Business plan for opening a car wash

Do you want to open your own business, and do not know where exactly to start? The car wash is what you need. In this article, you will find a sample business plan for starting a car wash from scratch with some calculations and financial calculations.

Summary

This car wash business plan is a project for organizing a car wash (hereinafter - Car wash) with a payback period of two years.

Objectives of the project:

1. Creation of a highly profitable enterprise
2. Getting stable profits
3. Saturation of the consumer market with car wash services

Project financing source: own funds, or bank loan at 23% per annum

Total project cost: 3,500,000 rubles

Payback period: 2 years

Payments of loan funds and interest on the loan will begin from the first month of the project

Stages of car wash business plan implementation

The start of the project is from the moment the business plan is approved by the Customer, or from the moment the borrowed funds are received. The stages of the project implementation and the terms of their implementation are presented in Table No. 1

General characteristics of the project

The main purpose of a car wash is chemical washing of cars and interior cleaning. The target audience of consumers of car wash services is the owners of individual, official, municipal, passenger vehicles.

In recent years, car owners prefer to buy expensive cars, which, as before, cannot be washed just with a bucket and a rag. Their maintenance requires washing in a professional car wash, where the work is performed by qualified workers who are responsible for their actions.

It was the demand for special equipment that allowed the first high-pressure washers developed by the Karcher company to appear in due time. However, at present, other, more advanced technologies have appeared that allow washing the car without touching it at all. We are talking about a non-contact automatic car wash. And most importantly, car owners are ready to pay for the provision of services in a more technologically advanced way, which means that the quality of improving car wash services can and should be constantly improved.

The main services at most car washes have not changed for several decades, these are:

• Car wash outside
• Body polishing
• Washing the engine compartment
• Dry and wet cleaning of the car interior

As a rule, a car wash is located in a covered area (for the provision of year-round services), with the number of washing boxes from 2 to 5. The most problematic stage of opening a Car Wash is obtaining the necessary permits and documents. Usually the whole process of finding a suitable place for a car wash with the availability of the necessary engineering networks nearby and business registration takes about six months. During this time, it is necessary to obtain permits from Rospotrebnadzor, fire inspection, environmental supervision service, territorial administration of the district in which the institution will be located.

Particularly stringent requirements are imposed on the Car wash by the environmental service. According to the current legislation, car washes cannot be located closer than 70 meters (in fact, this distance is at least 100 meters) to the nearest residential buildings. In addition, they require the installation of an expensive special closed system for draining and purifying water. Draining into a regular storm sewer is strictly prohibited, because after washing a car, traces of fuel and lubricants remain in the water. Recirculating water requires digging a hole with a volume of at least 6 cubic meters.

There is an option to conclude an agreement for the maintenance and treatment of wastewater with the city administration of the water utility, but the amount will also be rather big. In addition, an agreement with the relevant service will be required for cleaning the purification system from sludge (dirt), which is performed at least once every 2 weeks.

In fact, the situation is that at most car washes (according to estimates - about 80% of the total), the requirement to install closed-loop cleaning systems is simply neglected, preferring to pay a fine, or by mounting dummies of such systems, rather than after installing a real cleaning system every 2-3 months to spend additional funds on its maintenance.

As a type of object, a car wash can be of several types:

• Using manual and automated labor
• Tunnel (the car moves on a conveyor with equipment installed on it) and portal ((the car stands still, the equipment moves around)
• Stationary or mobile

The owner of the establishment chooses the most optimal type of car wash for himself, drawing up a business plan for a car wash with calculations. The option with the minimum investment is a manual car wash, requiring approximately $ 5,000 to $ 7,000 in investment. However, given the quick payback of this business, this is considered a relatively small investment. It is possible that in the absence of the required funds, a business plan for opening a car wash will have to be submitted to a bank to obtain a loan, so all the "little things" should be provided.

