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Paul Kendall
Starting a car wash business is a huge step, and if you are thinking of opening up a car wash business, we’ve got a few great steps for you to follow. These steps can help you with car wash financing and actual business operation from starting out to attaining maximum success within the car wash industry. Like any other industry we recommend you have at least three years industry experience before opening up your first car wash business.
- Find the Best Location within the car wash industry.
Knowing where you are going to begin your car wash business is important. If you have a great location, then your car wash financing will be much easier to obtain, as will business success. A great location is known to bring customers, and that will help your business start growing right away.
A great visibility tip is to place your car wash next to businesses that people use daily, like grocery stores, fast food restaurants or gas stations. The more you can get people into your business without having to use a lot of money on advertising, the better. A highly visible location can provide a car wash financing company more comfort to loan you money as well.
As with any business, competition can either help or hurt your business. When you are planning out your car wash financing, look at how close other car washes may be and if you have a better location than they do. Otherwise, you may have to focus on more creative ways to draw business to your car wash to obtain success.
- Know Your Competition
If you are up against a large national gas station with a car wash that has huge advertising budgets, then you need to put your creative hat on. Include all of the ways you can attract business away from competitors in your car wash financing proposal. That shows the car wash equipment leasing company you have been thinking this through, and it’ll give you a better foundation as one of the best business owners start out with when acquiring customers.
Also, do not place your car wash where there are a lot of other similar companies in the area. You want to stand out, not have someone flip a coin to decide which car wash to go to. Make sure you are the one to go to in your area so you can handle your car wash equipment financing payments each month and keep your profits high.
You want to make money and create a profitable business, but you also need to stay competitive. If your price is too high, people will drive past your location to save some money. If you are similar or less expensive, they will probably choose you. But if you’re too inexpensive, they will assume you have less value to offer and won’t come at all, or you simply won’t make enough money from each service you provide in the united states.
One big way to stand out from your car wash competition is to offer a monthly membership plan. Unlimited & Limited club programs are the hottest trend in car wash marketing today. Set up a flat monthly fee for customers to be able to come through your car wash as many times or a certain amount of time as they'd like in a month for a flat fee.
- Decide On Your Car Wash Business Model
When you are looking into car wash equipment financing or other business loan offers, you actually have business finance options for your car wash business.
Express Exterior Business Model.
Customers are guided onto the conveyor by an attendant. Customers ride through the tunnel then exit the wash. Customers usually take advantage of self-service vacuums that are provided. At an express exterior wash, labor becomes almost a fixed expense. The replacement of service advisers and production employees with automation reduces your labor requirement to only two or three employees on site. This allows longer hours of operation and fewer employees on the payroll.
Exterior business model.
Customers are greeted by an employee and can make their purchase with the attendant. They are guided onto the conveyor by an attendant who preps the vehicle. The attendant rides through the tunnel in the customer's vehicle then exits the wash. The attendant can park in a finishing area where employees hand-dry the vehicle and perform extra services like tire shine or hand-wax if purchased. This removes production from certain exterior washes allows the wash to open earlier and stay open later, requiring just one or two employees.
Flex service business model.
Customers can drive onto the lot and be greeted by a service adviser or an unattended terminal that recommends car wash services to them. Customers have a choice of purchasing an exterior wash only, express detail services, or a full-service wash. . Customers can also take advantage of self-service vacuums
Full service business model.
Full-Service car wash business model has the highest ticket average per car and greatest customer loyalty. Full-service washes will often offer additional services like detail or express detail, impulse items in a lobby setting, or in some cases a lube center. Your customers will drive onto the lot and get out of their car to be greeted by a service adviser who recommends car wash services to them. The customer either pays for the wash there, or gets a presell ticket which they take to a cashier inside a lobby. Their car is vacuumed by an employee who then drives the customers vehicle into the wash tunnel. Inside the tunnel is a conveyor that moves the vehicle through the wash while timed equipment and chemicals clean and partially dry the vehicle. At the other end, another employee drives the vehicle to the finishing area where employees dry off the vehicle, clean the glass, and wipe the dash.
In Bay Automatic car wash business model.
