More than car wash

Washing at service stations is no longer just about car washing – dog washing and now truck washing are part of the product mix. However, the same principles apply.

GFC = Great for car wash

Car wash operators are familiar with the impact of the weather on car wash sales – a bit of poor weather will drive increased activity, but persistent rain drives customers away until the weather clears. When it does, it can be hard keeping up with demand; for example, after the recent east coast dust storms.

However, it is weather's 'driver' – the climate – that is shaping the long-term trends for the commercial car wash business in Australia.

"Consumers are getting used to using a commercial car wash and the main driver has been recent water restrictions," said David Crampton, General Manager, CK Group. "However, people now realise that a car wash saves them time and money. Not all will go back to washing at home, even as water restrictions are relaxed. There will be a new generation of car owners growing up that will never think about washing a car at home."

The 'global financial crisis' (GFC), and consequent recession, have been 'blessings in disguise' for automatic car wash owners. It looks like the more expensive car wash operations have lost business to service stations.

"While people are reluctant to spend around $35 at the local hand wash, they are still willing to spend $10+ at a service station," said Adam Pisk, Sales Director, Autowash Pty Ltd. "We expect some of this business to stay with the channel when economic conditions improve because a service station car wash is convenient and good value. This is an opportunity for service stations that can offer compelling competitive options."

The GFC, recession, and now the recovery, have had an effect on the economics of buying equipment. "Now is an excellent opportunity to invest in car wash," said David Crampton.

"With the strengthening Aussie dollar, exchange rates are very favourable and interest rates are low. Even if investors are finding it difficult to get finance, CK have various financing options available to help get investors into the industry."

"Manufacturers are under pressure because sales fell away when access to finance was tightened," added Adam Pisk. "They have reduced prices to move stock. Even if the banks are still reluctant to lend, we offer different finance options, such as partnering, where we install a machine and share in the profits for a time, as well as favourable payment terms. This means a good site with potential to do well with a car wash does not have to wait."

Car wash has proved a valuable source of revenue during tough times. "For independents, it is a useful counter to the majors," said Wayne Rogers, Sales Manager, Good Sight Co Limited. "Car wash diversifies the site's revenue streams and improves fuel sales as well."

"It is the same here as in the United States," said Rob Lewis, International Sales Manager, APLA, PDQ Manufacturing Inc. "A well-run car wash is one of the highest dollar margin categories on a fuel site. The 'rule of thumb' is that 1–2% of passing motorists will come in for a car wash, bringing new customers to the site; and 5–7% of motorists already on the site to buy fuel (or other products) will also buy a car wash."

Just as fuel volumes drive car wash sales, a car wash increases fuel sales. "In the United States, the relationship between car wash sales and fuel volumes varies from 150 to 400 litres per wash," added Mr Lewis. "It varies with climate and consumer behaviour and how well the car wash and fuel offer are managed."

Add polish to shine

"Service stations need to keep their car washes operating well with the latest options," said Wayne Rogers. "Customers expect a quality outcome and that means including a sealant in the offer. In fact, the biggest change in recent months has been in consumables – the range of polishes and sealants. Equipment needs to be modified but it is not a huge change and well worth it."

Rob Lewis agrees. "The biggest innovation has been in the general class of products that suppliers call 'supersealants'," he said. "For example, our preferred supplier CSI stocks Lustra Shield, which provides a very high gloss that customers like and a very high margin for car wash operators."

Similarly, CK has formulated Maxi Gloss, which uses the latest 'nanotechnology'. "It not only provides a superior gloss to vehicles, but also a high level of protection to the vehicle's paintwork," said David Crampton. "Some clients upsell to this option for an additional $3–6 per wash, and the chemical cost is minimal."

The other significant improvement in chemicals has been their ability to work more effectively with recycling systems. Even though New South Wales and Queensland have relaxed some of their water restrictions, it is now standard practice to recycle as much as 90% of water in commercial car washes.

"The new waxes that add a gloss finish are another point of difference and another price point," said Adam Pisk. "However, the main improvement in chemicals is their ability to work more effectively with recycling systems. Water quality is critical to wash quality. Previously the chemicals did not break down or neutralise very effectively. Now, the quality of recycled water is much improved."

The challenge for car wash operators is to get the message across to customers, but it is worth the effort. The additional cost of upgrading equipment and the cost of the better quality chemicals is far outweighed by the extra margins and customer satisfaction.

Equipped for success

Improvements in chemical formulations have been paralleled by improvements in equipment.

"CK has just introduced a new 'combination' machine, XT-Combi, which is a touch-free and brush machine in one," said CK Group's David Crampton. "The new system offers both types of wash formats to consumers without the need for two machines.

"Touch-free equipment has improved; it is more consistent. By more closely following the contours of the vehicle and using better pressure and chemicals, touch-free machines can now deliver a quality wash. Similarly, better technology in materials such as our SofTecs, provides a buffing effect that actually enhances shine. People are becoming much more comfortable with friction car washes."

PDQ Manufacturing's hybrid unit combines friction and touch-free technology, and its recently-released new touch-free machine incorporates new technologies for faster washing and lower maintenance.

"With the new machine, the spray arch is very forgiving," said Rob Lewis. "That means it can handle all kinds of shapes, including the likes of long trailer hitches that the ultrasonic sensors can't see. The arch responds to it by backing away (and remembering where it is) and keeps washing."

All PDQ car wash units are mounted overhead in open bays that are easy to drive into. The ultrasonic sensors locate the vehicle and the wash follows its contours.