The most convenient option for the client is a mobile car wash that works on call. As a rule, such car washes are called by the owners of motor transport companies, so as not to "drive" the entire fleet to the wash. If it is convenient for the car owner, then it is very beneficial for the owner, because such services involve the conclusion of a fixed-term contract for the provision of car wash services, and this is a very solid profit.

According to experts, the main types of sinks that bring their owner a stable profit are:

1. Car washes with a minimum set of services offered and high daily traffic. Such car washes are most beneficial on busy road sections, and are mainly used by drivers who value their time. Fast vehicle service (15 minutes maximum) improves productivity. The equipment for such a car wash only needs automatic, capable of servicing up to 50 cars in 1 hour. Manual labor is minimized, and wage costs are reduced accordingly.
2. The second type is the opposite. It is a car wash with a wide range of services and first-class time-consuming service. Such car washes are designed for people who are ready to lose up to 1.5 hours in exchange for quality service. Such a complex of services usually includes - washing the engine compartment, dry cleaning of the car interior, polishing the external and internal parts of the car, blackening of tires, etc.
   Often, cosmetic pre-sale preparation is carried out on such washes. Such car washes require only the use of manual labor. Low productivity is compensated by ordering several services, and by spending time with customers waiting for their car. In order to make a profit in waiting rooms and rest rooms, car wash owners install coffee machines, open cafes, small shops, etc., which often bring up to 40% of all revenue.

One of the most important factors affecting the successful operation of a Car Wash is its location. The close proximity of auto shops, car services, service stations, gas stations, or motor transport enterprises, as the practice of operating car washes shows, is the most advantageous place. Another location option is near hypermarkets, near which a huge number of cars gather on Saturday-Sunday, or during rush hours on weekdays. Another important point when choosing a place for a car wash is a good driveway to the building. The best option is different entrances and exits in order to “unload” the flow of cars.

Some experts working in the field of this service market give the following distribution of categories of car washes:

1. By car classification (cars, jeeps, minibuses, trucks)
2. By the type of equipment installed (brush, contactless, combined)
3. By throughput (with low productivity - from 30 to 50 cars per hour, medium - from 50 to 80 cars per hour, high - from 80 to 160, ultra-high - more than 150 cars per hour, such car washes in Russia have not yet been installed and are found USA only)
4. At the cost of equipment (economy class - from 60 thousand euros, the next category - from 95 thousand euros, and expensive - from 180 thousand euros)

It is more profitable to rent premises for a Car Wash, having found a building that is suitable in all respects, rather than building it yourself. According to the most conservative estimates, the implementation of design work, the provision of communications, approval in various authorities can lead to additional costs of at least 2.5 million rubles. In any case, when building or renting, you need to take into account that most car owners prefer to wash their car near their home or work, so as not to waste gasoline and time on the trip.

However, the option of renting a Car Wash carries the risks of refusal to renew the contract by the owner of the premises, the loss of regular customers, and the need to start everything in a new place.

The construction of a building for a car wash is associated with a large amount of time required for the approval of the project by various services and the actual construction of the building. As a rule, the same company is engaged in project development and construction. A list of such companies can be obtained from a car wash equipment dealer. They usually conclude a mutually beneficial agreement with each other.

A car wash for 4 posts will require a construction of at least 200 sq. meters. This figure includes utility rooms, boxes for cars, a staff rest room and a waiting room for clients, a bathroom, a technical room for equipment. The height of the premises must be at least 4 meters. A car wash business plan should contain all the necessary calculations.

The use of metal structures and sandwich panels in construction, in contrast to capital construction made of concrete and brick, will somewhat reduce costs and time for the construction of a building. The final cost of construction work will also depend on the distance from the car wash of the necessary utilities - water supply, power lines, sewerage.

Another stage of the project implementation that requires a careful approach is the selection of personnel for the Car Wash. Working at a car wash does not differ in prestige and is somewhat harmful to health due to the use of chemicals when washing. The salary is piece-rate and depends on the number of cars serviced. Although car washing does not require special skills and knowledge, additional services such as body polishing, interior dry cleaning, etc. require a certain skill. If an inexperienced employee harms the car owner, Carwash will not only have to reimburse him, but also sacrifice some of its reputation, and therefore customers.

