On the Wash Front - May 2009

Weather Trumps All:
Northeast Rollercoaster Breaks Records
By Anthony Analetto

Just when you thought it was safe to assume the worst, it seems car wash traffic and profits are spiking in several regions of the country, most notably the Northeastern United States. For over six years, operators in these states have been in dire straits. First, horrible weather patterns were made worse by four dollar a gallon gas. Then, gas prices start to drop, but only because the entire world entered an economic recession. Now, defying the downturn, many operators in the Northeast are seeing their best numbers in years and there’s no shortage of washes reporting record sales. There’s cautious optimism and even a little bit of enthusiasm coming from one of the most difficult places to wash cars for some time now.

So what’s going on? For this, I called an old time friend, amateur meteorologist, and veteran car wash operator with 16 locations throughout Pennsylvania. When you ask Fred Frattaroli, owner of Triangle Car Wash, how he runs his business with locations separated by up to 150 miles, he’ll famously answer “poorly” — something that anyone who knows him realizes is very far from the truth. Fred is one of those people who makes things happen. While many plan to do things, Fred’s the guy who just does it.

For the 45 years Fred has been a professional car washer, he has tracked the weather. I’m not talking about checking the weather report to plan staffing, he’s kept detailed records. He has calendars for the last 30 years where he can pinpoint precipitation, wash volume, and even the water-per-car used at each of his locations. On top of that, Fred is a savvy businessman with a keen knowledge of real estate — who better to analyze the situation?

I want to thank Fred for taking some time to share his ideas on weather, the economy, and consumer trends in car washing. I’ve included several excerpts from our conversation below.

ANALETTO: Are you experiencing the spike in volume being reported by many operators in the Northeast?

FRATTAROLI: It’s been absolutely wonderful. All 16 of our locations are up. At some sites we’ve washed more cars in January of 2009 than we washed in the first quarter of 2008. What more is there to say?

For starters, how about why you think traffic is up?

No doubt about it, there is a lot going on these days. That said, I’ve been doing this for 45 years and there’s one thing that always holds true. People don’t wash their cars when it rains. Our last really good year before now was in 2002. That year we had 108 days of measurable precipitation with 49 of those days on weekends. It’s been mostly downhill from there with a couple of decent periods. Last year, our worst, presented 177 days of precipitation with 78 of those falling on weekends. With only 52 weekends per year, 78 rainy weekend days doesn’t leave a lot of room to wash cars. Our washes are all in smaller markets. Unless we have snow on the ground, it’s hard to make up for a lost weekend. We were repeatedly seeing five, six, and even seven days in a row with partial rain. Try making payroll without any income for a week. It’s not pretty. So far in 2009 we’re getting precipitation but it’s not continuous and the weekends have been decent. In January we had 12 days and in February 9 days of precipitation. March has been good too. Last weekend for example, Friday and Saturday were what I call 60-percent days, meaning 60 percent of the day was clear and sunny. Sunday was a 10-percent day, but after a strong Friday and Saturday it’s easy to take.

Have you really tracked and documented your daily weather for 30 years?

I don’t think you can be in this business and not track the weather at least mentally, if not in writing. To show you how much I like to aggravate myself, I’ve been tracking weather for at least 45 years, but I only have calendars and records for the last 30. Our washes are up to 150 miles apart so the weather isn’t always the same at all of our locations, but more often than not, the weather is similar. Whenever I’m in my office the weather channel is on. There have been occasions I’ve gotten really frustrated and have been tempted to throw my stapler at the TV, but so far I haven’t actually done it.

You mentioned that all of your washes are in rural areas; what types of washes do you operate?

Full, flex, automatics, self-serve, really a little of everything. In my eyes, in all this time, I think the utopia in the car wash business is now an express tunnel with a flex-serve option, along with an automatic and a couple of self-serve bays so that you’re utilizing the facility 24 hours per day. I believe you must have a conveyor to handle peaks. In my mind, it’s really the only way to go. We have one location that has two automatics and four self-serve bays, but we’re about three weeks away from tearing out one of the automatics and putting in a 70-foot conveyor. It’s a beautiful building so we’re leaving it in place and just using one of the bays. It’ll end up with a touch-free automatic and self-serve open 24 hours with the conveyor doing exterior services only. Action creates action so if you have the room, I always recommend installing a couple of in-bay automatics.

What are your guiding principles for maintaining revenue during a prolonged period of bad weather?

You have to be in control of your expenses, especially labor, and you have to do what you can to drive traffic on cloudy days. You also can’t miss a single opportunity to make up revenue. Don’t get lulled into believing that your volumes will be off forever because they can change just like that. You have to know your equipment, how it works, how to maintain it, and how to fix it in an emergency. The other day I went to visit a new operator to find out he closed his wash and went home on a 400-car day because a limit switch broke and he didn’t know you could activate a roller up with your foot. I told him you can’t do that. Get in the car and drive it through yourself if you have to, but you can’t close if you have a line of customers willing to pay you to wash their car. You just can’t do it.

The other thing I see are operators scared to put cars bumper to bumper on busy days and really make the most of volume spikes. Equipment today is unbelievable if you know how to use it. I’ll tell you, you got to be optimistic and look for the good things. People today keep talking about unemployment passing 8 percent. To me that means 92 percent of the population is employed and able to buy a car wash from me.

What activities do you do to drive traffic on cloudy days?

We do a lot of marketing, but one easy thing I recommend is putting out a sign at different times promoting some sort of special that you keep changing. I’m not a big fan of discounting and I’ll explain that in a minute, but putting out a sign with a special teaches people to look at your wash when they’re driving by to see what you’re offering. We’ll do breakfast specials from 8 a.m. to 11 a.m. or evening specials — we have a sign company so it’s easy for us to change. The point is that customers are thinking about getting a car wash which means they’re one step closer to getting a car wash from you.

Be careful with discounting because it can cost you big time. Although you have to drive volume on cloudy days, you can’t increase volume where there is no volume. Right now I’m discounting for about 32 hours per week but have to be careful that I don’t just reduce my revenue from regular customers who would have paid full price. Don’t forget the purpose of discounting is to carefully build volume, not blindly reduce revenue.

Do you have any theories other than the weather that you think are contributing to your increased traffic?

Plain and simple, with gas at less than two dollars per gallon, people like their cars again. At four dollars per gallon, even if you could afford to pay, your car became your enemy. Now, for the 92 percent of the population that’s still employed, getting a car wash is an inexpensive pleasure.

Comments or questions can be sent directly to Fred at: trianglecarwash@comcast.net

Anthony Analetto has over 26 years experience in the car wash business and is the president of SONNY’S The Car Wash Factory’s Equipment Division. Before coming to SONNY’S, Anthony was the director of operations for a 74-location national car wash chain. Anthony can be reached at (800) 327-8723 x 104 or at AAnaletto@SonnysDirect.com.

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