Tag: Truck

Truck Wash Business Case Study

Often smart entrepreneurs look for out of the way businesses, things out of the mainstream but businesses, which have a good customer base and steady incomes. This is an extremely interesting story. I had always considered the mobile truck washing efforts to be very profitable and believed that fixed truck washes were a big waste of money. That was until one year when a new franchisee joined our team from Oklahoma City. I run a franchise company called the Car Wash Guys; http://www.carwashguys.com. Turns out the franchisee was formerly employed by Blue Beacon Truck Washes the largest chain of truck washes in the US. They do about $138,000,000 per year with 80 truck washes and the company is very closely held. Tim our franchisee was a truck manager for them and before buying into our franchise and started washing cars in OKC even though he knows truck washing best. He had a two-year non-compete with his old company, which we have honored in OKC. He has tons of experience and had indicated to me that the business is sound and we should really get into it. Later that year I sold a franchise to a person in WA State who owned car washes (5) and he made a deal with a truck stop on an Indian Reservation, he never started the plan, but the numbers we ran on the spreadsheet looked great and very profitable.

Even as a serial entrepreneur, I had never considered the fixed site truck wash business, as the mobile truck wash business seemed so much more efficient and so little over head; http://www.truckwashguy.com . So even with all this knowledge on the team we still did not enter that market. One of our competitors in the car washing industry bought up two

truck washing chains for a total of fourteen truck washes and proclaimed it more profitable than his other car washes by 5 times as much money. They now own nearly 100 locations of truck and car washes nationwide. After looking into it some more a franchise buyer who owned Fuel MAN, an East coast Fuel Card for fleet owners approached us in South Carolina to use the Truck Wash Guys name and develop a truck wash mid state. At that point we decided to start working on the details. Then a franchisee in OH made a deal with a truck stop between Columbus OH and Pittsburgh, to operate a 24 hour truck wash and de-ice business. He thought how easy this is and now so we have made deal in WV at a truck wash as well. Our Ohio Franchisee at the time took on another partner in WV.

Still reluctant to fully dive into the subcategory of full service truck washes we found our Ohio Franchisee going full guns to put together a deal with Pilot Truck Stops. Pilot Truck Stop has the most Truck Stops on the Planet and sells 8% of all the diesel fuel in the United States. So we planned a pilot program at pilot. Our temporary set up is a trailer unit, which sits at the truck stops and washes made sense. We then worked on plans for a building to submit them to the Building dept. for approval, meanwhile the deals in

OH and WV and SC were suddenly in the works. We figured if our deal with the truck stops worked well, the Truck Stops will get more traffic and fuel sales while we generate

revenue and a percentage of the total take for the truck stop for the privilege of working there. We are so use to washing trucks and have on our team a gentleman who sells simonize truck wash and has been in the car washing and pressure washing equipment business for 20 years. By using the fuel man fuel cards as currency on the east coast and name recognition of Pilot we figured we could move into this industry and pick up the slack.

There is a shortage of truck washes across the country and also a shortage of oil change facilities for trucks. A franchisee could be trained by our truck wash prototypes and probably on the top performing franchisee in our mobile truck wash

division; then quickly set up in their own markets. Pressure Washing companies which specialize in fleet truck washing should in fact consider this type of strategy for moving into the fixed site truck washing business.

If you study entrepreneurial companies you will in fact see that many companies fall into markets due to opportunities which present themselves, it is amazing the opportunities which exist out there and how fast companies can grow when they can handle the demand of those markets. Think on this.

Truck Wash Business and Incentives for Higher Profits and Efficiency Considered

One of the most consistently growing sectors in our economy after the 2008 economic crash has been surface transportation for moving goods and services. Maybe that’s why Warren Buffet bought a railroad company or why FED EX is doing better with its ground freight than with its airfreight division currently. Although things do change over time, the trucking industry has been constantly hiring new drivers every month, about the only sector expanding throughout the economic recovery. So, maybe a good business might be one that is involved in that sector? Let’s talk about the truck washing business.

Yes, the truck washing sector is a decent business model if done correctly, I’ve been involved in on-site mobile fleet washing and fixed site truck washes in my career. The trick is to be efficient with the labor and process because, last time I checked trucks still don’t wash themselves, or drive themselves, and until Google figures that one out with autonomous self-driving trucks and fully automated truck washing systems to talk to each other via the Internet, well, we still have a good business strategy our here.

If you want your wash teams, employees and managers to run your business efficiently then you need to consider performance pay, bonuses, and incentive money. Yes, I know, Friedrich Winslow Taylor already made that abundantly clear well over 100-years ago. Now then, how much should you pay your hired help? Well, first there are minimum wage laws right? So, that ought to be a good starting point for a base pay for the washers, then pay them a bonus of the revenue over the minimum number of trucks which need to be washed based on average price charged to break even.

To do this, show them your real costs to break even. The bonus percentages are based on each hour worked and divided by each workers total hours – thus, different people get different bonus checks based on the hours they worked. Next, tell the workers that the only way in hell they are going to increase volume is by improving quality, speed (getting the divers out fast), repeats and referrals. This way they are overly nice to EVERY DRIVER and ask them to be sure to tell everyone to come in to your truck wash.

As you prune the “stand-around” lazy workers, your team will only have the best hard-working people and this will permeate what is expected of anyone new hired to replace the dogs.

What about management bonuses at truck washes?

Okay so, why not tell the manager that he gets a base pay, salary plus a bonus of the increased volume over last year’s same month volume, plus an efficiency number based on labor costs per unit. Let him know that the only way he’s going to get that done is to have the best kick-ass employees work more hours, and those who suck to take a hike and to go out and get new business, sell accounts, make calls to other companies to bring their trucks in, he’ll be more aggressive.

You need to think about the implications of all of this, and what formulas you might use to determine percentages. Remember your objectives are more efficient operations, saving costs, higher profits and more sales and volume – right? Okay, that’s the mission and that’s the goal – so use employee incentives for higher profits and greater efficiency. Please consider all this and think on it.

Exit mobile version