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Publication of the Southwest Car Wash Association

John Jurkens

First Quarter 2017

Jim Coleman

Lifetime Achievement Award Winners 2017 SCWA Convention & EXPO Highlights


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PRESIDENT’S MESSAGE The 2017 edition of EXPERIENCE SCWA is now in the books with two key words that describe the event - first “record” and next “expanding”. This year our event brought together the largest ever gathering of successful car wash operators and suppliers for three strong days of premier education; the EXPO, great networking DeWayne Hall opportunities and strong energy. SCWA Preside­­nt SCWA believes that by coming together and uniting our efforts and ideas - we can all grow to be better and stronger. I mentioned the words “record” and “expanding” – here are a few examples: 1. The EXPO included a record number of booths and companies in two large EXPO areas. 2. The EXPO area expanded this year and included a new feature – QUICK TALKS. 3. Small “mentoring” sessions provided by our CEO Forum speaker – Davy Tyburski. 4. We had the largest attendance ever of car wash operators. The Convention this year was highlighted by John Stossel’s keynote address. Stossel highlighted all the “crazy” government rules and regulations that “hamstring” the business owners and stand in the way of growing business. The popular CEO Forum featured nationally recognized Davy Tyburski, America’s Profit Officer. Davy discussed 21 Unique Ways to increase your business profit and also stayed through the convention to provide a session for the SCWA Car Wash Academy on Tuesday. The 2017 Car Wash EXPO included two EXPO areas with more than 70,000 square feet displaying car wash “state of the art” all under one roof and all at one time. The EXPO included a new feature this year with the addition of QUICK TALKS. QUICK TALKS highlighted professional car wash speakers providing practical ideas that can be implemented immediately in your business. In fact the challenge of each session was to provide at least 3 “takeaways” for instant business improvement. I know the ones I attended gave me many good ideas for my business. I hope you were able to join us to EXPERIENCE SCWA 2017 and take advantage of the new ideas, solutions and strategies, plus see the innovations in the car wash industry. Many people work hard to make the SCWA Convention & Car Wash EXPO a special experience for everyone from the exhibitors to the SCWA leadership. To all the 2016– 2017 Board of Directors – thank you for your time, energy and commitment to SCWA and the car wash industry. Board members go above and beyond by giving their time

and assuming financial expenses for their participation. It is an honor to serve on the Board but also a sacrifice in terms of time and financial resources. This year we had a significant increase in the number of exhibitor booths and first time exhibitors. Thank you to all the companies who made the effort to participate in the 2017 EXPO. We truly appreciate your partnership with SCWA and hope it pays good dividends. A special thank you to the 2017 SCWA Sponsors who helped make the SCWA events more fun and affordable. Check out the Exhibitors and Sponsors on page 22. You will also be able to find these companies on the SCWA website. I encourage you to support the companies who support SCWA. To David Swenson, Immediate Past President, thank you. We all owe you our appreciation for your leadership and guidance this past year. You gave us an outstanding year including the great car wash tours all leading to the largest convention & EXPO ever. To each of you – thank you for your support and now I challenge each of you to take the high energy and enthusiasm of EXPERIENCE SCWA 2017 into this next year and let us raise the bar to the next level in SCWA as well as our businesses.

SCWA NEWS In Memoriam

Long time SCWA member Jeff Jurkens passed away February 26, 2017. Born in Chicago, he grew up in the family of car wash pioneer and Octopus Car Wash founder John Jurkens. Jeff was the owner of the Octopus Car Washes in Madison and Rockford Illinois and completely devoted to his business and his family. Jeff is survived by his wife Inna, son Jonah, step daughter Yulia, brother Joel, sisters Jill and Jody and his mother Alice. He was preceded in death by his father John Jurkens. His father was honored by SCWA recently with the Lifetime Achievement Award.

PERSPECTIVE State of The Car Wash Industry: The Good, the Bad, and the Competitive Edge The industry is growing, but with rising competition and cost, operators must optimize operations to survive and thrive

With recent economic growth in North America, the good news is that the car wash industry is growing. Consumers are buying more new vehicles, particularly 3




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ADVANTAGE trucks, which creates a greater demand to keep them clean, polished, and looking new. The bad news is that the car wash industry’s growth has attracted lots of tough new competition. This has placed downward pressure on pricing just as labor and utility costs are rising. Technological advances like sensors, keyless ignition, and driverless cars are also introducing complications in the market. To survive and thrive in an increasingly competitive car wash market, owner-operators must now pay close attention to operational details and select the best equipment and materials that will give them a competitive edge in wash quality, shine, efficiency, and total per car cost savings.


With total U.S. vehicle sales on pace as of August 2016 to eclipse 16.98 million for the year, sales continue at a brisker pace than the 15.42 million average of the last two decades. In fact, the industry came off its sixth straight year of sales growth last year. Consumers however, are opting for more cargo-passenger capacity and features like towing and four-wheel drive, pushing the light duty truck (including pickups, SUVs, crossovers, large vans, and minivans) market share up to 58% of all vehicles sales in the first half of 2016. For car wash owners who have traditionally calibrated their equipment to wash smaller cars and sedans, the taller, longer, wider vehicles that consumers now prefer may require adjustments to their operation. This could include working with vendors to adjust equipment to accommodate these vehicles.


As more car washes are built, local market over-saturation can become a problem. So how can owner-operators set themselves apart from new competitors with big checkbooks? “When we compete with big box retailers, we’ve got to keep our wash quality high, our service fast, and do the little things that they find hard to do,” says Justin Alford, co-owner of Benny’s Car Wash, with seven family-owned locations in Baton Rouge, LA, including express, exterior, full-service oil changes, and convenience stores with gasoline. Often this requires that owners maintain a hyper-focus on operational details and seek out the most effective wash materials and equipment for their market. With the fully integrated gasoline marketers, this is less likely to happen because the car wash business can be an afterthought. For example, instead of inefficiently having staff hand scrub, hard-to-clean, vehicle tires and wheels in tunnel washes, Alford uses an automated conveyor car wash brush specially designed to clean tires and wheels. The brush’s filaments vary in length between four to seven inches so that as a vehicle travels through the automated car wash, the longer bristles reach deep into wheel crevices while the shorter bristles clean the tire and wheel surface.

