Australian Convenience Store News | Car Wash Cleaning up in the carwash business

Tunnel vision is not necessarily a bad thing - particularly when it involves the carwash business. The danger is not doing your homework and paying too much in the process. ASS&CSN gets some advice.

For a while ëcarwashí was a dirty word. While the convenience was great, worries about damaged paintwork and broken aerials kept car owners away.

That was then. Today the reality is different. Technology and engineering developments mean the latest rendition of the commercial carwash is more car friendly than ever before, and certainly easier and more environmentally friendly than doing it on the lawn. The people are happy. However the carwash operator may not be - unless heís keeping up with the times and his customersí demands. The first question should be, what is he offering?

Rollover Or Touch Free
At the present time, thereís quite a bit of choice. Rollover (or friction) machines, which involve contact with the vehicle, have had some bad press because of perceived damage to the paint and to any ancillary fittings, giving rise to the popularity of touchless (or touch-free) machines which use a combination of chemicals and high pressure water to wash the vehicle. Many sites combine one or the other of these automatic machines with self-service bays to keep all their customers satisfied.

New technology is concentrating on maximising the effectiveness of the wash and not damaging the vehicle. With the friction or rollover washes, the rolling plastic brush has changed considerably with the introduction of special washing materials such as Car Lite, FoamBrite and LammsCloth replacing the older, harder materials making contact with the vehicle. The result gives the potential operator a much wider choice, one which will enhance the finish of the vehicle.

Most experts agree, officially or otherwise, that the friction system provides a cleaner car every time but past concern about the potential damage they inflict has given touchless systems a real boost. The downside is perhaps a less effective cleaning job, particularly if the vehicle is not washed regularly or has come in after a particularly demanding drive.

A change in the washing devices used may serve to even up the balance. Aside from the constant innovation in both friction and touchless machines, there also are now available combination or hybrid machines which combine friction technology (vehicle contact done by a soft fabric) with the best of the touchless technology.

Reg Leonard, director of N/S equipment distributor Washcraft, says while LammsCloth and its like will revolutionise the rolloverís appeal, some of the other new technology is exciting too.

"Thereís a two-step pre-soak system now being trialled for touchless systems involving an acid detergent which works on the glass and chrome, followed by an alkaline detergent which completes the job on chrome and paintwork. Itís still quite new in America and is just being introduced here.

"It is unique because of the use of the acid - it is more effective than traditional highly alkaline mixes used by the touchless manufacturers. But it works particularly well for the touchless wash system, so it will be interesting to see whether it goes further."

Good Sight Company, Australian agent for Ryko, has already begun manufacture of acid/alkali chemical systems in Australia.

Bill Whitburn, director of PDQ Pacific, the company instrumental in introducing the new technology called ëSmart Soapí under a strategic alliance with Ecolab (the parent of Blue Coral Systems) says the new technology is unique and particularly effective in vehicle cleaning using the touch-free method. A differentiator between ëSmart Soapí and some other competing products is that the technology delivers ëcustomer clean carsí irrespective of changing weather or climatic conditions.

Pete McManagan, MD of TEAM carwash Services, says his group is working on a new self-serve single-wash unit which comes all-inclusive with its own building and pollution control as part of the deal.

"It should be ready early in 2000 and available for around $15,000. Itís perfect for the small operator, who canít substantiate putting in a Taj Mahal structure or even a three-bay set-up, but the demand is there and it will add to the bottom line. We think itís an area of the market that isnít being properly served."

Good Sight Company has done a similar thing with its new tunnel wash, by incorporating the wash and the building that encloses it in a single unit."

All you need is the concrete slab with services provided," said Good Sightís Operations Manager Mick Ball. "The complete wash and building are lifted from the truck, assembled, bolted down and connected to power and water."

Getting Into It For someone who is just thinking about getting into the carwash business, the advice is as it would be for any new enterprise - think it through carefully and get the best advice you can.