Many car wash owners hire girls who are inherently tidier, cleaner, and more responsible than men. In addition, the good looks of the workers attract customers to the Carwash. But, taking into account all the above negative factors, the rotation of personnel at any car wash is high, you need to be prepared for this in advance.

The question of the choice of equipment is decided by comparing the characteristics of various equipment, its quality and price. The most popular in Russian car washes is the Karcher technique (according to some estimates, its "share" is up to 65% of use). The rest of the positions are shared by Italian Comet and Ceccato, English Carebridge, and German WAP, Weidner, and Wesumat.

Marketing plan

Natural advantages for organizing a car wash business in our country are large vacant land areas due to the crisis of 2014-2015. almost lost their importance with the increased value of land. Business was also negatively affected by the reduction of credit banking organizations, and the tightening of the rules for issuing loans for the organization and development of small and medium-sized businesses, especially for novice businessmen. Plus, there is a significant drop in new car sales.

However, despite this, the demand for car wash services not only did not fall, but also increased slightly. This is partly due to the increased attention of car owners to caring for their cars - it is unrealistic for many to buy a new car, and everyone wants the car to look like a "5". After all, it is generally accepted that a car determines the status of its owner.

According to experts, 1 car wash in the country accounts for an average of up to 2 thousand cars per month. Of course, the figures are very approximate - the incomes of various car washes differ significantly (for example, in Moscow, the demand for car wash services is much higher than throughout Russia), but they still give a rough picture: organizing a car wash is a profitable project with a quick payback.

Table No. 2 shows the indicators of the number of personal vehicles per 1,000 inhabitants in various regions of the country as of 05/01/2014

One of the main tasks of Carwash is to create a permanent customer base, and to provide services during the "off" season - in winter, when the decline in car wash services is observed by more than 2 times. As a rule, car wash owners resort to providing other, unrelated services, such as high pressure carpet washing. Organizing a car service next to the car wash will also help to overcome the winter period with the least losses for business.

In summer, visits to the car wash also decrease - many car owners go on vacation, but the losses are compensated for by ordering additional complex services, which are usually not ordered in spring and autumn. As an option to overcome the stagnation in the work of the Car Wash - the introduction of a system of discounts, holding promotions, and expanding the range of services offered. The car wash business plan should contain recommendations for advertising campaigns.

• Distribution of advertising in crowded places, in particular, vehicle owners
• Audio advertising on car radio waves
• Installation of advertising banners near the roads
• Using discount cards

Table 3 shows the average prices for car wash services in Russia

Production plan

All car wash equipment is estimated by independent experts. Presented on the Russian market is about the same quality, the difference is only in price. However, Karcher's marketing strategy and the presence of a wide dealer network, which, in addition to selling, is also engaged in the maintenance and repair of equipment, led to its great popularity.

The main equipment for Car Wash consists of:

• Car vacuum cleaner
• Compressor
• Foam generator
• High pressure cleaner for cold water cleaning
• High pressure washer with water heating function
• Treatment plant

The number of equipment is determined by the number of washing stations. In addition, you will also need:

• Various accessories for technology
• Detergents for cars
• Pieces of suede
• Overalls for workers

Financial plan

The plan of the approximate volume of services for the duration of the project until the moment of full payback is presented in Table No. 4

Conclusion

The analysis of the implementation of the project for organizing a Car Wash, carried out in this business plan, showed that this line of business is super profitable and very promising. Stable demand for Car Wash services, a growing number of vehicle owners makes with the right choice of the location of the establishment, the availability of the necessary investments in the project, the purchase of professional equipment, the implementation of the project is profitable for both the business owner and the Investor. The car wash business plan is typical, but anyone can use it to organize their own business.