If it were your car wash... New owner

[Duke'sWash]

I just recently purchased a small 2-bay self-service car wash. It is located on the main street of a small town, beside a gas station that sits on a corner lot. The traffic count past the car wash is approximately 4000 VPD. Looking at the previous owner's financials, he was grossing around 15K. Currently the car wash offers presoak, tire cleaner, high pressure soap, foam brush, wax and rinse along with 2 vacuum stations. I've read quite a few posts on how to improve the car wash but wouldn't mind some of the more experienced members to give me some recommendations. My thoughts are to clean the place up, add credit card readers to the bays, add a few more functions and update some of the older equipment. I'm also considering adding a dog wash and an automatic if I can restructure the building to get them to fit. I'm looking at used equipment to save some money and doing most of the work myself. My business partner and I both have industrial maintenance backgrounds which should eliminate the need to hire repair/install technicians. Because the building is a simple pole building structure, I'm even considering knocking the building down and rebuilding with taller bays and reusing the existing slab if I can get the permits and a decent price on a new pole building. My goal with this project is to learn the car wash business and improve the location to its full potential. I don't expect this business to replace my full-time job, but it would be nice to improve the profits. So, if it were your car wash, what upgrades would be worth the investment and what would not?

 

[Keno]

Grossing $15k per year?!?! You can't operate a wash for $15k per year, you will be in the red.

 

[Duke'sWash]

I know. 15K is not a lot of money, but according to the previous owner's records it is enough to make a few thousand dollars of profit after expenses are paid. I'm new to this business and wanted to start out small. I'm OK even if I only break even as I am using this as a learning experience and possibly a steppingstone to another more profitable car wash. The purchase price was less than market value, so there might be some future value here as well if I decide to sell.

 

[Keno]

The previous owner lied to you, I don't care where in the country you are, your fixed costs to run a 2 bay wash are going to be more than $15k per year. Cost of capital? Insurance? Utilities? Heat in PA to keep your wash from freezing in the winter? Not trying to be a Buzz Kill here, just trying to save you some $. You need to take a good look at your financials before sinking anymore $ into this wash. In the meantime, make sure everything works as it should and keep it clean. In a small town, your potential customer base is finite, and will usually be a big limiting factor in how much revenue the location can produce. It doesn't always make sense to invest in huge capital improvements in small town washes.

 

[OurTown]

It needs a ceiling in the bays to prevent birds from nesting.

 

[MudMoney]

A wash in a town that small in population is a money pit and time waster.

 

[edredtop]

You have a low annual gross AND a business partner.
If you guys can take $10K profit from the 15K gross (you can't), that will be $833 a month, or $27 a day. Now you get to split that with your partner leaving $13.50 a day profit. I broke it down this far to illustrate that the best-case scenario possibly won't even buy the gasoline needed to be on-site for daily maintenance, but that wasn't the question you posed.
You asked what would we do..
I would recommend what many others before have said on this site:
* Clean it, paint it, make it attractive, get noticed
* Make sure everything works
* Add modern services to get your customers to spend more time using the equipment. Credit cards, Air Shammee, triple foam. etc..
* Raise your prices! I'm willing to bet you're at a $1 to $2 start up with 30 to 40 seconds per quarter. Your goal should be to get to 15 to 18 seconds per quarter as fast as you can.
* Lastly, I would have an exit plan with your partner. The sooner you can buy him out, the less it will cost you. If you get it fixed up and ripping and your partner is still around, you are risking paying more to get their half, and that doesn't mean they'll have the dough, or be willing to pay you if you want leave. Control your future by controlling the property if at all possible.
At any rate, congratulations on your new venture and please keep us posted.

 

[Earl Weiss]

Before considering major expenditures for structural changes I would consider. 1.Credit Card with Count up. 2. A second changer so you don't have to run there if one breaks down. 3. Make one bay a superbay. 3. Have timer set for both Grace and Bonus time.

 

[Greg Pack]

How far do you live from the wash?

what is the current height of the bays?

 

[Duke'sWash]

My business partner and I both live less than 30 minutes from the car wash, which makes it easy enough to check on a daily basis. As for the height, the bays are only 8 ft tall. I think this hurts business. Right now, we are trying to figure what improvements would deliver a solid ROI without over improving the property. I realize that being in a small town will limit its profit potential.

 

[edredtop]

What customer base are you attempting to capture by raising the roof? You know your area better than anyone, but this is puzzling. I'm guessing that 3,500 or more of the 4,000 vehicles that pass your property each day fit into the category on the chart* attached below.

*source:
https://vehiclehelp.com/car-height/

 

[Duke'sWash]

It's a tight fit for lifted pickup trucks, but the bigger concern is the lack of space for an automatic machine. I can't find any machine that would fit in that height. At this point I don't know if I can justify the added expense of a used automatic, or the cost to restructure the bay, but I would like to explore all of my options and hear everyone's opinion. I know this is highly variable, but how much of an increase in sales is typical of an automatic in a small town?

 

[Randy]

I did a drive around in Arendtsville and I wasn’t too impressed. Looks to me like a pretty poor rural area with a lot of vacant buidling. With a population of only 900 I don’t think you can do a whole lot to increase business. The best advice I can give you clean the place to the point that shines, new lighting. How much are you charging for your services? Adding credit cards is a good idea. I wouldn’t consider a automatic, there’s not enough people to justify expense. With a gross of $15K what is the net? About all you can do is consider this to be a hobby.

 

[I.B. Washincars]

I agree with Randy. I live in an almost identical town. I just watched someone buy the only wash here, totally remodel it, including a brand new Laserwash. It’s been about six months since they re-opened. I’d say that they are about ready to put a gun in their mouth by now.

 

[designflaw]

Dont do it. The numbers dont make any sense. The end goal is to get money in your pocket, not out of your pocket.

 

[Duke'sWash]

Thanks everyone for your feedback. I think the safest bet at this point is to clean the place up, get all of the equipment functioning properly, maybe add credit card readers and see if we can get the profits up before making any major investments.

 

[Car_Wash_Guy]

Thanks everyone for your feedback. I think the safest bet at this point is to clean the place up, get all of the equipment functioning properly, maybe add credit card readers and see if we can get the profits up before making any major investments.

I would most definitely add CC readers. But these 3 things would be the priority and then see what happens.

Just out of curiosity what was the privies owner listing as expenses? Mostly ins and property taxes?

 

[Duke'sWash]

Supplies, utilities, services, equipment and sales tax. It looks like there are a few expenses missing, but I think it is a rough estimate.

 

[Dan kamsickas]

Supplies, utilities, services, equipment and sales tax. It looks like there are a few expenses missing, but I think it is a rough estimate.

Did you see actual business records or tax returns? I would never trust a rough estimate from anyone.

 

[washpetsmart]

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