“Instead of inefficiently hand scrubbing vehicle tires, wheels, and rims, particularly difficult big ones, we use something called the Poodle Brush,” says Alford. “Resembling a well manicured poodle, this brush is made for us by car wash supplier Erie Brush and Manufacturing.” “It gets into the nooks and crannies better than highpressure sprayers with heated water and cleaning solution, and gives a better quality wash for our customers,” he adds.


Among the issues that confront car washes today are rapid changes in technology such as collision sensors, keyless ignition, and even driverless cars. On tunnel washes, for instance, cars are placed in neutral. But what do you do if a sensor thinks that wash equipment is a car and applies the brakes? Another problem occurs when cars have keyless ignition fobs. The technology can lock the doors or change gears from neutral to park if the owner walks away with the fob. “There’s no great solution to technology glitches right now because the last thing car manufacturers think about is how the car will be washed,” says Alford. “When a car’s sensors or keyless ignition is a problem, we have the owner ride in their car through the tunnel and have an operator follow to fix problems quickly. But in the long run, car manufacturers may need to create a Car Wash Mode to simplify the process for everyone.”

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Along with greater competition, the rising cost of labor and utilities means that car wash owner-operators have to optimize their labor and processes with the most effective equipment and materials to compete. “When we started 34 years ago, labor was $3.35 an hour and we charged $6.00 a car,” says Doug Seniw, co-owner of Prairie State Express Car Wash, an exterior express wash in Chicago, IL. “Now labor is $9.00 an hour and we charge $3.00 a car. Due to the competition, we’ve had to cut our price and streamline our business anywhere we could without cutting quality.” To optimize their process, Seniw has made a number of changes over the years. Previously, at the wash entrance his staff used nylon prep brushes to mop trouble spots on the front and back of cars such as the grill, headlights, and license plates. But this required excessive scrubbing to remove bugs, bird droppings, and other debris, and was not sufficiently gentle on the car surface. Seniw turned to prep brushes made of hog’s hair, actual hair that comes from hogs. This has the smallest diameter tapered filament, which helps to make it the softest. Since it is soft, tapered, and feathered at the tips, it tends to release grit and debris when properly lubricated and will not grind it into the car surface. Because of the taper, the hairs still retain stiffness for washing up close, if scrubbing is needed.

For an optimal approach in the automated express wash tunnel, Seniw prefers soft cloth for cleaning painted surfaces. For windows, he opts for Gentle Foam, a unique type of foam material mounted on a core, which rotates, and is used in similar top, side, or wrap around equipment as cloth, filament, or regular foam. Unlike typical foam, which is usually offered at standard levels of softness, Gentle Foam significantly increases the level of softness. Because of its composition, it provides a better polish without the risk of scratching, snagging or damaging any portion of the car. Its softness enables it to clean difficult to reach areas, which also helps to optimize the wash while reducing claims. “Since Erie’s hog’s hair brush gets in the trouble spots easier, we can scrub once instead of several times, which makes a huge difference on busy days,” says Seniw. “We’ve cut about one-third of our labor with better prep, and switching to Gentle Foam provides a better, more efficient, damage-free clean as well.”


As owner of College Park Car Wash in College Park, MD, Dave DuGoff ran a high volume location with five self-serve bays and three in-bay, touchless, automatic spray washes for many years. When he noticed higher demand for the self-serve bays and realized that two automatic bays would be sufficient, he converted his third automatic bay to another self-serve bay.

Continued on pg. 11

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The SCWA membership elected new members of the SCWA Board of Directors at the Annual Membership Meeting held during the 2017 Convention. DeWayne Hall, 2017–2018 SCWA President, presents Board Plaques to the new Board Members. Those pictured include (left to right):

John Agnew | Breeze Thru Car Wash Ronnie Corbin | Americus Development Group Pat Kirwan | Motor City Wash Works DeWayne Hall | President Bob Kopko | DRB Systems

Special Thanks to SCWA Retiring Board Members. SCWA Immediate Past President David Swenson presents Appreciation Plaques to retiring board members. Those pictured include (left to right) :

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ADVANTAGE Continued from pg. 7

In the self-serve bays, he also relies on hog’s hair for his foaming brushes. “You can’t beat the quality of a soft hog’s hair brush on the car’s surface,” says DuGoff. “It’s something my self-serve customers notice. In the first month we converted an automatic bay to self-serve, and we increased our sales volume and since then it has been a source of growth.” As car wash owner-operators adjust to both the good and bad in today’s market, zeroing in on operational details and choosing the best materials and equipment for the job will help them outwit, outshine and outwash the competition.

OPERATIONS Vacuums - Are They Turning Away Your Customers?

At a recent event, one of the talks started off with an impromptu survey consisting basically of inviting the audience to ask themselves questions about their own operation: How many of you ignore express tunnel customer complaints about dirty wheels or wet windows? Who ties back their wraps when they aren’t working and processes cars anyway? Whose wash offers and advertises a service that you don’t deliver? Not surprisingly, in a group of 50-plus people, only two hands in total were raised (and they were standing next to each other) in answer to the wrap question. Why

were there only two hands? What would happen to your business if you disregarded those issues? You’re an operator; you know better than anybody. Then consider these questions: Are any of your free or pay vacuum stations out of order now? Do you have any vacs that are running, but have poor suction? On average, over the last year, how many of your vacuums would you say are out of order on any given Saturday? Given your answers above about the wash bay, how are your vac services any different than your wash equipment? Vacuums, especially free vacs, are so commonplace today that it has become a customer expectation. Just as with a clean, shiny, dry exterior, customers expect to leave with a clean, presentable, pampered interior. If your vacuums aren’t working or don’t get the interior clean, or there’s a wait for a space to open up because your remaining operating vacs are backed up, customers will go somewhere else to get what they expect. If you take only one lesson from contemporary marketing thinking, let it be this: Marketing success is dictated by how well you meet or exceed customer expectations.