All though this model is less expensive it will mean lower revenues. The customer makes their car wash purchase at an unattended terminal. Then drives into the car wash bay, puts the vehicle in park and then the car wash moves back and forth and / or around the vehicle to clean, and in most cases, dries it. There are two types of in-bay automatic car washes. Friction car washing cleans the vehicle using chemicals and soft cloth or foam. Touch less car washing uses chemicals and high pressure water to clean the vehicle without touching it.
Self service business model.
A self-service car wash has the least operational complexity but lowest return on investment. The customer pulls into a wash bay and gets out of the vehicle. Using cash or a credit card, they activate the car wash equipment. The customer washes their own vehicle using a soft bristle brush, a high pressure water nozzle / chemical applicator, and sometimes additional accessories like a triple foam applicator, or a blower to dry the vehicle. There are also self-service vacuums on the site for customers to use. Pricing is based on time, not specific wash services, which is unlike other washes. Self-service car washes often have additional profit centers like vending or an in-bay automatic car wash.
From your car wash financing position, you can present any of these options, as long as you have an idea of what you’ll need to start your business and how to make it successful.
- Make Important Business Decisions
Once you have done your research and location scouting, then you are ready to make some business decisions. Part of your business plan for your car wash financing options will be to ask how you are going to be operating your business. Are you going to be a sole proprietor, an LLC, or a corporation? This is an important business decision on multiple levels because it determines the exposure your business has and how it will operate.
Knowing how you will be operating your business and how you will be drawing in business is important for your car wash financing. Your business plan should spell all of that out in detail so you and the car wash equipment leasing companies know what you are going to do. The more details you have thought through and planned out, the better.
- Plan for the Future
Operating a business is far more than bringing in customers and making money. You will need to check with your local municipality and determine what kinds of ordinances and guidelines you will need to follow to operate your business. The earlier you determine any issues with opening your business, the more you can focus on solutions for your car wash financing details with 504 loan.
Another detail for the future and your business plan is your business growth. What are your goals? Where do you want to be in a year, 5 years, or 10 years? You need to have these things in mind so you can properly create the best long-term business plan possible. That will go a long way towards gaining traction with a car wash financing company.
- Obtain Car Wash Financing
Once you approach your lender to obtain the car wash financing or sba loan, have your business plan in hand and be able to answer any questions they may have. You must know your business and how it will run inside and out, or the lender may not believe that you can be trusted with equipment financing. Be prepared to answer questions about how much operating cash you have of your own and how much money you need to borrow. If you have some of your own money to invest, that shows planning and that you are betting your own money on the business as well.
If you are a startup and have not been in business before, car wash financing might be easier to obtain from independent equipment leasing companies rather than a local bank. Local banks or traditional bank do not usually work with startups and if they were to provide you with equipment financing, they would require a large amount down, possibly up to 20%.
If you're an existing car wash renovating or adding equipment you can take advantage of deferred payment programs from equipment leasing companies. Companies like Trust Capital specialize in start up businesses and have low money down options for start up programs.
- Master Marketing
Before you have even opened your doors, you need to make a marketing plan. It would be great if customers just came running to you, but the reality is that you will need to get the word out. The methods you mentioned in your business plan for car wash financing should help to draw in customers.
Have a fancy tall sign out front for the whole world to see and consider weatherproofing your car wash by setting up a car wash owner club program for your customers and receive a guaranteed fixed income from the car wash club members at the beginning of every month, regardless of bad weather or time of year volume fluctuations.
Customers who join an unlimited wash club provide a credit card that will automatically be charged a flat fee every month, and in return receive as many washes as they wish for that particular vehicle. Lock into customer loyalty and retention since the members paying you a monthly fee are less likely to visit a competitor.
You can also create a Limited club membership for your car wash which operates the same as unlimited clubs except for one difference... the amount of washes per month. The limited club includes a predefined amount of washes for a flat monthly fee.
In today’s market you will need a web presence like a web site, social media links, and online advertising to get the maximum exposure to all your potential customers. With so many people using their smart phones and their computers to look things up now, that is the quickest way to reach people. If you are not able to handle these things on your own, you can contract that out, but you need to utilize this for small business success.
To discuss these 7 tips for starting your own car wash business and obtaining the most competitive car wash equipment financing in the market contact Trust Capital at 866-458-4777. Trust Capital has helped several start up car washes get the business finance of hundreds of thousands of dollars they needed at low rates and long terms to get their carwash business going.
