International Carwash Association's research team estimates there are over 62,500 carwash locations in the U.S.
According to IBISWorld and Grandview Research, U.S. carwash industry is between $11.5 billion and $15.0 billion business with over 54,800 locations.
According to our estimates, the U.S. carwash industry is a $24.0 billion business.
Analysts expect the U.S. carwash market to expand at a compound annual growth rate of 4.8 percent from 2021 to 2028.
Principal demand drivers are vehicle miles traveled, dirt and grime, and people's aversion to washing their own vehicles at home. Impeding factors are the weather, decrease in vehicle miles traveled, or decrease in personal discretionary income.
Most carwash operators are private investors that own one or two locations. The next largest segment is convenience store chains that operate carwash networks.
Other competitors include family-owned and operated regional chains, private equity backed investors, and hypermarkets (i.e. big box stores).
Carwash performance is a function of density, attraction, and conversion.
Density refers to amount of pass-by highway traffic. Attraction is the proportion of motorists that can be encouraged to pull in. Conversion is the proportion of customers who can be encouraged to return.
Emperical studies show pass-by traffic is main contributor to performance, and the relationship between traffic and attraction indicates only a small portion will buy.
Current equation for capture rate by product class is 0.3 percent in-bay, 0.74 percent full-service conveyor, and over 1.0 percent exterior conveyor.
Over the last decade, patronage for a typical customer has increased from an average of four visits per year to fourteen (14) visits per year.
This increase is attributed to decline in washing at home and increase in the number of carwash establishments offering subscription programs such as monthly unlimited wash option.
Average per car revenue by product class is $9.50 in-bay, $10.50 exterior conveyor, $18.70 full-service conveyor, and $5.00 self-service.
Carwash cost of goods are credit card processing fees, chemical, utilities, equipment maintenance, and customer claims. Operating expenses are advertising, insurance, hourly wages, salaries, payroll expense, building maintenance, and property tax. Other expenses would include rent and/or amortization (interest, principal).
Average gross net by product class is 55 percent in-bay, 55 percent exterior conveyor, 32 percent full-service conveyor, and 60 percent self-service.
The cost to develop a commercial carwash varies considerably.
In-bay automatic at a convenience store and gas station runs about $500,000 whereas the average cost to build an exterior conveyor including real estate is between $3.0 and $4.0 million.
Average cost for smaller balance properties such as self-service, express in-bay, and mini-tunnel is between $1.0 and $1.5 million.
Buying and renovating an existing wash instead of building new can lower start-up expenses as well as reduce business operating risks.
Smaller balance properties are ideal as family-owned business because they can remain open 24/7, rain or shine, and do not require full-time attendants to operate.