Running a successful carwash business is as challenging as running any start-up. Some entrepreneurs think cars will stream in once they have built a fully functional cash wash like ants migrating to a new colony.
However, statistics show that approximately 20% of small businesses fail in the first year after launching, and half the start-ups do not pass the five-year mark.
Since a car wash business is no different, an entrepreneur should learn about the factors causing these massive failures and how to avoid them.
This article will point out eleven common mistakes when launching a car wash and how you can prevent them.
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Here Are The 11 Car Wash Ownership Problems And how to prevent them
Owning a car wash is more than just washing clients’ vehicles. One of the biggest challenges most car wash owners face is managing this kind of business, such as employees’ high turnover and repairing and maintaining car wash equipment when pieces break.
Here are the most common issues faced by car wash owners:
1- Poor Location
Many successful businesses owe this success to the ideal location. You cannot hack the market if your business is located where there is limited traffic. Most performing car washes are often situated near the exit route on the highway so that car owners do not struggle to access your premise.
However, some car wash owners choose the cheapest land or commercial building they can find regardless of traffic. They may believe that car owners will stream in once they open, only to realize the business location is inconvenient for most drivers.
You want to remember that you are not the only one providing carwash services in the market. If your target customers find it challenging to access your business premises, they will likely shift to your competitors.
How To Avoid Location Problems:
- The best way to determine an ideal location for your carwash is to conduct thorough research.
- Establish where your target customers live and if it is easy for them to access your preferred location.
- It is also good to know where your immediate competitors operate and if you can fill the gap.
- Cash wash should be near high-traffic areas, such as shopping centers, major roadways, and office buildings.
- These premises may be expensive, but they guarantee better business than cheap premises in an unsuitable location.
2- Inadequate Marketing Plan
Unless you are a major brand like Coca-Cola or MacDonald, you will need to develop a workable marketing plan.
Many new carwash investors base their decisions on demographic studies and proformas outlining market potential; however, they soon realize that the predicted traffic percentage on paper may not translate to real numbers on the ground.
How To Avoid This Problem:
- As a start-up, you need a solid marketing plan that may include training programs, community involvement, and advertising (online and flyers) to reach potential clients.
- You can also focus on a stellar customer experience to convince your clients that your carwash is a big deal.
- Don’t assume that once you have installed state-of-art equipment, customers will be amazed and ask about you.
- It is about proper marketing and consistently meeting expectations.
3- Properly Pricing
Pricing can also be related to marketing, and one way to attract new customers is by offering lower pricing.
However, to remain competitive, you don’t want to lose all your profits because the profit margins can be very thin, mainly when running car washes. I suggest being careful when setting your prices.
How To Avoid This Problem:
- Instead of undercutting your competitors’ prices, try to find ways to attract and retain new customers.
- As a business owner, your main goal is to make money and stay in business.
- Don’t compete only on price; find different ways to differentiate your business from your competitors.
4- Thinking That A Self-Serve Car Wash Is Passive Business
Even though self-serve bays might be relatively easier to operate because they are the type where people come in and spray their cars.
While the customers do all the cleaning work, you must regularly check chemical levels and other repairs as the car wash owner. Repairs are costly as they are specialized equipment; most general plumbers or electricians will generally not work on car washes. Additionally, you still need to clean up after people.
How To Avoid Location Problems:
- Learn how to repair and maintain your equipment yourself.
- Unlike what most people think, owning a business requires a lot of hard work.
- Here are a few ideas to help solve this issue: add credit card payments, a support line, and build a responsive website where people can get their questions answered.
5- Poor Design
Have you ever wondered why high-end hotels focus on presentation? It is because people are attracted to organization and order. If your car wash has an oddly shaped business layout that hampers the free flow of cars in and out of the property, you will put off many potential customers.
A car owner may seek your carwash services, but if they struggle to come in or get out when you have many cars, they may not want to return.
Your customers will not want to play a maze game in your garage. A poor carwash layout could also interfere with local traffic and can make you rub traffic officers the wrong way.
How To Avoid The Problem:
- Like determining the right location, researching and planning will help you know if the premise has a good design.
- The research will also help you know if cars coming in or out of the property will affect traffic in the area.
- You hire the services of a professional designer to design your business layout and make it easy for customers to navigate.
- The result will be happy customers who will likely return and spread the word to other motorists.
6- Poor Customer Profiling
Some new carwash owners enter this business thinking they know what their target audience wants without conducting a survey. Instead of investing money in research to know customer pain points, some entrepreneurs hurry to start operating with their eyes on making profits.
To address their needs, it is crucial to ask for feedback from competitors’ customers and potential customers.
