The most significant change that has occurred in the conveyor carwash industry in recent years is the embracing of the unlimited wash club (UWC) concept. In other industries, this UWC is referred to as a subscription business.
The most amazing aspect of the UWC is that conveyor customers who used to wash their vehicles three times a year are now washing three times a month. That consumer behavior could be changed so significantly and so quickly with a pricing mechanism such as the UWC was really hard to envision. However, the change has occurred, and carwash volumes positively reflect this change.
What’s even more exciting is that the potential number of sign-ups can go even higher than previously thought possible. There are some wash chains that average over 10,000 members per location, and there are numerous carwash chains averaging over 5,000 members per location. The average for the industry is probably closer to 2,000 members per site.
What follows in this article are the key elements that need to be addressed to achieve 5,000 UWC monthly members per site with an average of at least $20 per member.
What has been proven to be the surest way to price your UWC program is for the monthly cost to be approximately two times the price of each package. So, as an example, if the prices for each wash package were $7, $10, $14 and $18, the UWC would be $15, $20, $30 and $35. We have found that the top two packages can be higher, but having a relatively low price for the bottom two is especially important.
Some washes will start their packages as low as $10 because they want the high volume of sign-ups and they get them. Are their dollars-per-member lower? Absolutely. But, overall, their car count and total revenue are much higher. A $15 base price works fine. It is just helpful to know what’s possible.
Another wash chain opens up a new wash and offers all its plans at half price for the first six months. In effect, the wash makes little money for that period of time. At the end of six months, when it doubles its prices, it loses 40% of its members. But, it is usually at or close to 5,000 members after cancellations. Again, I am not recommending this strategy. I am just letting you know how the game is changing.
There are four major areas of the marketing equation to be considered regarding the UWC program: on-site signage, sales literature, promotions and off-site advertising.
As far as signage on the property, there are menus, signage on the gate arm and several signs (if allowed) on the property to be considered. The key difference on the menus is having the monthly plan price next to the individual package price so that people can easily do the math in their heads.
The signage on the gate arm simply says, “Unlimited wash plans — starting at $15 a month.” The signage around the property has the same message as the gate arm and, at a minimum, there would be a standing curb sign in the driveway and a sign entering the vacuum area.
With the sales literature, the objectives are to have a single card with package info on the front and program rules on the back so it looks simple and professionally done.
A promotion for a new carwash opening is the most important. Washes have signed up as many as 2,000 members the first month. Half-price offers for a month and $1 for the first month are examples of successful first-month offers. Some washes will have some type of promotion every three to four months to convert non-members to members.
Advertising is where most carwashes do not spend a lot. However, some very successful washes spend quite a bit of money and get results that are worth it.
For example, billboards have always been great for carwashes, and that is true for promoting UWC sales as well. Ongoing marketing in social media can be very effective. There are advertising firms that specialize in digital marketing for carwashes, which has proven very valuable for building traffic.
Far and away, the biggest change from an operational and a cost-of-doing-business standpoint is the decision to start manning the pay stations with employees for the purpose of signing up people to the UWC program.
Since exterior express carwashes started being built, unmanned pay stations were the rule, and employees were only out there at very busy times at high-volume sites to move vehicles through more quickly. To begin to man the pay stations continuously is a huge increase in human resource costs. However, most washes that launched a UWC program began to increase their number of employees and man their pay stations anywhere from 40% to 100% of the operating hours. And, not surprisingly, membership increased.
This change led to more changes: the introduction of incentive programs for employees, sales training, goal setting and changes in the site management position.
However, there is one variable that has to be considered that is often overlooked: A customer service advisor (CSA) is not a professional salesperson. CSAs are performing highly physical work, and they don’t have to talk to a lot of customers; in other words, they never would have applied for a sales position. So, this fact is taken into consideration in the following areas.
Every imaginable sales incentive program that you can think of has been and is being utilized today. There is no standardization in the industry in this area, and you are pretty much left on your own as far as figuring out what works. The good news is that the formula that we are going to review has worked very well for the average CSA.
