Why Adding a Car Wash is a Smart Decision

The convenience store industry is a tough business.  Labor shortages mean business owners pay higher wages to attract and retain quality employees.  With consumers focused on high gas prices, the pressure to lower prices to bring in more customers cuts into the profit margin even more.  One solution is to look at complementary services your convenience store can offer.  Here’s why adding a car wash is a smart decision in 2022.

Approximately 5,000 convenience stores in the United States already benefit from this $15 billion industry.  Yet, revenues continue to grow, showing there is room for more competitors in the marketplace.  There are several reasons consumers choose to pay for car washes, even in an inflationary environment, including these two primary factors:

1. Consumers have spent more money on purchasing vehicles than ever before.  As that investment increased, so has their interest in maintaining their vehicles in top condition.
2. The gig economy (Uber, DoorDash, etc.) exploded during COVID, and the demand hasn’t dropped significantly.  Many workers continue to enjoy the flexible working hours and use car washes to keep their vehicles clean and presentable.

Adding a Car Wash is a Smart Decision for Many Convenience Store Owners

If you haven’t considered the benefits of adding a car wash to your location, now’s the time to take a good look at them.  Here are just a few examples:

1. Car wash services are high margin.  Since many run with little to no human labor and use affordable cleaning supplies, the profit margin on a car wash operation is significant.  The actual profitability will depend on some factors, including utility expenses, type of products used, and location lease.  However, some reports have found the profitability to be as high as 68.6% of the ticket price of the car wash.  Few business lines bring in that much profit.
2. In-bay car washes take little space.  90-95% of convenience stores’ car washes are in-bay units (“IBAs”).  These units take up minimal space and work very efficiently.  
3. Consumers have a choice.  Today’s car washes offer consumers different cleaning levels, from basic to premium, to fit their needs and budgets.  Customers can choose different foams, waxes, and other add-ons to their wash.
4. Subscription programs bring customers back.  Most car wash customers use the service routinely–from once a week to once a month.  By offering a punch-card type program, those customers will continue to return to your location for all of their needs.
5. Car washes are easy to maintain.  Today’s modern car washes require little ongoing maintenance.  That saves convenience store owners both time and money.

Factors that Create Optimal Locations for Convenience Store Car Washes

Of course, many factors must be considered before making any business decision.  Fortunately, there are several attributes that tend to result in greater profitability for convenience store car washes.  A location has a higher propensity for profitability if more of the following factors are present:

1. Strong non-diesel fuel sales
2. High density of cars
3. Corner location with easy accessibility
4. Located near a residential neighborhood
5. Near banks, shopping centers, or grocery stores
6. Cross-streets are at slower traffic speeds
7. Ability to make a right-hand turn into the location from the primary cross street

Are you considering adding a car wash at your c-store locations?

At GP Energy, we partner with ISTOBAL for our car wash equipment.  ISTOBAL is a world leader in innovative solutions for car wash and car care systems.  Business owners love ISTOBAL car wash equipment because their innovative designs provide greater flexibility, profitability, durability, versatility, and less environmental impact.  Customers can choose between friction with three to five brushes, touch-free, or a combination of both.  It’s easy to see that ISTOBAL is a win-win for owners and customers alike.

Contact our team at GP Energy today if you’re looking for new ways to improve your services and grow your profitability.  We work with C-store owners and leaders to implement proven products, software, and methodology to achieve their goals.  We’ll have you crossing the finish line before you know it!