Whether you use individual vacuum motor canisters or central turbine vacuum systems, we’ve all heard and swapped stories of what we find plugging the filtration devices. And changing vacuum motors and maintaining filters, vacuum lines, and turbines could be a cost center of




ADVANTAGE its own in some washes. Vacuum maintenance is tedious and dirty work worthy of a Mike Rowe episode on the Discovery channel’s “Dirty Jobs.” On paper, it’s not that difficult; vacuum systems aren’t that complicated. They suck dirt up a hose with a vacuum motor and filter the dirt out of the air. That’s it. Address the clogging of the filtration device and increase the vacuum motor life, and things get easier — way easier. But how do you do that? That is what you should take away from this article: the answer to the question, “How do you do that?” There are four key, actionable principles you can look for and implement to drastically increase your maintenance intervals and reduce labor and parts costs. These apply whether you are specifying and choosing a new vacuum system or refurbishing and retrofitting an existing one: filtration, exhaust contamination, motor design, and motor capacity. The implications are a little different, but these principles work on individual vacuum canisters as well as a central vacuum systems. Again, all you have to address is filtration clogging and vacuum motor (or turbine) life.


The first issue we’ll address is protecting your filtration device. Let’s apply the “Pareto Principle” — the 80/20 rule. Roughly 20 percent of the items sucked up from car interiors by your vacuums probably cause 80 percent of the clogging. We all know them. Human and pet hair,

carpet fiber, sand and gravel, soil, grass, cereal, food crumbs, French fries, and candy (and sometimes some other really gross stuff) all have two important attributes in common. First, in terms of filtration devices, these items are all quite large in particle diameter. Second, they tend to stick to filters. When they are caught, they clog the filter by accumulating on the surface of the filter and form a mat of material. Throw in a little (or a lot) of moisture from floor mats soaked with winter snow melt, mixed with the hair fiber and the starch of the French fries and the sugar in the candy, and you’ve got something resembling industrial felt totally coating the surface of your filtration device. Then comes the labor; separating the dirt from the filter has to be done frequently, somehow. Getting that disgusting surface layer off is tedious, difficult, and dirty work. Nobody wants to do it, so it gets delayed, making the task even worse when it finally gets done. Labor goes up, costs go up, employee morale goes down and customer service declines. What’s wrong with that picture? Everything is going in the wrong direction. It’s not that there are no fine particles caught by the filter. Dirt from the organic things mentioned above that have been left in the car too long will decompose, plus dried salt from winter snow and a little bit of environmental dirt do build up over time. But those fine particles penetrate and distribute themselves in the bulk filter media, and they account for a very small percentage of the mass



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ADVANTAGE collected. It takes a while for that to build up into a problem. This requires you to wash the filter eventually, but only after several months. So how do you fix this surface clogging? The approach is straightforward; keep the surface of your filter clean. Here are a few concrete suggestions. They are not exclusive; combine these principles as appropriate to your vacuum installation for better results: Install a pre-filter, like a furnace pre-filter that is easily cleaned or disposable. The crude pre-filter catches the bulk of the trash and does the heavy work, leaving the rest of your entire system to catch the fine particulate and serve your customers reliably. • Use a filter membrane cover with a non-stick surface; if nothing sticks to the filter, it can’t clog. Gravity will clean it off when the vacuum is off. They are commercially available. • Paper filters catch everything on the surface — the big stuff and the fine dust. They work fine at filtering, but they clog quickly, and they are difficult to clean, especially without damaging the filter. Avoid them. Use a glass, metal, or plastic/polymer fiber filter instead. • Look for filter housing designs that make the entire filtration surface easily accessible or easily removable (and re-installable). It doesn’t extend the filter life, but

it makes it easier and faster to maintain. Combine this principle with any of the previous three.


In hindsight, it always seems more obvious — sometimes painfully obvious. Look at the design of your new or existing equipment and the placement/location of the equipment. Make sure that the exhaust of your system is not sucked into the intake of the vacuum source’s cooling air. Don’t underestimate the amount of heat transferred into your vacuum air on a hot summer day when the sun is shining on every square inch of surface and the turbine or vac motors are working full time. Also, don’t underestimate the amount of fine particulate dirt in the exhaust air of your system. The dynamics of fine particles give them an amazing ability to penetrate, stick, and grind up metal, and when they stick, they insulate. Hot, dirty motors wear out. Cleaner, cooler motors last longer. It‘s that simple, short and sweet.


“You get what you pay for.” That’s a well-known saying. But we all have a tendency to apply that only to the things we are passionate about, where we have invested ourselves, where we have accumulated some knowledge and understanding, and ignore it otherwise. We believe

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ADVANTAGE this about our cars, athletes believe this about their sports equipment, hunters about their guns, musicians about their instruments, chefs about their cookware and utensils. You’re an expert at car cleaning. Don’t ignore that saying and advice when you buy vacuum motors and turbines. If you keep your vacuum motors clean and cool, the only other significant causes of failure are the bearings and “brushes” — the carbon bars that conduct electricity from the electric wires attached to the stationary motor frame to the rotating armature of the motor. Look for motors that are designed and built for durability and extended operational life. They will be a little more stocky, taking more space that may require some modest modifications to your equipment, they may not be readily available, and you may have to change suppliers. The effort will be worth it. These aren’t the cheap motors. They are the more expensive, longer-living, higher-powered motors with high quality brushes, commutators, and bearings.


This last principle only applies to individual canisters, not central vac systems. If you use canisters, look for double capacity motors. There are respected, well-established, reputable companies out there with a lot of brand equity invested in using dual motors, with some reasonable arguing points supporting their design. But consider this alternative: You’re trying to reduce maintenance, right? So why do you want two motors in each canister? That’s two motors to maintain, and two motors to fail. If one of them goes down, you’ve lost more than half — read that as “all” — of your vacuum motor performance. Utilize a single high-capacity motor. It’s not rocket science. Use fewer motors and do less maintenance. You don’t shop for a car with two engines, do you?

FINANCE Tax - Last Minute Savings and Potential Pitfalls

Although tax planning should be a year-round strategy with year-end planning a good backup, even with filing deadlines fast approaching, it is not too late to reap tax savings. Keeping in mind that a car wash operator’s obligation is to pay only their fair share of taxes, and not a dollar more, consider a few last-minute tax savings tips such as those regarding the cost of the equipment and new technology that play such an important role in every car wash operation.


