A car wash business is a business that washes cars for clients in its car wash facility. Some of the basic services offered by car wash companies revolve around the cleaning, washing, and waxing of automobiles (cars, trucks, vans, and trailers et al). Available data shows that the market size, measured by revenue of the Car Wash & Auto Detailing industry, is $13.7 billion in 2023.
It is important to state that the car wash industry is very fragmented with no one company controlling a large portion of the industry. According to the United States Census Bureau, there are over 100,000 car wash facilities in the United States with Americans spending approximately $5.8 billion a year at car wash facilities.
Is It Possible to Open a Car Wash Business at Home?
You can start a car wash business from your home as long as you have a garage or carport that is big enough to contain the number of cars you intend to attend to per time. All you need to do is to erect an advert board or flex banner to inform people that you run a car wash in your compound.
Please note that this can only work if your house is not gated and fenced. It is important to also note that in some states in the United States, you may have to check with the local authority to know what is expected of you if you want to operate a car wash business from home.
Steps on How to Start a Car Wash Business.
Table of Content
Conduct Market Research
The first step in the market research process for your car wash business is to develop market-based research questions in line with your overall business goal and objective.
In this regard, you should source information that will help you maximize your business, information that will give you a reliable clue of what your potential market will be looking out for from a car wash business and also help you operate your car wash business with less stress and of course, build the business to profitability within the shortest time frame.
a. Who is the Target Market for Car Wash Business?
- Car Dealership Operators
- Households and individuals that own cars
- Taxi and car rental company drivers
- Drivers for Transport Companies
- Drivers for Haulage Companies
b. Is Car Wash a Profitable Business?
Yes, the car wash business is very profitable. Statistics show that in the US, players in the industry earn from $41,000 per year for a small car wash to $686,250 per year for a bigger luxury car wash.
Please note that the market for car wash business is driven by the purchase of cars and the increase in consumer spending – in essence, as the general economy of a country grows, more people will buy cars and more people will patronize the services of a car wash regularly especially if their driving habits encourage them to do so.
c. Are There Existing Niches in the Industry?
Yes, there are existing niches when it comes to car wash businesses. Here are some of the niche ideas;
- Mobile car wash business
- Self-service car wash business
- Automobile detailing business
- Standard car wash.
d. Who are the Major Competitors?
- Mister Car Wash
- Driven Brands
- Zips Car Wash
- Quick Quack Car Wash
- Tommy’s Express
- Tidal Wave Auto Spa
- GO Car Wash
- Autobell Car Wash
- Cobblestone Auto Spa
- Mammoth Holdings
- Whitewater Express
- True Blue Car Wash
- Club Carwash
- Express Wash Concepts
- Golden Nozzle Car Wash
- Magnolia Holdings
- Wash Depot Holding Inc.
- Splash Car Wash
- BlueWave Express.
e. Are There County or State Regulations or Zoning Laws for Car Wash Business?
Yes, there are county or state regulations and zoning laws for car wash businesses, and players in this industry are expected to work with the existing regulations governing such businesses in the county or state where their business is domiciled.
In addition to that, it is essential to state that in the United States, government agencies and departments routinely grant variances to rules and regulations. Often, you only have to fill out a short form. In other cases, your request may have to be publicly heard before your city council, zoning board, or other body. Please check with your zoning or planning department to find out what options are available to you.
f. Is There a Franchise for Car Wash Business?
Yes, there are franchise opportunities for the car wash business. Here are some of them;
- Super Wash
- Sparkling Image
- Spot-Not Car Washes
- Fleet Clean USA
- Green Shine
- Superior Wash
- Clean Carwash
- Tommy’s Express Car Wash
- Cactus Car Wash
- CAP Solutions
- Sparkle & Shine Auto Detail
- SONNY’S The CarWash Factory
- Exppress Car Wash
- Blue Dawg Power Wash
- PCC Professional Car Cleaning.
g. What Do You Need to Start a Car Wash Business?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Well-Equipped Car Wash Facility
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Startup Inventory
Choose a Memorable Business Name
When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.
Some of the catchy business name ideas suitable for a car wash business are;
Creative Car Wash Business Name ideas
- Clean Joe® Car Wash, Inc.
- Richard Reno and Family® Car Wash, Inc.
- Car Nation® Car Wash, Inc.
- Big Daddy™ Car Wash, Inc.
- Space Planet® Car Wash, Inc.
- Gray Street® Car Wash, Inc.
