Gas Prices, Rain have Dried my Bays

[Thomas3599]

The gas prices hurt 2 years ago, now they are killing the washes in Midwest, and rain. Every other day we have had rain are their calling for rain. I have never been hit this hard this quick. I have made adjustment to get ready for a tough few years. I knew this year would be rough, but I didn't think it would come so hard and quick. I've adjusted the loan and getting ready to dig in for tough times ahead.
I've been in the business for about 8 years and 2 years ago we just put in another auto. I have a 3/2 touchless and softtouch. I have had those month in the past 2 years were we may have to kick in a $1000.00 here or there, but trying to make back to back payments is tough. Anybody else being hit real hard with gas prices?

 

[bigleo48]

I can't say that I've had a real drop in business because of the price in gas...but that's hard to determine. I guess people can see it two ways...price of gas goes up but not carwashing, so carwashing is a bargain. Or, I don't want to spend anymore money on my car. I think what we'll see in the long run are smaller vehicles (like in Europe). I had studied the types of cars a few years agao and what I found is that 40% of all vehicles in my area were trucks, Vans and SUVs. In a year or so, I'll check again and see if there is a drop in trucks as I suspect there will.

Weather...I find that in the end, weather even's out. We had a tough winter here and sales were down, but April's looking like a record.

BigLeo

 

[MEP001]

April was a record for us with a week of it still left. We had two tough years with rain on the weekend or forecast for it almost every week, but so far this year it's been mid-week instead. I can't see any effect from the price of gas, in fact most people I ask don't much worry about it. They just cut back on unnecessary driving and sometimes switch to a more efficient vehicle (I'm planning to sell my full-size truck to get a small one, which is really all I need). Someone I know who once swore she'd never drive anything but a Suburban for "safety reasons" just traded it for a Toyota Rav4.

 

[Danny]

I get atleast one call a day from a customer asking me how business is and how everyone else is doing. Here in california, gas is high, home foreclosures are going up, and the general economy is going down. I agree with bigleo48 I think most see it two ways. I hope more start looking at it as a bargain!

Danny

 

[bigleo48]

Don't need to hope...put up some signs!

 

[robert roman]

Some parts of the country are booming while other parts like Ohio and Michigan are staggering. However, one thing is certain, overall consumer perception has been negatively affected by uncertainy, the housing bubble and rising fuel, energy and food prices. According to most economists, the next two years will be a vary challenging for many industries. Many analysts believe that consumers will respond by staying close to home, they will become very careful on how they spend their away from home money and they will be more willing to do things to keep average tickets lower. As a result, consumers will be looking to extract the full value proposition from their service providers and will look for more cheaper and viable options if they don't get it.

Although it is advisable to hunker down and save costs whenever possible, you should not ignore the opportunity to move your carwash business ahead. This means advertising, promotion, publicity and raising your level of service standard; not discounting. If you do not know how to do this, get help. Otherwise, you risk the danger of becoming an efficient but marginal business.

Hope this helps.

Bob Roman
www.carwashplan.com

 

[Chiefs]

We just finished the first year in the last 10 where not only did we not wash 10,000+ cars for at least 2 of the four winter months, but we had no months of 10,000+. The only saving grace was that we washed twice as many cars in January over the previous January.

Gas prices certainly are not helping, but we just finished two beautiful weeks of 2,000+ cars each week. The weather is far more of a determining factor in wash volume. If you lose two or three days each week and then one or both weekend days to boot, and you do it for 2-3 weeks in a month, its a very, very long month. Get 2-3 months in a row like that and it becomes a viscious cycle to be sure.

Thank God I'm not full service.

 

[Jim Caudill]

I sure wish you folks would edit your profile and put your location in. Your posts are relatively meaningless without knowing where you're located.

 

[Ben's Car Wash]

It's not just gas prices. Speaking to a lot of people in the industry (suppliers, installers, realitor who sell car washes and other owners) most tell me the same; Tunnels are off by 20-30% this year and SS are 30%. Saturday I spoke to an Agent who has many washes listed in Florida. She said that business is down in Floida 30% as an average. I hear from veterans in this industry that they have "never seen it this bad".

This is not just "weather related". This is our second recession is 7 years and likely the worst in 40+ years. Today's headlines have home foreclosures double in the first Q of 2008 and up for the seventh straight Q. The average American's income has dropped by over $1000 per year over the past 6 years. Job creation averages below the birth rate! People do not have the disposable income to keep up with the cost of commodities.

That is what is hitting us hard. A combo of stuff.

