Auto Laundry Newsinvited 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
We asked the panelists to consider four issues of general interest to car care business operators: 1. The Economy — The outlook for next 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?
Gilbert (Jr) Rietsch, Jr.
Kati Wilson Wright
Following, the panelists address the first three of these topics. They will return in the January 2019 issue with their views on other concerns confronting the industry.
2018 has been a banner year for PECO. We have increased our revenue by 50 percent and have increased our distribution in the United States by almost 30 percent. We are very optimistic for 2019 – 2022. While the U.S. tariffs will force price increases in our industry for manufacturers with product lines primarily fabricated of steel, and interest rates will increase, individual investors and corporations will still have generally cheap access to money. The economy will be strong and persist to grow aggressively. The upcoming year will be filled with organizations purchasing, buying, and rehabbing multiple locations over multiple regions. We are expecting double-digit growth in 2019 – 2022. We have aligned our internal resources, systems, and processes to scale exponentially. While no organization is perfect, especially in times of hyper growth, we are set to do our best and have the processes in place to change dynamically with the needs of our client base and the car wash industry.
I predict a great year in the car wash industry. In my opinion, our industry is recession proof. Whether the economy is good or bad, customers want to keep their car clean. Presently our economy is booming and there continues to be more growth in the car wash industry as well. As the industry continues to grow, more equipment and goods related to the car wash industry will be purchased and with that even more expansion should occur.
I believe that unemployment rates and the recent midterm election results will have the greatest impact on the economic outlook for 2019. If unemployment continues to stay as low as it has been in 2018, the United States will continue to struggle to maintain a steady supply of labor for ever-increasing demand. Additionally, if the current tariffs, especially those enacted for trade with China, remain in place, raw material and supplies will continue to steadily rise in price. While many manufacturers can produce “American Made” equipment and products, the reality is that we still rely on importing several key components for material production in our industry. I believe that as the availability of labor continues to decline, the car wash industry will continue to move towards automated equipment and systems to limit the number of laborers, and the laborers that are hired will have a more focused skill set to offer solutions to a potential scarcity of certain products or materials. The benefit of a lower unemployment rate means that fewer Americans are not working. When Americans are working, they can spend money on services and products that might not normally be considered a necessity. While I personally believe that regularly washing and servicing vehicles is the key to a long life, several consumers consider these items and services as a “luxury.” I think that if Americans are working, this will translate into more frequent washing and/or purchases of more expensive wash packages. Only time will tell what the outcome of the elections and split control of the house, senate, and executive branch will result in for the economy.
At PECO we believe the industry is working hard to become more appealing to female participants. PECO participated in the ICA’s Women’s Leadership Experience in Chicago November 14-15, 2018. Our current head of sales, Jennifer St. John, who was hired in March 2017 to help PECO change our go-to-market strategy and align us for growth, has been highly impactful to our business, distributors, and partners. She brings to the industry a unique perspective and has helped changed our partners’ ideals of what and who defines car wash. St. John has hired five territory managers/sales executives in the past 16 months. In our hiring efforts we have welcomed Kim Mann as our territory manager covering the West. She joins Steve Michuta, territory manager – Southeast; Josh Hicks, territory manager – Midwest; Matthew McNamara, territory manger – Northeast; and newly appointed Brian Pasienza, territory manager – Southwest. In addition to our sales team, 50 percent of management-team roles at PECO are held by women. We are excited to consider more women for positions and ecstatic by the trend of more women hired in our industry.
The car wash industry is absolutely welcoming and encouraging to female participants. I believe women have become an integral part of the car wash industry. I have seen an increase in the number of female managers over the past few years and they have become a vital part in the success of the car washes they are managing. Growing up in the car wash business, there were only male managers and male car wash employees. Car wash organizations now fill positions with females for all aspects of the car wash industry — and not just as cashiers like in the past. I have been attending car wash shows for years, and I was one of very few women attending. Not anymore! The female presence in the car wash industry is now tremendous. This year, the ICA held its first ever Women’s Leadership Experience, allowing me to meet more women like myself involved in the car wash industry.
Gender equality is a term that can mean anything to anyone. When it comes to the car wash industry specifically, it covers an even broader spectrum from person to person. I do believe that for many men and women, this has been a “non-issue” in the past. “Gender Equality” often carries a negative connotation for many and can often be presented as an attack on what has been considered “normal” up until this point in time. I do not believe that men or women in our industry actively seek to discriminate against women (or anyone for that matter), but I do often see that unintentional bias is a common struggle for women that are in the industry, or maybe wanting to join our industry. There are so many available roles in our industry that have traditionally been held by men, but I think many companies and organizations have abandoned hiring a “type” of person to instead hire the best candidate for the position. Man or woman, many people are moving into positions that may have seemed unattainable before now. While there are many unique challenges that women may face in this industry, or the American workforce, I believe that the car wash industry is welcoming to all, and there are hundreds of people working hard to foster talent and motivation, regardless of gender. I encourage anyone to look around, you will see that several of the companies you are dealing with on a day-to-day basis most likely have a woman at the helm, helping guide the industry to be more innovative than ever before. It is encouraging to see so many women making waves in our industry, and the workforce in general.
It is such an exciting era in car washing! We are seeing great innovation and opportunity. The express model is certainly still the trend for tunnel car washes and PECO is posed and positioned to capture a large share of these opportunities globally. Distributive innovations such as the belt conveyor challenges manufacturers like PECO to help innovate new equipment designs and modifications to current equipment that help operators who choose belt conveyors produce clean cars. With the attention of large venture capital and private equity firms, there are so many talented people penetrating our industry who previously did not participate. Smart, innovative, and dynamic people entering our industry can only have a positive influence and improve results for car washing. For PECO, we find large opportunities to sell blended car wash solutions to hand washes (semi- automated), in-bay automatics, new industries, and new vertical markets. Our products are no longer limited to just tunnel car washes. The new outlook for our industry with distributive innovations and bright people attracted to our industry is creating unlimited opportunities, and PECO is excited to be at the forefront of this transformation and expansion.
Conveyor car wash popularity has accelerated tremendously in the past few years. I believe it will continue to grow at the fastest pace of any other car wash format. The in-bay automatics are also growing but not at the same pace as the conveyor washes. The model for in-bay automatics seem to be paired with grocery stores and gas stations and this platform is becoming very popular. Again, I feel they will be increasing but not at the same pace as the conveyor. Regarding the self-serve car washes, I feel the self-service car wash seems to be diminishing in bigger areas and cities. They are being replaced with the in-bay automatic. Next year I feel they will continue to diminish and we may only see them in more rural areas.
2019 will hold upgrades across the board for all types of equipment. As vehicles become “smarter,” I think there will be a focus on tunnel safety and collision prevention. In-bay automatics will continue to become smarter and able to wash a wider variety of vehicles in a shorter span of time. While self-serves are not as popular in some areas, with the addition of credit card readers, minimal human interaction, and the freedom to spend as much or as little time on the wash process as you please, I believe they will continue to be a staple of our industry. Another trend that will affect all wash formats is the use of social media platforms to communicate and discuss maintenance, labor, and general questions with operators and manufacturers. With online groups and chats, operators now have direct access to people across the globe that may have dealt with an issue they are encountering and be able to offer a helpful tip to resolve the issue. These platforms also offer insight to potential owners and operators as to what the day-to-day of running a car wash business will really be like. Manufacturers are given a firsthand look at what is working, and what might be frustrating for end users, resulting in an opportunity to tweak and adjust components before they even leave the factory. Those who take advantage of these open lines of communication could really benefit from the wealth of knowledge of hundreds of members of the industry.