Do you want to start a car wash business? If YES, here are 10 pros, cons, threats and challenges you should expect when opening a car wash business.
Regular car washing is a chore, and I believe quite a lot of car owners are with me on this. In a bid to have one less chore to do, a lot of vehicle owners take their cars to the wash, or make a similar but alternative arrangement to get their cars cleaned. It is for this reason that the car washing industry is experiencing a boom in profits.
But it may not be all rosy for the average car wash business. This is because a lot of things have to be factored in before you can come out with a car wash business that can make you and your bank account happy. A car wash business can be a good profession for anyone who enjoys working with their hands or enjoys working with the public.
Of course there are many advantages to starting a car wash business like the enduring need for affordable, accessible vehicle cleaning and maintenance, which makes a car wash appear to be a safe investment. However, there are also downsides to this business.
If you are considering starting a car wash business, you must look at the both sides of the coin so you can know how to maximize your pros and mitigate your cons. Listed below are pros and cons that are associated generally with a car wash business.
Pros of Starting a Car Wash Business
- Car Washes Are Basically Indispensable
Car wash businesses are always need, this is a fact. Not everyone has the time and even inclination to wash their cars, and they would gladly pay someone to do the chore for them.
According to Hedges & Company, there were 276.1 million vehicles registered in the U.S. in 2018. That is 276.1 million vehicles that need to be washed and maintained regularly. You do the math. Despite reports that younger Americans are buying fewer cars and driving less than previous generations, there is still no shortage of vehicles on American roadways – and no decrease in demand for car washes.
- A Car Wash Business Can Earn You Good Profits
A successful business is one that can turn in profits in a short time and a car wash business falls in that category. If started up in a good location and if you employ the right marketing strategies, it will not take to turn you car wash business into a winner.
Small-scale, self-service car washes average just over $40,000 per year in profit while larger luxury car washes can net owners more than $500,000 per year. So, if done right, your business can be a source of long-term income and stability, and one of the best investments you make.
3. You Get Reward For Hard work
To run a car wash business, you have to put in the hours and the muscle power, unless you have an automatic wash. But even at that, you have to be around to ensure that thing work according to plan. The thing is your hard work pays off in this business as you can easily build a costumer base that would of course translate to profits.
4. You Get To Be a Boss
Like any small business, owning and operating a car wash offers a way for a person to be their own boss. You get to make your decisions without outside interference, and of course you get to choose what to do with your profits.
5. The Business Requires Minimal Startup Capital
Compared to other kinds of businesses you could start, the inventory for a car wash is minimal. In fact, for some types of car wash such as the hand wash car wash, you just need to get your location and the very basic wash tools and equipment.
Also, in the last decade, developments have helped to reduce energy and water waste in this business leading to an overall reduced cost in operation.
6. Cheaper marketing
Because of the nature of the car wash business, customers don’t shop around for car wash services in another town, county or state, so advertising is affordable. You only have worry about advertising your services in your locality. This could cut your advert dollar in half.
Owners can equally accomplish quite a bit through word-of-mouth marketing in local communities, and further complement this method with affordable web pages, local merchant web alliances and social media.
Cons of Opening a Car Wash Business
- Car Washes Tend To Be Seasonal In Nature
The car wash business certainly depends on the seasons and even on the day-to-day weather as well. As a result of this, you can understand that this business may not provide you with a consistent income especially in its initial stages.
In snowy climates, clients may get their cars washed more frequently in the winter to remove salt stains. In wet climates, car washes see far less business during the rainy season than during the dry season because rainwater washes dirt and debris off vehicle exteriors.
At a self-service car wash, car owners in colder climates tend not to wash their vehicles as frequently during the winter, which is not the case at car washes where the client remains in the vehicle or waits for it to be cleaned and detailed. One of the most important disadvantages to owning a car wash that prospective owners must keep in mind is how much the weather can impact their profits.
Consecutive weeks of rainy weather can mean a sharp reduction in business, and a pollen-heavy spring can be a boon. Operating a successful car wash requires the ability to forecast profits based on annual weather patterns and a financial strategy that keeps the company from going into debt during low-profit periods.
- A Car Wash Business Entails More Than Washing Cars
Owning a car wash involves more than washing clients’ vehicles or buying a turnkey operation. One of the greatest disadvantages to owning a car wash is the complexity of this type of business and how expensive it can be to repair specialized car wash equipment when pieces break.
Prospective car wash owners should keep a sufficient amount of savings on hand to cover equipment maintenance and replacement when necessary, because one broken part can grind the whole operation to a halt.
- Management issues
Another disadvantage is the owner’s responsibility for managing the team that helps keep the business running. Like any other business, a competent, friendly staff can drive up profits or drive customers away. For an owner who does not have the time or management skills to effectively manage a team, hiring competent managers is a must.
The most profitable car wash is not necessarily the one that charges the most. In most cases, it is the one best suited to its location and clientele. When researching ownership advantages, take note of what the other car washes in your area are doing successfully as well as where their services fall short of clients’ needs.
4. Competition is Rife in the Industry
Because a car wash business is easy to set up and manage, you have a lot of entrepreneurs entering into the industry on a small scale and offering a variety of cheap and affordable services. If you set up your car wash business in an area with a lot of competition, you will find it hard to break even. The problem now is that there is no location that you don’t find at least two car wash businesses. This is one of the prominent disadvantages of this business.
5. Machine down time
A car wash business makes use of cleaning equipment, so it is high possible that your machines can break down from time to time. These breakdowns will result in business down time for you. Of course if your machines are not working, you will stay idle, thus racking up bills with no means to pay them off.