What percentage of your washes sold are the top package? I took a look through our sales data for the past year in our POS and it looks like we were at 14%. I want to try and create a commission program for our CSA's and would like to know what the industry standards are for top package sales....
Top Package Sales Percentage
- Thread starter hkim310
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That is a very low percentage for your top package. Maybe before you look at a commission program you should take a look at your top package and how it is positioned by the price and value. It may be priced too high or it may not present enough value for customers to choose it over another package.
From my experience top package sales should be between 20 - 25 % depending on how many packages are offered and the content of the packages. If there is a large separation between the top and next package sales tend to be in the 20% range. With three packages and less separation I have seen sales as high as in the low 30's. With four packages usually closer to 25%.
robert roman
Bob Roman
14% is dismal.
This implies CSA’s are just taking orders. However, low average is often associated with lower volume washes where market cannot support extra sales that drive up average per car revenues.
Lower volume wash = 57% good, 26% better, 17% best, average sales $7.25
High volume wash = 11% basic, 19% good, 28% better, 42% best, average sales over $10
Full-serve = 20% good, 50% better, 30% best, average sales almost $20
I often find same with in-bay.
Lower volume might average $7.25, higher volume $9.00 (30% good, 40% better, 40% best).
Consequently, a lot of thought needs to go into commission program.
For example, I use to work for an outfit that had a reputation for getting as deep as possible into customers pockets.
Because of the way the sales commission was structured to accommodate this strategy, CSA’s often made their day by 11AM or 12PM. Then they would stand around and take orders.
Here, the business becomes unbalanced. First, over-selling which overloads staff with work followed by under-selling and idle labor.
In both cases, the needs of customers are subordinated for sake of extra sales.
This implies CSA’s are just taking orders. However, low average is often associated with lower volume washes where market cannot support extra sales that drive up average per car revenues.
Lower volume wash = 57% good, 26% better, 17% best, average sales $7.25
High volume wash = 11% basic, 19% good, 28% better, 42% best, average sales over $10
Full-serve = 20% good, 50% better, 30% best, average sales almost $20
I often find same with in-bay.
Lower volume might average $7.25, higher volume $9.00 (30% good, 40% better, 40% best).
Consequently, a lot of thought needs to go into commission program.
For example, I use to work for an outfit that had a reputation for getting as deep as possible into customers pockets.
Because of the way the sales commission was structured to accommodate this strategy, CSA’s often made their day by 11AM or 12PM. Then they would stand around and take orders.
Here, the business becomes unbalanced. First, over-selling which overloads staff with work followed by under-selling and idle labor.
In both cases, the needs of customers are subordinated for sake of extra sales.
Earl Weiss
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14% may or may not be dismal.
Many factors vary. I recall when NS opened a flagship location . They were disappointed in package upgrades but surprised by overall volume.
IMO higher volume locations will have lower upgrade percentages. Factors such as % commercial drivers will affect this.(We do a fair # of taxis who may wash a couple of times a week but won't upgrade) I think the NS location is near an airport and had lots of livery drivers.
A large % of monthly customers may affect this as well. Years ago an operator (Now out of the business) on the forum told me how bad my percentage was but later it came to light that by the time March rolled around I had already exceeded his annual wash volume.
Many factors vary. I recall when NS opened a flagship location . They were disappointed in package upgrades but surprised by overall volume.
IMO higher volume locations will have lower upgrade percentages. Factors such as % commercial drivers will affect this.(We do a fair # of taxis who may wash a couple of times a week but won't upgrade) I think the NS location is near an airport and had lots of livery drivers.
A large % of monthly customers may affect this as well. Years ago an operator (Now out of the business) on the forum told me how bad my percentage was but later it came to light that by the time March rolled around I had already exceeded his annual wash volume.
What constitutes higher volume for a flex serve? When I took a look at the Professional Car Wash magazine annual tunnel wash survey, the average flex serve wash had volume around 55,000 cars/year. Is that what you base it against? Would you use the metrics for full serve or express to compare against as flex is somewhat in between both express and full serve?
Just some additional information, when I was referring to top package, I was referring to the most expensive exterior only package for a flex serve car wash.
Just some additional information, when I was referring to top package, I was referring to the most expensive exterior only package for a flex serve car wash.
sudsurfer
Member
How do these numbers work with an EE?
robert roman
Bob Roman
Benchmarks published in trade journals are most useful for comparing store performance against industry performance.
For example, are total sales revenues at my store less than, the same as or greater than the benchmark?
Since exterior-only tunnel (stay-in-car) is one component of flex-serve, ideally flex-serve “carwash” service menu would be nearly identical to express “carwash” service menu.
Let’s say it breaks down like this.
Express exterior has average per car revenue of $8.50, full-service is almost $20 and flex-service is around $14.00.
“Price” is function of what the market can bear.