Depreciation is an annual allowance for the wear and tear, deterioration, or obsolescence of business property such as buildings, machinery, vehicles, furniture, and equipment. Also depreciable is intangible property, such as patents, copyrights, and computer software. The “extenders” bill passed late in 2015, permanently set the Section 179, first-year expensing write-off at $500,000 with a $2 million overall investment limit before phase-out. While there is no increase in the dollar amount of asset purchases that qualify, thanks to the inflation adjustment, the investment limit for 2016 increased to $2,010,000 before phase-out begins.


There is no silver bullet to eliminate vacuum maintenance. Vacs are machines, and they will require maintenance. But what if you could take major cleaning of your vacuum filter from a daily hassle to a weekly chore — or to once every six weeks or six months? What if you cut the motor replacements on your lot from once a month to twice a year? Those are dramatic “outlier” results, but they are real life experiences. You may or may not realize a gain that dramatic, but suppose that all that happened for you was that you cut your maintenance in half? That’s pretty hard to ignore. You’re a car wash operator, a businessperson, an entrepreneur. Employ these tips to keep your vacuums running so you can invest your time and effort in what you do best: taking care of your customers. Bob Schaefer has a background spanning engineering and equipment distribution, he is keenly aware of the effects of facility maintenance and equipment performance on the customer experience and retention. Bob believes that the availability of vacuums has evolved into an integral part of the car wash expectation and service.




ADVANTAGE The same extenders bill also extended the 50-percent “bonus” depreciation write-off for equipment placed in service between 2015 and 2017, with a lower percentage kicking in for an additional two years. That means a writeoff of 50 percent of the purchase price in the first year plus the regular depreciation write-off for the balance. In many cases, taking those immediate, up-front deductions for Section 179 expensing or bonus depreciation makes sense. It’s a great way to boost cash flow. But spreading the deduction over time might make sense for a startup or a car wash that expects taxable income to be considerably higher in the future.


Whenever possible, repairs and maintenance expenses should be deducted immediately, rather than capitalized and depreciated over their “useful life.” New “repair” regulations provide guidelines for deciding which expenditures for acquiring, repairing, or improving business property are deductible and when. A small car wash business that lacks so-called “applicable financial statements” (AFS) can still take advantage of a unique de minimis safe harbor to deduct smaller purchases ($500 or less per purchase or per invoice). Businesses with an AFS can deduct as much as $5,000 per purchase or invoice. Small business with gross receipts of $10 million or less can also take advantage of a safe harbor for repairs, maintenance, and improvements to eligible buildings.


Thanks to the tax “extenders” bill, the Work Opportunity Tax Credit has been extended through 2019 for employers hiring members of targeted groups. That same bill also added qualified long-term unemployment recipients to the roster of targeted groups effective January 1, 2016. As a general rule, software bought for the car wash or detailing business must be depreciated over a 36-month period, but there are some important exceptions. When, for instance, software comes with a computer, and its cost is not separately stated, it’s treated as part of the hardware and is depreciated over five years. However, under Section 179, the cost of a whole computer system (including bundled software) can be written-off in the first-year so long as the total cost is within the Section 179 annual deduction limits. The cost of advertising the car wash operation or its services or goods — flyers, business cards, yellow page ads, and so on — is currently deductible as a current expense. Promotional costs that create business goodwill such as sponsoring a peewee football team are also deductible as long as there is a clear connection between the sponsorship and the car wash business.


Over the years, the way the IRS has viewed “reasonable compensation” has changed significantly. With a car wash or detailing business operating as S corporations, the IRS’s goal was and continues to be preventing owners from Continued on pg. 23



2017 Wade Welch Memorial Golf Classic

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For Team Sponsorship & Registration - See Reverse Side • Only Team Sponsors are guaranteed Team Member requests. • Limited to the first 72 paid registrants. • $175.00 per person includes green fee, cart, prizes, driving range balls and lunch. Name: ______________________________________________________________________________________________________________ Company: ___________________________________________________________________________________________________________ Mailing Address: _____________________________________________________________________________________________________ City: ___________________________________________________ State ______ Zip ____________ Email: ___________________________ Phone: ____________________________ Fax:___________________________ Handicap: ____________Or Average Score: ______________

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ADVANTAGE Continued from pg. 19

exploiting a loophole in the payroll tax rules. As a result, when the IRS examines the tax returns of S corporations, the focus is usually determining whether the reasonable compensation amount paid to the S corporation owner was “reasonable” based on the services provided. In a number of Revenue Rulings regarding S corporations — the most common corporate entity in the United States today — the U.S. Treasury Department has determined that to the extent the owners of an S corporation performed services for their business, the business was required to pay that owner a reasonable salary as compensation for those services. In addition — and crucially — that reasonable salary is subject to self-employment tax. What’s worse, the IRS typically examines data in the three to five year range.


Often forgotten is the fact that casualty and theft losses that result from a sudden, unexpected, and unusual cause are tax deductible. Note, however, the tax deduction for a casualty loss is only allowed in the year of the loss and no deduction can be taken if reimbursement is anticipated. When it comes to theft losses, a deduction can be taken only in the year the theft was discovered. There are also strict time limits for a car wash or detailing business to claim a Net Operating Loss (NOL) carryback or for choosing to forego the NOL carryback and just carry the loss forward. The typical statute of limitations for filing

a claim for a NOL tax refund is three years from the time the return was filed or two years from the time the tax was paid, whichever period expires later. Lawmakers enacted a special provision that requires the claim for a NOL refund to be filed within three years of the date on which the return was due to be filed (including extensions) for the taxable year of the net operating loss which results in such a carryback.


The operators and shareholders of a car wash might not be subject to the often-overlooked 3.8-percent Medicare tax if they actually participate in the business. It is so-called “passive investors” that are hit with this tax. Participating in the business means any work performed as an owner, manager, or employee, so long as it is not in-vestor activity. Even so, activities must be documented with the IRS; it often rejects “ball park” after-the-fact estimates. Documenting the hours spent using calendars and appointment books, e-mails, and narrative summaries, if asked, are usually satisfactory.


