In this inaugural issue of the Investor Insider, Professional Carwashing & Detailing has focused on the business plan and pro forma process. From analyzing your competitors to approaching lenders, we recognize the first step in realizing your dream to own and operate a carwash or detail shop is often the most difficult. That’s why we asked four of the car care industry’s best and brightest minds to answer a few questions about the process and help our readers be successful in their investment journey.
Professional Carwashing & Detailing: What is the most challenging section to write when developing a successful pro forma/business plan for a new carwash business and why?
Steve Gaudreau: The executive summary. Potential prospects for funding usually make their decisions on the one page executive summary. To convey your entire concept in a compelling manner in one page is a challenge.
Bobby Willis: Financials. It is hard to put together a good financial package unless you are working with someone who owns and operates carwashes. Most pro formas provided by the carwash equipment manufacturers are flawed.
Prentice St. Clair: Financials. There are so many variables, here. it really takes a CPA type to do this work.
Trent Walter: Financials. Accounting for all expenses and calculating the potential revenue is what makes or breaks the project, a lot of estimates and/or "guesstimates" have to be made.
PC&D: What aspects of the competition should be analyzed during the pro forma process?
SG: 1. The amount of competition relative to population.
2. The types of carwashes.
3. The ability of the competition to be able to change relative to their space restrictions.
BW: Strengths, weaknesses, opportunities and threats.
PSC: Pricing, service offerings, menu items, and traffic counts.
TW: Competition’s location, service factor (ability to please the customer), marketing niche, ingress/egress for location, how clean is the business, do the employees represent the business in a favorable manner.
PC&D: How many lenders should the typical investor plan on approaching during the financing process and why?
SG: I would recommend approaching two national brokers who specialize in carwashes first. They will prepare you to approach three local lenders, hopefully with an offer from the national broker already in hand.
BW:.Start with at least three lenders. Small Business Administration (SBA) loans are the best bet for new investors right now unless they have high net worth. (Learn more at www.sba.gov.)
PSC: These days, there is little money available for business lending. Be prepared to seek out funding from many sources and unique sources.
TW: It is always a good idea to approach three or more lenders. Some private lenders are financially in a better position to lend then larger commercial banks.
PC&D: What do you believe are some of the most common complaints about carwashes brought up during the planning and permitting process and how should these concerns be addressed?
SG: Too loud. Too much traffic. Not an attractive use of space.
Present the answers in the plan. For example:
1. Site layout and stacking space answers traffic issues.
2. Info. from manufacturers on decibel level answers noise concerns.
3. Artist's rendering of an attractive building and landscaping addresses appearance.
4. Hiring requirements, appearance policies, address work force professionalism, etc.
BW: Attracts crime or loiterers. Not an attractive use of space. Operators can get around these concerns by showing examples of top operators.
TW: Too much traffic. Attracts crime or loiterers. Not an attractive use of space. Operators should use current locations as examples of how clean and safe they are. If they are new to the business they need to use architectural renditions and work with existing owners for testimonials.
|Steve Gaudreau is a carwash consultant and trainer with over 20 years of industry experience. Gaudreau wrote the books, "So, You Want To Own A Car Wash, Finding and Evaluating Retail Site Locations for Car Washes" and "Creating Exceptional Managers in the Car Wash Industry," both available through Professional Carwashing and Detailing’s online bookstore at www.cminstitute.net. Steve can be reached personally at firstname.lastname@example.org.|
Prentice St. Clair is the president of Detail in Progress, Inc., which offers automotive detailing and reconditioning training and consulting. He is currently vice president of the International Detailing Association. Prentice has authored multiple training videos and manuals, and has contributed hundreds of published articles to several industry trade magazines. He can be reached at 619 701-1100 or by email at email@example.com. Website is www.detailinprogress.com.
Bobby Willis has been in the carwash industry for 15 years. He currently owns Cool Wave Carwashes in Virginia and Wash Consultants LLC , a carwash consulting firm. He speaks often at regional and national trade shows on carwash marketing and site selection. He can be reached at firstname.lastname@example.org.
Trent W. Walter is the General Manager of Ashland, Ohio based National Pride Equipment. He has over 20 years experience in the carwash industry. His main area of focus has been on self-service and in-bay automatic carwashes. He has worked with hundreds of customers to improve the profitability of their wash through planning, implementation and continued follow up.