Spit and Polish

Its easy for business owners to look the other way when it comes to maintenance and remodeling. Every week some new crisis rears its ugly head and your attention is diverted from planning for the future to putting out the fire.

In the car-wash business, maintenance isnt just an issue of making sure your equipment operates; it is a function of protecting your investment for the long haul and eventual time to sell. Most of us know the importance of an exit plan. If you expect to maximize your opportunity to sell/exit with the least amount of deductions, you must have your facility spit and polished at all times.

Its like buying and selling a house. If youre a seller on the way to market, youre scrambling around repainting, remodeling and doing everything within reason to make a favorable impression. Your business is no different. Shabby lobbies, unkempt yard space, neglected landscaping and dirty bays all demonstrate a mismanaged operation where ownership doesnt care.

Downtime Is a Downer

Keeping an eye on your facility is important for many reasons. First and foremost, a car wash only makes money when the sun shines and everything is working. As is unfortunately true in every business, Murphy inhabits the hallowed halls of car washes. Just when youre on track to make your monthly number, the roof falls in, the conveyor breaks, you have a fire, or some other preventable event occurs and the register is silent.

Not long ago, a large car wash chain studied the effects of uptime on operations. The company launched a team of black belt Six Sigma folks on the project. The results were eye opening. First, they discovered 1 percent of downtime resulted in a monetary loss of profit of $100, so if a site was operating at 90 percent rather than 99 percent, that location would lose $900 that month. Extending that calculation over multiple stores would have been a disaster.

The team also found downtime was greater than reported because many employees didnt report issues in a timely matter. When the black belts dug deeper, they found a fix: Implementing tighter controls and new hardware minimized employee errors and increased the number of timely reports. Now, when a mechanical problem crops up that could result in downtime, the machine notifies management as well as the service organization, and everything is tracked on a real-time basis.

In addition, the company went to the manufacturer and asked for its participation in an uptime risk-reward program. The manufacturer accepted the challenge and, in doing so, realized there were a number of predictable maintenance issues that could be placed on an accelerated replacement schedule. By replacing parts early, uptime increased from an average of 90 percent to 99 percent. Today one manufacturer, Mark VII, has taken this experience and offers an uptime guarantee, a seemingly risky program but one that has positive results for the operator.

Rethinking Remodeling

Not long ago, an interesting business book, The Experience Economy, by Pine and Gilmore, was released. The authors contend we are entering a new business phase in which we must create for customers an experience that involves presentation, ambience, theatrics and a host of other items. Businesses creating positive experiences maintain the highest margins and greatest customer loyalty.

Obviously presentation plays a key role, so rather than wondering if you should remodel your car wash, you should be rethinking the remodel. How can you become a destination for the motorist wanting a car wash?

In the car wash business, we find dozens of people offering the same goods and services. Bottom line, we have become a commodity. As a result, now more than ever, we need to rethink who we are and who we serve. The goal is to provide value and a favorable, lasting experience for customers.

Anytime you think about remodeling you must ask yourself, What it will do for the bottom line? How long will it take? What kind of return is expected? These are the quantitative questions. When it comes to equipment, if its faster, more efficient, provides a competitive advantage and produces a cleaner car, the decision is easy. Improvements to building and grounds arent so clear-cut. But do your homework, and youll come up with a new vision.

A word of caution: Most equipment distributors offer extensive maintenance contracts. Although your first reaction may be, Ill do it myself, the reality is youll rarely achieve a professional result on your own. Good luck. Enjoy the book, and I look forward to hearing about the success of your projects.

Fred Grauer is president of Grauer Associates and vice president, investor services, for Mark VII Equipment LLC, a car-wash equipment manufacturer in Arvada, Colo. He has made a lifelong career of designing, selling, building and operating car washes. He can be reached at [email protected].