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Remember wondering how to start a car wash business when you were growing up? Whether it was with a club in high school, your group of friends or even yourself, it was the first time you ever made some real dough. The work was simple and you didn’t even have to go to a real job yet. Plus, it was basically like your own water park. Beats that childish lemonade stand any day.
Just because you’re an adult now doesn’t mean you can’t make a profit by washing cars. In fact, you can use what you’ve learned over the years to build your own car washing business. As long as you choose the right location, invest in some stellar marketing and provide unmatched service, you’ll be engaged in a fun and rewarding business that’s just like the old days.
The carwash business is one as old as the car itself, and even if it seems simple, there’s a great deal to know before jumping in and getting your feet wet. Much of what we’ll explore here holds true to any business, but there are also some industry-specific items to look out for.
What does it take to start a car wash?
Research the Business
It’s time to get up to speed on the business, because starting a car wash without any knowledge of car washes wouldn’t be a wise choice. Take a look at some of the technologies being used in car washes and possible trends occurring right now.
Some noticeable trends include the following:
- People tend to use car washes when the economy and car sales are doing well.
- Environmentally friendly products are making their way into the car wash market.
- Certain growing demographics around your area might want cars washed.
You should definitely go out to area car washes and decide what type of wash you want to start — self-service, automatic or waterless. Don’t be afraid to talk to the owners and employees to see things from their perspective.
Scope Out the Competition
When you’re making small talk, remember that these guys are your future competition. It’s time to do some data-collecting on their washes. How many customers do they get? How do they market their business? What will your wash have that theirs won’t?
One more thing factors into how well a car wash does:
Find a Spot and Make a Business Plan
With your game plan in mind, you’ll need a base of operations. Unless you plan to be mobile, that means finding a spot with the right traffic patterns. Look for areas where traffic moves slowly and drivers will be able to spot your advertising from a distance.
Consider the costs that your business will incur. These will vary depending on how your wash is set up. For example, if you run an automatic wash that requires pressurized hot water, you’ll need to purchase water pumps, boilers and a fan drying system. Hand washes will have costs associated with more employees.
You can get some ideas of what works where by observing the competition in your area. Draw up a plan that includes an estimate of your monthly and yearly costs to get an idea of the capitol you’ll need to open your business.
Do Some Paperwork
In order to actually get your building built, you’ll first need to go your local department that handles business licenses. There, you’ll request an application and all other information for starting a business. You’ll also need the following tax requirements:
- Federal tax identification number
- Sales tax license
- Income tax withholding
- Unemployment insurance tax
Every area has its own rules, so it’s crucial to understand all the information you receive.
Create a Business Plan
We all know that throwing money at problems doesn’t make them any better. Treat your car wash the same way — draw out a detailed business plan. It should include the following sections:
- Marketing Analysis
- Company Description
- Marketing Strategies
- Product or Service
- Funding Request
- Financial Information
To read more about how to write a business plan, check out the SBA Business Plan Guide.
Find a Way to Finance
There are three ways to finance your new car wash: you can do bank financing, take out a Small Business Association (SBA) loan or use private investors. In order to secure this financing, you need to have money of your own saved up. Investors will agree to your car wash proposal if you show them how it can become a great business.
To start up a car wash, you’ll need between $100,000 and $400,000.
Depending on the type of car wash you have, your equipment needs will vary. Here’s some equipment that most car washes have:
- washing system (a pressure washer, compressors, pumps and conveyor)
- chemicals (cleaning solutions, wax, protectants and presoaks)
- water system (water heaters, boilers)
Market Your Car Wash and Start Hiring
Once your car wash is built and ready for use, it’s time to market your business any way you can. Here’s a few ways to get started:
- Make a website and keep it updated.
- Establish a social media presence on Facebook and Twitter.
- Create flyers and post them around town.
- Make sure your car wash has a big, clear, eye-catching sign.
You might think you’re Superman, but you can’t run this business alone. Start hiring employees that are skilled, on-time and great communicators.
Evaluate and Reinvest
The trick to staying successful and keeping your business churning is to observe what’s working and what’s not. Remember that most businesses will make the vast majority of their revenue from a small number of services. Configure your wash to feed business to those services, and then add smaller offerings to them to collect extra revenue.
Look at the statistics of your business and find places to save money. Perhaps you can change to a more affordable brand of microfiber towels and save $100 per month in material costs, or reinvest time during slow hours into training new staff.
Those little things add up, and pretty soon you’ll be moving the cars through like a pro.
From here on out, it’s a matter of keeping your car wash running. Never get too comfortable — you can always add a new feature or service to keep customers coming back. But be sure to have fun and enjoy your new business!