In my area, full-service top package is around $24.95. Full-service in Naples, Florida (affluent) average revenue per car “carwash” is $30. Add in detail, average ticket, net site, is $50.
Average full-service volume is 50,000 to 60,000. However, I have some clients in Florida as well as other states washing over 100,000 cars per year.
Flex-serve is more difficult to quantify because most are conversion projects rather than built new.
Done properly, a new flex should attract as many if not more cars as exterior express.
Done properly, a flex conversion should realize at least a 30 percent gain in volume. So, 60,000 becomes like 75,000 or 80,000.
For example, are total sales revenues at my store less than, the same as or greater than the benchmark?
Since exterior-only tunnel (stay-in-car) is one component of flex-serve, ideally flex-serve “carwash” service menu would be nearly identical to express “carwash” service menu.
Let’s say it breaks down like this.
Express exterior has average per car revenue of $8.50, full-service is almost $20 and flex-service is around $14.00.
“Price” is function of what the market can bear.
In my area, full-service top package is around $24.95. Full-service in Naples, Florida (affluent) average revenue per car “carwash” is $30. Add in detail, average ticket, net site, is $50.
Average full-service volume is 50,000 to 60,000. However, I have some clients in Florida as well as other states washing over 100,000 cars per year.
Flex-serve is more difficult to quantify because most are conversion projects rather than built new.
Done properly, a new flex should attract as many if not more cars as exterior express.
Done properly, a flex conversion should realize at least a 30 percent gain in volume. So, 60,000 becomes like 75,000 or 80,000.
Earl Weiss
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I for one do not believe this for a second. Most observations, including mine are limited but it seems the vast majority of EE start at $3.00, then there seems to be a fair # at $4.00, and a few as high as $6.00.
1. It is not believable to think that with a $3-$4. average base the upgrades average $5.00.
2. Further, with the monthly plans typically starting at 5x the base, the average will drop even further. One local operator with lots of monthlys said that he used to love seeing the lines on sunny days. Now, those lines don't necessarily mean a lot more $ due to the monthlys. (Which is not to say that the annual bottom line is not better.) It just doesn't help boost the average with extra service sales.
robert roman
Bob Roman
I know lots of exterior conveyor operators (express, flex) with average per car revenue greater than $10.00 (excludes other sources of revenue).
$3.00 or $4.00 express is becoming thing of the past because of unlimited washing.
Most new express price base wash at $6.00.
Unlimited is teaching new express investors what most full-service operators already know. Key to making money is maintaining high average per car revenue.
My experience with full-service shows that unlimited can drop average sales by as much as two dollars.
So, chemical guys come along with new products to boost average by $1.50 or more.
Everybody wins.
Carwash operators get paid up front, chemical company sells more of more expensive product and manufacturers sell more equipment and parts because carwash wears out faster.
$3.00 or $4.00 express is becoming thing of the past because of unlimited washing.
Most new express price base wash at $6.00.
Unlimited is teaching new express investors what most full-service operators already know. Key to making money is maintaining high average per car revenue.
My experience with full-service shows that unlimited can drop average sales by as much as two dollars.
So, chemical guys come along with new products to boost average by $1.50 or more.
Everybody wins.
Carwash operators get paid up front, chemical company sells more of more expensive product and manufacturers sell more equipment and parts because carwash wears out faster.
Earl Weiss
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Knowing lots means little if it does not represent a real possibility. As i said, I don't have a national view. I was out in Denver and saw some higher priced EE's.
In the Chicagoland market there have easily been 50 EEs with free vacs built (Many conversions from FS) all at $3.00 in the last 5 or so years.
So, if you factor a $10.00 average on a $6.00 that is a $4.00 bump from base. Again, I would think demographics, i.e. lots of commercial customers could play a part as in the NS Wash example.
I am at $3.50 and have been for the last 8 years or so. No free vacs. Likely would have raised to $4.00 had their not been the great 43.00 influx.
i can see how raising price to $4,5,6 etc. would help drive people top a certain unlimited price point.
robert roman
Bob Roman
Back in 2003, chain in south advertised $3.00, 3-minute wash and free vacuums.
Capture rate was about 0.75 percent, medium volume, average per car revenue was around $4.50, top price $9.00.
In 2006, express in El Segundo, CA (N/S) advertised $5.00, 5-minute wash and free vacuums. Capture rate 1.5 percent, very high volume, average per car revenue $6.50. Normalize price for cost of living difference anywhere USA and average would be $4.50.
2010 express in N.E. Base price $8.00, capture 1.2 percent, medium volume and $10 average sales.
By most accounts, Michigan was prostituted first with cost strategy, competing on the basis of low price. It became home of $2.00 carwash. Atlanta Metro now suffers from over-saturated markets because too many express washes were built. Chicago land same thing.
California’s next, probably followed by NY when effect of $15 hr wage and unionization is realized.
