Are self service car washes going extinct ?

[soapybroker]

Hi,
I have a client that I'm helping sell his carwash for another. He mentioned to me that self service carwash, particularly 8 bays or less are going away. I disagreed with him. I told him it has more to do with the location . Here in Atlanta I noticed self service carwashes in mid to low income areas, but in places like Buckhead, Sandy Springs (affluent) tend to have automatic carwashes with detail attachment. Am I wrong ? what do you guys see in your neck of the woods ?

 

[I.B. Washincars]

IMO, back in the nineties to early aughts, way too many SS/IBA washes were built. Many were built in less than ideal locations. Most of those sub-par locations didn't make it, or didn't live up to their creators expectations and were left to wither on the vine. Many of the ones built in the right places survived.

Standing off in left-field and watching express washes being built in smaller and smaller markets, I think we will start seeing a righting of the ship in that market within the next 5-10 years as well. But, what do I know? I'm just a lowly SS/IBA guy.

 

[DiamondWash]

God if I build another wash I WILL NOT be adding Self Serves, I would gladly do an express tunnel with 2 WashWorld Razors attached.

 

[Randy]

Do you guys remember the B-17 bomber from WW II with half its wing shot off and it’s making a slow spiral into the ground? That’s what I think the Self-serve car wash industry headed. Yes I would have to say the Self-Serve car washes slowly dying. Up here in our area car washes sit on property that is far too valuable for a car wash. Last summer a car wash operator sold his 4 bay car wash on a small corner lot for $950,000, today there is a 5 story condo building on the site with light retail on the first floor. Right now there are 5 Self-Serve car washes that are closed and are in the permit process to be redeveloped. I’m on the fence, it wouldn’t take much for me to sell out. I can’t remember when the last car wash was built, it’s got to be over 15 years that a car wash was built from the ground up. Most cities do not want Self-Serve car washes because they produce very little in tax revenue for the amount of services they require.

 

[chaz]

Do you guys remember the B-17 bomber from WW II with half its wing shot off and it’s making a slow spiral into the ground? That’s what I think the Self-serve car wash industry headed. Yes I would have to say the Self-Serve car washes slowly dying. Up here in our area car washes sit on property that is far too valuable for a car wash. Last summer a car wash operator sold his 4 bay car wash on a small corner lot for $950,000, today there is a 5 story condo building on the site with light retail on the first floor. Right now there are 5 Self-Serve car washes that are closed and are in the permit process to be redeveloped. I’m on the fence, it wouldn’t take much for me to sell out. I can’t remember when the last car wash was built, it’s got to be over 15 years that a car wash was built from the ground up. Most cities do not want Self-Serve car washes because they produce very little in tax revenue for the amount of services they require.

First guy that offers me a million dollars CASH for my wash and property can have it. I’ll even through in some dollar coins.
....but seriously..I’ve got a 12 year old wash 4 s/s and I auto plus 8 vacs. It’s all paid for...and makes good money .... especially if the weather cooperates......but most likely my wash will sell for its property value......just not there yet

 

[pgrzes]

Have not seen any new ones in my area being built. I rehabbed one that was closed for 11 years and its doing great, but the cost to build ground up just doesnt seem to work. Think about it this way, a strong ss bay might bring in $1,200-1,500 per month. A strong iba might bring in $14,000-18,000 a bay. an express maybe $35-100k per month. Where are people going to put their money?

 

[soapybroker]

That's interesting. I have sold a few of them and it seems that it depends on the market. Come to think of it a lot of the buyer have operated them as Hand detail carwashes.

 

[soapybroker]

Yes I would the $ where there is a stronger return on my investments. My question to you is, the car washes that you mentioned. What kind of markets are they located in ? meaning Low - moderate - income areas ? Because I do think that local economy (neighborhoods) plays a factor as well. But I could be wrong. Thanks for the reply

 

[mac]

All depends. Many were built that should never have been. There are some here in FL that are kicking butt. One customer with a 6 bay self serve only grosses around 250K per year. Yes, you read that number right and no I won't say where it is. Don't see any new ones but see a fair ammount of older closed ones selling for the price of the dirt and being rehabbed.

 

[soapy]

Express washes are being over built now just like SS were over built in the 90s. This has a big impact on existing washes. SS washes that are well run will always have niche that a express wash can't fill but as our society ages and the younger generation being less willing to do as much physical activity the customer base will shrink.

 

[Greg Pack]

Expresses have take over in our market. There hasn't been a SS built in ten years or so in our area. As Soapy said self serve will serve a niche, but the golden days of self serve car washing have gone the way of a drive in movie theater. Ironically, one of my washes is doing the best it's ever done because many others in the area have shut down or converted to express.

 

[soonermajic]

Have not seen any new ones in my area being built. I rehabbed one that was closed for 11 years and its doing great, but the cost to build ground up just doesnt seem to work. Think about it this way, a strong ss bay might bring in $1,200-1,500 per month. A strong iba might bring in $14,000-18,000 a bay. an express maybe $35-100k per month. Where are people going to put their money?

I'm sure they're out there, but making $100k/mo @ an Xpress & $18,000/mo on an IBA are crazy good!