 

[Chiefs]

Cleveland, Ohio - one of the poorest cities in the nation.
I agree, desperate times call for desperate measures. But this may one place the $3.00-$5.00 format works against you. If you have this format and have still seen these 20-30% drops in volume, to put it mildly, you're screwed. You can't lower the price anymore, so what do you do.

In the rush tio fill the void between the $18-$25 traditional full serve wash and the $8-$12 in bay automatic price, exterior/express operators have rushed in and cut their own throat by undervaluing their product from the get go and now with volume dropping, have no alternative strategy.

Tunnels have the advanatges of speed and qaulity over in-bays. New operators who have or are investing millions of dollars into their car wash need to think about who they are competing against. Your biggest competitor are the people who wash at home.

The problem most car washes have is that they really don't care how their cars come out, or even if they do care, are not willing to take the steps necessary to ensure that each customer receives a far better wash than they can if they were to do it themselves.

With the myriad of conditions that customer's vehicles present (bugs, mud, snow, ice, bird crap, tree sap, egg) and the varyied frequency of washing, and the difficulty presnted by wheel rim cleaning, lock and load carwashing with no or inadequate attention to these problems will result in a vehicle that is still dirty and a customer who is not happy. If you are a car wash that prides itself on customer service, the inability to address these issues is a kiss of death and results in customers coming to you when they have to rather because they want to. Lets face it people have lots of options when it comes to washing their vehicles, if your wash is not standing head and shoulders above the rest, even the attractiveness of low price is easily offset when issues related to qualityare present.

 

[rph9168]

Well said Bill.

I would add that it is also the time to be working hard on your marketing plan. There was a good article on this by Jeff Sturgis in this month's Modern Car Care magazine. If you don't subscribe to that magazine you can get it on line at their website. In addition to marketing I would say that even if you have a good marketing plan, your ability to provide a quality wash in a well maintained facility is essential to survival. Marketing brings customers to your site. Your wash's performance keeps them coming back.

 

[bigleo48]

We often talk about looking at cutting costs and increasing revenue (marketing, new services and improvements). These are areas that you ignore at your own peril.

Case in point, an acquaintance of mine who owns his own wash has seen his business dry up steadily over the years. He has done nothing for years and now feels he must do something to save his business as others are looking to build in his market and some local manufacturing is leaving town. Yet he still can't get off his butt and put his A-frame sign at the road that has the most traffic (he's on a corner). I ask why he doesn't put the sign where people can see it...he just shrugs. This is a small thing, but symptomatic over the wash in general.

Many operators can just look in the mirror to see the main problem...a complacent operator. I believe his wash is doomed and this saddens me as he has a family to support.

BigLeo

 

[Ben's Car Wash]

The only issue with Bill's thinking is that when all other washes are down.... it's not that you have been able to distingush yourself for someone else that is effecting your volume. But I agree that now is the time to look into grabbing what business you can and make a differance in your own washes operation.

Case in point: Friday I went to the next town to the newspaper office to turn in a proof Ad to run over the next 6 weeks. I haven't done any advertising in almost a year, except on certian occasions (Mother's day, Father's day specials and the sort). But with things slowing down I decided to run a $5 off a wax or $5 off an Express detail and a promotion for a drawing for a free detail. After I dropped off the ad my wife & I had lunch at Captian D's that over looks onto the competitors FS wash. We ate and timed his cars as they enter the lot... watched his employees and noticed what they did compared to how we operate. I do this about once a year. I know the owner fairly well... he was a customer of mine and his brother is a regular (twice a week) of mine with his Hummer. What I saw made me mad as hell! His staff was snapping towels at each other, shoving & pushing, throwing rags and hitting one another.... as customers watched! Some wore SHORT SHORTS with their shirts rolled up and tied to the side exposing "tramp stamps", some had red shirt, some blue shirt, some tan shorts some blue jean cut offs.

When I got back to my wash I saw the owners brother pull in my tunnell.... I banged on his window and asked him if his brother was at the wash. I called the competitors wash and told him what I saw. We exchanged how business has been, how the ICA show was and the normal things. I don't get to talk to him that much, as much as I would like to. We are 9 miles apart so we don't dirrectly comp. for too much business.

Cont.

 

[Ben's Car Wash]

What did I learn? I told my employess what I saw. I looked at what each employee was wearing (Safety Green shirt, tan pants or shorts) none have Tatoos, none smoke upfront (I observed that too at the other wash). I explained to them why my wife & I do not tolerate horse play and why uniformity maters. That "rag-tag" "motley" look at one wash where employees are snapping towels at each other.... they are giving me an advantage! I would be foolish not to notice these things now and act to keep this advantage. I like the guy, that's why I called him.... but his crew...looked like a bunch of crack heads. Yes we hire min. wage employees... but dam-it... make them dress the same and behave.