My question is at $3.50 (for the last 8 years or so) and “No free vacs” what would you do if some firm decided to consolidate the region?
Capture rate was about 0.75 percent, medium volume, average per car revenue was around $4.50, top price $9.00.
In 2006, express in El Segundo, CA (N/S) advertised $5.00, 5-minute wash and free vacuums. Capture rate 1.5 percent, very high volume, average per car revenue $6.50. Normalize price for cost of living difference anywhere USA and average would be $4.50.
2010 express in N.E. Base price $8.00, capture 1.2 percent, medium volume and $10 average sales.
By most accounts, Michigan was prostituted first with cost strategy, competing on the basis of low price. It became home of $2.00 carwash. Atlanta Metro now suffers from over-saturated markets because too many express washes were built. Chicago land same thing.
California’s next, probably followed by NY when effect of $15 hr wage and unionization is realized.
My question is at $3.50 (for the last 8 years or so) and “No free vacs” what would you do if some firm decided to consolidate the region?
Earl Weiss
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Based on your examples above average extra service revenue was $1.50 -$2.00, not the $4.00 you alluded to earlier. Normalizing for COL anywhere in USA compared to El Segundo to increase this to $4.50 makes no sense. Throughout the midwest, even from Denver Past Chicago and other areas the Cost of living is less, not more so you can't normalize $1.50 to $4.50.
If some firm decided to consolidate which would be difficult in my immediate market area due to land cost and zoning restrictions I would:
1. Tell them to buy my places - we will both make more money.
2. Do what I have done. Provide some things they don't like - triple foam soap and all equipment turned on for basic wash and Humans instead of auto cashiers. I also offer after care services which later was formulated differently elsewhere into "Flex Serve" .
3. I offer vending and combo vacs.
4. . My locations tend to be on tighter lots not suitable for multi lane auto cashiers and 20+ free vac drops. I see how crowded the free vacs are on nice days and wouldn't want the freeloaders impinging on paying customers ability to vacuum. (My locations offer 8-14 Pay Vacs)
Almost all the EE's in Atlanta are at $5 or $6 now. They moved up to $4 about three years ago then raised it late last year. The one near me has a $20 top package. I know the owner. He told me he only gets about 8% on the top package but gets around 20% for his $15 package. Since it is obvious the his top package is probably over priced if you combine the top two he is getting a pretty good percentage for his top two.
Earl Weiss
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Did he share average ticket, figure? And does that include monthly revenue, so it's x revenue per month / # cars thru the tunnel? (As opposed to seperating out monthly wash revenue / volume.
Also it seems monthlys were priced at about 5 x basic when it was $3.00 . Does that factor still apply at $4-6?
I guess you are right Earl, it's all depends on the context. We also have a top exterior only wash of $20 and our next package down is $17. If you were to combine both of those percentages together, it would be around 24%. This seems to at least put us in the "realm" of what is considered acceptable. We may be in a similar situation to what rph1968 stated about his friend who is an operator in Atlanta in terms of high price for top package.
On a side note, our wash clubs have always been priced at 2.3 x basic wash. I didn't realize that there were washes charging 5 x basic wash!
On a side note, our wash clubs have always been priced at 2.3 x basic wash. I didn't realize that there were washes charging 5 x basic wash!
Washmee
Fullservice Tunnel
I don't know anybody charging 5X wash price for monthly plans. We charge 3X.
Earl Weiss
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HK and Washme. Are you both at $3.00?
I think it is the number of customers that purchase the packages divided by the total number of washes. I don't know his average revenue but it is a busy wash and with those percentages on those packages I would guess it is pretty good. I have told him I thought his top package was priced too high. He feels that even though it is probably high that it makes his next package at 15 look better and increases his average revenue. It is an interesting view on pricing packages that I don't remember seeing anywhere else.
When he was $3 I think his top wash wash only $10 and it went up to $12 when he went up to $4. His base wash is now $5 but I would guess he will go to $6 before the end of the year. I haven't talked to him recently but I would guess he won't raise that $20 wash or the $15 package because he has said to me before that he would be reluctant to increase them.
He once told me that he barely made a profit at $3 but was afraid to raise prices. He said he saw no drop off after either raise which leads me to believe he will raise it again this year. As someone has already said, I think pricing should relate to the demographics of the location. I think in some neighborhoods his pricing would not fly.
When he was $3 I think his top wash wash only $10 and it went up to $12 when he went up to $4. His base wash is now $5 but I would guess he will go to $6 before the end of the year. I haven't talked to him recently but I would guess he won't raise that $20 wash or the $15 package because he has said to me before that he would be reluctant to increase them.
He once told me that he barely made a profit at $3 but was afraid to raise prices. He said he saw no drop off after either raise which leads me to believe he will raise it again this year. As someone has already said, I think pricing should relate to the demographics of the location. I think in some neighborhoods his pricing would not fly.
