Start a Car Wash Business And Smile Regularly to the Bank
Car Wash is a business you can start with what you have right now and still make a lot of money out of it. The business involves setting up a facility where busy car owners come in to wash their cars for a small fee. Whether you are a retiree looking for a business to keep you busy, unemployed who is not ready to dust your CV once more, or you have your day job but desires to have a system to earn passive income; even if you are a student who is looking for a way to put your pocket money to good use, car wash services is a business you can easily use to launch your entrepreneurial endeavour.
Why Car Wash Business, you may want to ask?
The major driver of this business is the increasing number of cars on the roads all over the cities and towns in the country. There are between 11 million to 14 million vehicles on Nigerian roads according to data from Nigerian Bureau of Statistics and the Federal Road Safety Corp. This number is growing steadily as the population increases and more and more people acquire cars as means of mobility. This means many more cars that require washing; especially as close to 90 per cent of these vehicles are either privately owned or used for commercial purposes.
Environmental factors and the effect poor road infrastructure have on vehicles in Nigeria are another reason car wash services will continue to be in high demand. The roads are challenging to motorists when it rains with splashes of dirty water and mud making cars needing washing on regular basis. Similarly the dry season comes with dust which also makes it a necessity that cars are washed on a regular basis.
Yet another driver for car wash business is the fact that many car owners are either working class or business people who are too busy to wash their cars by themselves. The nature of their career also makes it necessity that their cars are always clean and well maintained, hence they patronize car wash services on a regular basis. Our investigation shows that most car owners visit the car wash once a week, many others do so once every fortnight.
Car Wash Type
Depending on the level of sophistication of the facility, the type of equipment used and the kind of services rendered, there are four car wash types that can easily be identified. These are
Full-Service Car Washes
This type of car wash provides full service like washing of interior and exterior, engine wash, steaming, vacuuming and all that. Virtually all the car wash businesses we modeled for this report were full service car wash.
Conveyor Car Washes: In this type of car wash, you’ll stay in your vehicle as your vehicle is pulled along an automatic conveyor tunnel while washing the exterior clean. This type of car wash is not popular in Nigeria perhaps as a result of the amount of investment required for equipment and components. However, we believe it is a facility that will appeal to the sophisticated consumer class in high brow areas of Lagos, Abuja, Port Harcourt and other major cities. If you have the money, you may give this car wash model a thought.
Self-Serve Car Washes: This is not also popular here but in advanced societies like the United States, it is estimated that approximately 36,000 self-serve car washes exists. In this type of setup, vehicle owners use the facilities to wash their vehicles themselves.
In-Bay Automatic Car Washes: This is the kind of set up that you will likely find at petrol filling stations and, large supermarkets. It generally requires much less space and manual labour compared to other models of cash wash. You’ll pay for the form of wash you need, your car can be pulled into the car wash from a start line, and also you’ll wait on your vehicle for the exterior of your automobile is wiped clean. Around 58,000 car wash businesses within the United States are in-bay automatic car washes.
What Business Model Should You Adopt
What type of car wash business should you establish? It all depends on the amount of money you have, the locality where you operate and the class of people there. If you are operating in an environment with high income earners and certain level of sophistication, you will have to consider investing in the type of facility that will appeal to them.
The type of car wash we envisage in this article, however, is a simple one that looks like the full service model but requiring no investment in sophisticated equipment.
All you need to set up this type of budget but standard car wash facility in Nigeria are not more than a convenient space, little equipment, washing materials and labor.
Services a standard car wash services offer will usually include exterior washing, interior washing, engine or steam washing, washing of car boots, rugs, carpets, radiator washing, vacuum cleaning and auto detailing.
What You Need
#1. A space – Getting a space to operate your car wash facility, perhaps is the most difficult challenge in this business. The space could be an empty land, the front of a building, a large space in the corner of your compound, a space around a filling station. Whatever type of space you are able to lay your hands on can be arranged to suit your purpose as long as it does not obstruct movement. If you have a large space, you will have to construct a washing bay, a sitting area where your customers will seat to wait while their cars are being washed. You will decorate this sitting area with half block wall an covered roof; equip it with a T.V set, plastic chairs, etc, You may even sell drinks and snacks for an additional revenue stream for your business.
#2. Some Equipment: For a standard car wash facility in Nigeria, you will need the following equipment:
High-Pressure Washer – Possibly the most important equipment you will need is a high-pressure washer. This machine comes with accessories including a hose, cord, brush and nuzzles to give a cleaner wash faster and with less labour. Machine models having a pressure of between 110 – 120 bars and a large amount of water flow will be suitable for your car wash business. A machine with this capacity can wash cars of sizes including SUVs and caravans.