 

[dogwasher]

Chicago IL, the weather has been rediculous!! Im on fire just thinking about it.
I told a customer the other day things havn't been so good and he told me not to lie to him and he knows the place is a gold mine! I told him I had a gold mine for sale and asked if he wanted to buy it! I told him I would even throw in my mining repair tools.

 

[Waxman]

Change it up, already!

Doug:

It really befuddles me that you haven't really advertised in a year. How can you complain about slow business when you do not advertise?

I probably run ads more than I should and I have no concrete proof that advertising works. But I know that NOT advertising does NOT boost sales.

Even if it's a little, $35 block ad in the local paper, your name gets out there and is placed in the customers' minds. Maybe they do not wash the day they see the ad, but it's about reinforcement.

Instead of all the complaining about the state of the economy and gas prices(things we CANNOT) change, why don't we all pledge here and now to focus some of our energy that we currently WASTE on negative things on things we CAN control and change to make our businesses better?

I think there should be a completely separate section here on this forum dedicated to productive, positive and forward-thinking initiatives that carwash operators have implemented to help their businesses. Enough negativity, already! I get enough of this line of thinking from all of my daily radio news programming. Tell me something good! Tell me what you're doing to help your business.

I advertise now more than ever. I am experiencing my busiest detail shop Spring ever, in 13+ years detailing.

 

[PaulLovesJamie]

Although it is advisable to hunker down and save costs whenever possible, you should not ignore the opportunity to move your carwash business ahead. This means advertising, promotion, publicity and raising your level of service standard; not discounting. If you do not know how to do this, get help. Otherwise, you risk the danger of becoming an efficient but marginal business.

good post Bob, nicely stated.

 

[Andy]

Doug:

It really befuddles me that you haven't really advertised in a year. How can you complain about slow business when you do not advertise?

I probably run ads more than I should and I have no concrete proof that advertising works. But I know that NOT advertising does NOT boost sales.

Even if it's a little, $35 block ad in the local paper, your name gets out there and is placed in the customers' minds. Maybe they do not wash the day they see the ad, but it's about reinforcement.

Instead of all the complaining about the state of the economy and gas prices(things we CANNOT) change, why don't we all pledge here and now to focus some of our energy that we currently WASTE on negative things on things we CAN control and change to make our businesses better?

I think there should be a completely separate section here on this forum dedicated to productive, positive and forward-thinking initiatives that carwash operators have implemented to help their businesses. Enough negativity, already! I get enough of this line of thinking from all of my daily radio news programming. Tell me something good! Tell me what you're doing to help your business.

I advertise now more than ever. I am experiencing my busiest detail shop Spring ever, in 13+ years detailing.

Well said!!

 

[bigleo48]

Well said!!

I second that! Bill are you listening? Having a section on business improvements is a great idea (instead of breaking it down into revenue centers).


I'll start with my favourite "Little Steps". Almost every week I will make an improvement to my wash business. Most of them are small, but after a while, they add up. Here's a small recent list;

-Added Febreze in my fragrance machine.
-Added Pop Machine
-Added tire Pump
-Removed disenfectant in my petwash selection, put up a sign informing the petwash is disnfected daily and as required and added a selection customers will use.
-Added electric auto drain to my compressor
-Added information boxes with sales and information material I produce.
-Updated Webpage
-Made new signs for my SS bays indicating where the change machine and the ATM are located.
-Put new vac and shampoo hoses
-Spoke to marketing expert (who is a customer) about a x-marketing brokerage plan he has and how it could help me.
-Working towards adding an express detail shop
-Changed dim MH bulbs.
-Spoke to newspaper rep about more ads
-Looking into 3xfoam with more show
-Looking at adding 3xfoam in SS bays.

I'm always doing something and I get many complements about my place.

 

[pitzerwm]

I agree that each of us have to constantly look for solutions rather than just sitting there convincing yourself that the sky is falling and there is nothing that you can do. Doing the wrong thing is better than not doing anything, you can learn from and correct a wrong decision.

We are not in a recession as defined by economist, 2 negative growth quarters in a row. If the media keeps telling you that we are in one, you will eventually believe that you are in one. I don't believe that there was one 5-7 years ago either, as my businesses are level to up over the last 12 years. As you can see in the poll there are areas of the country that are up and a number of people are raising prices this year. They are still building houses and commercial business here, in Flagstaff, I saw a large residential development going up. Vegas is still building like crazy.