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By Linda Lisanti
Car washes can be one of the most lucrative profit centers for convenience store operators -- if they are done right. Unfortunately, retailers can succumb to a number of costly mistakes, from choosing a poor location to relying on stale marketing techniques. Sometimes, the decision to even enter the car wash business is a wrong move.
With the help of car wash industry experts -- Mark Thorsby, executive director emeritus of the International Carwash Association, and Andy Pazz, former car wash operator and author of the book, "How to Set Up a Profitable Car Wash That Will Make You Money" -- Convenience Store News sought out the worst blunders and compiled a list of the top 10 pitfalls c-stores must avoid to operate successful car washes.
1. Don't assume the car wash business isn't complicated.
All too often, people go into the car wash business, thinking "this is going to be easy money. All I have to do is turn the lights on, and I'm going to clean up." But that's not the reality, according to Thorsby. Car washes are sophisticated profit centers, and as such, they take work. C-store operators must be willing to put in the necessary effort.
2. Don't go into the car wash business with unrealistic expectations.
Many enter this business with impractical revenue expectations, Thorsby said. People figure they're going to have a positive cash flow within three months. They might, but they also might not. There are no sure things. Revenue expectations depend on a variety of factors, including the site and type of wash operated. To determine realistic expectations, talk with other car wash operators and local distributors.
3. Don't choose a location without careful consideration.
Thorsby has seen it happen time and time again: People will have a piece of open property and someone will say to them, "You should build a car wash there." But they end up putting a car wash on an inferior site. Choose location wisely. Also, especially in the c-store environment, make sure the car wash is visible from the street. C-store operators, believing they are in the c-store business and must put the c-store first, will wrap the car wash around the back of the store. This is never a good idea, he said.
4. Don't get caught up in the "me too" mentality.
When a close competitor installs a car wash, many store owners immediately think, "I need to install a car wash in order to compete." That may be true, but Pazz said they must avoid the "me too" mentality when deciding on equipment type -- touchless vs. friction, in-bay or short tunnel. "Just because a competitor installed a friction machine does not mean if you do the same, you will be OK," he said. "Think outside of the box."
5. Don't make equipment decisions without considering service reliability.
Operators frequently make their decisions based on the equipment's features rather than the service reliability of the provider, which Thorsby said is far more important. All the equipment on the market today will wash cars, but not all distributors will react quickly when the equipment is broken. "Distributors will sell equipment based on the features, but you should ask them instead to focus on their service capabilities, because when that equipment is broken, you're not taking in a nickel," he noted.
6. Don't forget to establish a daily maintenance schedule.
A daily maintenance schedule should be in place for the store manager(s) to follow in terms of checking chemical levels, washing down the bay at night and running a car through the wash before opening each day to make sure the equipment is functioning properly, Pazz said. Keeping the area around the car wash clean is also a must.
7. Don't assume car washes will sell themselves.
Just like it's a no-brainer for convenience stores to promote the products inside their stores, car washes need marketing attention too. As Pazz once heard someone in the industry say, if you can teach a 16-year-old to ask a customer, "do you want to supersize it?" why can't you teach your employees to ask, "would you like a car wash today?" He cited one c-store operator who had his employees wear badges saying, "keep your car happy with a car wash today." His car wash volume increased 35 percent the first month.
8. Don't fail to treat the car wash as a separate business from the c-store.
One of the most obvious mistakes Pazz said convenience store owners make is failing to realize that a car wash is not only another profit center, but should be perceived as an entirely separate business. To "do the business right," the owner needs to be involved in all the various aspects of a car wash and not just look at the car counts at the end of the day.
9. Don't fall into the "know it all" syndrome.
The need for continuing education -- whether it's through association membership, trade shows or industry publications -- is something both Thorsby and Pazz stressed. There will always be some "aha" moment for either marketing the wash, cross merchandising or preventive maintenance, according to Pazz. Seeking out individuals with different beliefs is particularly beneficial, Thorsby said, adding "you have to be a sponge and learn as much as you can, and when you challenge your ideas, that's when you learn the most."
10. Don't become complacent, a.k.a. "fat and happy."
"If you are successful with your car wash, believe me, you will have competition," Pazz cautioned. That's why he said it's critical for convenience stores operating car washes to keep things fresh by changing their marketing every few months. Have a ladies' day and offer a discount or free upgrade. Pick a special day every few months to advertise a $1 car wash. Most importantly, don't become complacent or "fat and happy," as he puts it. "The most consistent mistake I've seen is apathy and neglect. If you had $200,000 or more in the stock market, wouldn't you be watching how it performed? Well, that's the amount or more in your car wash building and equipment, so nourish it and it will return the favor handsomely."