Considering building a new wash

[LVWashGuy]

Hello all,

Long time reader, first time posting. I've been considering building a new wash for some time now and since I'm fairly new at this, I'd like to hear some thoughts on the matter. First off, I'm thinking about IBA due to the low/ no employee requirement. I do realize the Express Tunnel model is where much of the industry growth is going; however, I'm not interested in having employees. So, the IBA lends itself nicely to this objective.

Some info and demographics:

Adjacent road: 15,000 cpd; nearest cross street: 20,000 cpd (~1/4 mile); nearby highway: 65,000 cpd (~1 mile).

Businesses: grocery, gas station, coffee shop, several small restaurants, large hospital doctor's office, park with ball fields and a dog park.

Population: 3 miles - 18,000; 5 miles - 61,000

Avg HH income: 3 miles - $129,000; 5 miles - $119,00

Wash competition: 3 miles - 1; 5 miles - 4

My question is this: since I'm new to the industry, will this location support a new wash? I tend to think it'll work nicely; but I'd like to hear from those that have more experience. Also, what type of annual revenue should/ could I expect? Let's say the wash will have two IBAs and probably one or two dog washes as well.

 

[robert roman]

Site analysis for dual in-bay suggests frontage roads with average daily traffic count of 25,000 or more. Analysis also suggests site selection in areas with population of 30,000 or more within 3-miles.

So, based on these two factors alone, you might be disappointed with the expected annual revenue.

You may also want to re-consider employee requirements for the business model you described.

Dog washes get filthy. So, you need attendant that loves pets as well as people. Moreover, I don’t know of too many busy dual in-bays without an attendant.

“…..will this location support a new wash?”

There isn’t enough of the right information to make that determination with acceptable level of confidence.

 

[LVWashGuy]

Ok, thanks for the info, greatly appreciate it. Only reason I was thinking of a dual IBA would be to increase reliability...at least one is going while the other may be down for maintenance. If that's not a big deal and the numbers don't support a dual, so be it. So think single in-bay and an attendant if the dog wash happens?

What is the right information to make an acceptable determination?

 

[robert roman]

“What is the right information to make an acceptable determination?”

Most start with financial goal and objective. For example, achieve earnings before taxes of $100,000 by third year in operation.

What is your goal and objective?

As for numbers, napkin analysis for single in-bay is 15,000 to 18,000 washes per year.

 

[LVWashGuy]

Perfect! Thanks very much, that's what I was looking for...what kind of numbers would an IBA do with the CPD count in that location. I can work out the math from there on ROI.

If you don't mind answering one more question, would shifting the model to an IBA Express improve those numbers? Obviously one of the limitations of IBA is throughput. So I guess what I'm asking is the 15k - 18k washes per year based solely on the CPD or is that also due to the throughput limitation of a traditional IBA?

Again I very much appreciate the help!