Obviously, it is not easy for any car wash operator to break a lifelong habit of minimizing income and maximizing deductions in order to produce a consistently low tax bill. Continued on pg. 33




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he 2017 edition of the Southwest Car Wash Association Convention & EXPO was another record breaking event. The largest gathering of car wash owners and vendors converged on the Arlington Convention Center for the annual SCWA event. This year the event included an expanded EXPO area with more than 300 booths and 70,000 square feet of exhibits plus the new feature QUICK TALKS. According to SCWA President DeWayne Hall “the new QUICK TALKS were an outstanding hit and will become a regular part of the SCWA EXPO.” The Convention & EXPO received many positive comments:

• “Would like to say thank you for a great show. The classes we attended were very helpful — I would highly recommend this event to all car wash owners.”

• “SCWA put together another robust event in Arlington.” • “This Show was fantastic and exceeded all expectations.” • “I attend many car wash shows and conventions and this was the best of all.” On Monday morning, the convention was highlighted by the keynote from John Stossel, the award-winning journalist and FOX News Commentator. Prior to Stossel’s presentation, the 2017 SCWA Lifetime Achievement Honorees were announced. Jim Coleman, founder of the Jim Coleman Company, and the late John Jurkens, founder of Octopus Car Wash Chain, were honored with the recognition. According to SCWA’s Vice President and Awards Chair, Tyler Furney “the Lifetime Achievement Award is the highest recognition given by the SCWA.” Mark your calendar now for EXPERIENCE 2018 – February 25–27, 2018.


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2017 SCWA Lifetime Achievement Honorees John Jurkens (1923–2013) Founder - Octopus Car Wash Chain John Jurkens grew his empire into 30 car washes in eight states at it’s height. “He really was a pioneer for the car wash industry,” said Ray Morton, Jurkens’ longtime accountant, “Many people admired him for what he was trying to do and really tried to emulate the system that he developed.” He volunteered for the Army Air Corps two weeks after Pearl Harbor and served four years during World War II. He flew more than 36 missions over Germany and received the Air Medal, the Distinguished Flying Medal and the Purple Heart. He at one time owned car washes in Wisconsin, Illinois, Kansas, Florida, Texas, Arizona, Colorado, and New Mexico. Jurkens became obsessed with creating a car wash system that didn’t use brushes, believing they left marks on cars. He felt the only thing that should touch a car was water and chemicals, Morton said. “He spent untold hours developing a chemical that would provide a perfectly clean car,” according to Morton. Alice, his wife of 66 years, said when they went on vacation, he would visit car washes while she would go shopping. “Family and car washing, that was his total life,” she said. “He loved every minute of it.” John passed away January 7, 2013 at age 90.

Jim Coleman Founder - Jim Coleman Company In 1960, Jim Coleman, an electrician by trade as well as the owner of several coinoperated laundromats, had been looking for a new business venture. One day he saw an advertisement offering equipment for a coin-operated carwash and decided to build one. Coleman believed this fledgling new industry showed a lot of promise and wanted to get in on the ground floor. The car wash proved to be a success and Jim eventually went to work as a distributor in the Houston area for the Pennsylvania-based manufacturer from whom he had purchased his equipment. As new self-serve car washes popped up throughout Houston, Jim noticed that the equipment could benefit from some modifications and made a few recommendations to the manufacturer. When the manufacturer refused to implement any of the changes, Jim decided to branch out on his own. In 1966 the Houstonian launched the Jim Coleman Company. From the beginning it has been a family affair. Through Jim’s passion and vision in manufacturing quality self serve and in-bay automatic equipment, the Jim Coleman Company has become an internationally recognized entity based in Houston. Jim has been active in SCWA for many years, serving as President in 1991–92.



The Tunnel Experts



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ADVANTAGE Continued from pg. 23

Surprisingly, however, the lowest tax bills often result from legitimate tax deductions postponed or ignored. Many car wash operators, owners, or managers often ignore perfectly legitimate deductions because of a fear it will increase the likelihood of an audit — or because the paperwork and record keeping isn’t worth the amount of the deduction. Although keeping track of small items purchased for the car wash or detailing business is often too time consuming to be worth the trouble, for many expenses such as travel, entertainment, and the like, physical receipts are not required for amounts less than $75.

EXPAND Your SCWA Experience

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Anyone who tried but couldn’t get their taxes prepared by the filing deadline can file a Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return, or use an online service. The IRS will automatically grant extensions of as much as six months to file taxes. Remember, however, the tax extension provides more time to file the car care business’s tax returns but not more time to pay the tax bill — or a good estimate of the final tab. Although taxes should never be the primary reason behind any strategy, purchase, or move made by a car wash operator, taking advantage of our tax rules is important. It is never too late to plan on saving taxes. In fact, any business owner changing their mind after the return is filed can amend or change an already-filed tax return. But, in order to achieve that low tax bill either before or after the return is prepared, professional assistance may be required. Mark E. Battersby is an Ardmore, PA-based freelance writer, specializing in finance and tax issues.

LABOR Millennials - Take the Mystery Out of Training Them

“What are the most effective ways to train Millennials?” is probably the question that training professionals hear more often than any other today. To trainers who were born before 1980 — the year when the first Millennials were born — the question can seem mysterious and complex. We look at Millennials and see a group of young people who seem addicted to texting on their phones, who sometimes seem skeptical about the lessons we want to teach them, and who are prone to changing jobs frequently. That’s what we see, or what we think we see. But do those rough observations really reflect who Millennials are? Do they offer useful insights on how Millennials should be trained? The answer is, not really. So let’s decode the millennial mindset more strategically and see what we can learn about how to train them effectively.

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The so-called millennial generation (also called “Generation Y”) includes people born between 1980 and 1998. Many older Millennials, now in their early-to mid30s, are already established in their careers. Chances are that a number of them are already working throughout the ranks of your organization. They have already taken part in your training — maybe even designed parts of your training — and chances are very good that you already understand their learning preferences better than you expect. Another factor to consider is that some of the

Millennials think like entrepreneurs and value autonomy. Millennials who work for you are currently training your other Millennials. So while you think you don’t know or understand them at all, you probably do.


Let’s focus on younger working Millennials — those born between about 1990 and 1995. Chances are they are the group that is causing you to feel the most uncertainty regarding training. Millennials born between those years are the younger workers who might be applying for their first “real” jobs with your organization right now. They’re young and fresh-faced. If you’re a generation or two older than they are, it could be that you’ve hit some roadblocks when creating training programs that work well for them.

Although generalizations tend to be flawed, here are some attitudes that training professionals have found to be shared by significant members of this cohort.


