Bright Future

By Sharie Sipowicz

02/01/14

 

The ugly duckling of the car care business is turning into a swan. That scrawny little business usually found on the wrong side of the tracks has been showing up in the better parts of town lately and it looks like it has grown into quite an attractive little industry. Customers are interested, and the big car care companies are casting a covetous eye over its alluring prospects. Car washers are naturally attracted. Detailing, after all, is an extension of the service they already provide. What’s more, they already have the potential customers.

BUCKET AND SPONGE

In the beginning was the car and, as they say about car washing, detailing has probably been around in some form or another ever since. Up until now, it has been mainly a wholesale business with the overwhelming majority of detail shops existing primarily to do dealer work — a regular, year-round source of income. As a result, it has basically remained a “bucket and sponge” affair, operating from the type of premises that — how can you put it? — never received a spread in Better Homes and Gardens.

The detail business has been run out of a back room, garage, or some dark, dirty warehouse or Quonset hut somewhere — anywhere a person could park a few cars and where there was a water supply and that sort of thing. To go into that type of business, you didn’t need much: a couple of electric buffers for a few hundred bucks; a few brushes; a pressure washer — probably your biggest expense (somewhere between $500 and $1,000); a bunch of squeeze bottles; supply of chemicals; a few rags; and that’s it.

It has been run like this mainly because the dealers do not demand anything more. They do not care what the place looks like as long as the person picks up the car, cleans it up, and brings it back.

CHANGING MARKET

However, the retail customer does demand more. Moreover, this customer is part of a changing clientele with more money, less time, and a real stake in maintaining what may well have been — after a home — the biggest purchase of their life.

There are a whole lot of changes going on in society and that is the reason you are beginning to see this great rumbling in this virgin business. Let me give you a couple of definitive statistics: the National Automobile Dealers Association projects that the average new car today sells for over $20,000. Compare this to 1973 when the average retail price of a new car was $3,390 and to 1983 when it was $10,725. Furthermore, the average price of a used car in 1973 was $1,600. In 1983, it was $4,650. Today it is over $10,000.

Corresponding with the rise of the cost of vehicles, you are seeing an increase in the length of ownership. For example, in 1978 a person owned a car for an average of 3.2 years. In 1983, it had increased to 5.4 years. Length of ownership averages about 9 years today.

So consumers are keeping their cars longer and cars represent an increasingly substantial investment. Coupled with this is the fact that people have more income available for car maintenance and there appears to be a downward trend in the confidence or willingness of the consumer to do the service themselves. People feel they might damage the car doing it themselves, with all these fancy leathers, new paints, clear coats, and so forth. Related to the increase in disposable income is the fact that you have a lot of double-income households — husbands and wives working — and the kind of “yuppie” mentality that is concerned with enjoying what leisure time there is.

As well, there appears to be a downward trend in the sale of off-the-shelf car care products because people just do not want to spend the time. If a person is going to wash and wax the car, it is going to take three hours.

These trends are reflected in research, which indicates that bucket-and-sponge shops seem to be enjoying a substantial increase in sales, perhaps as much as 40 percent. And the demand is not letting up.

Talk to body shops, gas station people, and almost any kind of auto service business and they all tell you that people are always asking where they can get their cars detailed. In addition, you find more and more car wash operations are getting into or expressing interest in detailing. Why? Not only because of the money to be made, but also because they are constantly being asked by their customers. The consumer may not even know what the word “detail” means, but they know they want the service.

$150 MILLION A YEAR

If the past was a garage in a back alley and the present is the upscale detail shop in a car care center, what is the future?

The future of the industry is going to be phenomenal. It is interesting: Even at its bucket-and-sponge level, it is somewhere close to a $150 million-a-year business. Between existing freestanding detail shops and car washes that do detailing, there are probably somewhere in the neighborhood of 15,000 detail operations in the country. Now consider that the average detail shop might do about $36,000 a year, which is not a lot of money. But, it may only be a one- or two-man operation with a very small investment and a very low price per car. And with that, they are doing close to $150 million.

Once the consumer becomes aware of the detail services and the necessity for that service as a part of vehicle maintenance, you will probably see detail shops evolving at the same level as, say, muffler shops or transmission shops. Because how often do you change your muffler during the time you own a car? Maybe once? Look at it in this way: if a person uses a detail shop, they probably ought to use it twice a year for good maintenance. But say they only use it once a year. How many auto services are there that the consumer uses once a year?

Quick tune-up shops would be even more relevant. Consumers probably tune up their cars about as much as they would detail their cars. They should probably do it twice a year; most people do it once a year. I do not know exactly what the figures are on tune-up shops but there is quite a proliferation of them.

THE BIG MISTAKE

Just knowing how to detail a car is not enough; no more than just knowing how to wash a car makes a successful car wash operator.

Many people make a fundamental error when they think: “If I know how to detail a car, well, then, I’m 90 percent there.” That is a big mistake. There has to be a full understanding of all the elements that go into making a successful enterprise.

What makes all these steps so important, is that 85 percent to 90 percent of the motoring public does not know what a detail shop is or has not been to one. Therefore, the majority of your potential customers do not have the faintest idea of what you are selling. Consequently, you have to be very concerned about all the factors, all the steps that go into developing, promoting, and operating a detail shop.

That is why the car wash operator, of anybody else in the world, has the best opportunity of making a detail shop successful. He already has that element of people who are willing to spend money on car care. They are coming in and they already trust him. Therefore, it is just a natural extension that he provides another service that is aligned to what he is already doing. He will have no trouble selling that service to his customers if, that is, he does it on a professional basis. That is the key element.

A DETAILING PRIMER

Anyone interested in professional detailing ought to gain a thorough knowledge of all the elements in business.

Some of the elements you need to focus on are:

Location

There are three places you can locate a detail shop: with a car wash, in a car care center, or freestanding out on the street. Each has its unique problems.

Layout

Without a good layout, you cannot obtain high volume. This means systematic organization of space, equipment, and employees. (If you have an unorganized layout, you cannot achieve a good flow.)

Equipment

What are the options, what are the pros and cons, what are the shortcomings from not going the full route? 

Merchandising

The key thing is that the customer may not know what you are selling. It

is very important how you merchandise your services. How is detailing promotion different from car wash promotion? The type of advertising is critical. Special attention must be given to signage. People may not be quite sure of what you have and what they themselves need.

Management

Hiring good people and training them properly cannot be overemphasized. 

Financial

What are the typical costs of getting into detailing?

How to Detail a Car

In addition to a detailed analysis of what to do, a description of the chemicals, and the procedures for every job, there is a significant amount of philosophy involved.

What differentiates the old style detailing from the professional detail shop? You need a complete professional detailing program with sophisticated equipment, laid-out procedures, operational manuals, and a simplification of the chemicals used in the process. In addition, you need to have a method of training and hiring employees.

Focusing on these things will provide, at least, somewhat of a primer on what to be aware of. You will know what you do not know now. And, you will know what you need to know in order to be successful. Maybe the guys that are satisfied with what they are already doing will learn something new.

 

Sharie Sipowicz is aftermarket sales manager with Detail Plus Car Appearance Systems Inc. She has been involved in the detail industry for over 20 years, both as a vendor of products and equipment and as a hands-on operator in a retail detail environment.

You can contact Sharie at sharie@detailplus.com. 



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