As car manufacturers increase their production to meet the ever-growing demands, other businesses that rely on the automobile industry also continue to rise.
One business that many people want to invest in is the self-service car wash. Car owners will likely take their cars for cleaning in your area once a week or even several times a week during bad weather.
You may be wondering, are self-service car washes profitable? On average, a car wash generates from $41,000 per year for a small self-serve car wash to $686,250 for a bigger high-end car wash, depending on several factors.
We know you will need some capital to invest in regular car wash equipment and probably pay rent for the property if you do not own it.
But how much return on investment will you earn by investing in a car instead of using an automatic car wash?
This article breaks down the cost of setting up a self-service car and analyzes how much it generates.
If you are interested in exploring the most common problems faced by most car wash owners, I encourage you to read this article about 11 car wash ownership problems and how you can avoid them.
What Is a Self-Service Car Wash?
The name may help you understand what a self-service car wash is. It is a system where car owners clean their cars at a convenient time. You may not necessarily follow a particular schedule or procedure outlined in the automatic car wash.
As a car owner, you also manage the janitorial resources needed to clean your car because you choose which parts need more attention. Therefore, a self-service car wash saves you more money than an automatic system.
If you run a small business with few cars, a self-service car wash is ideal and more convenient since your cars are easily cleaned within the business premises. You do not need to spend on other forms of car washes.
Furthermore, self-service car wash equipment is easy to purchase at an affordable price.
Later, we will discuss the pros and cons of investing in a self-service car wash system, but for now, let’s delved into the investment needed to install it.
Investing In a Self-Service Car Wash System Business
Whether investing in a single-space or multiple car wash park system, you need a concrete plan to establish a self-service car wash business. You will need money to rent or buy the site and equipment.
In this section, you may consider factors when building a self-service car wash and the approximate costs involved.
1- Find The Right Site
If you want to start a self-service car wash business, you probably need a space at high traffic industrial estate near a supermarket or store. You are more interested in the number of vehicles in that vicinity than the number of people living in the area.
As you choose a suitable location, ensure the size of the catchment area is approximately ten kilometers around the site. Furthermore, you should be concerned about your nearest competition, including those with self-service car washes or other car wash systems.
The cost of renting or buying a place for your system depends on the area’s size and location.
A smaller site that can handle a single-bay cleaning station is less expensive than a car wash park that can handle more than one car at a go.
2- Site Planning
Once you have spotted the right location and rented or bought it, you need to plan how to use the space and make it profitable optimally.
The size of the area will determine how many wash bays you construct. Every wash bay occupies 30-square meters and another 30 square meters for a plant room.
For example, assuming you want to build 3 wash and vacuuming bays, you will need a minimum of 1500 square meters of space.
Additionally, you will need to factor in the area for entrance and exit since it is recommended to have a drive-through way, allowing the car to come in from one side and exit from the other.
A good space deal could range from $3 to $5 per square foot.
3- Construction
You will incur costs to construct the wash bays, the plant room, and payment systems which you should include in your profit and loss accounts.
The construction costs depend on location and the number of bays. You can expect to invest about $42,000 per bay to build automatic units in some areas (Source: smallbusiness.chron.com)
On the other hand, the average costs of one self-service car wash bay range from $8,000 to $10,000.
4- Fixed Costs
Besides land and machines, a self-service car wash system also incurs fixed costs, including site labor and administrative expenses.
The table below contains the average fixed costs per car for a car wash:
| Items | Average Fixed Costs |
| Administrative expenses | $1.00 per car |
| Site Labor | $1.24 per car |
| Rent, Mortgage, and Property Taxes | Depending on the location of the car wash |
5- Variable Costs
So far, we have covered fixed costs such as land and equipment costs; however, you will also need to calculate variable costs. These costs include electricity, water, consumables, gas, heating, and waste disposal.
These costs can vary greatly every month.
The table below contains the average variable cost for washing one car on a self-service wash bay:
| Items | Variable Costs |
| Water | $0.16 per car |
| Electricity | $0.50 per car |
| Natural gas | $0.12 per car |
| Detergents | $0.64 per car |
| Maintenance | $0.47 per car |
6- Sustainability
When buying a self-service car wash system, consider its sustainability since it can help you save on costs. For instance, you can choose a design that uses a photovoltaic solar power system.
