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5 Questions You Need to Ask Before Buying a Car Wash

Posted On: 11/09/2016 / By:
Buying A Business

For years, car washes have been a promising investment for those interested in buying a business; however, as car washes become more automated and cars and consumers continue to evolve, the industry has changed significantly. If you’re thinking about buying a car wash business, there are several important questions to consider before you sign on the dotted line. Luckily, Sunbelt Business Brokers is here to offer 5 questions you must ask before buying a car wash business.

1.)  What type of car wash are you purchasing?

Tquestions to ask when buying a car washhere are three different types of car washes: full-service, express, and self-service. Determine which type of car wash is right for you to help narrow down your options. We’ve highlighted the main service offerings of each type below.

Full-service car washes typically run around $14 with a labor-intensive process that often includes multiple add-ons such as detailing, fuel, convenience store, and/or a lube stop.

For express car washes, the service is much like the name. Express car washes offer a variety of different price points that increase with respective services. Service usually costs between $3 to $12 and depends on a high amount of car volume to make its sales goals.

Finally, self-service car washes are the last type of wash. While self-service washes used to be fairly popular, they are slowly losing ground to automated washes. Consumers prefer the automated washes over doing it themselves and don’t mind waiting for that service. Self-service car washes are typically supplemented by one or two automatic wash bays and the service costs between $3 and $7.

Asking prices for each type of car wash vary depending on a variety of factors. Always consult with a professional business broker when buying a car wash to ensure you are investing in a worthwhile business.

2.) Where is the car wash located?

Location is something that is frequently overlooked by potential buyers. Understanding how the location of your business will impact revenue will help you determine the right car was for your investment. There are three things to consider when it comes to choosing a location for your car wash.

First, ensure there easy entrance and exit for the customers. Second, the likelihood of people stopping is increased if the car wash is on the way home from work. And lastly, car washes tend to have more success if they are in a higher than average traffic area in a neighborhood with a good mix of both residential and commercial properties.

If the car wash in question has at least two of these three qualities, it is likely a sound investment.

3.) How much traffic does the wash see on every day of the week?

Sometimes if a real estate agent is selling the car wash, they will bring you to the car wash on a Saturday, when the wash is guaranteed to be busy. While it’s good to see what the wash is like on a high traffic day, you should see what it is like on other days of the week too. For instance, if the wash is only busy Fridays, Saturdays, and Sundays, you are missing out on business four days of the week. Lack of regular traffic should be considered when deciding on whether or not to invest.

4.) Is all of the equipment in working order?

The last thing you want is to buy a car wash and then find out that all of the equipment needs to be replaced. Be sure to have a thorough inspection done by someone experienced with car washes to ensure that everything is in working order. Brokers can assist you with finding an inspector to ensure the equipment is functional and in working order.

After confirming that everything is working, it is a good idea to see if there are any upgrades that could be made to the equipment. For instance, if everything is working but the three other car washes in the area have the newest model of wax applicator, it would be a good business decision to upgrade. The cost of new equipment, potential repairs, and upgrades should be factored into your purchase price.

5.) Do you have an exit plan?

Yes, this is an important question to ask when you are buying a car wash. Things happen. The car wash can end up consuming too much of your time, you may find a better investment, have health concerns or a myriad of other things. It’s important to have an exit strategy in place before you buy the car wash so you can feel secure in your investment.

If you are looking for listings of car washes for sale or have more questions about purchasing any type of business, contact a professional Sunbelt Business Broker. Our experienced brokers have years of experience and can guide you through the buying process so you can invest in confidence.


John Davies

After obtaining his MBA, John began his career at PriceWaterhouseCoopers, the international accounting and consulting firm, and subsequently joined Progressive Corporation, a large U.S. based insurance company. John was a Division President at Progressive and subsequently became the CEO of a New York based private equity investment company. In
More about John Davies


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