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Do you want to open a washing zone for cars, bikes and other commercial heavy vehicles? Here in this article, we intend to explore how to start a car wash business with small capital.
The automobile industry has increased in recent years substantially. Car washing zone is an emerging business in India. Basically, automated car washing offers speed and convenience. Nowadays, consumers consider products and services that save time. The demand for the auto laundry industry is increasing rapidly. Equipment and product technology has made a big impact on the industry over the past decade.
The single biggest motivation for using a professional carwash – it makes the consumer feel good! The emotional rewards outweigh the attributes in terms of motivation. Generally, people use car washes more when the economy goes well. And when motor vehicle sales are up. When people have more money to spend, they are more willing to pay for a car wash.
Here is a Stepwise Business Plan Guide to Start a Car Wash Business
Broadly you can start the business in two ways. The first option is buying a franchise and the second is its own brand. You can find a lot of renowned car wash franchise in the Indian market. Starting a franchise car wash business is easier than opening their own brand. However, own business secures more profit and expansion possibilities than a franchise opportunity.
Why is Car Wash Business Profitable?
The car wash business presently is a highly profitable business in urban cities. Some of the reasons are the following:
- Potentially high-profit margins of a successful carwash
- It’s still a fragmented industry, so it is possible to build a strong regional brand
- Availability of capital for startup and lending
- It’s largely a cash business
- Unlike other industries, such as food service, inventory does not commonly spoil
- Many allied services you can offer under the same roof.
- No receivables, payment is immediate.
Location for Starting car Wash Business
First of all, this is not a business for rural areas. However, you can start the business in the metropolitan city and small town too. Basically, selecting a location is the most important aspect of this business.
You can establish the car washing zone nearby major shopping centers and among other businesses and attractions. Additionally, avoid building the washing zone sites within a one-mile radius of an existing car wash.
Fast traffic is harder to stop, causing capture rates to fall. Therefore, it is often best to simply select a location with slow cross traffic. Quick and easy entrances are important. Generally, modern car washes often depend on impulse purchases.
How Much Does it Cost to Start Car Wash Business
Initiating a car wash business demands moderate capital investment. There are different major segments that attract upfront cost involvement. First, you have to invest in securing the space. It is better to start the business in your own space. In case you don’t have space, you can go for rental accommodation.
Apart from the space, you have to arrange a reliable water source for the continuous water supply. Other major investments include building the shop, procuring equipment, staffing, and marketing expenses.
Business Compliance for Car Wash Business
Generally, starting a car wash business demands several licenses and permissions from the local authority. And it varies in different cities. It is advisable to check the local rules and regulations of the area where you are initiating the business. Here, we have listed some of the basic checklists.
- In starting the business, you have to first register the business.
- Apply for MSME Udyog Aadhaar online registration.
- Secondly, check the nature of the land.
- Apply for Trade License from local Municipal authority
- Contact Pollution Control Board for waste disposal.
- Finally, check the tax liabilities and yearly compliance liabilities for your business.
Car Wash Equipment
Generally, you will find different types of equipment in the market. Basically, equipment and tools come with different features, benefits and price range. However, you have to procure the equipment as per your specific requirement. You can also purchase the equipment with hire purchase leasing facility.
Car Wash Business Operation
For day-to-day operation, you have to hire skilled manpower. Additionally, you can ask the machine supplying company for providing on-site training. Generally, the requirement of the number of manpower depends on the size of the washing zone.
Before you start to offer the services, you must be equipped with the right business tools. And accounting software is the most important aspect here. Basically, accepting and managing bookings, raising tax invoices, printing money receipts are the major requirements in car wash business.
Additionally, your accounts department must be prepared for the annual auditing for filling the Income Tax yearly basis. Procure a right accounting software for daily basis bookkeeping and getting the track record.
Fix the pricing properly. Broadly, you can fix the price for both one time service and monthly basis. In addition to this, you can charge different prices for different services. Such as price for an exterior wash, only interior cleaning or for both.
Promotion and right marketing are the most important aspects of getting long term success in this business. And if you are starting the business of your own, you must put your creative thoughts for creating a regional brand. Select the right name of your business with a relatable logo and catchline. Additionally, create the company uniform for the employees. Also, put a bright and broad sign at the exterior wall of the shop.
In starting, you can offer to launch discounts to your consumers. The hyperlocal promotional strategy is the must. The car owners of the locality must know about your washing zone. Setup your company website. If possible, provide an online booking system. Make your car wash business available on Google My Business also.