Auto Laundry News invited executives from vendors to the car wash industry to share their insights on what the following 12 months might hold for the industry. The participants are:
• Gilbert (Jr) Rietsch, Jr., president of PECO Car Wash Systems • Juliette Silver, CEO of Panaram International/Carwash World • Kati Wilson Wright, marketing manager of Lone Star Car Wash Systems
Gilbert (Jr) Rietsch, Jr.
Kati Wilson Wright
We asked the panelists to consider four issues of general interest to car care business operators: 1. The Economy — The outlook for this year and its impact on the car care industry. 2. Gender Equality — Is the car wash industry welcoming/encouraging enough to female participants? 3. Wash Formats — What does the New Year hold for conveyor, in-bay automatic, and self-service wand washes? 4. Concerns — What other issues will the industry face next year? In the December 2018 issue, the panelists addressed the first three of these topics. Their views on other concerns confronting the industry follow.
The alarming rate of growth that all of us in the car wash industry are facing challenges our capacity, delivery, and ability to maintain quality. While this challenge is by no means a bad problem to have, it forces all of us who care about the quality of our products and reputation to invest very methodically and pragmatically in our infrastructures and continual process improvement goals. Our goals at PECO are to be very transparent to our supply chain and our shared client base. Our industry is evolving and maturing, which means status quo is out and we aren’t doing business the way we did in the past because we have to deliver faster with higher quality. PECO has and continues to make the investments needed to evolve with an ever-changing industry including thinking outside the box and surrounding ourselves with smart people who want to contribute positively to car washing.
Labor will be a big challenge for next year. As rising minimum wages go into effect, the labor costs in a full-service car wash will also rise. Car washes are going to need to find ways to reduce their labor or raise their prices. We also need to find a way to recruit labor from other sectors to the car wash industry. Our industry is very attractive to us, but not many workers have the same impression as we do. We need to find a way to make our industry look more attractive to these potential employees.
A big and taboo topic in our industry is the sudden and rapid expansion of the presence of private equity groups buying seemingly every successful business within reach. If you aren’t reading about an acquisition on Monday morning, you can almost bet that there will be one by the end of the week, not to mention the gossip and rumors about potential purchases and sales. While the sale and subsequent purchase of a company is not cause for alarm, when small businesses across all facets of the industry are being absorbed by larger corporations, it can be daunting to suddenly be in competition with a company with significantly more buying power.
From operators to manufacturers, everyone is feeling the effects of their competitors being added to a conglomerate of industry heavyweights. This trend will continue for another year or so, but I believe eventually many of these companies will split apart again, and the industry will stabilize and move towards a new trend. And while the prospect of having to compete against half-billion-dollar companies can be terrifying, each company in this industry has a unique offering that appeals to their customer. Competition will thrive, as consumers look to smaller businesses to offer some of the services and personal relationships that they might not have with the larger competitors. For every large business that exists, a small, locally-owned-and-operated competitor is there, with their doors open and ready to receive their customers.