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Steps in Building a Car Wash

Preliminary Research

Funding Prequalification

Finding a Site

Site Analysis

A newly interested investor can expedite the process by doing their research early on.  During the preliminary research process the investor will certainly want to consult with experienced sources.  Perhaps talking with someone in the business, or consulting with a local equipment distributor.  Visiting industry websites like www.carwashmag.com, and www.carwash.org can be enlightening.  The annual surveys compiled by Auto Laundry News, a national industry periodical, are also very informative.  Initially the investor will want to make educated and informed decisions about the following important factors:

• What type of wash do I want to own and operate?  Self Serve, Automatic, Full Service, or Combination?

• What are the pros and cons of each type of wash business?

• Where do I want to locate my new car wash business?

• How much does it cost to construct and start my car new wash?

• Am I prepared to devote the time, energy and resources necessary?

 

 

In today’s economy, the cost to build a modern carwash usually exceeds $1,000,000.00.  Carwashes are typically funded through traditional sources such as banks and savings and loan institutions.   As with any venture that requires a substantial monetary investment, it is important for an investor to have current verification of the specific extents/limits of their personal borrowing capacity.  If  their plans are to secure even a portion of the funding from traditional lending sources, it is highly advisable to meet early on with a loan officer to determine basic criteria such as:

• Borrowing Capacity

• Loan Options

• Down Payment Requirements

 

 

 

 

 

 

If you are planning a partnership, it is advisable that all of the partners pre-qualify.  Additionally, you will want to make sure you know all of the partners very well.  This should include their personal and business backgrounds, as well as design, construction and operating philosophies.  One tool that is helpful in partnerships is drafting a partnership operating agreement with a business attorney.

 

 

If an investor does not already have a potential site located, it is advisable to employ the services of a Commercial Real Estate Broker.  Understanding the investor’s personal criteria, a good real estate broker should be able to provide a listing of potential sites.

 

Once a potential site has been identified it is important to determine that the site is zoned appropriately.  If the site is part of a larger planned development it is also important to ensure that carwashes are an allowed use.  These questions should be answered directly by the governing jurisdiction(s) and/or the developer.

 

If a potential site is not zoned appropriately, the process to change the zoning may become a formidable and expensive challenge.  Of course, every site comes with specific circumstances that present arguments for and against a zoning change.  Likewise every jurisdiction has their individual process, specific requirements, and legacies regarding their stance for rezoning requests.  At any rate, if the investor decides to take the “rezoning path” they should be prepared for a long and arduous process.

 

 

 

Car Washing is an extremely location sensitive business.  Determining the “fitness”

of any potential site requires experience and expertise.  Your equipment distributor should be of assistance with useful tools and expertise to verify the potential and fitness of your site.  These tools should include:

• Market Analysis

• Site Analysis

• Demographic Analysis

• Sizing & Typing

• Preliminary Project Estimates

 

 

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