Greg Pack
Wash Weenie
Not much to add, but I had to post to get my number off 666, so I thought I would comment on the situation in my area. In seven years (probably a 600-700 K market area) we have had 16 new expresses constructed and two old school exterior tunnels converted to expresses. Some are underperforming, but that's still about a million cars washed annually by them that were being washed by other places less than a decade ago. Three expresses have failed, one was repurchased for 1/4th the original cost, one remains empty, and the other is being run (very poorly) by a financial institution. There is another express under construction and one piece of property under contract for another one.
SS's in this town- I know of ten that have either been either foreclosed, taken over by a financial institution, or an arrangement has been made with the owner to keep the property running until it sells, but no payment is being made. Half of these are nice, new IBA/SS combos less than ten years old with gabled roofs. Of all these, only one has been re-purchased for about 50% of original investment costs. I know of several others that have negotiated interest only loans with banks so they will cashflow. Many more are just what we would call underperformers with gross revenues probably in the $500 per bay range , but they are probably cash flowing. Some others are just fortunate enough to have the cash from their regular job to feed them.
Some may see my pessimistic rants as bitching and whining. It is hard to be optimistic about this business when you see such carnage and have several friends that are dealing with the repercussions of a failing business with large deficiencies owed to a bank. I'm just trying to convey to other new operators and potential new investors how bad it can get. I am still profitable, but I am in the minority. If I had a heavy debt I would be in real trouble. I cringe when I read about these new investors sinking 1M+ in IBA/SS facilities.
So what will the SS industry do to survive? OK, survive may be a bit dramatic for some of you, but how about "thrive"? We do need a game changer here for the SS industry here, locally at least. I'm just not sure what it will be.
SS's in this town- I know of ten that have either been either foreclosed, taken over by a financial institution, or an arrangement has been made with the owner to keep the property running until it sells, but no payment is being made. Half of these are nice, new IBA/SS combos less than ten years old with gabled roofs. Of all these, only one has been re-purchased for about 50% of original investment costs. I know of several others that have negotiated interest only loans with banks so they will cashflow. Many more are just what we would call underperformers with gross revenues probably in the $500 per bay range , but they are probably cash flowing. Some others are just fortunate enough to have the cash from their regular job to feed them.
Some may see my pessimistic rants as bitching and whining. It is hard to be optimistic about this business when you see such carnage and have several friends that are dealing with the repercussions of a failing business with large deficiencies owed to a bank. I'm just trying to convey to other new operators and potential new investors how bad it can get. I am still profitable, but I am in the minority. If I had a heavy debt I would be in real trouble. I cringe when I read about these new investors sinking 1M+ in IBA/SS facilities.
So what will the SS industry do to survive? OK, survive may be a bit dramatic for some of you, but how about "thrive"? We do need a game changer here for the SS industry here, locally at least. I'm just not sure what it will be.
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