The car wash industry is a billion-dollar industry with a market size value of $35 billion in 2020. So, if you are planning to start a car wash business, there’s definitely great potential for success.
However, just because it’s a lucrative business opportunity, doesn’t mean that you’ll be guaranteed to achieve success just because you’ve launched your own car wash business. Proper planning and market research are very important, and we know how potentially daunting these processes can be.
With that being said, here we will discuss some crucial steps to launching a successful car wash business.
1. Location, Location, Location
As with any brick and mortar business, location is one of, if not the most important factor that can make or break the car wash business. While there’s the option to launch a mobile car wash business (where you’ll visit your client instead of them to you), having a great on-site location can definitely help your business grow.
You should consider at least the following criteria when selecting the location for your car wash business:
- Population (how many people nearby own vehicles)
- Competition in the area
- Size (car counts)
- Street types (would affect renovation costs).
If necessary, get help from the local commercial real estate listing companies in finding your ideal location.
2. Competitive Analysis
It’s actually unwise to avoid competition. If you somehow find a location where there aren’t any car wash facilities around, then there’s probably not enough interest for your service.
Make sure to conduct adequate competitive analysis when choosing your location. Check how many customers do they have and their approach in marketing. Also, estimate their potential move after you do open your car wash: can they cut prices to undercut yours? Can they afford a renovation to outcompete your facility? Are their customers very loyal? Can you provide something better for their customers?
And so on.
Figure out how you can beat these competitors and/or whether you have unique value propositions they can’t imitate.
3. Plan for Customer Service Excellence
The car wash business is a service business and one of the most important factors in winning customers from your competition and grow your customer base is to consistently deliver high-quality service and ensure a great customer experience.
This might be a simple and obvious thing to understand, but you’ll be surprised at how so many service-based businesses forgot this fact. Thus, simply by delivering your services on-time and ensuring your service quality, you can beat the majority of your competition.
In this digital age, you can improve your service excellence by investing in automated scheduling and field management software like fieldd. Fieldd can help your business in implementing advanced scheduling to help you ensure timely delivery for each of your services.
4. Do The Necessary Paperwork
Don’t forget the legal requirements in starting your car wash business. Check your local regulations and figure out:
- Where to apply for business licenses
- Information on local utility usage codes
- Insurance requirements in your area (note: even if you aren’t legally required to be insured, it’s best to invest in the right insurance policies to protect your business from potential incidents)
- Tax rates, you will need a Taxpayer Identification Number if you are located in the US
Each location has different rules, so take the time to figure out all the details to avoid legal and financial issues in the future.
5. Make a Business Plan
Having a proper business plan is especially important if you are looking for financing. However, even if you are going to finance your business yourself, a business plan can still be very useful as your car wash business’s roadmap in achieving success.
Your business plan should clearly communicate how your car wash business can generate a solid revenue model to help convince investors to finance your car wash business. Remember that the more detailed and well-researched your plan is, the better it will look to your bank or investors.
Your business plan should include:
- Executive summary (basically a summary of the following sections of the business plan)
- A detailed description of your business and you, the operator (and your partners)
- Marketing plan
- Organizational structure (managers and employees)
- Your location, competitive analysis, and market analysis
- Financial projections
Furthermore, your business plan should include a detailed list of the equipment you will need to run your car wash, such as wash bays, water treatment systems, vacuums, and other machinery. You should also research the cost of purchasing or leasing this equipment and factor it into your budget projections. The equipment you need will be a major factor in determining your start-up costs. Therefore, it is essential to accurately estimate your expenses to develop a realistic financial plan for your business.
There are professional services that can help develop a proper business plan if you absolutely need help.
6. Marketing Your Business
Just because your car wash business is now open, doesn’t mean your target audience will automatically flock to purchase your service.
Marketing is very important so your local community knows about your new car wash ahead of the opening. Use available channels as applicable in your location (and according to your target audience’s preferences) like online, TV, radio, and print advertisements. Nowadays, it’s also important to invest in social media marketing and optimize your Google Maps listing as they are now the primary ways people learn about local businesses.
Remember that marketing your car wash business isn’t a one-off thing, and you should be prepared to collect feedback and adjust your marketing efforts as necessary to ensure cost-effectiveness and better ROI.
Conclusion
While launching a car wash business can be quite complex and daunting, the efforts will be worth it as the potential of building a profitable business is quite high in the car wash industry.
By following the tips we’ve shared above, you can better plan your car wash business and ensure more cost-effective marketing and operations. In turn, by offering consistent customer service excellence, you can grow your car wash business’s customer base and become more profitable.