Absentee Ownership of Car Washes

The common understanding or misconception about the car wash industry is that car washes are a ‘set it and forget it’ type of revenue generating businesses. In some cases, after years within the industry and a well-oiled team this could be the case. However, with more and more “new blood” entering the industry to expend capital this is far from accurate.

Car Washes are just like any other business, they need to be well maintained and professionally managed to be successful. As the carwash industry grows it is important that interested buyers keep a few key factors in mind.

• Self-Serve Car Washes are not fully absentee
• Customer Service is Key
• A business can only be as successful as the infrastructure set up to support it

Self-Serve Car Washes are not fully Absentee

Although Self-Serve Car Washes can act as a passive source of income for an owner, the business itself is not. Like any business, good leadership, attention, and care its success. Car Washes are no exception to this golden rule. Speaking with operators’ day-to-day there is a common appreciation for the industry as a whole and the amount of hard work and care that goes into running each wash model. Self-Serve washes require management in place to oversee the delivery of chemicals to the facility as well as standard upkeep and maintenance of the equipment and site. Having an understand of how the wash should be managed and run is up to the owner / operator to decide, both in the way of design and execution

Any individual who is looking to enter the car wash industry should consider a Self-Serve Car Wash from a learning perspective. Self Serves can be highly profitable and provide for a great experience to learn the industry on a smaller scale and how to maintain the wash.

If the owner / operator has purchased the wash as a passive source of income, a few factors must come into play:

• The owner should have basic knowledge on how they would like the business to run and communicate that to all staff.
• A site manager with car wash experience should be hired or retained to work on the site and assist the owner with gaining understanding of the industry and business. As well as managing the day-to-day operations of the site.
• Owner should check-in on the site weekly and or biweekly to ensure the site and service being provided are meeting expectations and standards.

Customer Service is Key

No matter the car wash model great customer service is key. Having a Self-Serve is no different then any other model when it comes to customer service and satisfaction. A customers experience at the wash is just as important as the site managers interaction with the customer. The following should be in place for a pleasant experience:

• Owner / Operator or Site Manager at the site during normal business hours
• Clean Site
• Maintained Chemicals / Machinery
• Consistency
• Feeling of Safety and Security

Regular and routine visits and physical presence by a responsible party, both during and outside peak and normal business hours is imperative; whether by a site manager or the owner. It’s important to ensure that the site is clean for any customers who are using it. Make sure all the equipment is functioning properly. All the chemicals are in order. And ensure that if a customer needs any assistance that help is available. This will make the difference for any site, and the even least involved and lowest human capital intensive of all carwash models, being the self serve, is no exception to this. Ensuring everything is in order and providing some basic customer service will surely go along well in retaining customers.

Only As Successful as the Infrastructure Set Up

The ‘set it and forget it’ type of mindset is probably one of the biggest misconceptions with individuals wanting to enter the industry. The term “absentee owner” is misleading to individuals believing the car wash business can be a form a passive income. While a carwash can be this, often it is not.

Even self-serve carwashes require a knowledgeable physical presence at the wash regularly. Although exceptions exist, and most notably dependent on the pre-existing staffs tenure and experience, it should not be assumed until proven and demonstrated otherwise, that a wash can be bought by a new absentee owner and continue to experience it’s prior level of performance. Unless a manager and or proper staff is in place outside the owner themselves, it’s more accurate to assume that for the first six months, if not a year, after purchasing, said owner should expect to learn the day-to-day operations and ensure the business is being run exactly how they had envisioned it would be. An owner/operator that has car wash experience maybe only need to be hands on for about six months and / or have a trusted manager / management team in place to handle the day-to-day operations.

Car Wash Advisory is an M&A firm dedicated to serving the car wash industry. Contact us to learn more or to speak to our car wash brokers.