There are several cases of fly-by-night operators who arrive promising the world and disappear just as quickly, leaving customers with no back-up. If youíre thinking about it, ask lots of questions and find a reputable operator who has been around for a while and can not only supply, install and maintain your equipment but help you avoid the potholes as well. One of the smartest moves could be joining the Australian Carwash Association (ACA) and tapping into a wealth of information from the experts.

Making the right choice on site and equipment are two of the hardest decisions. Land and machinery are expensive and the wrong choice can make paying it off extremely difficult. And with nearly $300 million invested in this industry in less than a decade, many recent investors are finding the returns marginal.

"With property, building and equipment for a four-bay self-serve system, you should pay no more than $500,000-$650,000," says Bob Schultz, industry consultant and director of Magic Spray. "If you add automatic, it can be up around $600,000-$750,000, but if you pay any more than that, itís too hard to crunch the numbers. If you get at it $500,000, itís a good price. Once it starts getting up around the one-million-plus mark, it doesnít work. The debt is too high to service."

Richard Davison, co-director of Shiners carwash Systems, tells a similar story. His company imports equipment and, like several of the major players in the industry, can handle as much or as little of the go-to-whoa of the project as is desired.

"The most difficult aspect is finding the right site with the right zoning. The rationalisation of the service station industry has certainly helped the carwash business by providing good sites will all the necessities, but basically what youíre looking for is a good position, with a good population base and no competition within five kilometres."

"Itís important to talk to people who really understand all aspects of the business and the industry," says Martin Dowling, MD of BPís official supplier, Car Kleen Australia. "Youíre buying a business, not just a vehicle wash system, so you need an organisation that provides more than just a reliable, competent product. You need quality and competence in the technician too, in fact full 24-hour back-up. You need to be sure that the system you install works, and keeps working."

"Look for a supplier who approaches your business not just from a machine sales perspective, but someone who looks at it wholistically, who understands what makes the business work and who can help you achieve that."

The experts suggest that installing a carwash on a service station site is another way of maximising the return on that site. But they say that shouldnít deter someone who simply wants a stand-alone operation. They also agree that whichever type of operation youíre planning on, the best basic combination is some D-I-Y bays and one automatic. That way you appeal to a wider range of customers, and the revenue from the automatic is equivalent to two or three self-serve bays.

Demographics differ markedly for the different types of carwash and itís one piece of research thatís essential to get right before you decide on your installation.

"The market is segmented and the end users are very different," says Robert Anson, president of the Australian Carwash Association. "Someone who is in a hurry or well-dressed or elderly is more likely to use an automatic, either rollover or touchless. They donít have to get out of the car, simply pay the money and drive through.

ëThe average coin-in-the-slot do-it-yourselfer is the 20-30 year old petrolhead who enjoys pampering their car, but there are plenty of others who find it relaxing to get out there and do it too," Mr Anson says.

In terms of making a decision of what to install, it would seem to depend on what, or who you are, whether the carwash is the primary or secondary activity on your site.

"I think the petroleum companies still are the major players in the carwash industry," says the ACAís Mr Anson, "and they have a large number of the roll-over style washers where the machinery moves over the car. BP, Shell, Caltex and Mobil feature here. "Then there are a smaller number of tunnel washes where the car moves through on a conveyor, like the Shell CarSpa. Also thereís the new self-service outlets, like Car Lovers and a lot of independents are into that segment."

Evenly Divided
"I havenít counted the numbers," says Washcraftís Mr Leonard, "but I believe Australia is pretty evenly divided between friction and touchless. BPís Superwash weighs it quite heavily - they believe in friction wash because they want to deliver a clean car without question and they do not see a touchless wash as cleaning all cars at all times." Others suggest there still are more friction than touchless, right across the board.

Magic Sprayís Bob Schultz has been around the game for long enough to have a fair idea of whatís happening. He believes the oil companies have slowed down their development plans. "Itís pretty static at the moment but I see a trend, a growth, in more self-serve operations going into small towns, not so many automatics because itís too expensive. The oil companies will be putting systems in, but not at the same rate as they have been, aside from new sites.