You could also choose a plan that utilizes a biological water treatment system, which uses rainwater or recycled water, thus reducing water bills and saving the environment.
Although sustainable systems may cost a little higher, they are worth every penny. They generate a good return on investment in the long run.
7- Marketing Costs
Once you have set up a fully operational self-service car wash system, you should market it to attract customers and make profits.
You can use cheaper or even free marketing platforms like social media, fliers, websites, and other paid advertisement avenues.
You might also enjoy reading: Is Online Vending Machine Good For Passive Income? (Yes, and here’s why!)
Is a Self-Service Car Wash Profitable?
You could earn $1500 per bay every month, providing an average annual income of $ 41,000. Although a self-service car wash can be a stand-alone business, it is an excellent addition if you already own a rest stop or gas station.
This business does not require personnel since the car owner does the washing. It may not have high traffic as the other carwash systems, but if properly managed, it can generate handsome revenue.
Why Should You Consider Investing In a Self-Service Car Wash System?
If you are looking for where to put your money to generate some income, here are six reasons to consider self-service carwash machines.
1- High Profits
Consider a self-service car wash if you are looking for a business venture with a good profit margin. Although you will need some money to invest in this business, the return on investment is worth the sacrifice.
Furthermore, you can benefit from excellent tax advantages associated with this business.
2- Absentee Ownership
Once you have set up reliable payment systems, you can run a self-service car wash remotely. This business does not need your presence at the property every day. Car owners wash their cars after making the payment, meaning your company is not required at the location.
Additionally, self-service car wash maintenance is low, thus reducing the number of times you visit the premise to check the equipment. With low maintenance, you can keep your profit margin high and enjoy returns on investment.
The maintenance cost can go high if you combine a self-service and an automatic unit, but the profits will also rise. Generally, a self-service car wash is one of those businesses you can run as a side hustle with other businesses.
3- It Protects The Environment
Many people do not prefer washing their cars at home, especially during drought. Using a self-service car wash can save water and keep the planet healthy.
Home car washing leaves traces of harmful chemicals like ammonia, phosphorous, surfactants, oil, and other waste on the ground.
These wastes can be washed into the nearby lakes, creeks, water treatment plants, and local streams by stormwater, leading to contamination. However, a professionally built self-service car wash recycles these chemicals and water, thus protecting the environment.
4- They Are Less Expensive To Install
A self-service car wash is relatively cheaper than an automatic car wash. You do not have to break a bank or take huge loans to invest in this business.
If you have saved some capital, you can invest in the equipment, lease a place, seek a permit, and have the business running.
Disadvantages Of a Self-Service Car Wash
- Car owners may not have the time and energy to wash their cars, or they may not know how to use self-service tools; therefore, they may prefer automatic or full-service car washes. This means you may lose business to your competitor with hybrid systems.
- Washing a car needs car owners to come with proper clothing because it is dirty work. Most car owners who dread making their hands dirty may not be your customers.
- Although a self-service car wash is an upgrade from a traditional home car wash, it lacks a professional touch. It cannot provide similar services you can only get with high-end car wash services. High-end car wash service ensures a client’s car achieves superior interior and exterior cleaning.
Is It Worth Starting a Car Wash Business?
Starting a car wash business is worth it and can be a good investment if you do it right. One of the biggest advantages of owning a car wash business is the profit generated by this type of business. For example, small- to medium-scale self-service car washes can make an average of $40,000 per year in profit, while bigger high-end car washes can bring in more than $500,000 per year.
However, remember that it will take some time until the investment generates a profit. The most common costs of running a car wash business include:
- Water
- Rent or mortgages
- Property taxes
- Electricity
- Labor cost
- Cleaning supplies
- And occasional maintenance and repairs.
See also: Is it Safe to Start an Online Business? (Let’s find out now!)
Final Thoughts
Are self-service car washes profitable? Yes. If you choose an ideal location with high traffic, you can be confident that car owners will try this new service.
You can increase your profit margin by installing more self-service car wash bays so customers do not wait too long to clean their cars.
Like any other business, it will take time to start reaping results if you advertise it and manage it well.