How to Start a Car Wash Business
If you want to start a business washing cars you’re not alone. There were 56,773 of these businesses in the US in 2023. The number of these businesses has grown in the United States by 0.4% on average every year between 2018 and 2023.
This blog will walk you through how to start a car wash business, including the essential steps to get started, the optimal locations to start your business, and the equipment you’ll need.
Why Start a Car Wash Business?
Carwash businesses are in demand across the country. For example, California has over 8,000 of these businesses. Texas has 6,319, and Florida has 5,784 entrepreneurs working in this field.
The demand is consistent since car owners want to keep their vehicles clean and well-maintained. You’ll have a steady income stream if you can establish a loyal customer base. This type of business usually works throughout the year. However, car washes are often among the top summer business ideas since drivers in certain markets tend to invest in cleaning more often during warm weather months.
Current Trends in the US Car Wash Industry
If you want your business to be profitable, you should consider trends like water-saving technologies and cleaning products that are biodegradable.
Customers are looking for mobile apps so they can get notifications and track their loyalty rewards. This is a great way for them to schedule appointments at your car wash.
Water-efficient technology is another big trend that people are looking for. This includes water recycling systems and other tools like high-pressure low-flow nozzles.
What Does a Car Wash Business Entail?
There are lots of options to choose from when you’re starting one of these businesses.
Automatic Car Washes
These car washes are familiar to a lot of people because they use machines in either a rollover or conveyor style.
The rollover style has different machines that wash and dry, like water jets, brushes, and dryers. People drive into these and shut the engine off while a unit moves back and forth.
The conveyor system is also called the wash tunnel variety. With this system, the vehicle is moved down a conveyor, and the washing and drying systems do their work.
Self-Service Car Wash
These usually involve the person washing their own car with a high-pressure hose. They often include a phone brush and some other accessories. A self-service car wash is usually less expensive than an automatic one.
Mobile Car Wash Service
This is a good option for people with a busy schedule. Cleaning and detailing services are usually involved here. The people offering a mobile carwash service bring it right to your home or workplace. You can even look into how to start a car detailing business to focus just on this niche service.
Full-Service Car Wash
This service includes cleaning the exterior of your car with a hand wash and full detailing both inside and outside of the vehicle. An underbody wash and some tire care are usually included.
Feature/TypeAutomatic Car Washes (Rollover)Automatic Car Washes (Conveyor)Self-Service Car WashMobile Car Wash ServiceFull-Service Car Wash
Washing MechanismMachines (e.g., water jets, brushes)Machines (e.g., water jets, brushes)High-pressure hoseManualManual
Drying MechanismMachines (e.g., dryers)Machines (e.g., dryers)DIY (Do it Yourself)Usually ManualManual
ConvenienceHigh (just drive in)High (stay in or leave the car)Medium (DIY)Very High (they come to you)High (they do everything)
Price RangeMedium to HighMedium to HighLowMedium to HighHigh
Manual Labor RequiredNone by car ownerNone by car ownerYes by car ownerNone by car ownerNone by car owner
Level of CustomizationLowLowHighHighVery High
Interior CleaningNoUsually notNoUsuallyYes
Detailing ServicesNoSome may offerNoYesYes
Location DependencyFixed locationFixed locationFixed locationMobile (any location)Fixed location
Typical UsersPeople wanting a quick washPeople wanting a quick washDIY enthusiastsBusy individualsPeople wanting thorough service
How Much Does a Car Wash Business Cost?
There are several expenses that you need to consider, like real estate. A carwash business owner needs to either purchase or lease land. Equipment is another cash outlay since you’ll need to consider items like water treatment systems, wash bays, and vacuums.
Part of the operating costs include labor — you’ll need to hire management people, technicians, and maybe attendants. There are also utilities like water supply costs and money needed for electricity and cleaning supplies.
Key Steps to Start Your Own Car Wash Business
Here are some steps for how to start a business as a car wash.
Conducting Market Research
You need to find out who your target market is and analyze any of the local competition.
Creating Your Car Wash Business Plan
The business plan needs to be thorough for your carwash. Along with your logo design and branding plans, you need a pricing strategy. Plus, an assessment of the competition.
