The car wash industry is growing and changing at a rapid pace. New wash technologies, payment systems and competitive challenges abound. Now is not the time to stand still.
Smaller operators still hold the lion’s share of the market. The conveyor car wash space is still dominated by owners with one or two locations, which make up 73% of the market.
But there is a lot of consolidation occurring. Private equity’s interest in this fragmented business is driving a lot of acquisition of smaller operators. Smaller operators have a unique opportunity to take the next step and scale their business or consider selling at a time when valuations are possibly at a peak. But whether an owner is considering selling or scaling, seeking guidance from a trusted advisor that specializes in the car wash industry can help maximize the value of operations.
So, what does this mean for the smaller operator? Especially when bigger chains have strong financial backing, resources available, and reputable branding that far surpasses what a local operator has access to. While bigger chains may have the overall advantage, smaller operators can still position themselves for success.
Frequently, owners and operators with a few locations often live near their businesses. That means they have special market knowledge. Small business owners can capitalize on a local climate by celebrating community achievements or local sports in promotions and advertising. In addition, they can tap into the community through fundraisers, charitable donations and school sponsorships. This not only builds goodwill, but brings awareness to your brand by reaching an extended audience.
Maintaining an online presence is important. Keeping up with online reviews, prioritizing Google and Yelp, and managing a digital presence with a current website and social media accounts is important. Even without a marketing team, responding to customers online shows your community how your business cares and prioritizes customer feedback.
In today’s world, third-party validation online drives business as the new iteration of good old-fashioned word-of-mouth advertising. Even negative reviews can be an opportunity to showcase how customer complaints are handled. Conversely, ignoring online outreach can harm a business by looking outdated or worse — uncaring.
Finally, embrace change. Smaller operators have something bigger brands often don’t: agility. With a single site or just a few locations, an owner-operator can have a hands-on role and point-of-view in operations. With a smaller leadership team, decisions can be made with less red tape. The ability to try new ideas and pivot quickly can be a huge benefit and an opportunity to differentiate from the competition.
At WashCard, we are obviously especially sensitive to payment system preferences. We’ve been at this for 30 years and have watched all the changes over three decades. Today’s consumers are fickle, more so than perhaps any other time in history. Based on the age of primary customers, wash owners should make sure they are in tune with their customers preferred methods of payment. We see car wash guests of all ages moving past credit- and debit-card swiping and chips, to mobile apps and tap-to-pay.
The pace of change in the car wash industry is only going to increase, and so probably will the pace of consolidation. Owners who will likely suffer in the long run are those who shy away from change.
Independent owners have dominated this industry since its inception – staying nimble and responsive is how to “keep it going”, and growing.