Considering purchasing a ss/automatic need advice

[pal132]

I am considering an older super wash that has been in operation since 1995 and is no longer branded as a super wash. The building is in decent shape, needs approx. 10k in face lift and signage.

Has three ss and one operable superwash auto unit that is a dog and one hydro spray that needs the tower recovered but works good and has credit card acceptor.

Equipment room is good.

One superwash with two ss and two auto and one private owned with two laserwash and three ss in same town, both one mile each way from mine. Mine (one I am considering) is in best location by far and is easiest to see and enter and has largest lot. Mine is on corner lot and has restaurant on one side, oilk change across side st, convenience across street and 12k cars per day in town of 16k. Located in iowa, very cold. My location in the worst looking location in the town

The place grosses 100k and has attendant that cost 45k yr. He is an old man, non owner and watches tv all day. Does the absolute minimum. I discovered he also is the man in charge of collecting money from ALL units including six vacs and vending.

they are considering my offer of 145k

What do you thing

Thanks

 

[I.B. Washincars]

The place grosses 100k and has attendant that cost 45k yr.

This is obviously a typo...right?

 

[pal132]

NOT a typo. Another point, attendant empties all of the cash boxes. So actual gross may be much higher. The attendant obviously will not be part of my operation if I purchase, I will be the attendant. I am self employed in real estate and can essentially do as I please now.

 

[robert roman]

“….considering a super wash in operation since 1995….no longer….super wash. The building ….needs….10k…face lift and signage.

…three ss and one ….superwash auto….and one hydro spray….needs…tower…but works good and has credit card acceptor. Equipment room is good.

The place grosses 100k and has attendant that cost 45k yr.

they are considering my offer of 145k

What do you thing

The population in my home town has dropped over the years from about 12,000 to around 7,000. It still supports two short exterior conveyors, about 8 wands and one in-bay at gas site.

So, informed on real estate matters, you should appreciate the notion of indentifying the highest and best use of a property.

In many areas today, it’s become more difficult to make self-serve fit in.

Consider this is a 19-year old wash with a building design and equipment that is obsolete technically and, more importantly, from a marketing perspective.

So, $145K to chase $100K may not be the bargain it appears.

My advice is to hire a consultant to help you determine the highest and best use of this property as a carwash site.

Otherwise, you may miss an opportunity to plug a gap in the marketplace.

 

[cwguy.com]

You need to check expenses! Seems like something is messed up? Taxes..... Revoking business license? Car wash opening across the street?

Why on earth would he need to hire a consultant that doesn't live in town? Maybe a local inspector to ask questions? Or a local building consultant? Seems like a no brainer?

 

[Ghetto Wash]

If your numbers are correct, $145 for a wash that does $100 is a no brainer. Buy it today before they change their mind. (assuming that real estate goes with the deal)

 

[BBE]

so...the attendant makes more than the owner

 

[Creole]

Sounds like a steal???? You better dig a little deeper into the financials before finalizing. Talk to the utility companies and make sure the equipment is sound. If it all checks out, GRAB IT.

 

[pal132]

Yes, the real estate is included

Yes, the owner is not earning anything, matter of fact he is showing a loss of nearly 10k that I am sure is offset with his other more important interests

I have dug through the financials and I think the place is a great investment, not only are they paying the employee to run the place, they are also paying 10k/yr maintenance. I think I can go in and make 30k/yr if I were to change nothing, but I want to better the place and increase business by at least 20%. What are the most efficient ways to increase traffic?

This is the worst looking wash in town but it is in the very best location. I have talked with zoning and no problems and no new building permits or even discussions with anyone who wishes to build a wash.

The hydrospray classic seems to be working pretty good, it cleans well so I believe the water chemistry is pretty good. I wonder how much it would cost to give the classic a facelift with new enclosure and new spray tips etc.

The building has the old ugly brown superwash mansard that I think I will just replace rather than paint, maybe a bright blue would work. Where do I buy the large letters for signage on the mansard?

The old superwash inverted L automatic still works, any ideas of a way to upgrade it so that it works and looks better?

 

[JGinther]

Sounds like a deal. Just make sure in the due diligence period you are confident that another business of the owners' isnt making the deposits. If deposits are verifiable... do it. It should appraise at least 400k based on income approach after expenses are corrected. That should give you plenty of room to make a very good wash and offer a better value than competition.

 

[JMMUSTANG]

I would get at least 3 years P&Ls.
Just doesn't sound right.

 

[Earl Weiss]

Look for snakles in the grass like when was the last time pits were pumped. Always nice to buy a place and then have to pay $5000 to pump out the last guys mud.

 

[cwguy.com]

It does sound really good. But the problem might be the buyer has to have cash? Banks around here hate car washes. Or there is a huge lean?

Earl of course the pits are full.

 

[pal132]

Last four years P&L's all pretty consistent, however each year is down a bit, I assume some of that is economy and some due to the appearance of the place.

Pits were pumped last August, I will have to do it soon, the cost to pump by local septic guy is $2200.00, how do I tell when it is time, just by sticking a probe in the grates and measuring the level? How deep should the pits be to the bottom?

My bank should loan on it, or I can use cash and equity in rental houses, got 32 of those and still a few lien free.

Why do banks hate car washes?

 

[Jeff_L]

... how do I tell when it is time, just by sticking a probe in the grates and measuring the level? How deep should the pits be to the bottom?...

The answer is that "it depends". It depends on time of season and how full they are. You do not want the mud to get so deep that it clogs your drain, that'll shut your bay down and could cause other sewer issues that could be expensive to clean out. Generally, a good rule of thumb is every 6 months to stay on top of it and not let a bay get out of hand. Some bays get fuller quicker than others, but when I do pits for customers I do them all at a flat rate per pit.

 

[2Biz]

Last four years P&L's all pretty consistent, however each year is down a bit, I assume some of that is economy and some due to the appearance of the place.

Have you obtained utility records for the past (3-4) years to compare Water Usage with the P&L's? It might help determine whether the numbers they are giving you are legit?

 

[rph9168]

Also check the chemical purchases as well. They can also give you some idea of sales.

 

[pal132]

The utilities and supplies are very consistent for past three years.

Water is very high, weep runs constantly in the cold weather.

Gas bill is within a few hundred dollars year to year as is Electricity.

The bays have what I believe to be metal halide as the light color is a bit yellow and some are dimmer than others. What would be a good plug and play replacement. Has the typical super wash wall mount brown housing lights.

 

[2Biz]

There are some threads on here on how to convert to CFL's. Some are switching out to LED...Pick your poison!

http://www.autocareforum.com/showthread.php?6668-In-Bay-and-Vac-Station-Lights

 

[Greg Pack]

Upload some pics of the place- we'll be glad to tell you how to spend your money