How much does it cost to start a car wash business?

It costs anywhere from a couple of thousand dollars to a million dollars or more to start a car wash business. This all depends on many different factors, including the type of car wash business you start, location costs, equipment costs, and other factors as well.

Mobile car wash businesses are by far the cheapest type of car wash business to start. Here you only need to cover a few areas of costs, such as vehicles, insurance, and employees, if you plan on having any. You can start a very small mobile car wash business for a few thousand dollars.

More traditional car wash businesses, like those that exist at a commercial location, can cost anywhere from $50,000 to $3 million to start. This all depends on if you are building a completely new structure for your car wash business, you are purchasing a pre-existing car wash, or you are renovating an existing structure that meets the demands of a car wash location.

Here are some things to consider when starting this type of car wash:

• Determining your business' location. Depending on the services you are going to offer, you can choose from a variety of locations.

  Again, if you don't have much startup capital, you can also choose to start a mobile car-washing business that comes to clients' homes or other locations.

  You can also choose a fixed location or temporary location for your business. Defunct gas stations and car washes that are up for sale make good locations for a car washing business, because the facilities may already have certain things you are going to need.

  Most of all you need to think about how your business location makes sense based on your market research, the consumer base you will serve, and the costs you can afford.

  If you are purchasing or renting a permanent location for your car wash you need to make sure it is in an area of your town or city that has a lot of car traffic. This way you can build up a steady clientele and get new customers who just happen to be driving by.

  Purchasing or leasing these properties can cost hundreds of thousands of dollars per year in lease costs, or hundreds of thousands to millions of dollars in purchasing costs.

• Obtain the necessary startup capital. The money needed to start a car washing business can vary widely.

  Depending on what type of services you are going to offer and the overall structure of your car washing business, it may cost you as little as $5000 or as much as $200,000 or more to start your business.

  Determine if you can self-fund the starting of your business or if you are going to need a small business loan or get startup capital from investors.

  Small business loans are more easily obtained when you have some startup capital already secured. You should aim to have at least $10,000 to $20,000, and sometimes more, depending on the bank and the size of the loan you are requesting.

• Find out what permits and licenses you may need to obtain. Costs in this area can be as low as a few hundred dollars or as high as several thousand dollars, depending on what route you choose.

  Most car washing businesses require you to apply for a combination of licenses and permits from your state and federal government.

  Requirements will vary from state to state, so it's important to do your own research into your specific state's requirements. Business insurance is necessary to protect your LLC from liabilities, and other possible claims.

  You also obviously need auto insurance for all of your vehicles, if your car washing business is going to be a mobile one. It is strongly encouraged that you seek the advice of an insurance agent to determine all the necessary insurance policies you should get for your business.

  Consider applying to become a limited liability company (LLC). If you operate as an LLC, your personal and company information is entirely separate. While this changes your tax status, it does protect you from personal losses based on the company's performance.

  Once you have this determined you'll also want to get a Federal Tax ID number. This helps you get a license to run your business. This is also referred to as an EIN or Employer Identification Number.

  Car wash businesses typically operate from a physical location, meaning you need to gain a Certificate of Occupancy. This confirms that your business meets all building codes, zoning laws, and government regulations at its location.

  Depending on your state, you might also have to meet specific environmental requirements to legally operate your car washing businesses.

  Call your local city hall to find out about any environmental regulations that may apply to your business and also for any insurance policies you must obtain to operate legally.

• Hire qualified and motivated employees. Depending on the scale of your business plan, you may not need many employees initially, or perhaps you do need large teams.

  Hiring employees is another cost you should have a look at and research. A car wash attendant in the United States earns an average salary of $30,843 per year, or an average wage of $14.83 per hour.

  Depending on the size of your operation, you may have to hire a significant amount of car wash attendants, which could result in significant annual costs you need to be prepared for.

  To service many cars at a time, you are going to need a considerable staff, if you are doing a mobile car washing business, you can likely have fewer employees on your payroll.

  You also need to consider any other services you might plan on providing. Do you need mechanics or technicians, in addition to car wash employees? There are also going to be administrative duties that you are likely going to need assistance with.

  If you are planning on keeping your car washing business on the small side, you can get away with wearing many hats in the business and hiring only a few employees, but if you want your business to grow in scale, you are going to need a workforce.

  It's helpful to gauge how many employees you think you will need if your car wash business really takes off, just to be prepared.

• Invest in equipment and suppliesh. There are many instruments and products that go into car stealing. You should make a list of everything you think your business will need.

  Costs in this area can be several hundred to hundreds of thousands depending on the type of car washing business you start.

  If you are constructing your own car wash bays on-site, you can expect to spend at least $42,000 per bay.

  Some items for exterior car washing and interior car washing include:

  • Detergents

  • Acid-free degreasers

  • Vacuums

  • Detail clay

  • Waxes

  • Shines

  • Polishes

  • Applicators

  • Drying towels

  • If also providing car detailing services, cleaning products meant for a variety of interior materials should be purchased, these include items like synthetic carpet upholstery, vinyl, leather, natural fibers, carbon fiber composites, plastics, other cleaning materials

  • Steam cleaner

  • Liquid and foam chemicals

  • Brushes

  • You might also want to invest in computer software for bookkeeping and other car washing business applications

  The kinds of services you provide will dictate your equipment and product needs, so be sure you are committed to any additional services before making any purchases for them.

• Market your car wash business. Marketing costs can range from several thousand dollars to much more, depending on how robust your marketing campaign for your car wash business is.

  You need to utilize the internet to market your car washing business. And the great part about this type of marketing is much of it can be free and you can do it yourself.

  In the modern world, social media is a critical marketing tool. You should create social media accounts for your business and try to gain friends and followers. You can post about your services and pricing, as well as show actual pictures of your car washing services.

  Similarly, you should also develop a website for your car washing business. This is relatively inexpensive, and if you have some extra cash, you can hire a professional to do a stellar website for your business.

  Your website should include your pricing and contact information, as well as things like customer testimonies about your services. Make sure your social media business accounts link to your website and vice versa.

  You can also market the old fashion way by handing out fliers, discount coupons, and other promotional items by hand. You or an employee can hand out fliers in heavily populated community areas or blanket potential customers' cars with fliers in communal parking lots. You should make sure you comply with any local solicitation laws when doing this strategy though.

  One of the best forms of marketing for a car washing business is word of mouth. Here you don't actually have to do much of the marketing at all, just simply provide very good services to your customers and ask your clients to recommend you to other possible clients and customers.

  You can also incentivize your clients to make recommendations by offering them perks, like a free car wash or multiple free washes per a certain number of referrals.

Here are some additional tips for figuring out costs and to help start your car wash business: