Car wash refreshes can bump up customer numbers and deliver a speedy return on investment.

When a new car wash opens in an area, owners of existing facilities may take a good look at their own locations and decide they need some changes. That can be a sound decision; it’s a proven way to improve their bottom line. 

“We’ve done some metrics and case studies that have shown that people have doubled and tripled their earnings before interest, taxes and amortization (EBITA) return at a site by giving it a fresh face and better throughput,” said Chris Michael, CEO of Express Carwash Equipment, which provides design services for new and existing car washes. 

Choosing upgrades that will deliver the greatest ROI is key to successful renovations. “We tell owners, ‘Give us your financial goals and let’s build you a machine around that with the piece of real estate that you have or are going to buy for renovation.’ That’s where we start.” 

Michael said that one renovation with a good payoff is upgrading to an automated prep process. EC has found that by automating this work, car washes can increase their throughput by as much as 20% per hour and eliminate the cost of employees for that work. Upgrading vacuum systems can also pay off, because that improves the overall customer experience. 

Adding a cashier hut and staffing it with a bubbly, charismatic employee is a relatively fast and inexpensive way to quickly boost club membership conversion rates. “A 4% conversion with an automatic teller is a pretty generally accepted number. But we know that if you man that station with the right person, your conversion rate can go up to 7.5% to 10%,” Michael said, which is data supported by research published in International Carwash Association’s The Pulse Report Q1 2024. 52% of respondents said the most effective way to sell memberships was having frontline workers at the point-of-sale. Without a person at the POS, only 9% found it extremely effective and 62% found it ineffective. “Also, with the right person there, you’re going to be able to create a higher product mix to your higher package rate,” Michael said.

Customer Experience vs. ROI

Summit Wash Holdings, owner of the Russell Speeders and Waters car wash brands, opened 24 new or renovated locations in 2023. Two older Connecticut locations, one in Waterbury and another a 60-year-old facility in Torrington, required extensive work to bring them up to company standards. The projects included improvement of the stormwater systems, new equipment packages and conveyors for the tunnels, new vacuums, new points of sale and remodeled interiors.

Summit obtains a good ROI on such projects by performing extensive due diligence and also by preparing and budgeting for unforeseen problems., “It’s possible to get caught really quickly with a large ticket item that you didn’t foresee and that could pretty substantially impact your return,” said Raymond Underwood, Summit’s chief development officer. 

The company builds its renovation budgets around creating a good customer experience, minimizing downtime and delivering faster throughput. “We design and renovate these facilities with the lens of much more volume than the wash has ever seen before,” Underwood said. “We do things like putting in additional blowers, which allows us to turn up or change speed and not lose quality.” User-friendly layouts and signage that smoothly guide customers through the site reduce wait times and maximize throughput.

To create a best-in-class experience and provide more value in its renovated facilities, Summit increases the number of vacuum stations and provides detailing supplies like towels, window cleaner, fragrance options and other add-ons. “This ensures that every touchpoint is an opportunity to exceed guests’ expectations,” said Kevin Matthews, chief operating officer at Summit. “We’re very heavy on the labor side, which scares a lot of operators, but we think it drives a huge ROI for us.”

Underwood said that Summit has definitely erred on the side of customer experience when balancing ROI with customer experience on a renovation. But it is now re-examining its approach to some extent. “Are we going too extreme toward customer experience so that we’re losing our ROI? We obviously need to hit our return thresholds, so I think in this next evolution of our conversions, we’ll be coming up with ways to track some of these things. Do they really generate an ROI?” Underwood said. “There may be things that we think consumers want but that really aren’t in their value set. Maybe we can save on some of those.” 

For example, major architectural upgrades to a building may not always be necessary; new paint and new signage can make a big difference in site rebranding. At a site like Waterbury, however, where the previous facility was very outdated, Summit will probably continue to make significant architectural changes. “If we don’t spend some of the money on architectural enhancements, people will think it’s the same old rundown car wash. So we want to be sure it pops from the road to draw people in,” Matthews said.

Extreme Makeover

Choosing whether to do minor renovations or going all in with a major overhaul is a big decision — and the right answer isn’t the same for everyone. Darin Kapanjie, who owns two Wave Car Wash locations in Pennsylvania, decided on just minor renovations at the Colmar site, but at Chadds Ford determined the best ROI renovation would come from taking the facility down to the bare walls. 

“We kept some of the tunnel walls and took out everything else,” Kapanjie said about the site, which he bought after a fire had occurred there. “The only reason we kept some of the walls was so that we didn’t have to go through full land development,” he said. 

Kapanjie worked with Car Wash Pro Designers on the site setup and equipment. “They saved us a lot of money on a few different areas, because this is something that they do all the time,” he said.  For example, on their recommendation, he improved efficiency by installing one inside vacuum turbine instead of the two outside ones that were originally planned. Kapanjie said that working with an experienced contractor who knew how to handle unexpected site problems also helped save money. 

One of the biggest decisions was to rip up the floor to replace the old conveyor, which could only handle small tires. The new belt conveyor has been a differentiator for the wash. “It’s more efficient, easier for cars to get loaded, and it supports the many different styles of tires and vehicles in the area. I don’t think there’s a belt like this within a one-hour radius of our site,” Kapanjie said.  

His renovation decisions have earned an excellent return. “In the first four weeks, doing a soft opening and without any marketing except one Facebook post in the local community, we had over 700 new members and did $120,000 in revenue.”

Delivering the Wow

Express Wash Concepts takes a “go big” approach when purchasing and renovating an existing car wash. Once the company decides on a site, “It’s really important that we don’t just put lipstick on the pig. On our remodels we do tip to tail. Every surface is new. Every piece of equipment is new,” said John Roush, CEO of the company, whose brands include Moo Moo, Flying Ace, Clean, Green Clean and Bee Clean. 

Selecting a site for a renovation should be very strategic, Roush said. Owners should ask themselves, “Would I build there if this wash wasn’t there? Will the renovation hold the standards of our new builds when completed? Am I leaving myself vulnerable to competition by building on a substandard site and substandard prototype?”

To earn a good ROI, car wash operators should have a realistic expectation of what their expenses will be. “If you do a renovation or remodel properly, you’re going to save some money but it’s not a 50% savings by any means,” Roush said. While staying on budget is important, any renovations should deliver a wow factor so that people who visit the remodeled facility will want to tell their friends. Investing in new branding signage and in trees, shrubs and flowers, and other landscaping can have a big impact on that customer experience. Adding new vacuums is another amenity that delivers an excellent ROI in terms of customer satisfaction.”

Choosing the right renovations yields big financial benefits. For Express Wash Concepts’ third project in 2009, it spent $1.6 million to transform a run-down car wash in Arlington, Ohio, into a Moo Moo Express Car Wash. Using its own contracting team, the company gutted the existing building, extended it and rebuilt it as a barn with a 125-foot tunnel and 10 free vacuum stations. Pre-renovation, the car wash did about 38,000 cars a year and earned $400,000 in revenue. The year after the renovation, 100,000 cars went through the wash and the revenue was about $1 million. “In the last couple of years, we’ve done somewhere in the 250,000 car range and $2.5 million in revenue,” Roush said. The company has renovated about 10 other car washes with similar success. 

Roush said that not all renovation ROIs are monetary. “There’s nothing more satisfying than shutting down a tired, sad car wash and then opening it up five months later when it’s beautiful and customers are blown away by what they see.”