How Much Should I Expect To Make From A Car Wash Business?

Comments & Replies: 2 Views: 7426 Posted By: Peter Siegel MBA

Topics: Buying A Business, Due Diligence Tags: business valuation, buying a business

Contributor: Peter Siegel MBA: BizBen Founder, ProBuy/ProSell Program Director

This is a hard question to answer specifically without any knowledge of the business. What kind of car wash it is (auto, self-serve, or full service)?, How many bays does the car wash have? Is there any other streams of revenue? But in general I can give you an idea based on nationwide averages. For the purpose of this discussion we will focus on automatic and self-serve.

Automatic Car Wash Averages:

Average number of cars washed annually: 19,947

Average sale per vehicle: $6.34

Average profit per vehicle: $4.35

Average annual profit: $86,531

Average annual revenue: $139,000

Average Self Serve Statistics:

Average monthly revenue per bay: $1,489

Average percent of time bay is in use: 10%

Average annual revenue for a 2 bay operation: $41,000

As you can see there is money to be made in the car wash business. You will have to do your due diligence when it comes to choosing a specific business as these are just industry averages, but you shouldn't have too much trouble finding car wash that will give you a healthy return on your investment.

Contributor: Timothy Cunha JD: Business Broker, SF Bay Area

This is a good topic to discuss "hidden" or unreported cash income.

A car wash is one of the businesses that are sometimes attractive to potential buyers because they think a lot of cash changes hands and a lot can end up in the owner's pocket without paying state and federal taxes.

BEWARE!

A seller who is going to tell you all about the taxes he hasn't paid on cash is telling you that he routinely steals, cheats, and lies -- but, he wants you the buyer to believe him when he tells you about his business. How trustworthy is that?

Material non-reporting of income distorts the entire system.--Those of us who are honest about our earnings are consequently paying a disproportionately higher amount of government expenses. How fair is that?

And, taking over a business with the intention of becoming an immediate tax felon can cost you bundles in legal fees, fines, and lost income, no to mention the prospect of looking through bars for several years. How smart is that?

Car washes, laundromats, vending routes ... these can all be good businesses. But, they must be sound businesses based on actual reported income, not based on being a criminal enterprise.

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