“You came up with a cost of $400+ a day, somehow. I have no idea how.”
Consider a wash with gross sales $500K. Total expenses are $363K which includes cost of goods, operating expenses, property taxes and debt service.
The window of opportunity for this particular wash is 4,320 hours.
$363K / 4,320 hours = $84 per hour
This is average cost of providing service.
So, it cost around $1,000 a day to stay open for 12 hours.
If the wash was monitored, data would give an indication of when motorists don’t wash in relation to temperature.
For example, at this wash, when it’s zero and below, history shows average of 30 cars a day whereas zero to 10 degrees, the average is 100 cars a day.
The average sales are $10.00. So, a 100 car day would cover cost of providing service.
So, zero would be the tipping point.
If the forecast was zero and above, history says there is a good chance of washing enough cars to justify the multitude of issues involved in opening and operating a wash in sub-freezing conditions.
If the forecast is – 5 F, history says mostly likely not enough people will visit.
Since every market is different, so will be the tipping point.
For example, in Atlanta, 1” of snow with a temperature of 32 F or below will paralyze the city.
So why open, close and do maintenance.
On the other hand, in extreme conditions in north, like a whole week forecast for -5, what would you do?