Looking to Move/Invest in a Business

[Car_Wash_Guy]

Look at the financials.
Find out from the town/city/county how many, if any new washes are going though the process of being permitted/built.

 

[Rocketman]

Greetings,

New member here with possibly similar interest / goals. This is a good thread with excellent answers and support. I will continue to read through and learn from this and several other threads as I visit this forum as it will assist in my decision making process.

I am a vehicle enthusiast and avid self serve, hand wash, tunnel wash, and / or detail experience locations ranging from SoCal, to the PNW, and Southern states such as LA, MS, and Fl.

From a professional / business standpoint, I work full time but have begun to look at other options and opportunities as the end of my career is starting to be a little more than just a light at the end of the tunnel.

I purchased, own, run, and maintain my own self serv 24 hour unattended laundromat. Hence, there are some similarities and efforts that I am familiar with and have mastered in over a decade of business ownership while maintaining a full time career.

We shall see what happens next. Thanks in advance to all of the forum participants. I am looking forward to learning and contributing as time goes on.

 

[John J Spokas]

I understand and support your research. But under reporting income would be illegal here in the US. And the reference in my opinion makes the industry look bad. I suggest looking at figures on the books to ensure you will succeed. Most income these days is by credit card and leaves little to the imagination.

AND !! !

If you skim for 10 years and then decide to sell then all that skim will not show up on the financials you present to the buyer and the buyers bank.

 

[mngoalie]

AND !! !

If you skim for 10 years and then decide to sell then all that skim will not show up on the financials you present to the buyer and the buyers bank.

I'm running into this with a wash I'm looking at purchasing. Banks said no because of lack of reported cash flow.

 

[Rfreeman]

I'm running into this with a wash I'm looking at purchasing. Banks said no because of lack of reported cash flow.

Seller has no option other finance it on his own or lower the price so that it makes sense. Unless someone comes in with an all cash offer...

 

[mngoalie]

Seller has no option other finance it on his own or lower the price so that it makes sense. Unless someone comes in with an all cash offer...

Yup. I'm doing a contract for deed now with them. They ran into this with afew buyers and realized they wanted to sell. It was an inheritance and they don't want to put in the work so they want it sold.

 

[soonermajic]

Thanks for the reply. I am open to spending a few hours a day at the business. The one's I am currently looking at are not by any means cheap in price ($600-800k) they net about a 10% return on the asking price. With that sort of return its what I would probably expect to make working full time so spending a few hours a day would not be a problem. I have come across some where a part-time employee manages it, which ofcourse affects the profit the business is earning.

Unlike a gas station business, I see a future for car washes especially down the road re-investing into adding more automatic (maybe touchless which is popular here in Canada?) to expand the business.

I, & many others on here, have the same model. 4/8 SS bays & 1 or 2 IBAs. Clearly the friction IBAs wash better, but a Touchless IBA can make u a lil more bullet proof, from the "tunnel takeover"...
1st wash i bought 5/1, i switched to 4/2 after a year of steady growth. Lines were too long, so wanted a preemptive strike, against someone w/ deep pockets wanting to take my business. Now have a touchless & friction.
2 mos ago bought a nice 4/1 which has a touchless. Im replacing that w/ a Razor Edge, for faster throughput.
1st wash I bought, they reported 95% of all cash. 2nd wash, seems like Definitely less than 90%.
Washes ain't all doom & gloom, but they ain't just "keep soap & wax, & pick up the cash" like a guy told me on my first purchase, 8 yrs ago! He took me to the cleaners!!!

 

[sjay]

I, & many others on here, have the same model. 4/8 SS bays & 1 or 2 IBAs. Clearly the friction IBAs wash better, but a Touchless IBA can make u a lil more bullet proof, from the "tunnel takeover"...
1st wash i bought 5/1, i switched to 4/2 after a year of steady growth. Lines were too long, so wanted a preemptive strike, against someone w/ deep pockets wanting to take my business. Now have a touchless & friction.
2 mos ago bought a nice 4/1 which has a touchless. Im replacing that w/ a Razor Edge, for faster throughput.
1st wash I bought, they reported 95% of all cash. 2nd wash, seems like Definitely less than 90%.
Washes ain't all doom & gloom, but they ain't just "keep soap & wax, & puck up the cash" like a guy told me on my first purchase, 8 yrs ago! He took me to the cleaners!!!

what tips would you recommend for a newbie to look for when looking at a carwash business? Definitely not looking to get "washed" on a purchase!

 

[Rfreeman]

Spend as much time sitting and watching the wash as you can. Last thing you want to do is buy a wash that supposedly does "X" in sales only to find out it does 50% of that "X" number.

Sure you can look at water bills or even financials but both of those can easily be altered or doctored.

Once you convinced the location your looking at does have steady volume then look at site specifics: overall condition of the structure, lighting, equipment, functions on the equipment. If the place is going to need an overhaul use that as a point of negotiation

 

[sjay]

Reviving my thread for an update, currently looking to make an offer on a car wash. Adding an inspection clause of course. How do you go about getting a car wash inspected? Is there anyone in the Florida area that would be recommended to come inspect regarding equipment, building, etc.