What Would You Do?

[bighead]

I think what waxman is saying (and what I would advise) is:

Kill the cheap wash. And with the extra slot put a super-duper wash, give it a name you're not currently using, shoot even put it on the $4 spot on the ACW if you want to give the impression that the other menu items didn't change.

If people complain just say you didn't raise your prices, you just eliminated the $4 wash because not enough people were using it, and you put in a super duper wash to see if people would like all the extras.

I went from $6, 7, 8, 9 ... killed the $6 because it had no dryer (and people never read the sign, but always complained) left the $7, 8, 9 alone, and added a $11 with the premium wax. My average vend jumped $1. And my $9 wash costs me as much as my $11 does

 

[whitescout]

With your Washworld, you are able to do double passes front and rear. You can use this verbage in your SUPER wash. You have a total of 10 cycles that you can program in, not counting double passes, underbody, or dryers.

I think that you are giving too much away for a $4 wash. If a customer only wants to pay $4 for a wash, give him $4 worth of services. I do not see with your current menu, why I would pay more than the $4 wash.

I would imagine, that you could get more for your cheapest wash. Even at $5 i think you are giving too much. I would lay out a menu that listed all services, and highlight all of the added services as the customer spends more money.

As I see your current menu, I get foam wax for $2, Then of $2 more I get triple foam, And for $1 more I get super sealant and spot free through the arch. I get 5 items on the first wash for $4

 

[MEP001]

I'm showing 11% on the $4, 21% on the $5, 18% on the $7 and 48% on the $8. With the $7 being the least used by far, if I eliminate the $4 it might slightly improve revenue with the cheapo washers spending an extra dollar, and if the former $8 users split between the $7 and the $9, at worst will cut expenses a tad. At that point, offering two vac tokens for the top wash and one for the others might help upsell the top wash. Then of course advertising free vacuum with purchase of auto wash will (hopefully) increase overall sales.

 

[Bubbles Galore]

With your Washworld, you are able to do double passes front and rear. You can use this verbage in your SUPER wash. You have a total of 10 cycles that you can program in, not counting double passes, underbody, or dryers.

I think that you are giving too much away for a $4 wash. If a customer only wants to pay $4 for a wash, give him $4 worth of services. I do not see with your current menu, why I would pay more than the $4 wash.

I would imagine, that you could get more for your cheapest wash. Even at $5 i think you are giving too much. I would lay out a menu that listed all services, and highlight all of the added services as the customer spends more money.

As I see your current menu, I get foam wax for $2, Then of $2 more I get triple foam, And for $1 more I get super sealant and spot free through the arch. I get 5 items on the first wash for $4

I guess I will look at what I can build up for a super wash and see if it makes sense. My wife is pushing back on this one pretty hard since it appears as though we have 20+% using the $4 wash, but I think we could at least make the change and see what happens.

 

[robert roman]

AR = ($4 * 0.242) + ($6 * 0.363) + ($8 * 0.172) + ($9 * 0.223) = $6.53

The $4 and $6 wash account for 60 percent of sales (mix), top washes account for 40 percent.

To achieve 20 percent shift in mix, you need to flip the table, making top two washes account for 60 percent of sales.

Before you jump at the many suggestions on how to do this, consider the challenge you face - 18 customers (475 / 26).

On an average day, four people buy the $4 wash, seven people buy $6 wash, three people buy $8 wash and four people buy $9 wash.

Basic to top wash is 11 to 7 people. Flip table would be 7 to 11.

In other words, to increase average revenue by $1.00, four of the “economical customers” would need to buy “top packages.” This is 22 percent of all customers.

Consider one of the suggestions – eliminate $4 wash.

“Basic wash $6
Middle package $8- add one extra service - maybe a sealer or underspray
Top wash - $9 - adds two or three more extra services - tri foam, wheel blast/scrub and whatever you did not add above in the middle package.”

AR = ($0 * 0.242) + ($6 * 0.363) + ($8 * 0.172) + ($9 * 0.223) = ?

T = (18 * AR * COGS) = ?

If you dump the $4 wash, at least four customers must make a decision - pay at least two more dollars for base wash at your place or go someplace else to get, say, a $4 or $5 wash.

If all four defect, T = (14 * $6.53 * 0.90) = $82; If original T = (18 * $6.53 * 0.90) = $106

You lose $24. So, how loyal do you believe the cheapest customers are?

If you add all the extras mentioned, this would cause COGS to go up, conservatively, by $0.50 a car but the four $4 customers stay and buy a $6 wash.

AR = ($6 * 0.61) + ($8 * 0.17) + ($9 * 0.22) = $7.02

T = (18 * $7.02) – ($20.75) = $106

Since the original T = $106, there is no net gain.

I believe you may find it easier to try and capture more customers than it is trying to squeeze more out of a small customer base.

 

[Bubbles Galore]

I believe you may find it easier to try and capture more customers than it is trying to squeeze more out of a small customer base.

So here is the question I have then...what makes more sense in offering tokens as an upsell? I don't want to offer more than 1 token, but should I at least do the top 2 washes or all of them to try and capture a bigger market?

 

[rph9168]

How about offering one token with the second best wash and two with the best?

 

[robert roman]

“I don't want to offer more than 1 token, but should I at least do the top 2 washes or all of them to try and capture a bigger market?

Instead of “capture a bigger market,” think “attraction rate” as in “capturing” cars from road (site) and let market be “location.”

Presently, seven of your customers buy the top two washes, eleven do not.

So, to answer your question, you would need to have some idea of how important vacuum is to customers.

In other words, how many of the “seven” customers and how many of “eleven” customers need or want to vacuum?

For example, if six of the “eleven” customers don’t need or want to vacuum, why would any of them buy-up into top two washes?

One answer would be to offer token with any carwash purchase and let customers decide for themselves what and when to buy.

As for capturing a bigger market (location problem), take a grapefruit, cut it in half and examine the cross section.

The core is market threshold or area/distance that contains enough sales to break-even. The rind is the market range or area/distance that customers are willing to drive to your store.

The fruit or juice that surrounds the core/center is consumers, some of them with the potential to visit store and contribute to profit.

Unless these folks drive the frontage road, how do you capture them (increase market share)?

Marketing is the answer here with the goal and objective of generating more customers.

For example, a website can serve as a digital store front, and a phone app can serve as a digital highway to your brick and mortar store.

 

[IBFLYIN]

John, I have the same machine as you do but I don't have a dryer. We price at $6, 24% used, $8, 25% and $10, 51%.

Scott

 

[Bubbles Galore]

After far more thought than I had intended to put into it, I have gone with 1 token for my top 2 washes. I will check back at the end of the month to let everyone know what changes we saw if any. Thanks again to everyone that posted here.

John

 

[briteauto]

John, I have the same machine as you do but I don't have a dryer. We price at $6, 24% used, $8, 25% and $10, 51%.

Scott

Perfect example. If the $10 wash was $9, you would probably have well over 51%. I'm not suggesting that for IBFLYIN - I never recommend a price decrease. Just pointing that out to the original poster who might only be separating his top two packages by $1 instead of $2.

I'm glad to see operators are getting over 50% on the top wash.

 

[soapy]

I have been out of town for this discussion but will weigh in now. I added 2 token vendors at one location to my automatics about a year ago. I give a token on my top 2 washes only. I have 4 wash packages, $3 $5 $8 $10. I have figured my cost on the $3 wash and it only costs me $1 so I am still putting $2 in my pocket. The $3 wash is only about 10% of the washes with most people purchasing the $10. So far this year I am seeing an increase of 50% in my automatic wash business vs last year with similar weather. My tokens are good for $1 in my SS bays, or $1 off the next automatic wash or a free vac. I think this has been a good investment for me considering that a new 3 million dollar express tunnel opened within a mile of this wash 18 months ago and I have not seen a decrease in business at this wash since it opened.

 

[Bubbles Galore]

Thanks for the input Soapy. May I ask what you do to market it? Just flipped the switch today on the dispenser and now I have my marketing hat on.

 

[soapy]

I use mostly a menu board in front of the autos that explain the packages. I also had a couple of banners made up that attach to the side of my front sign. It took a while for people to learn how to use the tokens.

 

[Ric]

Thanks for the input Soapy. May I ask what you do to market it? Just flipped the switch today on the dispenser and now I have my marketing hat on.

Can you post a pic of your setup?

 

[Bubbles Galore]

Can you post a pic of your setup?

Once I swing by there this morning, I will get a pic posted.

 

[raisetheprice]

So here is the question I have then...what makes more sense in offering tokens as an upsell? I don't want to offer more than 1 token, but should I at least do the top 2 washes or all of them to try and capture a bigger market?

We tried tokens on the top wash ($10) only over the last 18 months. ALL we did was spend $2K on tokens that 60-70% of were never seen again. My tokens are for 6 minutes of vac compared to the standard $1 for 4 minutes and I even gave them the option of using the token for a $2 bag of ice if that was their choice. NO MORE...I caught a guy hoarding them and then selling my tokens back to my customers for a $1 each at the ice machine...or equal to $4 in lost revenue on ice. I killed the program on the ice and any remaining tokens out there can still be used as vacuum.

Now our attendant will start the vacuum for the customer at the time of purchase if they want the vacuum at the time of their wash.

Furthermore, I tried a guys wash here in town that upgraded his 4000 to the new 360. Great wash, beautiful new HTK spit out a token...that's still in my cup holder 4 months later.