- Auto Jonah® Car Wash Company
- Jackson Dairus® Car Wash, LLC
- Lincoln Inn® Luxury Car Wash, Inc.
- Wash Master® Car Wash, Inc.
- Ralph Williams® Car Wash, Inc.
- Bourn Mort® Car Wash, LLC
- Colly Bonny® Car Wash, Inc.
- Down Street® Car Wash, LLC
- Daniel Bruce® Car Wash, Inc.
- All Well® Car Wash, Inc.
- Partee Parley® Car Wash, Inc.
- Up Next® Car Wash, LLC
- Straus Gabby® Car Wash, Inc.
- Victory House© Car Wash, Inc.
Register Your Business
a. What Type of Business Structure is Best for Car Wash Business?
Even though there are several options when it comes to the business structure of a car wash business, the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits. Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Car Wash Business?
- General Business License
- Fire and Safety Permit (Fire certificates)
- Zonal Permits
- Signage Permit
- State Occupational Licenses
- Operational State Facility Inspections (Building Permits)
d. What Type of Certification is Needed to Open a Car Wash Business?
You don’t need any certifications to open a car wash business.
e. What Documents are Needed to Open a Car Wash Business?
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Federal Export Licenses
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering starting a car wash business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Car Wash Business?
When it comes to starting a car wash business, the startup costs vary and could range from $50,000 to over $150,000.
b. What are the Costs Involved in Starting a Car Wash Business
- The total fee for registering a business in the United States of America – $750.
- Legal expenses for obtaining licenses and as well as the accounting services totaling – $3,500.
- Marketing promotion expenses – $3,500
- The cost for hiring a business consultant (writing of business plans inclusive) – $2,500.
- Insurance (general liability, workers’ compensation, and property casualty) coverage at a total premium – $5,400.
- The cost of accounting software, CRM software, and Payroll Software – $1,500
- The cost for payment of rent and business office – $50,000.
- The cost for facility remodeling – $25,000
- The cost for equipping the car wash – $30,000
- Other start-up expenses including stationery – $1,500
- Phone and utility deposits will cost – ($2,500)
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $30,000
- The cost for start-up inventory – $18,000
- The cost for store equipment (cash register, security, ventilation, signage) – $3,150
- The cost for the purchase of office furniture and gadgets – $8,000.
- The cost of launching an official website – $600
- The cost for our grand opening party – $3,000
- Miscellaneous – $2,500
c. What Factors Determine the Cost of Opening a Car Wash Business?
- The size of the car wash business
- The choice of location
- The required licenses and permits
- The cost of branding, promotion, and marketing of the car wash business
- The cost of furnishing and equipping the facility
- The cost of the insurance policy covers
- The cost of registering the business
- Source of your supplies and ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms
- The cost of the grand opening of the car wash business
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
It is not compulsory to build a new facility for your car wash business, but if you have the required finance, it will pay you to build your own facility. The truth is that building or reconstructing a facility for your car wash business will help you come up with a facility that will perfectly fit into your overall business goals and vision.
e. What are the Ongoing Expenses of a Car Wash Business?
- Rent and lease
- Supplies (office supplies, car wash liquids, and car polish, et al)
- Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
- Maintenance of equipment
- Salaries of employees
f. What is the Average Salary of your Staff?
- Manager (Owner) – $45,000 Per Year
- Accountant (Cashier) – $32,000 Per Year
- Car Washer Men and Women – $26,100 Per Year
- Security Guard -$24,000 Per Year
g. How Do You Get Funding to Start a Car Wash Business?
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Daniel Bruce® Car Wash, Inc. is a licensed car wash company that will also provide top-notch auto cleaning services to clients. The business will be located in North Charleston, South Carolina – United States of America. We chose to operate in this city because we know that our services will be in high demand due to the growing ownership of cars.
Daniel Bruce® Car Wash, Inc. is located in a full-service state-of-the-art car wash facility that has the following features: a seventy-foot fully automatic tunnel; 3 high-pressure wand self-service bays; and 5 vacuum stations complete with fragrance and carpet shampoo dispensing machines,
Insulator washers with a pump pressure of about 1000 psi and a nozzle pressure between 500 and 750 psi, centrifugal water pump, stainless steel water storage tank, high-pressure water hose, high-pressure dead-man type water wash gun and Electrical grounds for the wash gun and washing system.
b. Products and Service
- Wash cars for clients
- Sale of car wash accessories and supplies.
c. Mission Statement
Our mission is to establish a world-class car wash business that will make available excellent car wash services at affordable prices to the residents of North Charleston, South Carolina.
