Need Help!

[Zachwash]

Hello everyone,

I hope you're all doing well. I'm in the process of exploring the option of buying a car wash business, and I'm particularly interested in seller financing as a means to make the purchase. I believe this could be a great opportunity, but I could use some guidance from those with experience in this area. I have 3 rental properties acquired via seller finance so I figured I could purchase a carwash utilizing the same acquisition strategy.

Any insights, tips, or personal experiences you can share would be greatly appreciated. Thank you in advance for your help!

Zach

 

[Rfreeman]

Car washes are a little different especially if it is an existing car wash with a good customer base. Personally, I would never sell any of my washes under seller financing terms. My main concern would be the buyer gets into the business only to discover it isn't what they have seen on YouTube or who knows else where and decided they don't want to dedicate the time and energy the wash needs thereby running the place down. If I owned a car wash property with a closed business possibly I would finance someone because there is less downside risk for me. I have lien on the property and if you didn't pay I would foreclose.

From an owner or seller's perspective, in car washes, rental properties, and commercial rea estate, any one who ask me about seller financing either:

a.) wouldn't qualify for conventional financing
b.) doesn't have the money or equity

the above both lead to a highly leveraged deal which isn't good in my opinion, therefore I would prefer to get my money and get out. I would of course be available for a pre-determined transition period and fee consultation afterward.

 

[Zachwash]

Appreciate the feedback! Great points here-I do not have enough equity to take down a carwash entirely with cash but I am bankable with good credit. Favorable debt in this interest rate environment is hard to come by which is why I'm a bit apprehensive on going down that route. My dad owned a wash (6 bay) when I was kid and it worked out well until the neighborhood started to diminish in value. He saw the writing on the walls (literally) and got out just in time to remained profitable.


That said, what advice could you offer someone like me looking to acquire their first wash? I would be willing to work alongside an owner to learn the biz as well but the ultimate goal is own one day.

Thanks again for the feedback!

 

[DAWGWASH]

Appreciate the feedback! Great points here-I do not have enough equity to take down a carwash entirely with cash but I am bankable with good credit. Favorable debt in this interest rate environment is hard to come by which is why I'm a bit apprehensive on going down that route. My dad owned a wash (6 bay) when I was kid and it worked out well until the neighborhood started to diminish in value. He saw the writing on the walls (literally) and got out just in time to remained profitable.


That said, what advice could you offer someone like me looking to acquire their first wash? I would be willing to work alongside an owner to learn the biz as well but the ultimate goal is own one day.

Thanks again for the feedback!

One of the main problems is the equipment side of things. In the rental business properties generally appreciate and tenants usually don’t destroy the property usually. With a car wash neglect from the operator especially with IBA can destroy the equipment and the business which can amount to hundreds of thousands of dollars. With that said an owner is unlikely to finance for those reasons and also an IBA only has a certain life span and if it runs out before the financing deal runs out the operator is likely not going to be able to afford a new IBA
So unless someone is DESPERATE to get out of the business they probably won’t finance it

 

[Rfreeman]

I dont know what your time frame is for buying a wash. I know I started looking at them when I was 24 yrs old. I had sold a very profitable landscape business enough to put 60% down on a wash I was looking at....but no bank would give the chance. Parents offered to finance the deal for me but I turned them down. We'll 7 yrs and a R.E. crisis later I bought my first wash at a hell of a deal. I now have 4 washes, all but 1 paid for. All this to say if you want to buy a wash...dont give up.

Learn what it really takes to run one and keep networking in the city or area where you want to buy one.

As far as financing one goes....if your networking you might eventually find someone that really wants or needs to get out and they will take you up on your deal. Personally I wouldn't but IF someone with the right work ethic and mindset came a long and proved themselves I would entertain it but that's a HUGE IF........

Best of luck...make it happen.

 

[Zachwash]

Thank you for the feedback-this was very insightful! For context, I am located in Dallas-I see youre in fort worth!

Would love to do a site visit if your time allows

Thank you!