Home' Convenience and Impulse Retailing : November December 2009 Contents FoRECouRT
www.c-store.com.au | C&I | December 2009
More than car wash
GFC = Great for car wash
Car wash operators are familiar with the
impact of the weather on car wash sales --
a bit of poor weather will drive increased
activity, but persistent rain drives customers
away until the weather clears. When it does,
it can be hard keeping up with demand; for
example, after the recent east coast dust
However, it is weather's 'driver' -- the
climate -- that is shaping the long-term
trends for the commercial car wash business
"Consumers are getting used to using a
commercial car wash and the main driver
has been recent water restrictions," said
David Crampton, General Manager, CK
Group. "However, people now realise that a
car wash saves them time and money. Not
all will go back to washing at home, even
as water restrictions are relaxed. There will
be a new generation of car owners growing
up that will never think about washing a car
The 'global financial crisis' (GFC), and
consequent recession, have been 'blessings
in disguise' for automatic car wash owners.
It looks like the more expensive car wash
operations have lost business to service
"While people are reluctant to spend
around $35 at the local hand wash, they
are still willing to spend $10+ at a service
station," said Adam Pisk, Sales Director,
Autowash Pty Ltd. "We expect some of this
business to stay with the channel when
economic conditions improve because
a service station car wash is convenient
and good value. This is an opportunity for
service stations that can offer compelling
The GFC, recession, and now the recovery,
have had an effect on the economics of
buying equipment. "Now is an excellent
opportunity to invest in car wash," said
"With the strengthening Aussie dollar,
exchange rates are very favourable and
interest rates are low. Even if investors are
finding it difficult to get finance, CK have
various financing options available to help
get investors into the industry."
"Manufacturers are under pressure
because sales fell away when access to
finance was tightened," added Adam Pisk.
Washing at service stations is no longer just about car
washing – dog washing and now truck washing are part
of the product mix. However, the same principles apply.
"They have reduced prices to move stock.
Even if the banks are still reluctant to lend,
we offer different finance options, such as
partnering, where we install a machine and
share in the profits for a time, as well as
favourable payment terms. This means a
good site with potential to do well with a
car wash does not have to wait."
Car wash has proved a valuable source
of revenue during tough times.
independents, it is a useful counter to
the majors," said Wayne Rogers, Sales
Manager, Good Sight Co Limited. "Car wash
diversifies the site's revenue streams and
improves fuel sales as well."
"It is the same here as in the United
States," said Rob Lewis, International Sales
Manager, APLA, PDQ Manufacturing Inc.
"A well-run car wash is one of the highest
dollar margin categories on a fuel site.
The 'rule of thumb' is that 1--2% of passing
motorists will come in for a car wash,
bringing new customers to the site; and
5--7% of motorists already on the site to buy
fuel (or other products) will also buy a car
Just as fuel volumes drive car wash sales,
a car wash increases fuel sales. "In the
United States, the relationship between car
wash sales and fuel volumes varies from 150
to 400 litres per wash," added Mr Lewis.
"It varies with climate and consumer
behaviour and how well the car wash and
fuel offer are managed."
Add polish to shine
"Service stations need to keep their car
washes operating well with the latest
options," said Wayne Rogers. "Customers
expect a quality outcome and that means
including a sealant in the offer. In fact, the
biggest change in recent months has been
in consumables -- the range of polishes
and sealants. Equipment needs to be
modified but it is not a huge change and
well worth it."
Rob Lewis agrees.
innovation has been in the general
class of products that suppliers call
'supersealants'," he said. "For example,
our preferred supplier CSI stocks Lustra
Shield, which provides a very high gloss
that customers like and a very high margin
for car wash operators."
Similarly, CK has formulated Maxi Gloss,
which uses the latest 'nanotechnology'.
PDQ Manufacturing’s hybrid unit combines friction and touch-free technology, and its
recently-released new touch-free machine incorporates new technologies for faster
washing and lower maintenance.
AT A GLANCE
• Although no-one would wish a
repeat of the global fnancial crisis,
it has been a boon to the automatic
service station car wash business.
• However, it has made fnance a bit
more diffcult to fnd; but, car wash
equipment suppliers have some
• Technology is always advancing; this
year, the big gains are in polishes
and sealants, where the margins are
• Car wash is not just ‘set and forget’
though; it needs to be managed and
marketed for success.
• Dog wash is becoming mainstream,
and an excellent option at the
right locations. The latest wash
technology for service stations is
"It not only provides a superior gloss to
vehicles, but also a high level of protection
to the vehicle's paintwork," said David
Crampton. "Some clients upsell to this
option for an additional $3--6 per wash,
and the chemical cost is minimal."
The other significant improvement in
chemicals has been their ability to work
more effectively with recycling systems.
Even though New South Wales and
Queensland have relaxed some of their
water restrictions, it is now standard
practice to recycle as much as 90% of
water in commercial car washes.
"The new waxes that add a gloss finish
are another point of difference and another
price point," said Adam Pisk. "However,
the main improvement in chemicals is
their ability to work more effectively with
recycling systems. Water quality is critical
to wash quality. Previously the chemicals
did not break down or neutralise very
effectively. Now, the quality of recycled
water is much improved."
The challenge for car wash operators is
to get the message across to customers,
but it is worth the effort. The additional
cost of upgrading equipment and the
cost of the better quality chemicals is
far outweighed by the extra margins and
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