3 Express Tunnels within 1/10 a mile

Trussville, Alabama (Northeast Birmingham, Alabama)

I would say that is the problem with tunnel equipment dealers........

Poor investment/advisement.

As the saying goes, a blind man could have seen this coming. I've written and cautioned about this mindless development several years ago, trying to alert independent investors about free-standing express wash development. But the cautions were drowned out by the slick presentations and bogus financial tools used by some in our industry's equipment supply chain to trumpet the free-standing express with free vacuums as being an express route to riches. Lies and misrepresentations abound, and the beat goes on... and on... and on.

If there is NO gasoline or multi-profit center in the mix to support volume, free-standing unattended express washing is the highest risk carwash venture to fund. It's rumored that over half of the free-standing express washes built in the past 3 years are doing poorly, quietly up for sale, or in foreclosure... with the southeast and central Atlantic states hardest hit.

What some equipment companies are doing and saying to sell equipment seems absolutely unconscionable.

It amazes me that city/county will give permits for construction in that situation. Gotta love their concern for the existing businesses.

I couldn't agree with Smokun more. Express is a good model but it is not a cure all in every market. The equipment manufacturers often promise the "express route to riches". Labor is brought to a minimum often with equipment sales brought to a maximum.

My .02 for what it is worth

The BP station tore down a 4/1 to build the express to "compete" per the owner's son.

I think it is hard to say that "express washes are the riskeiest car washes to fund." In my opinion it is like anything else, in the right location you can get a good return on your investment. No matter if it is a full-serve, self-serve, or express, the wrong location, or competition in the area, can hurt someone's business. So all car washes are risky in that sense.

My biggest fear at my existing washes is that someone will build too close. It seems like for some people, $2 million is not a lot of money. We figure the best competition is no competition.

I can't for the life of me figure out why people would build this close together. I know the area and I don't believe there is any way it can support 3 express washes. It will be very interesting to see what happens.

You may find it hard to accept, but that's the feedback from several observers. And in the quiet moments of candid discussion, equipment suppliers will likely agree.

As for the generalization about "any car wash" makes no sense. Traditional full-service is also a risky venture, due to the required labor.

Yet, a flex-serve can do it all... because it can adapt to the marketplace demands on a daily basis. Express relies on volume. Full-service is dependent upon labor.

Yes, if you operate either an express or a full-service, your biggest fear should be a well-run flex-serve opening up as your competitor.

It's not too late to upgrade!

-Steve

Smokun:

You have hit the nail on the head. Thank you for your insightful comments.

I looked at selling to an investment group in this area. After surveying the area, there is another full serve within a mile between this area and the I-459 interchange. I told the invester NO WAY! I also new from doing my homework another tunnel would be built with Gas here. The gas dealer has the advantage. Lower overhead!

Competition is great. But in the end, revenue and P&L statements tell the story. The best of luck to all of these operators in the future.

.......and the world turns.

Regards

I think there is a huge problem with this. Equipment dealers hands are tied when oil is involved, but when it comes to someone with to much money, and the thought that since there wash is the newest (or just because of the fact that they own it) it will prevail over an established wash...makes me sick. That goes for every kind of wash from self serve to full serve. On the other side of the coin there are the neglectful wash owners that invite this kind of behavior, because they truly have a run down wash that people may only go to because it’s the only choice they have in the area, so what happens? A new wash springs up, so then what happens? The run down wash starts panicking then the games of cut throat begin ending with no real winners. I love this industry, and so desperately wish there was some kind of regulation committee to set a standard for all car washes and car wash vendors. That would benefit everyone, because when you promote good car wash standards, people are going to wash more frequently and with more confidence.

You guys don't get it.....

Multiple car washes in close proximity will create a synergistic effect. Customers will be bombarded with the subliminal images of clean cars as they drive by the multiple washes. Clean Car Awareness (CCA) will penetrate the psyche. Area customers will perceive great value in frequent washing of their car, their second highest investment. As a result all operators will be profitable. How do I know this? My equipment rep told me so.....

P.S.- There is also a Goo-Goo going in at the next exit. So that will be four expresses and a full serve serving about a 75K market.

haha!

Heard from a friend that the one across the street from SpeedyJr. is standing opened today.