They want to stake out a business identity and space for themselves, even in larger companies.


Many are self-confident, able to take risks, and willing to help their employers take chances too.


They tend to be highly mobile and like to access information and training on smartphones and tablets.


They tend to be compassionate and respond positively to working for companies that embrace and support social causes and “do good in the world.”


Many welcome being part of diverse workforces. Furthermore, they are more welcoming of alternative lifestyles than preceding generations were.


Your assumptions that Millennials are job-hoppers could be correct. Many do not hesitate to change jobs as a way to achieve personal goals and success.

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Here are some ways to make your training more compelling and effective with younger millennial workers: • Deliver lessons and modules in short “digestible” chunks that Millennials can absorb quickly. They are generally fast-moving and can tune out as soon as training seems irrelevant. • Use animations, videos, and other moving images to deliver key concepts. They often work better than words or text to convey important take-away concepts to Millennials. • Deliver training on platforms that Millennials prefer and already use, including smartphones and tablets. Remember, Millennials grew up using mobile devices.

• Ask for their ideas and suggestions before and during training, because Millennials think like entrepreneurs, value autonomy, and like to shape the content of their jobs. • Express your company values in your training. You can explain, for example, that your organization is trying not just to generate profits, but also to support employees and do good in the world. When younger Millennials see that their work supports those objectives, they are more likely to believe in company leaders and initiatives — and more likely to experience levels of satisfaction that make them want to continue working for you in the long term.


Don’t let the fact that you are training Millennials worry you. Even though they may differ in some ways from your other trainees, the fundamental principles of all good training still apply. That means knowing who your trainees are and what they do, understanding the results that you want to achieve, identifying metrics to measure before and after training, and delivering it in empowering and interesting ways. No matter whom you are training, those principles still apply. So be brave about training your millennial newcomers, go out, and get the job done. Evan Hackel is the CEO of Tortal Training, an executive coach, speaker and author of Engaging Leadership: A New Approach to Leading that Builds Excellence and Organizational Success.

MANAGEMENT Take the Reins - 12 Factors that Build Effective Leaders

When you think of leadership you are actually thinking about influence. At its core, leadership is really about influencing the people around you, and the ability to move them in a certain direction to obtain certain goals or objectives. When looking for leadership in your business or organization — perhaps in yourself — there are several



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ADVANTAGE factors that are part of all great leaders. Consider the following 12 factors to improve your leadership skills or help you identify those individuals in your business that can take over leadership positions.

attempt to have individuals and businesses believe, like, and trust you and your organization. When you accomplish this, you are well on your way to professional and personal success.


Purpose is your mission — the driving forces behind your business. You should clearly know and understand your purpose and the purpose of the individuals around you. In some cases, your team may not fully understand the real purpose of their job or the organization. It is a leader’s responsibility to effectively convey the mission and purpose to others. Leaders know their purpose and the purpose of those around them.

Motivation is a huge key to any successful enterprise. Remember what motivates one person may not motivate another. True leaders can quickly identify motivating factors in an individual, in order to move them or influence them in a certain direction. Some of the strongest motivators include money, fear, time, and power. In most cases individuals will be motivated by several factors, however one factor will prove to be the dominant one. When you find out what it is and how to use it, your ability to influence will be greatly improved.


Tolerance is the ability to respect others’ views, without selling yourself out. It is of utmost importance to understand where the organization or people are coming from and to realize that they may not understand your position. In order to accomplish this you must be an excellent communicator.


Trust is necessary to create the right environment. Consider the three sides of a triangle — or the BLT, which stands for Believe, Like, and Trust. Your goal is always to



All leaders have a clear vision, which is really what the ideal future will look like. It is important that a vision include values, and it is critical that good leadership makes sure that the people and organization agree with the vision. When a leader’s vision does not match the organizational vision problems will arise.


This may seem like a small thing, but a positive attitude can make a big difference and, conversely, a negative attitude can make a big difference too — but not in a good way. People and organizations feed off of leaders, and those with positive attitudes will receive the best response.

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A leader’s awareness is the understanding of not just their own identity, but also the identity of the people around them and the organization they represent. Each and every individual has a core identity, and understanding that core will improve your leadership.

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It’s what every car wash owner wants…more revenue! By utilizing proven strategies around effective menu design, packaging, pricing, and signage, you can boost your revenue today.


It is impossible to become an effectual leader without this trait. Failure often accompanies leadership, and those who are not determined will never get off the mat and pull themselves back up. When determination starts to disappear, leadership will begin to fail. Determination never takes a vacation or gets sick; it should be working every day.

There are three ways to increase revenue at your wash: 1. Increase the average amount a customer spends per visit. Typically, this is the easiest way to impact revenue quickly through pricing, menu and offering management, and buy-up promotions. This tactic requires minimal expense to implement and can be easily measured. 2. Increase the frequency of visits your current customers make. Keep current customers returning through loyalty programs and promotions. Success can be measured by identifying your total customer visits per month, annually, and measuring the lifetime value of the customer. 3. Gain new customers. Attract completely new customers to your site. While important to continued growth, gaining new customers is typically an expensive tactic. The old adage, “it costs 20 times more to gain a customer than it does to keep a current customer” is true. Consistent outbound communications is required to make an impact, and can be tough to accurately measure.


A great leader must have faith that they will succeed, but equally important is that they have faith in the people and organization around them. The best leaders believe in themselves. In order for your organization and the people around you to believe in you, it is critical that you first believe in yourself.


Leaders are always looking for new ideas and different places to find them. Leaders are not afraid to solicit new ideas from others. Businesses constantly need new ideas to improve their products and/or services, and some of the best ideas are inspired by something or someone.




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Effective leaders know how to control their emotions and do not allow others to control their emotions or dictate their reactions. Willpower is critical for all leaders and is absolutely necessary to succeed. Life and business are very similar: things will almost never go as planned, so be prepared.


Patience means that no matter what the challenge is, a leader never gives up. Your business and the people around you sense this and respond to it. Patience goes hand-in-hand with commitment, which means that when a leader says something, they do something. They take action steps, they set examples, and, when this is done, people and organizations respond. It’s interesting how patience appears last on the list. Success and effective leadership happen over time and not overnight. Kevin Coughlin, DMD, MBA, MAGD is an accomplished dentist, author, and speaker. He provides small businesses with actionable solutions when considering strategic change, as well as keys to compete in an expansive market.









