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Business Operations

The value of information

April 25, 2012
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Water, electricity, chemicals and manpower — these are all important factors when a carwash is open for business. The performance of employees and chemicals has a direct effect on customer satisfaction, while the usage of water and energy will have a direct effect on a carwash's bottom line.

Still, there is one valuable factor that some owners often forget in the carwash equation — information. In fact, information about a wash's customers is one of the most valuable assets that an operator can have. Using today's point-of-sale (POS) systems, it is easier than ever to track customer buying habits and gauge the public's response to any special offers.

In the past, operators may have made decisions based on a "gut feeling" or a "hunch," but now owners can easily educate themselves with sales information and system reportage. These powerful tools give operators the ability to break down a wash's sales to levels that were unheard of just a decade ago. And, in turn, this information can be used to aid an owner when making all important business decisions.

Learning their habits

The auditing capabilities of today's POS systems allow wash owners to track individual accounts as well as a carwash's total business, according to Brad Quay, vice president of sales with Hamilton Manufacturing Corp. The sales tracking is so precise that it can monitor whether a certain customer always purchases the same wash package or whether they tend to mix up their selections.

One example Quay provided: If the data in a POS system shows a customer does not usually purchase the highest-priced package, the system will present targeted marketing during the payment process to entice that particular customer to upgrade. On the other hand, if a different customer always purchases the highest-priced package, it will not present him or her with the same upsell information.

When it comes to POS systems monitoring a carwash's overall sales numbers, the data collected during the typical week can highlight the peak wash times for a business. Armed with this information, owners can run specials during slower times of the day or week to average out their throughput, Quay stated.

Pushing packages (and profits)

Quay said that modern POS systems utilize different technologies in order to communicate to customers the benefits of purchasing a higher-priced wash package. All systems use voice prompts to walk customers through their transactions, and these prompts can include messages that lead customers to an upgrade. The menus and upsell screens can be programmed to visually highlight a featured package as well.

Also, while a POS system's marketing capabilities are generally geared towards drawing in new customers and retaining loyal customers, they can provide operators a number of options for upselling more profitable wash packages as well, according to Quay.

There are numerous ways to market a carwash through the use of a POS system, including online promotions that allow customers to purchase a single wash or a loyalty wash card. In addition, coupons can be purchased online, through the mail or through face-to-face sales. All of these promotional tools are then recognized and accepted at the POS terminal, and the system has the ability to offer upsell opportunities on-site after the customer's initial online purchase, Quay noted.

POS systems can also drive sales volume through a number of customer loyalty programs. These programs include frequent customer promotions, bonus points, clean car guarantees, books, wash clubs, time sensitive pricing and promotions and bundled services that offer discounts.

In self-serve carwashes, POS systems and automated cashiers help customers purchase more wash services based on another convenience. Jennifer Wilcox with WashGear LLC said that when a customer is able to use a credit card to pay for a carwash, there is nothing to prevent the purchase of the top package. Yet, there can be problems when a customer is paying with currency.

"Sometimes bills just won't feed into a validator, or you simply don't have enough of them. Credit cards don't have that problem," Wilcox explained. "Credit card acceptance is much faster than using a bill changer or feeding bills into a bill validator." Also, customers have been shown to spend significantly more using a credit card, especially if a wash operates on a "time up" system.

Electronic employee

"There are several ways to look at how POS systems help to increase profit," Quay said. "First and foremost they may eliminate the need for an employee. That in itself creates a direct positive impact on the bottom line. Secondly, they eliminate the potential for on-site 'silent-partners' who eat into the company's profits when they have access to the cash."

Other labor-based advantages of a POS system include offering customers a consistent message, something they will not always get from an employee. Also, POS systems do not come to work with personal baggage that can negatively impact how they interact with a customer base. Finally, the systems will never show up late for work and they do not call in sick, Quay said.

"POS systems allow a business owner to operate his or her business 24 hours a day," Quay continued. "That combined with the idea of potentially saving the costs of having additional employees and potential theft are key reasons to have a POS system."

Off-site management

Important features that most POS systems now offer are remote management capabilities. In fact, Quay noted that deeper levels of remote access and a wider array of promotional tools are some of the newest advances in POS technology.

Here, the POS system allows the owners and managers to receive messages throughout the day that provide updates on the status of the machine and the latest transaction data. Further, actually logging into a POS system allows an owner to pull up-to-date audit reports, according to Quay. In some cases, operators can even reset error codes remotely, which adds another cost saving benefit to the systems.

Wilcox sees some of the same POS advantages for owners in the self-serve market as well. "I think the increased sales and the reporting capabilities are the most valuable aspects of a modern POS," she said.

Mistakes to avoid

Wilcox said one of the biggest mistakes carwash owners make when dealing with POS systems and automatic cashiers involves service pricing. Some washes may insist on charging a higher price for credit card transactions than they do for customers that pay with cash. Typically, the operator will explain that the price difference is necessary to cover the associated credit card fees.

"The reality is credit card users spend a lot more, let's say 40 percent more when compared to cash customers," she explained. "You don't want to miss out on that additional 40 percent because you were worried about the 5 percent credit card processing fee."

Quay stated that many owners do not take the time to properly maintain their POS systems on a regular basis. Since the POS system is the first thing that customers encounter at the wash, if it has not been properly maintained the customer experience at the carwash may be lessened.

Another common mistake owners make with POS systems is not taking full advantage of the custom sales and marketing tools. These tools can be used to explain the value that a carwash offers and help educate customers about a business' services. These tools can also increase sales with effective upsells based on the customer's base wash selection.

Making changes

How flexible are POS systems when it comes to updating or changing menu offerings? "In some cases, owners have to manually make these changes," Quay said. "Other POS units allow the owner to pre-set dates and times for their pricing and messages to change automatically."

Change can be a different proposition in the self-serve market. Wilcox said that, in the self-serve context, most POS systems run parallel with another POS system that is a coin- or bill-activated timer that's limited to cash. Because of this, the changes usually need to be made simultaneously on both systems.

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