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I'm a new in-bay automatic carwash owner and operator who keeps a close eye on industry trends and competition. One trend that's getting a lot of press lately is the express exterior concept. To me, this idea offers the excellent cleaning potential of a conveyorized automatic carwash without the extra manpower traditionally associated with full-service tunnel operations. Express exteriors offer a low-priced carwash and sometimes free vacuums.
I have read that many express exterior operations are opening up nationwide and competing with full service carwashes and in-bay automatic/self-service sites. But, still, I wonder if this type of carwash will become as popular as in-bay automatic carwashes.
Finding the perfect site
I think most operators would agree that site selection is the most critical factor in determining the success of any carwash. Express exterior sites need to be A+ sites, combining high traffic counts, good population numbers, and a market area that isn't oversaturated with carwashes.
In-bay automatic site requirements are still very important to the success of the carwash, but they are more relaxed than those of the express exterior business model. In-bay automatics can and do prosper in small towns with average populations and traffic counts of 8,000-10,000 cars per day.
The management of an in-bay automatic carwash is not easy, but it is simple. An attendant is helpful, but not necessary for success. I know sites that are regularly attended and those that are not. I think an attendant at an in-bay automatic carwash can be used to generate additional profits for the owner. This is accomplished by helping the customer use the facility, keeping the carwash clean, and fixing things as they break or notifying the owner of malfunctioning equipment.
My in-bay site is attended during the regular business hours of my full-service detail shop. I help customers on a daily basis with things like making change, clearing bill and coin jams, and helping guide them into the automatic bay.
My main job managing my in-bay automatic is to keep the carwash looking good and functioning at its best. I also perform routine maintenance on a monthly basis by oiling pumps, greasing moving parts on equipment, and cleaning pits. I inspect blower frames for cracks and drain my air compressor. Performing routine maintenance helps me stay open, washing cars and making money.
Express exterior carwashes have more moving parts than in-bay automatics. Conveyor chains and mitters must be maintained to a high degree for obvious reasons. I know that some operators use automated gates and entry systems that allow customers to load their own cars onto the conveyor.
Personally, I would be hesitant to let customers load their own car onto a conveyor. Many of my customers need my assistance lining their car up in the automatic bay. Therefore, I think it's fair to say that the express exterior business model requires an attendant during all hours of operation.
The bottom line
While in-bay automatics can survive and even flourish with modest carwash counts, express exteriors need much larger volumes of cars annually washed in order to cash flow. The bottom line for any new business venture is achieving break even point and then moving beyond that into decent profitability. What determines this is the overall project cost (debt service), and operating costs compared to the annual number of cars washed at an average price per car.
With land and construction costs rising, all carwashes are becoming more expensive to build. More construction expense means more debt service, which requires a higher annual car count to make money. Of course, we'd all like to wash more and more cars annually, but as an in-bay operator I can survive on fewer cars if the weather and economy are less than optimum for carwashing. I'm not sure all express exteriors can say that.
Choose the right business model for you
As an in-bay and self-service operator, I enjoy the simple and straightforward business model that I chose. To be fair, my operation also includes a full service detail shop, which is completely labor intensive and requires constant employee supervision and interaction with customers.
I enjoy the fact that my carwash can often times run itself while I take care of business at the detail shop. Many customers enjoy washing their car themselves and taking it through my in-bay automatic without interacting with another person. I think it's because people are busy. They enjoy being in the comfy cocoon of their car, talking on a cell phone, and sliding their credit card into the autocashier.
I think many people are actually less nervous and apprehensive when they are left on their own to maneuver into the right spot for an in-bay automatic carwash.
Success is in the eye of the customer
Customer perception and satisfaction are also key factors in the success of any carwash. While volume-driven express exterior carwashes charge prices that are on the low end of the carwash pricing scale ($3-7), in-bay automatics charge more of a 'premium' price for a carwash. In-bay automatic prices in my area range from $6-12!
I know from experience at my wash and other in-bay sites that customers choose the top wash most often. I think this is simply perceived value. It's the same reason that certain people pay an extra dollar or two for 'gourmet' coffee. The key to the success of higher pricing is that the customer feels that they got what they paid for. If they do, they will return and pay for it again.
Perhaps the low-priced carwash business model is necessary to drive volume in extremely competitive carwash markets, but I think it's a mistake to offer any automotive care service at a bargain price because motorists with high-end vehicles may associate a low price with inferior quality. This may be a broad generalization, but I think it should be taken into consideration for any new carwash while establishing a pricing structure.
Choose the right business model
I am sure that express exterior business models can be very profitable, but they also are a high-risk startup business. With a large initial investment required, complex machinery and labor requirements, these washes should be well-planned.
In-bay automatic sites are relatively simple to operate, with only part-time employees required for the carwash to run extremely well and efficiently. They have been very popular and well-received by customers and they can demand a premium price in markets where traffic count and population would not support an express exterior.
I think that any carwash needs to be a good fit within its market area to be a success. There is certainly room in our industry for a few different carwash business models. I am certain that the customer will decide which ones will be successful over the next 10-20 years.
Dave Meausky (firstname.lastname@example.org) is President of House of Wax Touch Free Carwash, Inc. He owns and operates a touch free and self-service carwash and full-service detailing shop in Central Massachusetts. Dave has been in the car care business since 1985. He's also a part-time musician who lives with his wife and children in Hampshire County.