On the Wash Front - October 2010

Innovate or Die —
Take Success to the Next Level
By Anthony Analetto

Triple Play Car Wash in Attleboro, MA is one of the most impressive car wash facilities I’ve ever seen. Opened nearly three years ago by Terrance Elder, this 3.2-acre property is home to a 157-foot
express-exterior tunnel, touch-less in-bay automatic, seven-MPD Exxon-Mobil gas station, six-bay detailing center, three-bay Valvoline Instant Oil-Change, and a 4,500 square foot On-The-Run c-store with a drive-thru Dunkin Donuts and Jay’s Deli. Under Terrance’s vision, leadership, and hard work, his overall business has experienced year-to-year growth of 20 percent, with the oil-change business alone posting a 58 percent gain. Just as he’s positioned to relax and reap the rewards of his efforts, Terrance is doing the opposite. Over the coming weeks, Triple Play is applying everything it has learned so far to create an innovative new cross-marketing system that leverages technology to build loyalty and drive revenue. Having already done the heavy lifting, Terrance agreed to share some of his insights on how to bring an already successful car wash to the next level. Below are some excerpts from our conversation.

ANALETTO: Your sales across every profit center have steadily grown. What are you planning to change and why?

ELDER: Why? Because there’s an opportunity to get more revenue from this property without increasing labor. I can only speak for my market, but in the Boston area land is expensive and construction is expensive. When I first looked to get into the car wash business, I heard all the horror stories and felt nervous that I had to rely on the weather to make it work. So, to me, the obvious choice was to build a business that would feed the car wash, and I use gas discounts to make it happen. I opened with a soft 10 cent per gallon gas discount with a car wash. Now it’s 20 cents off Monday through Thursday and 15 cents on the weekend. I did that because I wanted to be at 135,000 washes per year with an average ticket above $10 — I needed the weekday volume to get there. The extra 5-cent discount during the week had an immediate impact. Volume moved from 250 cars per day to 350, and what’s more, the weekend business wasn’t affected.

There’s a lot of emotion with gas prices and when a customer hits “yes” to a car wash, and the pump rolls back 20 cents, they absolutely love it. What’s amazing is that after so many years of conditioning customers to make a minimum gas purchase to get a discount on the car wash, when we first started doing it, I actually had people ask me if there was a minimum. I would say no and watch as they pumped one gallon of gas for a 10-cent discount on a $12 car wash.

My goal now is that instead of getting an extra $10 dollars from my gas customer for a car wash, I want to get $40. That’s why I’m re-inventing everything to teach my customers to buy in bulk and save. Our average fill-up is only 10 gallons. So, in reality, we’re giving a $1.50 to $2 discount on the car wash. I could run coupons for $5 off a car wash all day long without the impact of the gas discount. The gas discount costs me a fraction of what a coupon on the car wash would, has a greater perceived value for the customer, and I don’t have to pay as much to promote it with direct mail or other advertising.

How are you planning to move your customers to such a high purchase?

I look at it this way: If you’re going to invest thousands of dollars to advertise something, you have to make the offer strong. If you do that, and deliver a real value, you’re going to get new customers, increase sales, and build loyalty. My original goal at the quick-lube was to get to 1,500 cars per month. So we ran online coupons with my local cable company and supermarket register tapes for $12 off a lube and included a free $8 exterior car wash. Giving $20 dollars in value for a $39 oil-change is huge. But in one month we did 1,470 oil-changes with 550 new customers. I spent a lot of time training my workers to get customers into premium oils and other up-sells like wiper blades and have been able to hold a $60 ticket. And once you’re averaging over 40 oil-changes per day, it starts to get fun and build some steam. We’re still averaging 400 new customers per month. My new goal is to average 1,800 monthly lubes in the next two years with gross sales the same as my car wash. It’s not as profitable, but it’s a big amount. What we’re working on now is to drive pre-paid car wash sales and express detailing business by reinventing how washes are sold both at the auto attendant and at the pump.

By giving away a wash with the lube are you hurting your wash business?

There’s always a risk that the customer only gets a wash with the lube, but that’s not what we’re seeing. An oil-change lasts three to four months and customers are often upgrading the free wash and visiting in-between to wash their car. Don’t get me wrong, I also have customers who go into the c-store with the ticket for the free wash trying to get a discount on gas, but that’s the exception. Basically, my competition can’t offer a free car wash, so it’s my competitive advantage in this market. It makes the customer feel good and that will always work in your favor.

Questions can be sent directly to Terrance at: terrancek@comcast.net.

Good luck, and good washing.

Editor’s Note: Anthony will conclude this discussion with Terrance Elder in the November issue of Auto Laundry News.

Anthony Analetto has over 27 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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