Is an Express Car Wash a Good Business Investment?

A car wash is an investment often considered by entrepreneurs and real estate investors. Most car washes in the U.S. are owned and operated by small- to medium-sized companies, drawn to the sector due to a relatively low cost of entry. Car washes generally aren’t costly to manage and take up a small real estate footprint. Are you looking into an express operation and asking yourself, “Is a car wash a good investment?” Here’s a look at what you should know.

Industry Background

According to the International Carwash Association, there were 62,668 car washes operating in the U.S in 2020. The industry employs over 220,000 people, both full-time and part-time, at retail locations. An additional 15,000 are employed in equipment-, chemical-, and service-providing segments. In total, car wash retail sales in North America totaled about $15 billion.¹

Per Grand View Research data, the car wash industry achieved a 3.6% compound annual growth rate for revenue between 2013 and 2018. Growth is expected to continue at a rate of 3.2% through 2025. Consumers are also increasingly preferring to use car washes, with 47.6% washing their vehicles at home in 1996 and 28.4% choosing this method by 2014.²

Demand

The high rate of demand is being driven by consumers’ busy schedules and an increasing number of vehicles on the road. People simply don’t have the time to wash their cars at home. Besides, a car wash can do it much faster. You cannot outsource a carwash or provide such a service remotely. The brick-and-mortar format is the only way to run your business.

Profitability

A steady flow of customers can provide the sales and profits you need. Even a small self-service car wash can generate over $40,000 per year. However, a larger business can net owners $500,000 or more annually.³

Stability

Car washes are always needed, so they afford a higher degree of stability than when starting many other types of businesses. Demand is not waning, either.

Risks

However, there are risks. Car washes do tend to be seasonal; vehicle owners may choose to wash their cars more often in winter when grime from snow and ice and road salt need to be washed off. If your location has a rainy season, it’s not as necessary for clientele to have their cars washed as regularly.

A self-service car wash might see a downturn in winter because car owners won’t want to get out of their vehicle. However, if the customer remains inside the vehicle, your car wash may sustain more business in the colder months.

That being said, demand for a car wash can be heavily dependent on the weather.

Location is another factor that can impact volume and profits. If your car wash is located in an upper-class neighborhood, profits may be higher. On the contrary, if your business is in a hard-to-reach location or isn’t highly visible, it can be hard to attract a steady clientele, and you may fail to reach profit goals.

The learning curve is another consideration. Operating a car wash is about much more than just washing cars. You’ll need to equip and maintain your facility. There may be a lot of technical work, marketing, and sales strategies that come into play. However, with due diligence and by consulting with experts, you could have a lucrative future lined up.

Why Investors Choose Express Car Washes

A car wash is a relatively predictable business, so there’s a fair degree of resale potential. It’s easy to find an investor looking for recurring revenue and sell your business to them for a profit. Membership plans, such as an unlimited wash program, can maximize profits and increase the value of your business significantly. An express car wash can handle multiple vehicles at once, which further boosts revenue potential.

Wholesale Supplies Are Easy to Find

At Superior Car Wash Supply, we manufacture and distribute not only car accessories that you can sell for a profit, but also car wash parts. These include vacuum parts, chemical injectors, spray system parts, pumps, valves, flow switches, hose reels/fittings, gauges, filters, water heaters, conveyor parts, and more. Order online today from our one-stop shop or call 800-554-9274 for assistance.

Sources: