In an increasingly competitive marketing driven economy, no service-based business can afford to be seen as a novelty, and the carwash industry is no exception. There are already nearly 60,000 carwash and auto detailing businesses in the U.S. as of 2022, a number that is continually growing.1 While demand for this industry declined in 2020 due to a decrease in consumer spending and shelter in place orders as a result of the COVID-19 pandemic, revenue is predicted to rise by at least 9.4% as the economy continues to reopen.2
In order to succeed, carwash owners must understand how to gain and maintain loyalty in an ever changing market. Implementing a variety of best practices can help owners deliver clean cars and secure repeat business that supports the bottom line.
Carwash demand revs up again
With a market size of $27.8 billion in 2020, demand for quick and quality car cleaning is increasing.3 The market is expected to grow at a compound annual growth rate (CAGR) of 3.8% from 2021 to 2028. This growth is due in large part to an increasing number of vehicle owners, busy schedules and increased spending power.
However, there is also more competition and greater pressure on pricing as labor and utility costs continue to rise. Meanwhile, technological advancements like sensors, keyless ignition and driverless cars also pose as potential challenges. Carwash owners and operators must understand profitable operational strategies and select the best equipment that will provide them a competitive edge.
Today, more car owners appreciate the value of professional carwashes. A study by International Carwash Association (ICA) cited that home carwashes, which were favored by 52.4% of people in 1996, are in decline; that number dropped to 28.4% in 2014. Also, according to ICA research, customers preferring professional carwashes increased from 47.6% in 1996 to 77% in 2019.4
According to the U.S. Census Bureau, Americans spend roughly $5.8 billion per year on carwashes. In terms of carwash usage, 47% of consumers wash their vehicles every couple of months, 24% wash their vehicles more than once a month and 4% visit the carwash once a week or more. It is estimated that at least 8 million vehicles are washed per day at carwashes. With this being said, customer satisfaction is imperative to the longevity of a carwash’s success.5
Driving profits through customer satisfaction
Carwash owners and operators can implement a variety of best practices to enhance customer satisfaction, including:
• Offering value-added services: The first step toward providing better value is to take stock of the current service offering and consider if these services are entirely worthwhile for the customer. Revisit the business plan and see what can be adjusted to offer more value for every dollar and turn the carwash into a one stop shop for drivers. Value-added services, such as cleaning upholstery and carpets, make a carwash more profitable as well as convenient for car owners. Having the right equipment, like double motor carpet and upholstery extraction machines, ensures this job is done quickly and efficiently. Additional add-ons can include higher end waxes, tire shiners and undercarriage sprays.
• Prioritizing cleanliness:It may sound counterproductive to clean the carwashing equipment and wash bay, but on the contrary, it’s one of the keys to operating a successful carwash business. Not only does it prevent maintenance issues and increase return on investment, but it also reflects pride in the business and helps ensure repeat business. Not to mention it makes for safer working conditions, as keeping the bay area clean reduces the risk of slip and fall situations. Interior areas must also be kept clean to give customers who are still concerned about COVID-19 greater assurance that the business is taking infection prevention seriously.
• Using reliable equipment: By installing accurate and reliable water driven pumps (WDPs), owners maximize the quality of wash results and reduce chemical spend. These pumps are designed for use with the most common chemicals throughout all phases of the vehicle wash cycle, including super concentrates that require leaner dilutions. Look for a WDP that combines outstanding chemical resistance with the ability to last for many cycles prior to maintenance. With these WDPs, owners get improved dilution accuracy across all flow rates, which reduces the need for rewash and the frequency of customer complaints tied to lack of cleanliness.
• Adding a convenience store drive-thru: Many convenience stores have had on-site carwashes attached for years. Now, more owners are exploring how to improve c-stores to enhance customer satisfaction and differentiate their businesses. One method is adding a drive-thru. Customers can purchase food, beverages and other necessities without leaving their vehicles, and can then experience the same convenience at the nearby carwash. At least 40% of c-store customers cited they would opt for a c-store over other operations as long as it had a drive-thru.6 An easily accessible c-store can bring new business to the property and encourage these buyers to become carwash customers.
• Utilizing app-based monthly subscriptions: This form of digital marketing allows consumers to download an app, select a monthly subscription package and visit any location where the app is accepted for a fully contactless experience. Some packages offer unlimited washes and extra features that vary by price. Incorporating technology seamlessly into the business can drive repeat business and help an operation stand out from competitors.
The future of carwash operations
As carwash operations continue to grow, so does demand for easily accessible and higher quality carwashes. Nearly 80% of all vehicle owners prefer the professional carwash to home washing. By offering better value for the cost of a carwash, owners and managers can secure more loyalty for their business. Doing so requires taking an inventory of services provided and considering new innovations that will drive repeat business and support the bottom line.
Sources:
2 https://www.ibisworld.com/united-states/market-research-reports/car-wash-auto-detailing-industry
3 https://www.grandviewresearch.com/industry-analysis/car-wash-service-market
5 https://www.profitableventure.com/profit-margin-car-wash-business
6 https://cstoredecisions.com/2022/02/08/is-a-drive-through-right-for-your-c-store
Scott Campbell is a global product manager for Hydro. He can be reached at 800-543-7184 or [email protected]. Based in Cincinnati, Ohio, Hydro is a world leader in delivering chemical dispensing and dosing solutions, including equipment, software and services. Hydro is a product brand of PSG®, a Dover company. PSG is comprised of several leading pump brands, including Abaque®, All-Flo, Almatec®, Blackmer, Ebsray®, em-tec, EnviroGear®, Griswold™, Hydro, Mouvex®, Neptune™, Quantex™, Quattroflow™, RedScrew™ and Wilden®. You can find more information on Hydro at www.hydrosystemsco.com and on PSG at psgdover.com.