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President of the marketing firm Yankelovich, Jay Walker-Smith, says we’ve gone from being exposed to about 500 ads a day back in the 1970s (before Facebook, Twitter, YouTube, etc.) to as many as 5,000 a day today. That’s nearly a 700 percent increase over the past 40 years. Grabbing the attention of your customer is becoming more difficult, and we are challenged with finding new ways to sift through the clutter. Nowhere is this more important than on your car wash menu. Your car wash menu is a critical tool for increasing your average ticket per wash. Effective menus that are designed to increase revenue have colors and images that attract, are easy to read, and are organized to guide consumers to a specific package. Common problem areas in developing a car wash menu are package order, package quantity, color, size, pricing, and naming. Always place the package you want to have the highest sales where it will be seen first. For most washes, this is your top wash excluding detail services. People read from either left to right or top to bottom, so ordering your wash packages from the best to the most basic in the order that people read will gain better results. For example, in a horizontal menu your best package will be on the left with your basic package on the right. In a vertical menu, your best package will be at the top with your basic package at the bottom (see Figure 1).

Your best package should also be the most visible. Make it bigger, taking up the most space, and in a bright color so that it stands out. Indicating that it is your best value will help guide customers to this package. Conversely, your lowest-priced package should be your basic wash with no frills. Don’t give more than a basic clean in this package so you can clearly differentiate higher packages. Clearly distinguished wash-package names that emphasize the value will resonate better with consumers and guide them to the best selection. Try descriptive package names that indicate the benefit of each offering. Four or fewer packages on a menu will provide better revenue results. More than four packages can become confusing and cause anxiety with customers. Generally, average ticket for three packages will net better results than four, typically by 5 percent or more. Let’s take a deeper look below. Bob’s Car Wash currently has four packages. As shown in Figure 2, below, the menu packages are ordered from the most basic to the best top to bottom and the packages are all the same size and color. His current prices and take rates are as follows: • Basic Wash: $7 with 33 percent take rate • Express Wash: $8 with 20 percent take rate • Deluxe Wash: $9 with 26 percent take rate • Premium Wash: $11 with 21 percent take rate Today, Bob’s Car wash is averaging $8.56 per wash.



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ADVANTAGE Now, let’s look at eliminating a package, updating the look of the menu, and optimizing price to increase average revenue per car. When eliminating a package from a current menu, consider take rates of each package. Most often, the lowest take rate will be in the “middle washes” where value can be confusing. When eliminating a middle wash package, typically two-thirds of customers will choose a higher price offering and one-third will choose a lower. Based on the 20 percent take rate in the Express Wash package, we’ll eliminate the $8 package. We also know that customers prefer even-priced washes, so, unless there’s a business reason, move odd price points to a higher and even price point. In this case, we will move prices on the remaining wash packages by $1. We’ve also changed the order of the packages to read from best to basic, and made the best package more visible through bigger package sizing and brighter colors that attract. The result can be seen in Figure 3, below. Take Steps to Increase Your Revenue Today1. Update Your Menu:• Create a clear #1• Maximize packages to guide customers• A new look will stand out2. Evaluate Your Pricing: • Take an increase — even if it’s your middle wash only• Round your price points to even/near break points 3. Modernize Your Offering: • Try a new product or packages• Offer theatre and customer validation4. Protect

Your Customers: • Reward loyal customers with an effective repeat purchase program Effective menu pricing is key. Today, $15 and $20 are “benchmark” price points on menu packages — meaning, when breached for the first time, the package take rate can suffer due to the “rounding up” mentality. For example, $15 will net a higher take rate than $16 because people think of 16 as closer to 20 than 15, so in this instance an odd numbered package may be preferred. And, it’s best to avoid pricing any package at $13. Just like most hotels do not contain a 13th floor, people will steer clear from a $13 wash. Based on these changes, Bob’s Car Wash’s new prices and package take rates are: • Premium Wash: $12 with 30 percent take rate • Deluxe Wash: $10 with 32 percent take rate • Basic Wash: $8 with 38 percent take rate

Together, these steps raised our average revenue per car to $9.84. That’s a $1.28 increase per wash. If Bob’s Car Wash washes 70,000 cars a year, that means Bob’s Car Wash will gain $89,600 more in revenue every year.


Once you have your menu value and prices designed, it’s easy to introduce a new option at any time. Testing a new solution doesn’t have to be difficult or expensive.




ADVANTAGE Simply start by introducing this new offering as a promotion or managers special with a cost-effective windscreen. A 3 percent to 8 percent take rate can be expected just by adding it as an off-menu package. Once you’ve found the offering is performing well and gaining new revenue, then look at adding the offering as a new top package without changing your current menu packages. Creating an additional package on your menu means your customers can still get the packages they were used to, but now they have another option. In six months to a year, revisit your take rates and determine if you should eliminate a package once again. In Bob’s case, a new top package was added featuring Extreme Shine Wax priced at $15 (see Figure 4, right). We’ve supported the value to consumers by adding onsite marketing signage, effective dispensing, and bright LED lighting inside the wash. Assuming a minimal take rate of 10 percent, Bob’s average revenue per car is now $10.24. That’s an increase of $117,000 from our starting menu and an increase of $28,000 from the prior menu update.

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Make sure your wash is using the newest innovative products and industry trends to create high value for your customers. According to the 2014 ICA consumer study, consumers are willing to pay extra for wax/paint protectants and sealants, so offering this provides extra value to your customers. Studies also indicate that consumers prefer to buy brands that they know and trust. Trusted consumer brands in your menu can also create a high value to your customers.


A major trend in today’s market focuses on “theater” or show. Exciting colors, scents, and lights will highlight the value received at your wash. Consider a grand entry arch, lighting, high impact chemistry, or other programs that offer consumers a great show and validate the customer’s purchase. Wash packages that promote enhanced protection and shine such as new waxes, protectants, and waxes that can be polished in by friction, create high value and satisfaction for your customers and increase top package sales for you.


