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Just received a site analysis... thoughts?

Cluelessman22

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Just received a site analysis for a property we have by a car wash manufacturer, for a tunnel build.

- Year 1 estimate: High estimate: 65k washes... Low Estimate 50k
- Year 2: 88k and 65k
- Year 3: 105k and 80k

Only fundamentals that lack are key demographics and traffic count: around 30k vehicles per day.

Is it worth to build a tunnel for the estimates they gave? Closest competition is around 4 miles away (3 of them and 4th being built).

Would love to hear anyone's opinion that is in the tunnel car wash industry. On a side note, how many monthly members does a tunnel car was normally have? Have more stats are needed, please feel free to ask.

Thank you.
 

MC3033

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What are the demographics? Speed limit and visibility good? Any big retail in the area?

The above questions can cause a big swing as well as the wash style (is it express w/ free vacs?), branding/look and pricing but 65k seems very low for year 1 on 30k cars per day.
 

Cluelessman22

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What are the demographics? Speed limit and visibility good? Any big retail in the area?

The above questions can cause a big swing as well as the wash style (is it express w/ free vacs?), branding/look and pricing but 65k seems very low for year 1 on 30k cars per day.
Key demographics is 1 mile: 3.8k, 3 mile: 20k and 5 mile 45k.
It is on a US Route, on an intersection across from a neighborhood Walmart.

Speed Limit is 45 and visibility is excellent.

If we build, it would be a express w/free vacs. There is a 12k building on the lot already, but was told that we can convert it to a tunnel and use part of the building as a covered vac area.

How many washes should we be looking at?
 

Waxman

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i'm not a tunnel car wash operator but I know a few things about creating a business plan. Creating your own business plan is where you start with any project like this. You create your own pro forma's based on your own research and data. You don't rely on anyone else for this critical step in planning your business. To do so could be a huge and costly mistake.

If you're not willing to do all of this work yourself and to dig in To the research and numbers that's a huge red flag in my opinion.
 

Cluelessman22

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i'm not a tunnel car wash operator but I know a few things about creating a business plan. Creating your own business plan is where you start with any project like this. You create your own pro forma's based on your own research and data. You don't rely on anyone else for this critical step in planning your business. To do so could be a huge and costly mistake.

If you're not willing to do all of this work yourself and to dig in To the research and numbers that's a huge red flag in my opinion.
Completely agree! Are there any pointers as to what are the main things to look for in my own analysis?
 

Cluelessman22

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A key thing I have learned in this industry is to not trust the pro forma or any analysis that is provided by a company that wants to sell me equipment.
Of course. Just here to get some insight from current or previous owners.
 

Axxlrod

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I've built several tunnel washes.

Traffic count is ok @ 30k; Higher would be better of course, but plenty of washes do well on less traffic. But pop is a little on the low side, especially since there are established tunnels already there. Are those other tunnels run well? Are they chains?

How long of a tunnel did they lay out? That has an affect on hourly processing speed.
 

MC3033

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I’d expect you can beat out the car counts on the pro forma with that site.

That said, I personally wouldn’t build a wash on that site unless you are able to keep the costs low. Even if you are able to salvage an existing building I’d expect to spend $2.5m + lan


Key demographics is 1 mile: 3.8k, 3 mile: 20k and 5 mile 45k.
It is on a US Route, on an intersection across from a neighborhood Walmart.

Speed Limit is 45 and visibility is excellent.

If we build, it would be a express w/free vacs. There is a 12k building on the lot already, but was told that we can convert it to a tunnel and use part of the building as a covered vac area.

How many washes should we be looking at?
 

Greg_T

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I would be extremely hesitant to make business decisions based upon an analysis prepared by someone with as vested interest in you deciding to go ahead. I think you are right to get lots of other information to help assist in your decision.

I would tend to assume that analysis by an equipment vendor would be well on the optimistic end of things.

Good luck, with whatever you decide.
 

Mr. Clean

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Who is building the fourth in close proximity to the other three? And why did they choose where they did over the area you are looking in? Lots of $$ to invest followed by lots of work on the operating side. Proceed with caution.
 

jfmoran

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Key demographics is 1 mile: 3.8k, 3 mile: 20k and 5 mile 45k.
It is on a US Route, on an intersection across from a neighborhood Walmart.

Speed Limit is 45 and visibility is excellent.

If we build, it would be a express w/free vacs. There is a 12k building on the lot already, but was told that we can convert it to a tunnel and use part of the building as a covered vac area.

How many washes should we be looking at?

5 Mile population of only 45K is low. Typically need population of 25K to support one tunnel. 3 competitors within 5 miles with another coming? Are they tunnel sites? 30K traffic count is good, but high for the population, which indicates that a good portion of it is probably commuter traffic, which means you would need to discount the traffic count. More info needed to give you a yay or nay, but based on current info, I would lean towards nay, especially at today's cost of developing new sites.
 

Cielba

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Just received a site analysis for a property we have by a car wash manufacturer, for a tunnel build.

- Year 1 estimate: High estimate: 65k washes... Low Estimate 50k
- Year 2: 88k and 65k
- Year 3: 105k and 80k

Only fundamentals that lack are key demographics and traffic count: around 30k vehicles per day.

Is it worth to build a tunnel for the estimates they gave? Closest competition is around 4 miles away (3 of them and 4th being built).

Would love to hear anyone's opinion that is in the tunnel car wash industry. On a side note, how many monthly members does a tunnel car was normally have? Have more stats are needed, please feel free to ask.

Thank you.
Who did the site analysis?
 

Cielba

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I would be extremely hesitant to make business decisions based upon an analysis prepared by someone with as vested interest in you deciding to go ahead. I think you are right to get lots of other information to help assist in your decision.

I would tend to assume that analysis by an equipment vendor would be well on the optimistic end of things.

Good luck, with whatever you decide.
Absolutely the truth… we’re dealing with this now!
 

eckert16

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Get an independent analysis (or two). And not from the company you plan to buy the equipment from of course.
 
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