Look into Business Insurance
It’s a good idea to have this kind of insurance. Here are three policies that should be included:
Property insurance is important to cover items like carwash equipment.
You’ll be handling customer vehicles, so liability coverage is necessary.
Business interruption insurance can cover lost income in the event of storms and fires.
Factor in Business Taxes
If your carwash business is a sole proprietorship, you need to claim your business income on a personal tax return. There are several taxes to consider, including sales tax depending on the state you’re in.
Legal Requirements and Registration
Requirements here vary by business structure and location. Generally, you need an EIN (employee identification number). A sales tax permit might also be in order. The SBA has a list of requirements for government contractors.
Funding Your Car Wash Business
There are several ways to fund one of these businesses.
Bank loans and SBA loans.
Those are just three options.
Acquiring Essential Licenses and Permits
Check with the local government to see what kind of zoning permits and business licenses you need. You might need environmental permits, depending on the kind of carwash you open, and a water use permit.
You might also need construction and building licenses and even a stormwater discharge permit. Check with your local governments to see which ones they require.
How to Run a Successful Car Wash Business
Following are some tips for running a business.
Employee Training and Customer Service
If you tie training to customer feedback, employees of your carwash can use what they learn as an opportunity to get better.
Maintenance and Upkeep of Car Wash Equipment
A preventative maintenance schedule should include calibration checks.
Pay attention to hoses, pumps, and filters that need to be replaced and cleaned.
Watch out for accumulating dirt and debris on carwash equipment light conveyor systems.
Marketing Your Car Wash Business
A professional website needs to be at the top of the list. Don’t forget about your Google My Business (GMB) listing.
Building Long-term Customer Relationships
A high-quality service will keep customers coming back. Loyalty programs help to build relationships too.
Essential Equipment for a Car Wash Business
Here’s a list of equipment you’ll need for each business type.
Automated Car Wash Equipment
You need high-pressure water jets, chemical detergents, and sensors that can detect any vehicle’s shape and size.
Self-Service Car Wash Equipment
Look for high-pressure washers with adjustable wands and nozzles.
Mobile Car Wash Supplies
You can’t start one of these businesses without an excellent pressure washer. Look for one that is durable and portable and has an excellent flow rate.
Growing Your Car Wash Business
Look at these tips for expansion.
Seasonal Special Offers
Offer discounts on several washes and spring cleaning specials that include interior cleaning.
Partnering with Local Businesses
Social media posts that cross-promote each other’s businesses are a good idea. Car wash services can also host cross-promotions.
Customer Loyalty Programs
Let customers earn points for each wash they can redeem later. Digital cards that get scanned are an excellent tool.
Car Wash Franchise vs. Independent Car Wash Business
There are some differences between opening a car wash franchise or an independent car wash.
Independent businesses have complete control and creative freedom. However, they might not have the brand recognition of a franchise or the support.
A franchise offers marketing assistance and ongoing operational support. The downside is usually high initial costs that include royalties and franchise fees.
FAQs: How to Start a Car Wash Business
How profitable is a car wash business?
Several factors affect how much money you can make like the following:
A location that is close to major roads and commercial centers as well as suburban neighborhoods will be more profitable.
The business model matters. Full-service carwashes offer other services like detailing so they can charge more.
Consider your operating costs and optimizing operations plus what you pay for insurance and cleaning chemicals.
What are the common risks associated with car washes?
Watch out for changes in the regulations around things like water usage and wastewater disposal. Beyond the usual economic downturns, these businesses can be affected by supply chain disruptions. You need a steady supply of cleaning chemicals to stay in business.
How can car wash businesses be more environmentally friendly?
This business can be more economically friendly by maintaining equipment regularly to reduce leaks. If you are renovating or building a new facility, use LED lighting and materials that are environmentally friendly.
What is the best location for a new car wash business?
Car washes can work well in nearly any market. In fact, they are among the top small town business ideas, while also thriving in larger cities. When it comes to choosing a specific location, here are a few boxes to check:
A good location that has a high volume of car and truck traffic like commercial areas and busy roads.
Look for a place that doesn’t run afoul of zoning regulations.
The location should have access to drainage systems, water, and electricity.
What other services can a car wash owner offer?
These owners can offer everything from headlight restorations to window tinting. Hand-washing is a high-end service people like and detailing services are popular.
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