When done well, a good loyalty program can make you money and can keep customers coming back to only your wash. An unlimited wash program priced from $20 to $50 a month can be very effective. An advantage of an unlimited program is that it allows you to garner a monthly income regardless of weather. To successfully implement this type of program, you’ll need to determine what percentage of your business you want to be part of your unlimited program. Typical redemption rates average w from 2.5 to 3.8 times monthly, with 15 percent to 30 percent of overall wash volume coming from a mature loyalty



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WELCOME NEW MEMBERS The SCWA members listed below have joined SCWA since our last issue. We Appreciate your Support! Matt & Christy Adkinson Volcano Express Carwash Pearl, MS

Kyle Bickham

Phase One Development, LLC Rowlett, TX

Jonathan Bill

Sound Business Services Atlanta, GA

Robert Brownhill, Jr. Raw Materials Corp. Houston, TX

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Darrell Hirsch

Hirsch Management Needville, TX

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Red Wave Car Wash Plano, TX

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Jason Stidman

Steadfast Investments, LLC Henryetta, OK

Doc Opp Enterprises Kingwood, TX

Brite Express Carwash Carrollton, TX

Productive Tech Solutions Normal, IL

Michael Smith

ZMB Enterprises, LLC Southlake, TX

FWLB Dallas, TX

Ascentium Capital Kingwood, TX Goff’s Enterprises Pewaukee, WI

Aaron Sansone

Phase One Development, LLC Rowlett, TX

Josh Thayer

Thayer Enterprises Austin, TX

Mark Tillman

Wash Worx Loveland, CO

Grapevine Express Car Wash Grand Prairie, TX

Nam Pham

Kevin Tims

Jetwash Express Carwash Mesquite, TX

Stripes/Sunoco Dallas, TX

Rich Plotsky

Blaine J. Warren

Precision Signs Austin, TX

Matrix Technologies, LLC The Woodlands, TX

Jeff Polasek

Matrix Technologies, LLC The Woodlands, TX

C.A.R. Products Bristol, PA

Partner Engineering & Science, Inc. Houston, TX

Oscar Hernandez

Mark Meeker

William Ridgway

Green Bank Plano, TX

Stripes/Sunoco Dallas, TX

program. Once you determine your target price and mix, you’ll need to aggressively market your program so customers see the offering and value. Another effective loyalty program is the clean car guarantee, sometimes called a rainy day guarantee. Typically marketed with top packages, it invites the customer to come back two to five days later to rewash if their car gets dirty. Consumers perceive this as high value; in reality the average redemption rate is around 3 percent. Experiment with new promotions, products, pricing, and offerings for your customers to create new revenue. Programs can be introduced as a limited-time offering. Don’t be afraid of starting with a simple time-bound offer, and determine later if you want to incorporate it long term. Engage others in the industry: ICA, other operators, and for sure suppliers can help with ideas and sharing best practices. Chelsea Beyer is senior vice president, sales and service for Zep Vehicle Care. She can be reached at

Nick Werth

Coronado Car Wash Brighton, CO Houston, TX

BOARD OF DIRECTORS President: DeWayne Hall Oklahoma City, OK (405) 414-1489

President-Elect: Tyler Furney Harker Heights, TX (254) 258-6786

Vice President: Andrew Zamora Lubbock, TX (806) 543-2775

Treasurer: Don Witt Dallas, TX (214) 358-2575

Past President: Davie Swenson Austin, TX (512) 346-8050

Vendor Vice President: Bob Kopko Uniontown, OH (800) 336-6338

DIRECTORS John Agnew Fort Collins, CO (970) 485-0287 Jeff Blansit Dallas, TX (214) 912-1729 Ronni Corbin Plano, TX (479) 651-7239

Ryan Darby Lubbock, TX (806) 535-7275 Robert Duncan Artesia, NM (575) 308-9248 Ian Heritch San Antonio, TX (210) 421-1295

Pat Kirwan Wixom, MI (866) 362-6377 Evan Lorentzatos Stafford, TX (281) 561-0469 Clay Wilson Lubbock, TX (806) 687-2024

Executive Director: Chuck Space (Jane) • 4600 Spicewood Springs Rd., Ste. 103 • Austin, Texas, 78759 • (512) 343-9023

THE ADVANTAGE is the official publication of the Southwest Car Wash Association. It is published four times each calendar year by SCWA, 4600 Spicewood Springs Rd., #103, Austin, Texas 78759. The officers, directors and members of the Southwest Car Wash Association, as well as The Advantage editors, in accepting advertising for this publication, make no independent investigation concerning the services or products advertised and neither endorse nor recommend or make any claims as to the accuracy and therefore assume no liability thereof. The opinions expressed in the articles are not necessarily the opinions of SCWA and its publisher and therefore makes no warranties and assumes no responsibility for accuracy or completeness of the information herein. (512) 343-9023.





■ Fragramatics 1600 hr Turbo Motor ■ Poly or aluminum dome ■ Computer controlled timer ■ UV protected graphics ■ Filters – Four-bag system uses high performance,

synthetic filtration media with 15 sq. ft. filtration area. Two easy-access service doors on rear ■ 2” dia. vac hose – high-flex, vinyl, crushable, 15 ft. long. Includes cuff and polyethylene hand tool ■ ¼” x 25’ Wire braid or coil hose with inline gauge


■ 1.25 HP ‘Big Dog’ high output compressor ■ Brushed Stainless Steel Tank and Main Cabinet ■ Coin acceptor – mechanical ■ Electrical - 120 V ac, 25 amps ■ Mounting - One internal and two external lugs with security collars. Uses 3/8” bolts for secure installation.

■ Tank Dimensions - 18.5”dia. x 42”h ■ Unit Weight - Net 145 lbs. Ship weight 185 lbs. ■ Ships in carton/pallet: 67”h x 32”w x 31”d Options

■ Multi-coin acceptor ■ Lighted dome ■ Debris catcher ■ Dome colors: red, orange, yellow, green, blue, white ■ Hose colors: red, orange, yellow, green, blue, white, gray, black 50

3021 Midland Drive • Pine Bluff AR 71603 800-643-1574 •



SOUTHWEST CAR WASH ASSOCIATION 4600 Spicewood Springs Road Suite 103 Austin, Texas 78759




Southwest Car Wash Association - ADVANTAGE - 1st Quarter 2017  
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