Guides to open or take over a car wash
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Modelled on a complete business plan of a car wash in Normandy, our template features both the financial forecast and the written part that presents the project, its team, the local market and the business strategy implemented by the management.
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This template includes a complete business plan, with a financial forecast and the following sections:
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Lave-Auto Caen will be a car wash located in the city of Caen on a road that leads directly to the ring road surrounding the Caen agglomeration.
Being located close to major roads gives Caen residents the ability to visit our car wash as and when they please for an efficient car washing service.
With a garage and service station located just a few hundred metres from our car wash, we'll complete the range of car services offered in the area to make it a one-stop-shop for motorists.
Lave-Auto Caen will offer three types of services: self-service cleaning, hand cleaning, and express hand cleaning.
We have chosen to offer these three types of services to cater to a wide range of preferences - whether customers are in a hurry and want a quick clean or would prefer a deep cleaning service.
We will also make sure to use biodegradable and environmentally friendly products, while using recyclable cleaning brushes.
Lave-Auto Caen will be a limited company with a share capital of €10,000. Colin C. will be the manager.
Colin has more than ten years of experience in various cleaning companies in the region.
Colin has joined forces with two private investors, Jean P. and Sarah N., who will not be involved in the day-to-day management of the company. The partners have also contributed €55,000 to the director loan's account.
According to INSEE, there was 32.7 million passenger vehicles in France in 2018, of which 6.1 million were light commercial vehicles.
Vehicle density (corresponding to passenger cars and light commercial vehicles per 1,000 inhabitants) in France is estimated at 600, similar to Germany, Spain, and Great Britain.
The car wash sector
According to the French National Automobile Observatory (ANFA), there is very little data concerning the number of car wash businesses in France.
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This can be explained by the diversity of the industry. There are 3 different main types of car wash services:
The difficulty in keeping track of the operation of the car services listed above is as follows:
The companies aren't necessarily referenced under the same activity code.Car garages using car washing as a service peripheral to their main activity are difficult to account for, given the activity code under which they operate.
Supermarkets that offer this type of service are also not referenced.Data on the number of car washes, therefore, remains limited - given the variety in the market.
In terms of revenues, Franchise Magazine's 2018 report on the Blue Elephant franchise, one of the car wash industry's biggest players in France, indicates that car washes belonging to their franchise generate between €150,000 and €200,000 in annual revenues with an initial investment of between €300,000 and €600,000 depending on the number of lanes and the size of the infrastructure in place.
Car washing in France
According to the study carried out by the IFOP institute for the Kleen car wash company, 84% of vehicles in France are washed twice a year and 18% at least once a month, while 34% are washed once every two to three months.
The study informs us that traditional car washes with pressure jets or rollers remain the most popular among the French. However, 22% of them still choose the most economical solution by washing their car at home.
In total, 78% of French people prefer to have their car washed at a station or by a professional rather than do it themselves.
At the regional level, the Ile-de-France area uses car wash stations most often - with 36% of its inhabitants washing their car at least once a month.
When it comes to preference for certain types of service in the southwest, 46% of car owners prefer roller washing whilst 26% of those in rural communities wash their cars at home.
While nearly 50% of people aged 65 opt for roller washing at the service station, 13% of those under 35 prefer getting their cars hand washed at these stations.
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The French budget for car washing
The majority of French people pay between €6 and €15 for a car wash (not taking into account the type of car wash), compared to only 5% spending more than €15 for it.
These figures indicate that most drivers go to car washes to wash their cars, since the average price for a pressure jet or roller wash is between €4 and €15.
According to multinational company Total, the most expensive type of car wash is the professional at-home car wash, which costs between €50 and €150.
Car wash centres are favored by the French, but also meet specific criteria in terms of their needs. They are divided as follows:
A car wash station must, therefore, be located close to the target clientele - because it's the main criterion of choice for a customer.
It can also be assumed that the price must remain affordable for customers who plan to use this service regularly, with 41% of households declaring they'd be willing to book online or taking advantage of 'happy hour' services if it means benefiting from a discounted rate.
When it comes to reasons as to why the French have given up DIY car washing, 50% blamed the weather, 37% said it was down to the price of washing, and 16% claimed that it's simply too difficult to do from home.
Since the city of Caen has a high concentration of apartments, it's not particularly easy for residents to wash their cars outside - especially those who live in the city centre.
The Caen metropolitan area alone has more than fifteen car wash stations, which illustrates a strong demand for car washing services.
With 66.9 million inhabitants in France and a fleet of 32.7 million cars, the number of cars per inhabitant is approximately 0.48 cars. It can therefore be estimated that the car fleet in Caen is about 51,000 passenger cars.
Our target market has been identified as residents of the area in which we're based - as the main criterion for people looking for a car wash is proximity.
We are located in a residential area, made up mainly of private buildings and townhouses, which lack facilities that allow local residents to wash their cars at home.
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At the end of Avenue Clemenceau, and close to our car wash, is the ring road with access to several roads linked to neighbouring areas, as well as a national road.
Whether they're on a one-off trip to Caen or on a daily commute, the location of our car wash is ideal for motorists, as they can stop without making any detours before reaching the ring road or having to exit it.
We have identified 15 competitors in and around Caen.
Our services are similar to those of our competitors, however, proximity is the main factor at play when customers are choosing their ideal car wash. Despite the high level of competition, we believe we can attract a local customer base.
The next closest car wash for our customers is a 20-minute distance by car. Using our car wash instead would therefore save local residents both time and money (in terms of gas use).
We believe that the services we offer (roller wash and hand wash) help us stand out from our competitors - as we let customers choose between two different types of service.
By providing an environmentally friendly car wash service, as well as a cheaper service for those on a budget, we believe we can satisfy our customers.
We believe we can achieve a total turnover of €148,925 in year 1, and then develop the business over the following years, by building customer loyalty and thanks to the impact of the actions planned in the marketing plan, to reach a turnover of €152,647 in year 2 and €158,050 in year 3.
We expect to achieve EBITDA of €12,628 (i.e .8.48% margin) in year 1, then EBITDA of €14,692 (i.e. 9.62% margin) in year 2, and €18,766 (i.e. 11.87% margin) in year 3.
Cash flow is expected to be positive over the duration of the plan, and the company should be sufficiently capitalized to enable us to meet our loan repayments while retaining sufficient leeway to renew our equipment and deal with any unforeseen events.
The opening of our car wash will require an initial investment of €136,000.
The manager and his partners have planned to contribute €65,000, i.e. 44.1% of the total.
To complete the initial financing, we would like to obtain a bank loan of €50,000 and a VAT bridging loan of €21,000.
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Find, in this guide, the main steps to carry out a market analysis for a car wash.