A good high-pressure washer can be acquired from between N70,000 – N100,000 depending on the brand and capacity. Aim to get a machine that is durable, comes with a high-pressure cleaning pump, powered by a high-quality coppery power cord and driven by a permanent magnet motor.
The Okhard High-Pressure Washer is of this quality. It is a durable, petrol machine used for washing cars, machines or engines.
Vacuum Cleaner – This equipment is applied to filter dust and dirt that accumulate in the interior of the car. This dirt can be the floor, the seats and the boot of the car. Sometimes this rubbish is quite a challenge to clear and this is where the use of a vacuum cleaner comes to the rescue. I have seen that not all car wash owners invest in vacuum cleaners and you will be differentiating your service if you invest in one. You can begin with a handheld vacuum clear which can be bought for as low as N2,000 ad later invest in a more sophisticated equipment as your business grows.
Borehole – you will need a good source of regular water as water is the major raw material you need for your cash wash business. If you have resources, it is advisable you sink a borehole especially if you are operating from your land. The cost of borehole may range from N100,000 – N200,000 depending on the area and the depth. For a car wash business, you need not go much depth to get good water for your services unless of course, you intend to add the sale of drinking water as an additional line to your car wash services. The alternative to a borehole is to dig a well.
Water Pumping Machine – You will need to install a water pumping machine to facilitate the pumping of water out of the borehole or well. A good water pump can be bought for between N15,000 to N20,000.
Storage Tank – This is required to store water. A 2,500 liter GP storage tank, which I believe is suitable for your car wash business can be acquired for about N45,000.
Generating Set – The need for acquiring a generating set cannot be overemphasized if you are doing business in Nigeria. Fortunately, a small generator which can be obtained for as low as N20,000 is adequate for your business if you simply are interested in powering your equipment. However, if you are offering other services in your facility like viewing center, etc you may have to consider acquiring a bigger generator of say 2.9 kva and above.
#3. Other Materials and Consumables – This will include buckets, bowls, towels, brushes, detergents, soaps.
#4. Labour – You will need two or three people to work for you or with you if you are involved in the washing of cars. You will have to put adequate control measures in place to ensure that money is not diverted. Most of the car wash businesses I profiled for this article adopt the income sharing model to remunerate their workers. In this wise, washers are given daily and at the end of the day, proceeds are shared between the facility owner and the washer in an agreed sharing formula.
A More organized enterprise will have a cashier and a system in place which ensures that services are properly receipted and workers are paid agreed wages.
How to Go About Setting Up Your Car Wash Business
These are the steps you should take in setting up your car wash facility:
#1. Do your research – this is a very important step in any business you will want to start. With respect to car wash business, your research should focus on the location characteristics, existing car wash businesses in the area, is the area residential or commercial and what is estimated number of cars there, is it assessable, what laws operate to regulate your business and how will it affect you and finally, the feasibility of having that kind of business in that area.
#2. Choose a Location – The major consideration here is that your car wash should be as close as possible to main roads where vehicular traffic is high. The spot where you are must be easily sited by motorist as well as be accessible. Location is important in this business, having a car wash in a lonely street and hoping to service the neighborhood many not keep you business for too long
#3. Register Your Business – This is important to give your business a legal backing. You should also consider and obtain relevant permits that are applicable if any to ensure that you operate freely without harassment from law enforcers. For a car wash business, there are no specific regulations I can think of at the time writing this post beyond the general laws regulating business in Nigeria. However, it will be in your interest to visit the local government authority to see if there are specific rules especially as it relates to environmental laws and local taxes for your type of business.
#4. Raise Capital – If you did your research very well and had conducted some form of a feasibility study, by now you should have known how much you will need to start your car wash business. Our research shows that where cost of acquiring land is excluded, you will need between N300,000 to N800,000 to start a car wash business in Nigeria. You may wish to consult us for a feasibility study and guidance.
#5. Procure your equipment – majority if not all that you will need to start your car wash facility can be purchased from the open market.
#6. Launch Your Business – You will have to brand your business and put a signage to announce your car wash centre. Remember that there could be local rates to pay for advertising. Find out the agency responsible for this in your area and do the needful to avoid being embarrassed when you open shop. Print some flyers and distribute to car owners and other residents in your area, offer free service for the first wash and penetrate the market with an initial pricing that is attractive, supporting pricing with sound customer service.
To succeed in this business, you must have: good location for your business, use the right equipment, be competitive in your pricing, render excellent service and adopt effective management principles particularly with regards to labour.
Are you already thinking about this business? Welcome! All you need do is get more information, plan effectively and start now.
Good luck and if you have something you think can be of benefit to us and others, please share it with us using the comment box.
Buchi creates content and leads the Team at Stalwart Investment Partners; a business development and investment consultancy firm. He provides strategic advisory to help SME's, small business owners and HNI's grow profitable business and make informed investing decisions.