Could we survive??

[Greg Pack]

I agree that the investors and outright bad operators are most at risk. Also, people that just paid too damned much for their wash and have a high debt ratio. I think there will be a shakeout of this and other industries soon, and some of the weakest of the herd will be taken by the lions. Any business that has a high debt ratio and low margins should be sweating bullets right now.

Ok, I'll lay it on why I think the next couple of years could be ugly and am being cautious. We are collectively in debt up to our eyeballs. Last figure I saw were nearly 10 trillion federal debt and growing about a trillion dollars every 16 months. Our financial obligations exceed 400K per household.

Things that are different from past history is we have shifted largely to a consumer spending based economy (70% I think). The housing bubble has popped and is leaking air, this has another year before the full effect is felt. Home equity lines and easy credit have let us have a real party, that party is coming to an end. There are indications that commercial real estate valuations are about to drop as cap rates deemed satisfactory are rising. Gasoline is at or near all time highs. energy and utility costs (including sewer) are rising faster than income. The list goes on and on.

But don't worry, it looks like we're about to elect the next Jimmy Carter. He'll set things right. More taxes for all us evil rich people and free health care for all. I wonder what will happen to oil prices when he pulls out of iraq and that place falls back into a civil war

Maybe Steven Okun was right. Chicken little shouldn't own a carwash. But I'd rather be chicken little than an ostrich with my head stuck in the sand.

 

[Jony82]

I'd be more concerned about oil prices if Chavez stops importing oil to the US because of Bush AND/OR Bush decides to stick his nose into Iran. Both export more oil than Iraq. Any glitch in any oil exporting country will explode oil prices. Affordable alternative energy can't come soon enough for the middle class, the poor, and the economy. Nothing like saving 200-300+ dollars per month on heating/cooling/electricity and having that extra money to take to the mall/auto dealership/car wash/etc.

I don't see an economic run for the positive till cost of living goes down. The only way I can see this happen is eliminating the need for the middle class and poor to budget their monthly income according to energy needs (fuel/heat/AC). Either oil needs to drop considerably or solar/alternative energy needs to become cost effective. Only then will the masses have the room to spend that extra $300 per month this economy needs to continue growing.

Either way, it's up to you to make ends meet. Start plowing your own snow, mowing your own yard, etc to reduce your expenses. Get a 2nd job to keep your income where you need it to be. Never count on the government regardless of party control to feed your family. Everything, good or bad, will pass.

 

[Earl Weiss]

Come to thinlk of it, it was about the time of the 1970's gas crunch that we went from Full serve to EE and then adding an after care option, which in a certain configuration was later known as Flex Serve.

 

[Greg Pack]

Just curious how the mfgs. are doing- Is anyone seeing any SS/IBAs being built in their region right now?

 

[I.B. Washincars]

I spoke with my dist a couple of days ago. He said '07 was the first year that he did not do a single new wash, only retro-fits.

 

[Ben's Car Wash]

My suppliers are saying it's bad! They are borrowing to stay alive. I'm down over 30% this month so far and this area has been the least effected in the Tampa bay area.

I see Commercial projects still moving forward.... which is a good sign because is cheap for them with all the contractors out of work and materail prices down. But on the economic side... indicators are VERY BAD.

Housing prices have fallen to record lows, consumer confidence is very poor (I heard the numbers this morning but didn't retain them... still stressed). Oil and gas price are projected to rise... gas at $4/gal by summer. I can't see how the middle class and poorer people can make it. It will bury many businesses.

I have had a business my entire life of some kind.... I never found it this hard. I fear (which is not a word or an emotion that I EVER display) that this economy is headed in a bad direction. Many of you say that I'm this or that politically.... but I do read vicariously and keep up with things. Were in for a deep hit.

 

[Waxman]

I personally have had it harder than I do now. I, too, have been in business for myself in some way for my whole working life; 24 years. I've been through hard times, scarcity and problems, as well as good times of growth and prosperity.

I know outlooks are bleak in the short term. However, I need to direct my energy toward improving and streamlining my business in every way possible, and not focus too much energy on the scarcity mindset. This isn't burying my head in the sand, but instead, staying positive and upbeat.

Economic trends will do what they will and we as businesspeople will respond and try to stay ahead of all trends, both good and bad. I always do better personally and professionally when I let go of fear and worry and focus on positive aspects of my life and business. For me, that mindset leads to the personal motivation to make improvements, get creative with marketing, explore other services/price strategies, and look for ways to save money on chemicals, supplies and utilities.

Some car washes will survive and some will not. I plan on being one that does. You should, too.

 

[Greg Pack]

Oh yeah Dave, Even though my posts about the economy sounds negative I agree that we are all capable and should be prepared to endure short term downtrends, whether they are caused by economic conditions, a spell of extended bad weather, or competition. No one likes to make less than they did the year before but it's part of the business cycle. The little things can make the difference.Stay focused on giving your customers a quality experience and and stay positive. Keep your expenses down. Maintain a reasonable level of equity in your business by not over-leveraging. In other words, stay away from the ledge and you probably won't fall (or get pushed)off.