"Our service station customers tell us that the open-bay design attracts higher traffic," said Mr Lewis. "PDQ equipment also operates on Windows CE-based software, so that all aspects of the car wash operation can be managed through the internet."

As well as remote monitoring – systems are getting better all the time – auxiliary equipment should be considered. "It goes without saying that you include vacuum units," said David Crampton. "When people clean their cars, they want to clean the inside. They may also want to add fragrance, and combination vacuum and fragrance machines are the most successful. Consumable costs (some fragrance and electricity) are low, and a unit can pay for itself in less than six months."

"The trend is towards quieter units," added Autowash's Adam Pisk. "Particularly for service stations near residential areas."

The other piece of equipment that will pay for itself in months is the vending machine. The latest development is the 'multipaper' unit that delivers a dose of chemical on a suitable cloth.

"The unit is less susceptible to theft and the margins are higher," said Mr Pisk. "Customers are just as happy with a single application that does all they need to do, and the cost for the retailer is only a few cents compared to around $1.50 for a small bottle."

Either way, they need to be stocked with the right type of product. Number one is Armorall, followed by a glass cleaner.

Market, maintain and manage

Although more people are using a commercial car wash, there are also more car wash options for them to choose from. There was a time when you could 'build and they would come', but that time is long past. Now the car wash has to be managed and marketed effectively to maintain and grow its customer base.

"That means always delivering a top-quality wash from equipment that is regularly serviced and uses good chemicals; and pricing to give value for money," said Autowash Sales Director Adam Pisk. "Value for money is critical. That means the likes of loyalty schemes integrated with other parts of the business; for example, discounts on car wash based on fuel sales."

"Giving four cents per litre off fuel purchases when the customer buys a car wash is excellent value," added David Crampton. "Customers can get the same discount by spending less than $15 at the car wash instead of $30 at a supermarket, and the car wash is providing an excellent profit margin for the operator."

The other key to a successful car wash is to make it easy for customers to use it. "People in the industry sometimes forget that new customers are not that familiar with their car wash facilities, and they don't really know what they are supposed to do," said PDQ's Rob Lewis.

A checklist of things to consider would include:

Visibility and signage

Ease of entry and exit

Marketing – eg pump toppers, upselling.

Regardless of other factors, maintenance is critical. Although automatic car wash equipment is designed to be low-maintenance, there is no such thing as 'no-maintenance', especially in recycling systems. The other important factor is supplier support. The top equipment suppliers offer ongoing support, including assistance with marketing.

No fleas on dog wash

Service stations with space in the right place are adding dog wash units to complement their car wash operations.

"No matter what the weather and in all economic conditions dog owners will wash their dogs every couple of weeks," said Willy Benter, Managing Director, Tru Blu Dog Wash. "You can go without washing your car for a while but the dog has to be washed regularly. Commercial dog washing is where commercial car washing was about 10 years ago. We are at the beginning of a period of incredible growth."

CK Group's David Crampton agrees. "We are experiencing excellent growth," he said. "Our customers have found that there is never a slow period with dog wash. Car wash activity depends a lot on the weather, but the dog wash is always busy when the weather is bad."

Tru Blu now has 230 dog wash units operating in Australia, including an increasing number in service stations. "Independent fuel retailers are looking for ways to diversity their businesses and dog wash is an excellent earner. Although some sites will support up to 100 dog washes per week, about 40 to 50 is enough to provide an exceptional rate of return on investment. A good service station site with the right demographic will generate about 60 per week."

The most important decision is location, and definitely not in an area with a lot of vehicle traffic. "An old car wash bay is ideal," said Willy Benter, "And, it might be a better use of some current hire trailer parking or other areas such as car parking and where the ice machine is now."

The basic technology is little changed in the past 12 months, but suppliers are improving the units all the time. Tru Blu's K9000 has an additional display on the side that is easier to see while washing the dog, faster changeover in the wash cycle, upgraded note acceptors, and a new floor that tilts for easy cleaning.

CK Group's Dog Wash unit is CE certified, and it has introduced a dedicated vending machine that stocks dog-related items such as wash mitts, drying towels, ear wipes, eye wipes, dental wipes and treats (for the dog).

Autowash now offers a dog wash unit imported from Italy, with an integrated ramp to walk the dog up to the unit (easier than lifting the dog into the basin), dual speed and temperature controls, and a vacuum unit that 'sucks' excess water off the dog before drying.

Although location and technology are the key considerations, success is linked to the overall experience for the dog and the owner. It has to be safe, comfortable and enjoyable. That means providing secure fencing and shade, and using good-quality consumables.

"We use Fido's consumables," said Willy Benter. "They are soap-free and work well. There is about a 30% margin boost from using good products. People don't come back if the chemicals are poor quality."

As with car wash operations, ongoing maintenance and marketing will make a big difference to the success of the dog wash business.

"As with any business, there is a return on effort," said Mr Benter.

Introducing, …truck wash

The latest development in the wash category at service stations is truck washing. Autowash has introduced a touch-free truck wash system from the United States that fits easily into a truck stop location's offer.

"This has been our biggest growth category in the past 12 months," said Sales Director Adam Pisk. "The Australian fleet includes a lot of American trucks with bull bars and aerials and the like; they cannot be washed with a friction machine.

"Our new unit uses 7000 litres of water (mostly recycled) and chemicals to wash both prime mover and load in two minutes. The truck depots are more than happy for their trucks to be washed elsewhere, so the service station channel is our target market."