Welcome!
Axel and I are excited to share this information about investing in car washes.
A little about us...
Our youngest daughter around the age of 5 came up with the name. It was catchy to say, so we kept it!
Axel has been in the car wash industry since 2013. He started as a chemical sales rep, understanding the VITAL role that chemistry plays in a successful wash.
F om there, he grew not only his territory, ut his expertise through equipment sales. orking for a indsutry distributor, Axel has een able to "test" all the brands / models / erations / promises / values of every ompany in the industry. Really getting to now the inner workings of manufacturers. oth from a quality stand point and also a upport stand point. This obviously created HUGE advantage for us in opening our wn car wash.
Her expertise comes
into play where you are involved. She took a credit card limit of $2,500 and turned it into a $500k business. After 9 years in retail and 3 years as a business turnaround consultant, she decided it was time to franchise her store! In 2021, she found her first franchisee. As they were getting ready to launch, Axel and Andrea were also about to purchase their first 32-unit apartment building out-of-state.
"I did not know that redevelopment would invigorate my soul
like it did. I offered my corporate location to that first franchisee and sold
the business in 2022 to go full-time into lopment."
We purchased another 144 unit property in 2022. Some of you may know that development is not exactly a quick process. So, while our hotels are turned into apartments, I am free to focus on helping you be a successful business owner with my nearly 2 decades of experience!
tanding choice for your forthcoming urial venture.
The USA car wash services market size: Valued at USD $15.2B in 2022 and is anticipated to grow at a compound annual rate of 5.7% from 2023 to 2030.
The in-bay automatic segment is the most popular style with a share of more than 50% of the market in 2021. This segment is projected to expand further at the fastest CAGR retaining its dominant position over the forecast period. These facilities have lower running expenses than tunnel washes and is the most profitable because it saves the customer time and money. Furthermore, these vehicle washes have a number of advantages, including easier client connection, less water usage, impulsive purchases, and the ability to fit into smaller locations. Moreover, the availability of combination washes is a popular trend. Customers can pick between touchless, friction, or a combination of both types of washes using this service.
Certainly, consumer demand plays a pivotal role in fueling growth of the industry. The necessity for car washes remains constant as long as there are automobiles on the road. Although drivers can choose to manually wash their vehicles, there is a growing inclination towards the expediency and convenience offered by automated car washes
According to the International Carwash Association, the number of drivers who wash their cars at home has dropped significantly over the past decade. In 2019, 77% of drivers reported that they frequently washed their vehicle at a professional car wash, up from 48% in 1994 It is estimated that the total annual car wash sales revenue exceeds $24 billion globally.
The ridesharing (Uber, Lyft, etc.) trend has also created a whole new customer base for car washes. These drivers wash their cars multiple times a week to maintain customer satisfaction. They can be some of your best customers and best brand advocates.
Chapter
When implemented
car wash business can be automated, streamlined, and expanded to generate a consistent growth in revenue. The field of car wash technology is continuously advancing, presenting novel efficiencies and opportunities to increase market share.
If your goal is to find a business that can be sold effortlessly to maximize your returns, a car wash is an excellent choice. Investors are attracted to the consistent and recurring revenue generated by membership programs. With the introduction of these programs, car wash operators gain greater control and established a stable revenue stream. Consequently, a robust membership program has the potential to significantly increase the value of your business, often by 10 times or more.
Exit Strategy
Franchisees save on procurement
Marketing
Brand building
Management costs
Facilitate the sale of franchised outlets
Increase their resale value
Economies of scale passed through
Managerial Benefits
Providing specialized managerial capabilities that many independent entrepreneurs might lack Brand awareness and image
Relationship benefits
Reducing franchisees’ risk
Facilitating relationships with other stakeholders
By accepting part of their compensat form of a royalty fee (calculated as a sales), franchisors bear a portion of the variation in the cash flows of individual franchise units, thereby reducing the risk borne by franchisees.
The franchise business model plays an important role within the U.S. economy.
Prior to the pandemic, in 2019, the economic output of franchise establishments in the United States was about $787.5 billion and represented 3% of the country’s GDP.
ng to this output were about 8.4 million o worked for a franchise business.
Axel has had the benefit of getting to test all brands and processes on almost 100 different independent car wash sites across the Midwest.
Aside from product offerings, he understands the manufacturers that 1) provide support 2) stand behind their offerings and 3) have strong com integrity and culture. Independent car wash sites historically: have not offered memberships keep up with technology ars and years to replace bad ent heir businesses dry without ting for long-term success
They create customer activity that drives more traffic, and they cultivate customer loyalty. In poor weather periods, a healthy membership base acts like an insurance policy by providing recurring revenue when single-wash sales are slow. The most profitable car washes have a large membership participation rate.
