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A clean drive for success

October 11, 2010
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As far as names go, Boomerang Carwash couldn’t have picked a better, more fitting comparison. No matter how many times this brand is tossed out, it always returns — usually bigger and better.

If its brief history is any indication, this is also a brand that’s going places, and going fast. It began as a wash on the path to national stardom, but after a bumpy start, it seemed the wash had set its sights lower — perhaps to dominate its region.

Today, its new owners say they are interested in expanding and franchising, although they stress a cautious, strategic growth. These newcomers even hint at pursuing the industry’s Holy Grail: a national chain.

A short, but significant history
The first of the chain’s express exterior carwashes was actually a Rapido Rabbit franchise. To be precise, it was the first Rapido Rabbit franchise.

Boomerang’s parent company, Arkansas Carwash Systems (ACS), became an area developer for Rapido Rabbit in 2004. In January of 2005, ACS teamed up with investor Keith Gibson of GN Investment Group to open the first Rapido Rabbit franchise in Oklahoma City.

At the time, ACS President and founder Paul Stagg said the franchisors offered his company extensive training and materials for employees, as well as help with site selection.

The first wash featured a 120-foot tunnel, offering a 3-5 minute express wash with price offerings ranging from $3 to $5. (Today, the sites continue to use a 120-foot tunnel with a 3-5 minute ride-thru time, but the price offerings are up to $5-$10.)

Nearly a month after the wash’s grand opening, Gibson and ACS were breaking ground on another Rapido Rabbit site in Edmond, OK. Following that ceremony, ACS opened three more sites in 2005, but things were starting to look shaky.

Nine months after its first franchise opened, Rapido Rabbit was floundering. ACS pulled out five days before the official announcement came from Rapido: they were bankrupt.

Two of the sites developed under the Rapido name were instantly re-branded to Boomerang Carwash. And with the new name came a new animal mascot: Boomerang the Kangaroo. ACS decided to focus most of its energies on the growth of the chain.

At first, the company had grand expectations of its new charge — Stagg said he hoped to have 36 carwashes by the end of 2006, and 100 units by 2008. But within a few months, he focused on a more realistic growth pattern, slow and steady regional dominance.

By the end of 2006, the company’s 16 express exterior facilities had spread to Arkansas, Oklahoma, Tennessee, and Louisiana, with additional sites under development.

An acquisition for growth
On Jan. 2 of this year, Drive Clean Holding, an investment group, acquired ACS, and Boomerang along with it. “The reason, first and foremost, that we targeted ACS was because of the brand they had with Boomerang,” according to Scott McLain, head of development for the company.

Secondarily, the Drive Clean investors had some personal relationships with some of the principals at ACS, and the acquisition seemed more than mutually agreeable.

“We did not start out looking for a carwash company to purchase,” McLain elaborates. Instead, the investment company was merely looking for a sound financial investment when it realized ACS was a perfect fit.

Previously, McLain had done a significant amount of research into the carwash industry to put together a plan for a big box retailer. From that experience, McLain gathered that the carwash market was very fragmented and “not one that you can grow through consolidation.”

Drive Clean believes the secret to national success is not acquisition or consolidation, but rather new development, and they will operate the Boomerang brand as such.

A measured expansion
While the company refuses to name numbers, its investors do hint at hopes for a national chain. Mike Bennett, president and CEO of Drive Clean, said the company will work franchisors while simultaneously developing their own sites, focusing on the regions the brand currently dominates.

“If we did it [went national], we’d want to do it before death,” Bennett said before adding, “I think businesses that plan more than five years out are probably fooling themselves.”

Five-year outlook aside, the company has prepared what seems to be a rock-solid plan for the next few years to help them achieve their growth.

“We’re looking to grow smart and grow strategically from the markets that we’re currently in,” McLain said. And they have the capital, too.

“It’s not to say we have all the money we’ll ever need to grow the business, but we do feel adequately capitalized as an operating company,” McLain said.

McLain said the company will work with specific vendors to make their plan work. Currently, the company partners with Sonny’s for equipment and Blendco for chemicals. (Drive Clean is also a distributor for these companies through its Splash distributor business.) The company also uses Innovative Control Systems (ICS) as its exclusive computer manufacturer.

Along with new investment, Drive Clean believes the secret to building a successful national chain will be to operate a franchise that is a turn-key operation.

“We find someone that wants to do a carwash in a particular location, or maybe they just want to invest in a carwash business and like our business model, we pretty much provide a turn key solution for them from that point through operations, they would just be responsible for their financing,” McLain said.

In the end, the company’s objective is not to be the biggest — but to be the best.

On the self-serve side
With all of the hype surrounding Boomerang, it’s easy to put the ACS self-serve development and service business, Splash, to the side. But Drive Clean is doing no such thing.

According to McLain, the company’s intention is to significantly increase the focus to sales and distribution of chemicals, equipment and as a provider of services, while an outside company handles the development of new carwashes and the Boomerang brand.

“Our engine is the growth of Boomerang,” McLain explains, “but not at the exclusion of the other businesses within the company that we believe have equally as great growth opportunity as the growth of the Boomerang company.

The development of new carwashes for both Splash and Boomerang will be completed by McLain’s company, Growth Ventures. That company will drive the site identification and entire development process. The 50 employees who were formerly of ACS will now focus their attention on growing the operating business.

“Very simply, our mission here with Drive Clean is to drive sales and manage expenses,” Bennett explained. “That way we can drive it to the bottom line and maximize the returns for our investors.”

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