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Raise Your Bottom Line

March 08, 2011
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Americans are often preached on the benefits of dieting; but how many of us realize the lessons of restraint and moderation can be applied to our business lives, as well? Indeed, too many carwash and detail shops are carrying around excess weight in the form of out-of-control expenses and inflated costs without realizing how unnecessary and harmful these extra pounds really are.

“It’s no secret that water and energy costs are rising everywhere – and the trend is unlikely to reverse,” explained Marcus McLaughlin, a member of Belanger’s marketing team. “At the moment, payrolls may be stagnant, but they can still represent a significant portion of an operator’s expenses, depending on their business model.”

McLaughlin agreed that operators must control these expenses before attempting to introduce a price increase. By better managing their costs, operators can increase car counts, frequency of visits and per-car ticket averages, he noted, and also improve their chances of surviving the current economic downturn.

“It’s the difference between just hoping to make it through a tough time, versus leveraging that business reality to ultimately increase profitability,” he noted.

A liquid diet
Earlier this year, Gary Hirsh, president of New Wave Industries, a company which manufactures water reclaim and treatment systems, was recognized by the International Carwash Association for his work in refining water saving and reclaiming technology by being given the Environmental Leadership Award. Hirsh said the problem facing many operators is simple.

“Water and sewer costs are rising exponentially as a result of our antiquated infrastructure,” Hirsh explained. “Specifically our municipal water treatment plants that were built years ago across the United States and now are unable to effectively meet the increased demands of a growing population of residential and commercial needs.”

For this reason, it has become prudent for operators to become well-educated on the benefits of water recovery technology. Hirsh said today’s systems can recover upwards of 85 percent of the wash water with the operator realizing a return-on-investment in as few as 12-15 months.

Many operators have also installed spot-free reject recapture systems to catch the reject water from their reverse osmosis systems to utilize in wash components that would otherwise use the more costly option of fresh water, Hirsh said.

“This is a simple and cost-effective method of significantly reducing water/sewer costs,” he described.

Onward and upward
Beyond those traditional solutions, Hirsh said he has also noticed a growing interest in rainwater harvesting systems. “[These systems can] capture and store rainwater in above or below ground tanking system’s and utilize this water to supplement or take the place of fresh water,” Hirsh said.

Rainwater harvesting isn’t the only common sense solution to the problem of rising water costs. Other water saving options range from reducing the size of nozzles on rinse arches to expanding your existing monthly preventative maintenance routine to include inspecting the wash site for any leaking hoses, nozzles, fittings and inspecting your restrooms for leaking toilets.

Not only that, but Hirsh added that today’s reclaim systems are more sophisticated than ever thanks to the use of programmable logic controllers, variable frequency drives and superior particulate separation technology.

“Today’s water recovery systems [are] far more user friendly [and] energy efficient,” Hirsh said. “[They also] provide the operator with a higher-quality, ‘cleaner’ (5-Micron quality water which is in compliance with the warranty requirements by the major high pressure pump manufacturers’) water allowing the operator to use reclaim water in high pressure applications and components that their predecessors unable to provide.”

A savings pass on gas
Water isn’t the only expense that’s on the rise. According to Trent Walter, president of National Pride Equipment in Ashland, OH, gas, electric and labor costs are also escalating.

“Gas prices have been fluctuating up and down over the past few years,” Walter explained. “Some operators have locked into contracts and others have rolled with the fluctuating prices. No matter which way one goes, there should be an evaluation done on what water needs to be heated.”

Walter suggested operators evaluate their use of hot water by asking themselves if the temperature of the water is crucial to the quality of application. “Even if the operator does need to heat the water, he/she should check the temperature set point,” he suggested and see that it falls within (and not above) the chemical manufacturer’s recommendation.

“If you’re looking to save a few dollars, don’t heat the high pressure rinse water,” he added. Instead, utilize a cold water rinse. “In the summertime the surface temperature of vehicles will be warm enough to achieve good cleaning,” Walter explained. “If required in the spring and fall adjust your hot water heater as necessary.”

According to Walter, operators can also evaluate their floor heat/de-icing system for gas savings. “Keep the temperature set point high enough to melt the ice,” Walter advised. “There is no need to have the set point above 40 degrees.”

For operators who have capital to invest, Walter suggested a new hot water heater and/or de-icing system. “There are several on the market with significant operating efficiency improvements,” Walter said. “Older boilers will have a rated efficiency around 80 percent with newer models in the mid to upper 90’s.”

For operators just starting construction, make sure to set up the floor heat in zones. “One should take into account which areas of the wash get sun during the day and evening,” Walter said. Otherwise, you’re wasting gas to heat an area that is already being sufficiently warmed.

A laborious task
Cutting labor expenses is likely the most difficult, yet most rewarding mission for any full-service or flex-serve operator. For these operators, labor costs represent the biggest chunk of expenses.

Walter had a few simple suggestions for operators who are ready to rein in their labor costs:

  • Eliminate cell phone usage during working hours;
  • Install a camera system to keep an eye on employees when the operator or manager is not present;
  • Drive accountability by having daily check sheets for each employee.

These can be modified depending on the expected demands of the day and will include special projects for slow days;

  • Physically inspect the work scheduled to be completed; awnd
  • Address performance issues immediately.

McLaughlin of Belanger said labor costs can also be reduced through the use of automation – which also guarantees a more consistent wash quality.

“So the question for the individual operator isn’t whether to automate the wash; it’s to what extent to automate it,” McLaughlin expounded. “Any service that can be automated should be. Even a high-margin service like tire shining is a good candidate for automation.”

Operators should absolutely automate their prep process, if nothing else, McLaughlin said. “It makes little sense to make a large capital investment equipping a tunnel wash, then pay employees to hand wash the car before your equipment washes the car,” he stated. “The best automatic prep systems use large volumes of medium pressure reclaim water at 85 gallons per minute (GPM) – equivalent to 24 self-service spray wands – to remove loose soils and thoroughly prep vehicles.”

He continued, “It should be self-evident that these systems will easily outperform a ‘prep guy’ with a single spray gun, and will do a more consistent job than any mop-wielding employee – without the risk of damage posed by a careless mop-job.”

For full-serve operators, the trick is to cross-train employees in order to realize new efficiencies, McLaughlin said. “If every employee is trained to do multiple jobs, the operator has more flexibility for staffing when the wash is operating at less than peak demand. A simple example would be having a vacuumer load the car, to avoid paying a loader to stand around when wash volumes are low.”

More EBITA for IBAs
A lot of attention is given to conveyor carwashes which have the opportunities to reduce labor costs in large amounts, but what about in-bay automatic operators? McLaughlin said they, too, can realize big savings by increasing the throughput of their wash bays.

“Simply put, washing more cars per hour will multiply the wash’s profitability, while better distributing fixed overheads such as the site’s mortgage or lease payments, property taxes and bay lighting,” McLaughlin explained.

According to McLaughlin, higher throughput isn’t just about the machine’s operating speed; it’s also a function of how easy it is for customers to navigate the bay, load their cars and exit the wash in a timely, efficient manner.

“For quick entry, a clear, open bay with no treadle, guiderails or floor-mounted travel rails is best,” he said. “Customers can pull into the open bay (typically found in an overhead gantry style wash) as easily as they can pull into their home garage.”

The color and brightness of the wash arms can also help give drivers a visual reference, he added.

Finally, operators should consider functionality of the machine. “Washes that size for length increase throughput by reducing the length of each wash pass,” McLaughlin explained. “On the other hand, experience from the field demonstrates that sizing for width does not increase throughput, as it adds unnecessary time to every wash cycle.”

He continued, “Provided the wash is using flat fan spray nozzles and the correct chemical package, sizing for width simply does not improve the cleaning result. That’s because the fan spray nozzles deliver total surface coverage and an efficient ‘stripping’ action that removes soils from the surface – while the two-step presoak system breaks the chemical bond between dirt and paint. Simply put, once the car is clean, it’s clean – and nozzle proximity becomes a non-issue.”

Invest your time
According to Walter, operators of self-serve and in-bay automatic sites can also reduce their costs by investing time into them. “Pay attention to your wash,” Walter suggested. “Be present and make daily checks to ensure everything is working properly and running smoothly. You want to make sure you’re offering a quality carwash.”

By going through increased maintenance checks, the operator can avoid costly repairs and other issues that deteriorate over time. “It’s really no cost to the operator,” Walter said, who added that operators can even ask their distributor or supplier to send a representative to the wash to perform some evaluations, as well.

“It really pays to have another set of eyes,” Walter said. “Your local service agent or chemical representative might see something you missed, or might be able to offer another point of view about how the wash is running.”

In addition to being present at the wash, Walter suggested that operators take a day to organize and take stock of their equipment room. “Take notes on what supplies or spare parts are needed,” Walter said, by considering if the carwash would be closed down without the component.

“Don’t buy something you don’t need, but make sure you have the parts that you need and that you know where they’re located and can access them quickly,” Walter said. “It’s all about operating as efficiently as possible.”

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