Business Case Study Automotive Detailing Franchise Company

By: Lance Winslow
Submitted: 2007-01-17 11:43:02
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How do automotive detailing companies start? What makes them work and how do they grow? How do they choose which services they will offer? This is an interesting case study about a test market of a franchise company in the cleaning business and how they went about setting up Auto Detailing Shops. It maybe of interest to your business study and research; I am familiar with this story because it is one of the companies that I founded.

It all started in Reno, NV where we had set up a mobile car wash franchise of the Car Wash Guys for a franchisee there. www.CarWashGuys.com . Because we have significant market share in Reno NV, we wanted to expand into different lines. So we looked at co-branding with Ziebart, yet their corporate culture did not mix with our Entrepreneurial Fiber and the cost of their franchises were quite high. On top of that they had sold so many franchises in the US, there would be a problem later if we decided to roll out our system nationwide or continue buying their units to expand with our current franchisees, still we felt this might be worth pursuing. So instead going thru all the mistakes, which had already been learned we wanted to buy into a proven system and wanted to exhaust this possibility first. They turned us down. So we have decided to take the market, city by city. But first we needed to establish a prototype unit and this is where our Reno Franchisee came into play. Ziebart instead of partner would become a challenge, as they had 216 units already up and running. We visited many of their locations including Hilo, HA at the time.

We decided we would put in co-brands at car washes as well, express detail centers. Also at Park and Flys and High End Parking Structures. These permanent Detailing Centers would provide a wide array of services. We are detailing for large dealerships, adding oil additives, which are guaranteed by Lloyds of London for 100,000 miles, bed liners, gold plating, window tinting, auto accessories, pin striping, Gold Plating, Dent Repair, Windshield Repair, Wood grain and Interior Paneling, Vinyl and Leather Repair, Paint Touch-Up, Engine Steam Cleaning, Rust Proofing, Odor Elimination. The business plan is extensive, and the training intense.

We determined to be able to handle all the services we wished to provide the Centers would have to be 8 bay Detail Shops the largest of all organized Detail Shops. By having other WashGuy.com franchise systems customers to draw from there would be enough customers to allow maximum synergy. This is where the tires meet the pavement. The Super Centers are exactly that. The smaller co-brand version was tested at our fixed site car wash franchise prototype in WA. Now realize we have been in the detailing business for years, www.detailguys.com and we know what we are doing and we are good at it.

This company was founded out of necessity to service the customers. Paul our franchise in Reno of the car wash guys kept getting detailing offers from the dealerships he was washing. One offer led to an onsite takeover of their in-house detailing facilities; a four-bay detail shop, which he grew out of in less than three months. Then he moved into an 8 bay detail shop keeping the four bay for a total of 12 bays in two shops. Before his second year he was on pace to do about $600,000.00 this year. He had only been in business 18 months. He was so busy trying to divide his car wash with all his detail work he had decided to sell part of it. We wanted him to be successful so we allowed the partial transfer and he will be using the money from the sale of one of his car wash guys franchised territories to fund his new detail center. He maxed the old center out and had to move into a bigger shop, and then at one point even that was not enough so he had to keep both. The next year we had set up smaller Detail Guys Centers in other parts of the country and established co-brands in WA, OK, OH, TN, and CA.

The entire business grew out of a mobile car wash operation, without any detailed advanced strategic thinking on our part until we had the customers breathing down our throats yellowing “We need more services” and that folks is how many opportunities are found in the market. You get into business and get tough and follow opportunity, this is why all the text books and business plans are not all they are cracked up to be and why reality based entrepreneurship come from the real world where people can. Not from the academia world where all they know how to do is teach. If you want to go from 0-60 in four seconds sure it is nice to have a venture capital bankroll, but all the real companies I know about started from scratch and then became built to last. From starting small to finishing big is all in the market place and minds of the greatest people on Earth, the Entrepreneurs.

Lance Winslow

Article source: Expert Articles