The lifetime value of a customer is exponentially increased when they become a member. Members spend 5.6 times the annual spend of a retail customer, but that’s nothing compared to the profitability difference!
This recurring revenue makes a car wash a great investment. A membership significantly lowers financial risk. Memberships also create more activity at your wash; activity entices activity, thus increasing your single retail wash sales too.
When you build your car wash, you need a marketing plan and an impressive grand opening. The car wash business is more of a business that requires getting customers to try it once and hopefully creating an experience that they want to repeat
Luckily, you are in great hands! Having taken an obscure business model (cloth diaper service) from non-existent in the market to over 120 customers, Andrea knows a thing or 2 about marketing. She also grew a tiny retail store of only 1200 sq ft to over half-a-million in sales annually. That volume is 128% higher than the average retail store and at an average price point of only $4/item!
Koala Wash® has developed a full, extensive marketing plan that is part of your participation in the franchise. Many new business owners underestimate their start-up marketing needs. Koala Wash® knows how to drive unbelievable traffic to your site upon opening and helps ensure that you are properly capitalized to do so.
As you may know, there are multiple ways to "skin a cat." Or in this case, wash a car. While the goal of all models is to clean vehicles, they are vastly different. As referenced to earlier, Koala Wash® focuses on the In-Bay Automatic segment of the market.
Customer pulls into bay. Equipment moves around vehicle to complete wash.
Lower investment Smaller footprint Can be unattended, open 24/7/365
An IBA is the type of wash where
An IBA is the type of wash where you pull inside the “bay” and the you pull inside the “bay” and the equipment moves around your equipment moves around your vehicle to wash it. vehicle to wash it.
IBAs are typically only 40-60 feet, making them the perfect choice for small lots and lower volume traffic areas (like small towns)
Due to the smaller lot size the real estate itionally, since occupy less them is much gth tunnel. pendent IBA g to sell their rice to be Wash®
Drivers don’t need help getting into an IBA like they do with a tunnel conveyor, so these washes can be unstaffed. This results in lower labor costs and less owner interaction. This also means they can be open and generating revenue 24/7/365.
With our main model being a Touchless machine, there is minimal opportunity for damage to cars. Compared to tunnels (or any friction machine) that can grab items off cars and create damage. Luxury car owners want to protect their investment. They know that the Touchless car washes are the absolute best option for their baby.
Koala Wash® has strong relationships and has created a long-term strategic partnership with a top Midwest distributor. This relationship helps us in many ways. We are able to provide discounts due to scale, provide no-cost reps for your ongoing chemical needs, provide training on equipment, instock parts for repairs and maintenance, industry knowledge and dedicated service technicians on-call.
Koala Wash® has a strategic construction partner. Our GC literally takes care of everything from entitlements through your full build. You will have a project management that helps guide you through the entire construction process.
Koala Wash® has strong investor relationships through our real estate business. All are passive investors looking for great returns. If needed, we can introduce you to our network of investors to successfully open your wash. Being licensed, I also have access to Realtor® only data to help find great sites and provide supporting data for your loan package.
Koala Wash® will support your sales in multiple ways:
Startup Marketing Plan for a successful Grand Opening.
Recurring Marketing Plan for continued success.
Proprietary Koala Wash® app that will drive memberships and new customers to your location. Providing a car wash that outshines any segment of the market.
Industry trends & market updates. Weather-related announcements to customers.
Koala Wash® will support your operations accordingly:
Provide training to you and your staff to properly run your location.
Provide access to our strategic partnerships that ensure minimal interruptions to operations.
Troubleshooting with you for quick resolution of issues through years of experience.
Proven daily operational systems producing maximum loyalty and minimum downtime.
Warranty support for all FF&E.
No-cost chemical representative to provide the highest quality of application and to control costs.
Easy, efficient online ordering of supplies & service.
Training portal for on-going support.
Continuing education in the industry.
Allowance for business agility.
Helping you meet and exceed customer expectations to ensure long-term success.
Koala Wash® will support your financials accordingly:
Training and support on the most important KPI's for a profitable car wash. Proprietary systems for tracking sales, marketing, cash flow and expenses. Access to our preferred banking partners and support through the approval process. Access to our capital partners when additional liquidity or capital is required to get approved.
Access to bookkeeping and tax prep services if desired.
You have picked an excellent time to enter the car wash industry. Over the past decade the industry has enjoyed immense growth that is projected to continue for years to come.
Through the support of our franchise system and the popularity of membership programs in the car wash industry, now is the time.