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- Ask the Experts
This month’s questions, as formed by Jimmy Branch, a member of PC&D’s Editorial Advisory Board and former president of the International Carwash Association (ICA) (2004):
1. In what ways has this recession been different from those in the past?
2. What have been the keys to survival for your company during the economic downturns?
ICA past president, 2009
Buggy Bath Car Washes, San Diego
1. In the past, it was a slow decline, but this one hit hard and fast. I’ll never forget the other small businesses around me coming up to me and saying — what happened to the customers?
The high gas prices, the quick downturn, high unemployment and bad weather hit us hard. The price of doing business — water, gas and electric — the government targeting small businesses for more taxes is increasing while my customer base has fewer dollars to spend — it is making it difficult to increase prices to keep my bottom line at where it needs to be.
2. Customer service and investing in the future is the key. I’ve been training my employees on how to make the customer experience at our carwashes the best. We have ramped up our customer service to make sure that every customer is happy and satisfied with the wash they are getting. It’s the little things for customers — don’t argue with them, make them happy.
I have also utilized new technology to answer customer needs immediately. I have invested in a loyalty program that is increasing my bottom line with fleet accounts and customer satisfaction.
I have also used our website and Google Ads and any other website service I can to generate business. I’ve also invested in new equipment, building maintenance and new marketing/promotion ideas to push every dollar I can to keep us moving forward.
This is the time to invest in your business, not sit back and wait until it gets better. I’ve been through the hard times before and the sun always shines bright again.
The best time to invest in your business is in the hard times — good interest rates and competitive pricing. Everyone is hungry — take advantage of it and build the future of your business. It’s going to get better. You just need to make sure you are on the winning side when it does.
ICA past president, 1998
Top Shelf Auto Wash, Orlando, FL
1. Brutal recession in this part of Florida. Job loss from a heavily construction-related economy, drastic reduction in artificially inflated-home prices, foreclosure rates never seen before. Lots of people affected at all income levels. It will be a slow recovery.
The rules of business and banking in particular have changed dramatically. We have all been forced to trim every expense.
One key is to closely monitor every expense item regularly. Areas where we have had success are credit card fees, insurance, cell phone bills and reduced water consumption via RO reject recapture.
2. Being positive. We have a great industry in large part because of the people like you and all the others who unselfishly share their experience with others to support success in the carwash business. That has always been my experience. It makes me proud to be a carwasher. What can be more positive than that?
ICA past president, 2005
7 Flags Car Wash, Vallejo, CA
1. In the early 90s we were just getting into the conveyor business. I remember that for three years in a row our self serves dropped in income 10 percent each year. We always thought that the self serves were recession proof.
The same thing has happened this recession. The self serves came back from the last major recession just fine. I’m hoping that the same holds true this time.
Other than that we have never felt any back slide in income on the self-serve business from other economic downturns. In the conveyor business, I cannot remember any recession affecting us like this one has.
The year 2007 was our high point and it has slipped in total income each of the last three years. The year 2010 was different because of the El Niño effect on our weather pattern. The first half of the year we were absolutely killed with bad weather, the second half of the year we were up from 2009.
I think the worst has passed and I am hoping that 2011 rebounds nicely for us. It will be dependent on the weather this coming year.
2. When the economy is good, most companies focus on the revenue side of the business. When the economy turns south, most companies focus on the expense side of the business.
Our company always focuses on both sides of the equation. We took an even harder look at the expense side as well as trying to make our company as ”green” as possible. In most cases there is an initial outlay of cash but that comes back in the way of a reduction in costs, from electricity, water consumption, office supplies, trash vs. recycle, as well as customer good will.
We also have tried to focus on labor reduction by way of automation. Any piece of equipment that can do the job of an individual has been looked at closely and if it makes sense and will fit in the tunnel, we will try to put it in.
Jimmy Branch, is the owner of Speedy Inc., a chain of three washes in Panama, FL, and a former president of the International Carwash Association™ (ICA).