Cost of Goods Sold for pre-soak, wash, foam brush, rinse, and wax chemicals?

[Bhtoplawn]

I'm a college student and I picked to make a business plan for a self- serve car wash for my seminar class. Does anyone have a good idea what the Cost Of Good Sold for each of the following products/chemicals. (pre-soak, wash, foam brush, rinse, wax) So whats the markup percentage the industry likes to use? Thanks for helping me out!

 

[Jeff_L]

Those aren't products we sell as they are supplies used to wash a vehicle and does not leave the lot. Those items are tracked as an expense in my books. COGS in my book are for vending items for which we apply sales tax to.

Vendors for chemicals have varying pricing, check the websites of Windtrax and Kleen-Rite for pricing.

 

[robert roman]

Follow this link to download PDF containing Auto Laundry News’ Self-Serve Survey.

http://www.carwashmag.com/home.html

Go to survey page - 2014 Self-Service Survey, June issue is latest benchmark.

Page 38 lists expenses (operating cost as percentage of total monthly revenues).

Throughput or Contribution Margin is the rate at which the carwash generates money through sales.

Contribution Margin = selling price – cost of raw materials

For self-service, cost of raw materials is chemical, water (and sewer), electricity, softener salt, lubricants/solvents and fuel (i.e. natural gas).

If the business accepts credit cards, the fee is a selling expense and would be included in cost of goods sold.

 

[robert roman]

Oh yeah, vending merchandise is also cost of goods sold.

 

[Kevin James]

Robert those car wash surveys are for the most part all Bull $hit. I can't believe anyone actually believes them. When we fill out those surveys we just put down what ever comes to mind at the moment.

 

[rph9168]

The problem with those surveys is the limited, small sample they represent. In most cases they are the better operators that subscribe to that publication. In general I have found most of the percentages to be in the "ball park" but not always. The amount of product would most likely be skewed since these are not your for the most part your average operators. I doubt anyone would really consider the data to be totally reliable or accurate.

 

[robert roman]

Benchmarking is process of comparing one’s business processes and performance against industry best practices from other firms.

So, a benchmark is a point of reference and not the “burning bush.”

Benchmark surveys are published by Auto Laundry News, Professional Car Washing and Detailing magazine and International Carwash Association (Cost of Doing Business Reports).

I’ve analyzed the benchmark survey reports going back to 1990 (PC&D has the oldest). I find they make a good point of reference.

Oh yeah, ICA also has their own program now Wash Count.

Of course, there are differences in the data.

In South Dakota, you may have to turn on the lights during daytime and burn fuel 24/7 to keep place from freezing up during winter whereas in Florida it’s sunny bright all day and wash car with cold water.

So, yes, there would be differences in cost. However, a rational person would make adjustments for this.

 

[robert roman]

As for validity, I wrote an article for ALN some years ago that discussed this.

More is better but the number survey respondents are always great enough to allow for student-T and other statistical tests of confidence.

Yes, the surveys are only as good as the quality of the data that goes into them.

However, experience shows that most people who would take the time to respond just don’t put down whatever comes to mind at the moment.

 

[Bhtoplawn]

Thank you everyone who commented. I'm kind of getting things figured out with this business plan.