On The Clock

Timing is everything for carwash start-ups

I’m fairly certain that when The Rolling Stones wailed their way to Top 10 record glory by asserting “Time is on My Side,” none of the band’s members had started a carwash business. Frankly, I haven’t met a start-up client yet who believes he or she has enough time to take care of the new business and grow it, too.

There are critical moments in the early life of a carwash business in which time is particularly critical. In fact, there are a handful of predictable episodes that could prompt a start-up owner to sing out, “Time is not on my side!”

Let’s examine them:

It doesn’t take a special genius to recognize when a new carwash business is fully prepared to open. The facility itself is ready; the equipment is in; the staff has been trained. All systems are go and the long, sometimes trying, period of preparation is complete.

In my experience, the typical time from an owner’s decision to start a carwash business until he or she opens the door to the first customers can range from several months to two years. This means a lot of money is going out for quite some time before any comes in. With any start-up time is money. It is therefore important to avoid things that waste time or prevent a rapid move from Step 1 to Step 2 to Step 3 — right through to opening day.

Sadly, most new business owners underestimate the time needed to secure all the necessary permits and zoning approvals and to line up contractors. Depending on the municipality where the new carwash will be located, these tasks can range from four weeks to several months. Owners will invest considerable time in this phase even before the business starts taking shape.

I’ve seen it time and time again: A carwash owner makes solid plans to open a new location with a fresh, new building that is perfectly situated and functionally designed. The schedule leading to the grand opening is thoughtfully developed, with design, contracting and equipment installation accounted for in the construction phase.

The critical mistake most owners make, however, is failing to allow for disruptive and unforeseen delays. In their eagerness to get down to business, nearly 75 percent of owners take a far too optimistic view of when things will be ready. Stuff happens. Start-ups suffer.

Moral: Allow more time than you think you’ll need.

It’s a fact of life that once you place an equipment order, you will probably wait longer for the specially equipped hybrid automatic machine to arrive than for a custom Mercedes automobile to show up for services. The popular way of explaining this principle is “supply and demand,” and the principle especially applies to the world of carwash equipment.

New carwash businesses should seriously consider the amount of time that will be required between ordering and receiving equipment. Popular machines, such as exterior express tunnels, are subject to backorders that can consume as many as eight weeks. Truth be told, many of the machines for which my firm supplies loans or leases come from all over the United States and sometimes abroad. Thus, the whole aspect of long-distance shipping, and inevitable delays, may come into play.

Some lenders are attuned to the time considerations that impact start-ups and have developed ways for owners to skip or defer some payments on what they have borrowed to finance their operations. Therefore, it may not be necessary for start-ups to begin making payments on their loans right away. For example, owners will inevitably have some downtime during the installation of equipment, so it is often possible to start loan payments after the business has ramped up and cash starts flowing.

If skipping payments isn’t in the cards, then graduated payments might be a possibility. Monthly payments can start low and increase gradually during the ramp-up period. Similarly, lenders can even adjust a loan or lease payment schedule to take slow seasons into account so that the startup operator can more easily handle payments when cash flow slacks off at different times of the year.

Starting up a carwash operation is a risk at any time for an entrepreneur, so it pays to become as educated as possible — in advance — and allow sufficient time in the process for the likely roadblocks and inevitable delays.

Time can be on your side, but make sure it is a lot of time.

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