Formula Saves Time, Space, Money
It takes a lot of time, money, and patience to get into the car wash business. If one could start up quicker, at less cost, and with a well-conceived operations plan, the process would be much less daunting.
A Florida-based firm has a shortcut approach that measures startup time in weeks, is environmentally friendly, and removes a lot of the uncertainty for new owner/operators.
Earthwash Carwash Systems, Inc., headquartered in Sarasota, FL, is up and running with two locations as of last November. Five were in the permitting process then, and land offers were out for an additional four Earthwash locations.
The washes, in one- or two-bay configurations, are automatic, each requiring just an 875-square-foot pad. Earthwashes are designed for 365/24 operation, and may or may not be attended during peak hours.
"The Earthwash building itself is a pre-engineered erector set," says Greg Frey, president of Polynet Global Wash Systems, where the Earthwash concept was developed. Steve Stimson is president of Earthwash.
Using structural insulated panels, the building can be assembled from the ground up by an experienced crew in about five days. "Not only that, it's also a ‘green' building," Frey adds, because it's made of non-harvested materials (no wood), and the equipment package features total water recycling.
Earthwash is a licensed product with a standard equipment package and a prescribed operating procedure that assures uniform wash quality at each location. Colors and signage are the same at each location.
"As a licensed business opportunity, we don't require any royalties," Frey explains. "What we're striving for is to bring standardization to the marketplace, just as you would with going to any national franchise. You expect and get the same quality product wherever you go."
Each site has a standard equipment package including Jim Coleman Company wash equipment, a POS-ready auto-cashier, and a detail island including two combination vacuums offering fragrance and shampoo and vended cleaning supplies.
Because of its compact size and standardization, a complete Earthwash costs about $265,000 plus an additional $75,000 in site work and setup costs. Land costs are kept to a minimum because of the small footprint of the Earthwash package. Many opportunities exist to fit such a wash onto available space near a convenience store or on surplus parking areas of shopping centers.
The first Earthwash opened in Dunedin, FL, in March 2004, and the second opened in Orlando last October. Each is a two-bay unit. The Dunedin site, a former Checkers restaurant, also has a training facility where operators of other Earthwash units can learn all about the system in two days of intensive training, provided as part of the licensed package.
Licensees also have a one-year preventive maintenance agreement that assures monthly visits by Polynet technicians. Those experts provide further training for operators as they work alongside the technicians, and enable the Earthwash parent firm to assure the quality of wash services.
Both parties in the licensing agreement have responsibilities to assure that the initial quality is maintained. The provider maintains and services the site, and the operator's role is to maintain the quality of the wash process.
"Our service calls help us address what's going on operationally at each site," Frey explains. "Wherever there's an Earthwash, we have a network of providers, and it's the responsibility of our support allies to keep track of what's happening."
To react quickly to breakdowns, a paging system on board the Earthwash contacts one or more of three numbers, first the owner and then backup resources. Outside of the Florida area where Earthwashes have made their debut, Jim Coleman Company distributors are responsible for service and parts.
Additionally, the video package incorporated in each Earthwash enables the owner to watch cars moving through his wash and be instantly aware of incidents. "The video system is a terrific way to handle damage claims," Frey adds. "We actually view some locations from our own offices."
A three-tier pricing setup is part of the Earthwash approach. "Limiting the choices to three enables us to be clearer in showing the value of upgrades without confusing the customer," according to Frey.
While Earthwash prices thus far have been $5, $7 and $9, "we can be flexible and go, say, to a $4/$6/$8 choice if that is dictated by the competition in a particular market." The average Earthwash customer spends a little under $7, with higher credit card usage for middle- and top-grade washes.
To assure success of each Earthwash, the parent firm has the right to approve the location as well as the qualifications of the operator. The company, through Polynet, has a variety of site resources. "We have some agreements in place with shopping-center owners and developers and also some large convenience store chains that have leftover property. The property on which we have an option doesn't always suit the prospective Earthwash owner," Frey says. "We may have several sites in one county and a prospective licensee in another county, so we go to our real estate bank and fire out e-mails to people in our address book."
For the four locations in operation or underway at the time of our interview, the company obtained ten-year leases with two five-year options. "Many shopping centers have excess parking space, so something this small can be put in a little spot over in one corner. Therefore, they have a sort of out parcel that doesn't interfere with their tenants but still derives more rental income."
The cost of opening an Earthwash is minimal compared to most car wash development approaches. While that low cost enables more people to enter the business, Earthwash screens applicants very carefully. "We look at their background and do a good deal of due diligence with our software systems to qualify them economically and make sure there are no cash flow problems," Frey says.
"What we've developed is a cash-flow model that looks carefully where pricing and costing are going today. We think our market timing is right. We're looking for a very strong 2006, and 2007 will probably be a real breakout year."
The typical Earthwash customer is a upper-middle-income, upper-middle-age driver who is looking to get a clean car without spending a lot of time, Frey said. Time pressures are also fueling growth of express tunnels, he noted, but three Earthwash units can be built for the same cost as a single express conveyor tunnel, and fitted onto smaller spaces as well.
Despite its low building cost, the Earthwash structure is designed to withstand a 140-mph wind load. While initial locations are in the Sun Belt, Earthwash developers are currently in engineering for the northern Freeze Belt area of the US and other countries.
"We have a waiting list of those interested in locating in such climates," Frey reports. "Our standard building right now has an insulating value of R-24, but to go to R-30 costs only $2,000 more. We also have to address the issue of building openings suited for cold weather and how to combat any feeling of claustrophobia when doors might close because of frigid weather."
Firms partnering with the Earthwash development include Warsaw Chemical. Their chemists tailor washing and other compounds to the exact water and climate conditions of each location, assuring that each mixture is reclaim friendly. Con-Serv provides the water reclamation system and Force Filtration Systems the reverse osmosis equipment.
Automatic cashiers at each Earthwash from Unitec Electronics will accept currency, coins, credit, debit, and fleet cards. Increasing reliance on fleet, credit, and debit cards is helping the move toward more cashless operation.
Promotion and advertising is part of the Earthwash approach, both to introduce new locations and to provide sustained demand in each wash's neighborhood.
Each Earthwash starts out with a $3,500 marketing budget paid by the parent company to be used for grand opening and related promotion. Licensees accrue credits in their account based on their purchases from the company such as equipment and supplies. "We will match their own expenditures, based on the amount of credit they have in that bank, for all the marketing they do to promote their car wash," Frey explains.
Polynet and Earthwash have national contracts with major direct-mail and advertising publications to provide licensees with heavily-discounted rates for mailings of coupons or special offers. "Redemptions from the mailings bring in new customers and remind previous customers that your wash wants them to come back repeatedly."
From startup through sustained operation, Earthwash seems to provide an easily-managed framework for a novice or experienced car wash operator to succeed.
Market response at the initial locations and rapid addition of new sites suggests the company has a formula that's right for today's business climate, ecologically sound, and an affordable, convenient choice for drivers.
Jim and Elaine Norland are regular contributors to Auto Laundry News.
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