You can also do a customer satisfaction survey and respond quickly when your customers show any signs of unhappiness. If you fail to identify signs of customer dissatisfaction can quickly get worse and send your business under.
You may become a victim of a social media smear campaign as customers vent their disappointment in public. You do not want such negative campaigns for your start-up.
How To Avoid This Issue:
- Regularly evaluate your customer service to prevent customer dissatisfaction from building up.
- Train your staff to effectively communicate with your customers to assure them that any issues or concerns will promptly be addressed.
- Your customers should feel appreciated every time they come to your carwash.
- Furthermore, you can conduct online surveys and apply your customers’ feedback and recommendations to improve your services.
7- Failure To Have a Social Media Presence
Social media marketing is a must-have for any serious business in this digital age. Gone are the days when flyers and posters alone were effective marketing tools for carwash start-ups. While these are still good marketing tools, they are less effective than digital marketing.
Your potential clients spend many hours daily on various social media platforms, and you can advertise your carwash business there.
The old ways of doing business have been overtaken by digital error, and establishments that fail to recognize this fact find themselves on the wrong side of history.
How To Avoid This Issue:
- Create one immediately if your business lacks a social media page like LinkedIn, Facebook, Instagram, and any relevant social media platforms.
- Some entrepreneurs worry about how to run these pages; if that is your concern, you can get help by hiring a freelance social media manager.
- Ensure you post regularly to keep your customers updated. If you are hosting an event or having offers at your carwash, let your customers know and request them to share this information with friends on their pages.
- Post quality photos and videos and direct your audience to your website.
8- Failure To Anticipate Or Budget For Equipment Maintenance
Modern carwash businesses are known for their specialized equipment. Like all machines, the equipment needs regular maintenance; otherwise, your operation may suddenly come to a halt. Most entrepreneurs budget for carwash equipment purchases but fail to anticipate maintenance and depreciation.
If the equipment is neglected, it may malfunction even before you realize its return on investment. And since the equipment takes up much of your capital, you may be staring at a premature closure.
Customers who are attracted to your carwash because of its high-quality equipment would likely move to competitors if your machines were damaged. Some may associate the damage with bad management, and no customers will want to be associated with negligence.
How To Avoid This Problem:
- Since you don’t want your investment to disappear into thin air, it is essential to give equipment maintenance the attention it needs.
- You can schedule regular inspections for all your equipment to determine which ones need immediate servicing and follow through with that routine.
- Once you realize something needs fixing, assign a technician to handle it immediately. Therefore, ensure you budget maintenance from the business profits to cover repairs, upgrades, replacements, and checks.
- If you plan for this expense, you will not be caught off guard when business is low.
9- Planning With Your Competitor’s Customers
Starting a business hoping to woo all your competitors’ customers is a disaster in the making. While most companies can succeed in stealing the competitors’ customers by offering better services, a car wash is a single-use property that may be difficult to change into something else if it fails.
It may take many marketing campaigns and superior capital investment in advanced equipment to make some of your competitors’ customers turn their heads to your premise. Lowering your prices may also not work if you are running at a breakeven point since you may not shift to a profitable price in the future.
How To Avoid This Problem:
- You can avoid losing business to the competition by understanding them well and finding what they do not offer that customers want.
- Focus your attention on addressing this market gap and building your niche around it.
- For instance, you can invest in quality auto machines, better services, and special extras.
- Build a stronger image brand that resonates with your customer, and you will remain memorable.
10- Being An Absentee Owner
Some entrepreneurs have thought a car wash may not be a source of passive income. If you thought starting a carwash was ideal for an absentee owner, think again. Once you invest in a cash wash, you choose a lifestyle that will require your attention to succeed.
While you can hire someone to manage the car wash for you, there is no guarantee that they will exhibit the same passion as you. In your absence, your employees may lack the motivation and desire to handle your clients properly.
How To Avoid This Problem:
- A successful carwash needs your full attention, especially in the initial stages.
- But your presence is still valuable even after the car wash is established and you have dependable employees.
- Therefore, organize your schedule to balance your time with other businesses and car wash.
11- Hiring And Retaining Employees Might Be Challenging
Hiring and retaining the right type of employees is not easy, particularly in the car-owning industry. A full-service car wash experience a high turnover, and recruiting, hiring, and training just one employee takes a lot of time.
How To Avoid This Problem:
- Take hiring new employees very seriously.
- Do not expect your employees to care about your business more than you do.
- Creative incentives to motivate and retain good employees.
- Properly train new employees on cash management, customer service, and operation of the business.
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Final Thoughts
A car wash business can be profitable if you avoid these common mistakes. Know your potential customers and plan accordingly to address their needs by offering services not offered by competitors.
Success is in your hand if you do proper research and planning.