 

[soonermajic]

SS in rural towns can kick some A$$! I'd say towns of less than 10k pop, & not w/in 40 miles of an Xpress/tunnel, would be ideal places for SS/IBA.

 

[copperglobe]

IMO, back in the nineties to early aughts, way too many SS/IBA washes were built. Many were built in less than ideal locations. Most of those sub-par locations didn't make it, or didn't live up to their creators expectations and were left to wither on the vine. Many of the ones built in the right places survived.

Standing off in left-field and watching express washes being built in smaller and smaller markets, I think we will start seeing a righting of the ship in that market within the next 5-10 years as well. But, what do I know? I'm just a lowly SS/IBA guy.

Agree. Been in business 30 years. Back in the 90's there were too many washes and too few cars for those washes. Now that all those washes are either out of business, torn down, whatever, my business has consistently increased with each year. I believe that now, in my area, we've got about the right number of SS washes to be supported at profit levels in our communities.

I.B. Washingcars is right in that we'll see the same thing happen to express washes- too many tunnels for the market to cover. I.B....I'm just a lowly SS/IBA guy too.

 

[Eric H]

I think the problem with most SS is they are kept in barely operational condition! If your meter boxes look like this you should reconsider your involvement in this industry.
I'm sorry if this photo belongs to someones that is a member of this forum, i pulled it from another site. I am hoping that the missing section of the decal is a recent issue. I see far to many sites that look like this and the owner can't figure out why they don't make any $$

 

[MEP001]

I think the problem with most SS is they are kept in barely operational condition! If your meter boxes look like this you should reconsider your involvement in this industry.
I'm sorry if this photo belongs to someones that is a member of this forum, i pulled it from another site. I am hoping that the missing section of the decal is a recent issue. I see far to many sites that look like this and the owner can't figure out why they don't make any $$

Let's have a meter door picture battle:

 

[Earl Weiss]

The cost of owning real estate in many markets will affect viability. 2 local SS were razed by the same operator and made into EE's . A third has the long term lease expiring we will see what happens. Good news is that will leave me with one (albeit top notch competitor) SS competitor anywhere close by. I expect his property is becoming quite valuable as well.

 

[Kevin James]

I see it all the time. You get these investors who think that they can buy into a S/S car wash business and they’ll only have to go there a few times a week. They think that they’ll make a boat load of money because some $hit bird distributor told them they would or there good friend told them they would. Once they find out how crappy of a business the S/S car wash industry is and how much work they have to do for such little profit they start to let the condition of the property slide, not doing the necessary repairs, coin box decals, equipment upgrades etc. So there you go another crappy car wash on the market. The next investor buys the car wash thinking he can turn the car wash around and spends a bunch of money on upgrades and the cycle repeats itself. I think Randy said it best, the S/S car wash industry is like a B-17 bomber with half its wing shot off and it’s making a slow spiral into the ground.

 

[OurTown]

I agree with most of these responses but will add some ideas of why some SS washes are dying.

Profit margins are low because expenses are high these days if you are a good operator. Most customers that use SS (other than the ones that can't use an auto because of size or other reasons) perceive it as being a low cost DIY wash. In reality it is not at the well run washes. For example it is nothing for someone with a truck to spend $12 to $18 at ours. Cars are about half to two thirds of that. That is at $2.00 for 3 1/2 minutes which is about average around here on the better SS washes. At that price you are into the price of an auto.

Auto wash equipment has gotten a lot better with less damage issues.

People are getting lazier and would rather wait in line for an auto so they can look at their phones.

Society's morals are getting worse about other peoples's property. Operators are less likely to fix items that are cosmetically damaged from abuse or vandalism but still work. The operator might think that if it is replaced it will happen again soon and the place may turn into a money pit. Customers may perceive the place as being run down or that it has turned into a bad part of town and start going to an auto wash.

Some people are somewhat scared to got to a SS wash these days (especially unattended washes) because of all of the bad things they see in the news that is happening out in society. They might feel safer staying in their cars and wait in line at an auto.

EEs are killing it when it comes to marketing. For one thing they have to market big time to get enough people to come to them to overcome their high overhead. Not only are they telling everyone to "come here!" and "we will get it clean!" but also that they are a "3 minute car wash". Time is tight for some people so they are going to go to the car wash that they are told is the fastest and self serve is not what comes to mind. Who is marketing their SS wash? (one that is SS only) Crickets......

Almost all EEs give away vacuums and SS charges for them.

Some people would rather go where there is an attendant in case there are issues. This only has to do with SS because most are unattended.

A lot of the older SS washes are built in the old part of town and the new EEs are usually in the new shiny part of town. People like shiny.

These are just some random thoughts that I have been harboring since being in the business for the last year and a half. Right now I'm thinking the SS market is here to stay but only if you can get the right combination to work in your specific area. I have other thoughts about it but don't have time to type it out and turn this into a book. Gotta go now.....vac hoses to pick up.....trash cans to empty....mud to hose down....

 

[OurTown]

I just thought of another one:

A lot of the old run down SS washes don't accept credit cards and more and more people are not carrying cash.