Our vision is to establish a standard car wash business that will be among the top 5 car wash businesses in the United States of America.
d. Goals and Objectives
The goals and objectives of a car wash business are to provide a facility where customers can get their car washed at a fee.
e. Organizational Structure
- Manager (Owner)
- Car Washer Men and Women
- Security Guard
a. SWOT Analysis
- Ideal location
- Excellent operational history
- Availability of the latest and easy-to-operate car wash equipment
- Accurate estimates with no hidden costs
- Excellent customer testimonials.
- Not enough existing clientele to run at full capacity immediately
- We will need a loan to build our car wash facility and to purchase the equipment and related accessories
- The owner is currently running the business solo
- Lack of economies of scale.
- Increase in the number of car owners in our location
- Build upon existing clientele
- Online market, new services, new technology, and of course the opening of new markets.
- Loans diminish profitability until they are paid off
- The first year will be financially tight while we gain customers and pay off loans
- Competition in the area could increase
- Management of employees requires time, money, and efforts
- The transport department could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses.
b. How Do Car Wash Businesses Make Money?
Car wash businesses make money by washing cars for car owners.
c. Payment Options
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
d. Sales & Advertising Strategies
- Introduce your car wash business by sending introductory letters alongside your brochure to corporate organizations, car owners, taxi companies, transport companies, households, and other key stakeholders throughout the city where your car wash business is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, and LinkedIn to get your message across
- Create a basic website for your business to give your business an online presence
- Directly market your self-service carwash services.
- Join local car wash business associations for industry trends and tips
- Provide discount days for your customers
- Advertise your business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories) and online directories
- Encourage the use of word-of-mouth marketing (referrals)
a. How Much Should You Charge for your Service?
Car washes can cost you $7 to $15, and rates change based on other related automobile detailing services you request for.
b. How Much Profit Do Car Wash Business Owners Make a Year?
Many factors can affect car wash income, but on average, it can start from $41,000 per year for a small car wash to $686,250 per year for a bigger luxury car wash.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the car wash business
- The location of the car wash business is covering
- The management style of the car wash business
- The business approach of the car wash business
- The advertising and marketing strategies adopted by the car wash business.
- The number of years the car wash is in business
d. What is the Profit Margin of a Car Wash Business?
The profit margin of a car wash business is not fixed; to a large extent, it will depend on factors that are unique to your location.
e. What is the Sales Forecast?
Below is the sales forecast of a car wash business. It is based on the location of the business and other factors as it relates to such startups in the United States;
- First Fiscal Year: $280,000
- Second Fiscal Year: $440,000
- Third Fiscal Year: $600,000
Set Up your Office
a. How Do You Choose a Perfect Location for Car Wash Business?
- The demography of the location especially as it relates to people who own cars
- The demand for car washes in the location
- The purchasing power of businesses and residents of the location
- Accessibility of the location
- The number of car wash businesses in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Open a Car Wash Business?
- Rowland Heights, California
- Portland, Oregon
- New York City, New York
- Atlanta, Georgia
- Dallas, Texas
- Las Vegas, Nevada
- Los Angeles, California
- Brattleboro, Vermont
- Tucson, Arizona
- Silver Spring, Maryland
c. What Equipment is Needed to Operate a Car Wash Business?
- Car Wash Bucket Kit
- Car Detailing Kit
- Vacuum Cleaner
- Steam Cleaner
- Buffer Heads
- Set of Microfiber Cloths
- Washing systems, such as a conveyor tunnel or self-service wands.
When it comes to hiring employees for a standard car wash business, you should make plans to hire a competent manager (owner), accountant, car washer men and women, and security guard.
Launch the Business Proper
In recent times, no car wash business opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party.
The bottom line is that with a proper launching of the car wash business, you will officially inform people in your city that your car wash is open for business.
a. What Makes a Car wash Business Successful?
- Choose a good location and facility to launch the business
- Install easy-to-use car wash equipment and machines
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your car wash business
- Leverage all available online and offline platforms to promote your car wash business
b. What Happens During a Typical Day at a Car Wash Business?
- The shop is open for the day’s work
- Cars are washed and cleaned as requested by car owners
- Stocks are taken, accounts balanced, and reports are written and submitted to superior officers
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Car Wash Business?
- Attention to details
- Customer services skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining and bidding skills
- Work experience in a car wash business environment
- Experience in managing people
- Experience in business administration.