"The trend with the majors seems to be towards touchless automatics - the older plastic brush style are very much on the way out - while the independents and stand-alones seem to be more self-serve. However many of them offer both self-serve and a touchless because it makes sense to grab both sorts of customers."

"I disagree that the industry is static at the moment," said Mick Ball. "The oil majors all realise that they need alternate profit centres to complement their fuel and C-Store business. They are steadily replacing existing wash centres and moving older equipment to rural sites. A few years ago I would have agreed, but now the industry is growing again."

TEAMís Pete McManagan is more pragmatic about the bottom line, suggesting that a self-serve offer alone canít succeed long-term."You make the big bucks with the automatics, they add the income to the site. So if you want to be an owner-operator and make a living out of it, you have to make the site work and it wonít do that properly if it only offers one option, no matter how many bays there are.

Income Areas
"For that reason too, I think a lot of the self-service operators will be starting to look for other income areas on their site just as some of the service station operators will probably re-think and look at multiple bays. The bottom line for everyone is maximising the return on the investment."

He also offers the opinion that the Australian self-service industry standard is very high: "generally our carwash centres are the best in the world. In most cases they are really nicely done and you could struggle elsewhere to find such well-presented operations which are run well.

"Australians do expect good service now. If somethingís not working, we expect it fixed yesterday and that means the industry has had to raise its standards."

According to Shinerís Richard Davison, itís not simply a matter of looking good and working well for the public to want to use the centre. Security is an important issue for certain sections of the community and he suggests itís an issue that needs to be considered when thinking about best use of the site. Far smarter to sacrifice one bay for the mental comfort of the customer than crowd the site for the perceived financial benefit involved.

The true bottom line for the industry is how its audience perceives it. In fact public attitudes to commercial carwashes, according to Magic Sprayís Mr Schultz, have been quite cyclical and very much dependent on whether they have a perception of possible damage to the car.

"If theyíre hesitant and they donít have enough facts about the type of system it is, they will err on the side of caution and not use it. Thatís why theyíre happier using self-serve and touchless."

TEAMís Mr McManagan agrees: "Thereís been a traditional perception that commercial carwashes are those things that scratch cars. Itís true thereís been some minor damage in the past but they do clean - and these days they do a better job with minimal if any damage, as long as the customer follows the directions."

According to ACAís Robert Anson, new technology is narrowing the gap in terms of which system offers the better wash.

"If youíre a regular washer, a once-a-weeker, the touch-free does an excellent job. If your car is caked in mud from end to end, youíre going to need contact of some kind with the car and thatís a friction or rollover job - itís another reason why itís smart to offer a combination of wash styles."

Trends In The USA
Andrew de Crespigny of Aquajet Australia, distributors of the American MarkVII wash systems, says that itís instructive to look at the trends in the USA.

"Five years ago in the USA," Mr de Crespigny said, "98% of all new automatic carwashes purchased were the friction (brush) type. Today that figure is under 30% and falling, due to smarter technology and better chemistry adopted by the touch-free manufacturers."

While a combination certainly makes sense, the most important factor will be pricing. Yes, you do have to make a return on your investment, but greed will guarantee you wonít have the business for long.

"A carwash is not seen as an essential even though it mightnít be seen as a luxury," says Washcraftís Reg Leonard. "Ten dollars is about the basic price point for an automatic carwash. Above that thereís resistance and that doesnít pay the bills."

"Most people are careful with money," says TEAMís Mr McManagan. "If money is tight, or the price is too high, the regular carwash is one of the first things to go. Ten dollars is about the ceiling for a straight wash."

"The real money is in the extras," says Shinerís Richard Davison, "but extra vacuum cleaners are not necessarily an oversell by your supplier. The basic truth is, if you donít have it or itís not operating when the customer needs it, they will go elsewhere."