Auto Laundry News - December 2011

Professional Detailing — Certification Establishes Trust

By Robert Roman

Earlier this year, The International Detailing Association (IDA) announced the launch of its Certified Detailer Program beginning June 1, 2011.

Hopefully, this program will be em-braced by the entire auto industry.

Detail shops and mobile operations are an essential link between vehicle manufacturers and consumers and
provide motorists with an array of car-care appearance services at different price points.

In 2008, the U.S. Bureau of Labor Statistics (BLS) reported that cleaners of vehicles and equipment accounted for 77,800 employees or 6.6 percent of total employees in automobile dealerships. The median hourly wage for cleaners of vehicles was $9.80 in 2006 as compared to $9.35 for all industries.

According to the International Carwash Association, there was an estimated 10,000 freestanding detail shops in 1998 with annual revenues of $1.99 billion. This excludes revenue from detail shops and express programs at car wash sites.

The detail industry has experienced a sea change over the last decade.

Sales of light-duty vehicles, one of the industry drivers, dropped to 11 million units in 2009 from the most recent peak of roughly 17 million in 2000.

According to the National Auto-mobile Dealership Association, the number of new car dealers dropped 26 percent between 1990 and 2010. Between 2008 and 2010, the total number fell 11 percent.

The number of vehicles on U.S. roads has dropped as well. Econo-mists at Edmunds estimate some 14 million vehicles were scrapped in 2009, ex-ceeding the 10 million vehicles sold that year.

A study by EPI-Federal Highway Administration shows the total number of vehicles in use dropped 1.6 percent in 2009 to 246 million. New registrations also fell to 10 million, a 33 percent decline.

People have less money to spend. The Federal Reserve Bank estimates household income has declined by
2.7 percent in real terms between 2001 and 2009.

The only industry driver giving any cause for optimism is the increasing average age of vehicles.

In 2008, the median age for passenger cars increased to 9.4 years or 2.2 percent. The median age for light trucks increased to 7.5 years or 5.6 percent. Pundits expect this trend to continue.

The employment outlook for the detail industry is muted. According to BLS, total employment in cleaners of vehicles and equipment is projected to decline 5.3 percent by 2018.

Consequently, I believe the IDA initiative presents itself at an opportune time. Having recognized credentials has shown to increase a technician’s chances of finding employment and advancing within the occupation once employed.

According to BLS figures, roughly 50 percent of service technicians in automobile dealerships are certified and make over $3 more an hour as compared to all industries. Cleaners of vehicles in dealerships only make about $0.50 more an hour.

Experience has shown that certification helps establish a level of trust between business owners and customers.
Certification may also help create a sense of legitimacy and professionalism that has been sorely lacking in the auto detail industry.

Despite the current business environment, I believe the demand for “qualified” detailers is only going to grow.
Higher prices for new as well as fuel-efficient vehicles, higher gasoline prices, the sharp drop in new vehicles sales, and worried lenders have culminated to create the tightest market for used cars in over 20 years. This market isn’t going to disappear overnight.

Today, many car dealers are struggling to manage the cost of keeping vehicles on lots. Moreover, the trend in the car wash industry is to build an exterior express conveyor or in-bay automatic car wash system that is virtually “people-less.” Hardly anyone is building full-service conveyors with a separate detail shop. Consequently, pressure to outsource detail work to in-house contractors and freestanding detail shops should increase.

Very soon, millions of baby-boomers will become the largest, wealthiest over-50 consumer group in history. Boomers will account for 40 percent of spending by 2015 and a disproportionate share of growth and consumption in a wide range of industries including car-care services. Baby-boomers gravitate to less stressful activities that are easier on the aging body.

In the final analysis, the need to know what to do and how to do it and get it right the first time is only going to get greater.

In my mind, detailer certification would help fill the void as will having an association that has more to gain from being member-driven rather than industry-centric.

Bob Roman is president of RJR Enterprises — Consulting Services (www.carwashplan.com). You can reach Bob via e-mail at bob@carwashplan.com.

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