, I'd consider it. Perform your due diligence and of all things, see if there are any new competitors coming to town.

 

[Rfreeman]

As owners or one day potential sellers yeah good will has value. As a buyer at the negotiating table good will has no value to me. In ss at least the land brings some tangible value...this deal would have to have a very high cap rate for me to consider it

 

[Roz]

I tried it and found it difficult to move cars through at a reasonable pace. It was also difficult to set prices. Some cars were in decent shape and some were a mess. Some cars you just can't make look better. I stopped because dealing with the customers was more of a pain than normal. A guy leases a bay from me on Firdays and Saturdays now and he does okay....$500 per day....more if he does wax or headlights. I like it because I cover what would I would generate from the bay and they line up cars which I think helps bring customers in to wash.

Just curious, what do you charge to rent a bay for a Friday or Saturday? I have someone interested in doing the same however hard to say what income he would be displacing since it can vary based on the weather and time of the year.

 

[soonermajic]

1 glitch: The employees are actually about $5500/month moving monthly expenses to about $7000. Grosses $175,000 net $90,000. Asking price is $35,000. You get no land. Just the new equipment (power washer, hoses, vacuum, surveillance camera & commercial safe), & a 10 yr old established business. payback should be 12 weeks. I'd split the cost with a partner, so $17,500

 

[Waxman]

I don't like the business model. Too labor-heavy. I also do not invest in businesses where land is not part of the deal.

 

[Rfreeman]

This is a deal that sounds too good to be true. Have you stalked this place to see how busy they are? Also do you know if they have some type of contractual agreement with 1 customer that is the majority of their business? If so does that contract continue with a new owner???? For example, a SS converted to mini tunnel/detail with free vacs has an agreement with a car dealership around the corner to bring their new inventory to his place to clean it before listing it for sale.....that's the bulk of his business. If this deal had similar situation I would be worried if this contract would continue with a new owner??? Like I said with that type of pay back it sounds too good to be true.