During a normal two-week pay period, there are three levels of customer purchases and corresponding levels of bonuses. A common example is as follows: If the number of UWC plans purchased from a CSA are from 1 to 30, the bonus is $2 a plan; from 31 to 59, the bonus is $4; and for 60-plus, the bonus is $6 for every plan bought from that CSA. Keeping it simple and individual — with everybody making something — and rewarding the high achievers has proven to work very well.
Site managers should be rewarded as well, but their bonus structure should be different. They should be awarded a bonus on levels of net sales. So, the number of plans sold, minus cancellations, provides the net memberships gained. The levels depend somewhat on the existing car count. A frequent plan carwashes utilize is to give a $100 bonus for 50 to 99 sign-ups, a $200 bonus for 100 to 149, a $300 bonus for 150 to 199, a $400 bonus for 200 to 249 and a $500 bonus for 300-plus.
Understanding that the job of signing up people for the UWC program is not going to be the easiest task CSAs have ever done means that you will get much better results if you provide some training. So, the training has to be geared towards who they are.
They need a little classroom instruction to cover some product knowledge, what is in each of the UWC packages, frequently asked questions, how to sign someone up and — most importantly — a very short script to give to each customer. And, like any other buying transaction, before they ever approach a customer, their results will be better if they memorize that short script, practice with role plays and deliver it very easily.
Related: 21st century training
If you have noticed, I have avoided the word “sales” throughout this article. Even in the section on incentives, I did not use the word “commissions.” The reason is that the less you talk about “selling” customers and the more you talk about “letting customers know about our UWC and letting them buy,” the more comfortable CSAs will be with this aspect of their job.
Asking people at all levels to set their goals for the hour they are on the pay station, for the day and for the pay period will make a difference in the number of sign-ups. Helping people achieve their goals as opposed to giving people their quotas is again the recognition of the nature of a CSA. Also, making membership sign-up an enjoyable and fun aspect of the job lends itself to avoiding at all costs an attitude of life or death on sign-ups achieved today.
Location goals, and some fun rewards if achieved, can lead to some increase in team spirit and results. Competitive contests against other locations — if there are a number of sites in the company — can also work if they are promoted in a spirit of fun with a reward for anyone with levels of achievement.
Okay, here is the bad news. Even if you do everything that we outlined in this article perfectly, you will not see a significant growth in your membership or get anywhere near 5,000 members per location unless management at all levels follows up on the training.
The first 30 days are critical, because CSAs have to see that this new task that they now have is doable, somewhat enjoyable and financially rewarding. That financial reward takes weeks before it is in their pockets and they have spent it.
Site managers need to spend some time out at the pay stations with each of their people every day during the first month to see that they are following the procedures, coaching them on improvements and congratulating them when a customer signs up. We are not suggesting putting in a lot of time — 20 to 30 minutes with a person who is performing well and an hour at the most with someone who is struggling. But, early on is the key.
The other part of the management job relative to UWC sign-ups takes a few minutes with each person and has to do with goals. Simply asking a CSA what his or her goal is, asking if there is anything you can do to help that person and congratulating the CSA when he or she achieves it does not take a lot of time. However, it plays a key role in the ongoing motivation of CSAs.
For the levels of management above site management, paying attention to the growth in membership with the site managers, providing refresher training periodically and working on reducing the churn rate of members are all examples of the kind of follow-up at the middle management and ownership level that is required.
There is one more very important point of information to be aware of. Having a large UWC membership is the strongest defense I have ever seen against competition. We have three clients who have had a very large chain build new locations directly across the street from them. They had plenty of time, at least a year, to know they were coming. In all three cases, their membership was between 3,000 and 4,000 members.
In the first year that their competitor was across the street, none of the three locations lost any volume. The average gain in volume was between 1% and 2%. In effect, there was growth so small that it could be called no growth.
However, with a brand-new carwash across the street, they did not lose any volume. And, since all three of these competitors washed cars, the fact is that more cars were being washed in this area than ever before. So, let me repeat it again: Having a large, successful and well-run UWC is the strongest defense against competition that this writer has ever seen. Build your UWC, and they will come.
Steve Gaudreau is the President of BRINK RESULTS INC., a 25-year carwash industry veteran, author of the books “Creating Exceptional Managers” and “So You Want to Own a Car Wash,” and he can be reached at [email protected].