When it comes to investing in a new business, car washes often fall under the radar. But are people overlooking a business gem? When exploring any new business venture, it is essential that prospective investors conduct extensive research into potential profitability to reduce their chances of losing cash.
In this blog from PSD Codax, we outline a selection of factors that influence the profitability of a car wash business, including the ways in which our forecourt products can help you maximise revenue.
Factors Influencing Profitability
More Vehicles Per Household
According to research into the car wash industry, there is evidence to suggest that the number of drivers using car washes is on the incline. This can be linked to a variety of factors, one of which is the increase in number of vehicles per average household in the UK. In a society where many families or even individuals own or lease at least one car – the demand for car washing services will naturally increase, leading to greater profits for car wash businesses. More than that, individuals who own multiple cars are likely to be less motivated to clean them all by hand at home – which is great news for car washes.
The key factor influencing profitability for car washes is demand. In addition to modern society simply containing more cars, lifestyle changes can also have an impact on the profitability of a car wash. In our contemporary lifestyles, people enjoy convenience more than ever before. Across almost every aspect of life, individuals are finding ways to shorten their list of jobs by outsourcing their needs to service professionals – and the same goes for car washing. Not only is washing a vehicle time consuming, it can also be messy. Taking an inconvenient task out of customer’s hands will never lose its appeal, and as customers become reliant on your service as a part of their routine, profit becomes steady and reliable.
The profitability of car wash businesses will also increase in line with technological advancements. As innovative new forecourt technology (such as that available from PSD Codax) continues to be developed, car wash owners are able to maximise profits by boasting the benefits of new innovations. In addition, modern forecourt and payment products help streamline the experience of visiting a car wash. In line with lifestyle changes, this provides an ideal incentive for car owners who wish to maintain the appearance of their vehicles without using too much of their time or physical energy. In addition to advancements in car wash technology, advancements in instant contactless payment also allows car washes to attract customers that are passing by or had not intended to visit that day.
The constant development of new technologies will also allow a car wash business to attract new custom over time – even after the newly opened buzz wears off. Over time, a car wash will be able to maintain regular custom and attract new visitors through keeping on top of new technologies and observing updates within their industry. And, of course, maintaining and attracting new customers is critical for maximising profits.
Land Acquisition and Equipment
In addition to factors that maximise profit, it is also important to consider the outgoings of a car wash business. While incoming profit is frequent and highly reliable, the investments required to get started and maintain machinery are costly. Investing in quality forecourt products will reduce the frequency of wear and tear repairs – limiting unnecessary outgoings and maximising profit margin. Another key expenditure for car wash businesses is the cost of land acquisition. Location and plot features must be well considered both in terms of attracting passing trade and logistical challenges such as drainage. However, providing the investment is well researched and fairly priced this will be worthwhile long term. Naturally, rented premises will pose different payment challenges.
Maximising the Profit at a Car Wash
On top of simple business principles – there are added steps that can be taken to maximise the profit of your car wash. A key method to maximising profit is through marketing and promotion. Businesses can maximise their profits by using social media platforms such as Instagram and Facebook to spread awareness of their service. If this promotion leads to increased footfall at your business premises, there will be a knock-on benefit for your profits. Another way of marketing your business could be through the printing of flyers or leaflets that can be posted through letterboxes or handed out by other local non-competitor businesses.
In addition to organising marketing and promotional materials for your business, small changes to your business model and pricing strategy can help increase profit margin and increase overall income. Just make sure these changes aren’t too dramatic – this may leave customers looking elsewhere for a better deal!
More from PSD Codax
For more business insights and tips on maximising the profitability of your car wash business, visit our blog. Our selection of posts cover a wide range of topics relevant to car wash owners. For more information about the range of carwash forecourt technology available with PSD Codax or to speak to our expert team, get in touch or visit our website.