Estimation for buying

[Dockman]

Hello,

my name is Michael and I am also a Newbie. I found this great Forum after reading one
of the best business book I have read from Buzz Glover the Car Wash Business 101.

I am negotiating right now on a Car wash with two automatic car wash bays and 4 self-service bays .

One is a AquaJet XT Mark VII which is 2 Years old
and
one is the I-5 from Sonny Enterprises that is 4 years old

The Car wash has also 4 self-service bays with Coleman equipment which is 17 years old and the seller was telling me that the equipment was updated thru the years as needed
Would you be so kind and tell me your opinion and experience on the two automatic car wash bays.
How stable/ strength/ repairing ?
How much should I calculate if I install a third automatic car wash bay? Or replace one of these?

About the profit:
The City has around 100,000 residents and is growing up very well.
The location is on a busy crossing. Easy to reach. Good and attractive Business Neighbors.

They are around 10 competitors in town - 2 bigger and some on gas stations.
I do not want to stay on the paper work numbers of the seller.
I want to go on my and yours estimations - is it realistic to earn after all the costs between
100K up 150K per year?

Thank you for your time and help


Take care

Michael

 

[robert roman]

Like a good book, it helps to start at the beginning.

Your “location” says Germany. Are you referring to carwash property in Germany or U.S.? I’m going to assume U.S.

First step is sanity test. Trade area population of 100,000 and 10 carwash sites is saturation index of 50 percent. Good so far.

Depending on market value, earnings before taxes (EBT) of $100,000 or more may require sales revenue of $300,000 or more.

For example, if a wash cost $700K to build and sales revenue is $160,000, one might expect EBT of $50,000 or return on cash of around 35 percent with conventional financing.

So, how sane or realistic is sales revenue of $300,000?

For example, if current sales are only $200,000. $300K requires $100,000 additional sales revenue.

$100,000 is yeoman’s task for mature combination self-serve.

Hope this helps.

 

[Dockman]

Hello Robert,

thank you for the speedy response - yes, I am thinking on a car wash in the US in Florida.

The sales revenue which the seller shows on the paper is around 270K.

 

[mac]

Send me a note on where the wash is located. I am located in FL and am pretty familiar with many of the washes. I might be able to tell you if his sales numbers are realistic. The gross seems a bit high, but who knows?

 

[robert roman]

Unlike some other folks here, I work from a desk so I get to lurk around a lot.

$270K, then income verification becomes sanity test.

Then asking price becomes sanity test.

 

[BBE]

Hello,

my name is Michael and I am also a Newbie. I found this great Forum after reading one
of the best business book I have read from Buzz Glover the Car Wash Business 101.

I am negotiating right now on a Car wash with two automatic car wash bays and 4 self-service bays .

One is a AquaJet XT Mark VII which is 2 Years old
and
one is the I-5 from Sonny Enterprises that is 4 years old

The Car wash has also 4 self-service bays with Coleman equipment which is 17 years old and the seller was telling me that the equipment was updated thru the years as needed
Would you be so kind and tell me your opinion and experience on the two automatic car wash bays.
How stable/ strength/ repairing ?
How much should I calculate if I install a third automatic car wash bay? Or replace one of these?

About the profit:
The City has around 100,000 residents and is growing up very well.
The location is on a busy crossing. Easy to reach. Good and attractive Business Neighbors.

They are around 10 competitors in town - 2 bigger and some on gas stations.
I do not want to stay on the paper work numbers of the seller.
I want to go on my and yours estimations - is it realistic to earn after all the costs between
100K up 150K per year?

Thank you for your time and help


Take care

Michael

This part immediately is what scares me for you about this deal. 270k is already above average revenue for a 4 and 2. Is there room for improvement, sure. There always is. Is there room to grow another 100k or more, if 270k is accurate IMO that'd be an awfully tough task. Possibly if you added a 3rd auto...but that's a costly project. If the current owner was profiting that I'm sure the place would not be for sale. I suppose if you didn't have a mortgage payment, and you were a very hands on owner and did all of the repairs and maintenance yourself and ran a tight ship 100 to 150k in profit could be possible. But if you had enough cash to buy the place and not have a mortgage payment I would think you wouldn't need to be getting into the carwash business.

We have a wash in our neck of the woods that the gentleman bought it after getting out of his current business and was assuming that it would bring in a nice 80-100k for him and still be enough for him to completely make a living off of...he's now bankrupt.

 

[Dockman]

Hello BBE,

...he's now bankrupt. That scares me.

Well I thought this could be a good second business for me.
I still ask by myself why is this car wash not sold since more than one year.

Something is going wrong on this…

Thank you for your answer

 

[Waxman]

I think alot of potential investors get the wrong idea about acquiring a car wash business. It involves alot of time, energy and money.

I do love my car wash business, but it is only a part of the total revenue stream for me. My company has other sources of income which have been necessary for growth, improvements, expansions, acquisitions and SURVIVAL ( at times ).

 

[Dockman]

Hello Waxman,

I was thinking it takes an average time of 3 or 4 hours every day for a 4 / 6 self serve wash plus 1one or two In Bays? Am I wrong?

Special thank to Mac - he did gave me a very good advice and spend his valuable time to answer my particular questions.

 

[Waxman]

I recently cut back from 7 days/week to 6.

The hours are up to you; will you be attended? Will you do repairs troubleshooting and testing? Will you perform maintenance and cleaning? Chemicals and vending ordering?