Mistakes To Avoid When Starting A Car Wash Business
According to car wash industry statistics, small business owners own and operate 90% of car washes in the U.S. And while the number of people who choose to use car washes over manually washing their vehicles has risen by 69% in the last 15 years, 20% of small businesses like car washes still fail within their first five years.
If the car wash industry continues to grow and thrive, why are so many businesses failing? Many new car wash owners don’t realize there’s considerably more to starting and owning a car wash than meets the eye.
As a soon-to-be car wash owner, you must follow some common-sense do’s and don’ts when establishing your business. This comprehensive guide will discuss how to open up a car wash, along with typical car wash mistakes to avoid.
Contact Us For Your Car Wash Supply Needs
10 Mistakes Car Wash Owners Make When Starting Their Business
As a car wash owner, you should be aware of some pitfalls that can put your business at risk. Be sure to keep these errors in mind when establishing your facility.
1. Not Making a Marketing Plan
Many first-time car wash owners make the mistake of assuming their establishment’s presence alone will be enough to bring in customers. While this strategy may work for well-known national brands and chains, it’s improbable the same would be true for a local car wash. That’s why it’s vital to prioritize marketing when opening your car wash to attract a solid customer base.
If you’re unsure where to start with your business marketing, consider some of these car wash marketing tips.
- Create advertisements: You can draw in customers by publishing ads with eye-catching graphics and enticing headlines to market your business.
- Support a local school or team: When you sponsor a local school or sports team, they’ll often allow you to advertise by hanging banners or printing your logo on their jerseys to create brand awareness.
- Offer an additional product or service: Some car wash owners bring customers to their doors by offering complementary products or services, such as a gas pump or detailing services. About 65% of car washes also serve as fuel stations, enabling them to boost revenue.
- Establish a social media presence: Creating social media accounts for your business is an effective and inexpensive way to market your car wash. Be sure to post regularly about business updates and interact with your customers to make your online presence meaningful.
- Partner with another business: Teaming up with a fellow local entrepreneur will get your name out while providing another business owner with something in return. For example, a local café may hang posters in their building and hand out flyers to promote your business. In exchange, you can provide a discount to customers who bring in a receipt from the café on the day they make a purchase.
- Use testimonials: A powerful way to promote your car wash is by publishing print, audio or video testimonials of others speaking highly of your business.
2. Lack of Customer Service
Some car wash owners focus more intently on running their businesses than they do on providing outstanding customer service. However, poor customer service collectively costs businesses more than $75 billion a year. When customers don’t feel appreciated, supported or respected, they’re more likely to move on to a different business that can deliver. Indeed, 67% of customers become “serial switchers,” or customers who transfer their business to another brand after experiencing poor customer service.
You must create loyalty among your customers by offering excellent customer service. Factors to consider include the following.
- Timeliness: Always show up on time and finish on time when providing services to your customers.
- Accommodation: Take every step to ensure your customers feel valued and heard. Consider and fulfill customer requests and prioritize meeting their specific needs.
- Attitude: Your employees should always exhibit a friendly, empathetic attitude that makes customers feel happy, comfortable and respected.
- Knowledge: Extensive knowledge of everything you offer can ensure you deliver expert advice, recommendations and guidance.
- Gratitude: Customers remember sincere gratitude when visiting a business. You can express your appreciation by verbally thanking your customers for choosing your services, sending handwritten thank-you notes or distributing extras like stickers, coupons and promotional materials.
3. Poor Pricing
Undercutting your service prices is a typical car wash owner mistake that can impact your revenue significantly. Many emerging car wash owners assume they can get ahead in the industry by providing inexpensive prices to remain competitive and attract more customers. And while you may experience a surge in business, undercutting your prices too low will likely eat into your profit margins.
There’s nothing wrong with offering unique discounts or pricing your services lower than the competition. However, you should remain conservative, at 10 to 20% cheaper than average prices.
Consider these common car wash services and average prices before setting your rates:
- Basic wash: $5 to $10
- Deluxe wash: $10 to $20
- Full-service wash: $15 to $30
- Mobile car wash: $20 to $50
- Detailing: $80 to $200
4. Initial Cost Misconceptions
Some entrepreneurs underestimate the cost of running a car wash, and are therefore unprepared to pay the high initial costs of starting one. Hand car washes typically cost between $15,000 and $25,000 to open, while starting an express wash can cost upward of $3 million.
Car wash establishment costs typically result from the following factors:
- Advertising and promotion
5. Expensive Equipment Acquisition
While you should expect to pay a hefty sum for your car wash equipment, that doesn’t mean you have to pay the highest prices on the market. Neglecting to look into more affordable options is a missed opportunity. That’s why comparison shopping is in your best interest as a fledgling car wash owner.
It’s a good rule of thumb to shop around among different vendors to find one that can offer you the most reasonable prices for the highest-quality equipment. You can also research aftermarket suppliers to find new parts and equipment at lower prices than an original equipment manufacturer.
Even if your car wash equipment is on the more expensive side, you can look into financing options to conserve capital for your business.
6. Poor Labor Management
A reliable crew is a valuable element of any successful car wash. Even if your facility has automated systems and components that minimize labor reliance, it’s still vital to have highly trained staff on the scene to keep things running smoothly and assist customers when necessary.
Though hiring talent is an essential decision, you don’t want to overhire. Labor costs are one of the most significant ongoing expenses for any company, which is why overhiring and overpaying employees can be a highly consequential car wash mistake.
7. Lack of Maintenance
Your responsibilities don’t stop after your open your car wash. You also have to administer frequent equipment upkeep to ensure customers have a positive and seamless experience with your facilities.
Many car washes lose business due to inadequate upkeep. If a customer comes to you for services and experiences difficulty due to poorly maintained equipment, they’re far less likely to return in the future. Even something as seemingly minor as a faulty car vacuum can deter consumers. That’s why you must regularly inspect your equipment and keep up with your maintenance needs.
8. No Progress Monitoring
Operating a car wash requires more than attracting local drivers and counting your profits. Many car wash owners forget that the secret to optimizing their businesses is to track their progress and make changes accordingly.
When you use tools like spreadsheets to monitor your activity, you can gain valuable business insights. For example, you may discover high- and low-traffic patterns for your business. With this information, you can brainstorm ways to further target your high-traffic crowd and draw in more customers during low-traffic times.
Constantly making adjustments for the betterment of your business is a surefire way to succeed.
9. Permitting Misconceptions
Many first-time business owners are unaware of the paperwork they must file or the permits they need to obtain before starting a business. Getting these authorizations and licenses requires more time and effort than many people assume.
Required permits for starting a car wash vary by state and sometimes by county. Types of licenses you may need to open your car wash include:
- Local business registration
- State business license
- Environmental licenses
- Federal tax identification number
- Income tax withholding
- Unemployment insurance tax
- Employer identification number
- Occupancy permit
- Payroll tax registration
If you don’t adequately prepare to acquire these permits, you can incur thousands of dollars in unplanned business delays.
10. Lack of Owner Involvement
Another common misconception for running a car wash is that you can function as an absentee owner while still generating income. If you’re planning on building your establishment and leaving the business operations to a manager, you may want to rethink your strategy. Car wash ownership is more than a title — it’s a lifestyle.
Because cash flow is unpredictable in the car wash industry, the owner must be around to make fast, informed decisions to respond to product demands and capitalize on unexpected volume spikes.
What to Know When Opening up a Car Wash
If you’re not sure how to start a car wash, review the following tips and advice to build your knowledge and prepare to open your doors to the public.
Understand the Types of Car Washes
Knowing about the different types of car washes will help you determine which is the best choice for your business. It’s always wise to distinguish how each operation differs from another to adequately prepare for your business needs.
The four types of car washes include the following.
- Full service: Staff manually clean the car’s interior and exterior.
- Self-serve: Vehicle owners use a cleaning tool to wash the outside of their cars themselves.
- Exterior conveyor: Customers stay in their vehicles while the car travels along the automated conveyor belt through the tunnel, which washes and dries the exterior.
- In-bay automatic: Car owners drive into the bay and wait for automatic equipment to clean the outside.
Make a Business Plan
The better prepared you are to run your business, the more successful it’ll be. When opening up a car wash, be sure to establish long- and short-term business plans to maximize your profits. You should ensure that your business plans are detailed, thorough and well-researched, as comprehensive plans are more attractive to potential investors and banks.
Consider implementing the following elements into your plan:
- Upfront and overhead costs
- Marketing strategies
- Building plans
- Revenue management
Create a Marketing Strategy
Make sure your community knows about your car wash before the grand opening. Building your customer base in advance is an excellent way to get ahead of the game by creating brand awareness, stimulating word-of-mouth advertising and tapping into your target market before even opening your doors.
Some examples of cost-effective marketing strategies you can use include:
- On-site advertising
- Radio ads
- Television commercials
- Promotional washes
- Social media campaigns
- Door hangers
- Loyalty programs
Value Your Employees
Always remember that your employees are perhaps your most valuable asset. That’s why it’s essential to prioritize building a skilled and knowledgeable team to serve your customers. When you provide your crew with the training and resources necessary to handle unexpected circumstances, they’ll naturally deliver better customer service.
It’s also vital to create a healthy staff environment that makes employees feel valued. When you respect and support your crew, they’re more likely to feel motivated to perform to the best of their abilities, making your business more successful.
Prepare for the Future
Even if you don’t currently have the resources you need to establish your dream car wash, that doesn’t mean you can’t achieve it later. When you build your car wash with the future in mind, you allow for business improvements when they’re more feasible later on, saving you time and money while promoting business growth.
For example, if you were hoping to install a top brush for your tunnel in the future, you can prepare by implementing the electric components for it now.
You can set up your car wash for success by purchasing equipment with your regional climate in mind. For example, if your business is in a city that gets a lot of snow, you might offer underbody washes to prevent corrosion caused by road salt. If your hometown tends to be hot and sunny, consider providing specialized waxes or clear coats that protect automotive paint jobs from UV damage.
Upgrading your equipment to solve region-specific challenges is an excellent way to gain more customers.
Choosing JBS Industries
If you’re looking for top-of-the-line industrial cleaners for your new car wash, JBS Industries has the solutions to serve you. We’ve been one of the industry’s leading car wash supply manufacturers since our establishment in 1979, and we continue to deliver superior products to this day.
At JBS Industries, we operate on four guiding principles — quality, innovation, value and service. We deliver unsurpassed product quality by creating densely concentrated solutions with custom manufacturing capabilities, high dilutions and product consistency to generate the best outcomes for our customers.
Learn More About Us Today
You can secure high-quality car wash cleaners for your new establishment at JBS Industries. We serve all car wash industries, ranging from automatic to self-serve to touchless, and have even expanded to dog groomers and aviation maintenance. Our dedicated team provides customers with powerful and efficient cleaning solutions paired with exceptional customer service.
Contact us to learn more about our products today!