Dry mobile car wash business

Published:

Introduction

Business Idea generation is a cumbersome activity. It involves deep market research in order to identify the customer needs and the options available, finding the gap and then clicking at the right time. An important aspect is the gut feeling of an entrepreneur for the success of any business; of course proper management of the business forms an indispensible part for any business's success.

Similarly here, we have thought of setting up a "service firm i.e. dry car wash business" and the details are as under:-

"DRY CAR WASH BUSINESS"

We are planning to provide dry car wash business services to various car holders who would like to have their vehicle in a clean condition we will open it in jalandhar city.

We have identified that various service class people face problem when they comes in the queue for washing their vehicle in the workshops the survey because they run shortage of time and in order to provide facility to them we will open this mobile dry car wash which will work from 8 am to 6 pm in the evening. To check the feasibility of this idea , We have conducted a very small survey i.e. of 40 people and we have seen the very positive response from the respondents which has positively motivated us to proceed with this idea. Moreover this idea is new in Punjab region and it got very good response, at present no one is our competitor and we are providing unique service of mobile van, i.e. the van which will reach at the place, where there is washing of vehicle, and the van is fully loaded with all the equipments.

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Our expansion strategy, in the startup we will open our garage in which the mobile vans are parked in defence colony i.e. in jalandhar because there are nearly 10,0000 lakh vehicles in jalandhar city only which will provide us a huge market to cover. But as we are the new in this business in the whole Punjab region, later on our target is to cover in the whole Punjab region.

In our case the demand exists as the individuals lead a busy life and they find hardly a time to go to workshop to get their vehicle washed.

We have identified this gap from our own experiences and so we find an opportunity to start a mobile dry car wash business.

Our initial and short term goal would be that of SURVIVAL i.e., for a period of six months and during this period we would try and popularize the concept among the customers and once we achieve this goal then sky is the limit for us.

Five years down the line we can think of going at the state level. And once we achieve this we can then only think of giving competition to some of the firms operating in the metros.

MARKET RISK is almost negligible because the demand for such services remains throughout and the threat of competition in the target market initially is negligible.

General Company Description

BUSINESS CONCEPT:

Ø The idea of our business is to provide adry mobile car wash services required by the customers at the right time and at a nominal fee.

Ø We would be having the persons working under us who will be hired on salary basis.

Ø Then we can even have the experts for the guidance of the workers and even to handle the long term and important projects.

Ø The customers can reach out to us through:

o a phone call on our helpline numbers

o direct

Ø The services would be available from 9am to 6 pm.

Ø We would try to equip our self with the latest technology for each of the service and this technology equipment would be on the basis of the scale of operations and the economic feasibility.

MISSION STATEMENT:

"To open first chain of dry mobile car wash in punjab"

COMPANY GOALS & OBJECTIVE:

GOALS: To be a healthy, successful company that is a leader in providing the best customer service and that has a loyal customer relationship.

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OBJECTIVE: To meet the high level of customer satisfaction.

BUSINESS PHILOSOHY: To be a leader in the service industry maintaining long term relationship with the customers.

Industry Analysis:

Automobile industry is one of the best growing sectors in India. The growth of this sector in last few years is tremendous and this sector grows very rapidly in future.

* India is 2nd largest two wheeler market in world.

* 4th largest commercial vehicle in the world.

* 11th largest passenger car market in the world.

* Sales of cars in India are likely to grow at an average of 15% each year.

Life cycle stage of Indian Automobile Industry:-

As from the above figures, we can easily predict that Indian automobile sector is no doubt at a growth stage and because of this, we are sure that our business will have a huge growth aspects in future due to the increasing demand of automobiles.

But, if we talk about our business plan, our business will be at introductory stage because it is new concept in punjab. So, at the initial stage it is at the introductory stage but it will be soon at a growth stage because of tremendous growth of Indian Automobile Industry

UNIQUE SELLING PREPOSITIONS:

* Timings of our work

* Mobile Van

* Service Provided within 30 minutes

SWOT ANALYSIS

1) STRENGTHS-

* Timing of providing service different from others.

* High quality sevice

* Home delivery sevice provided by us.

* 30 minutes service

2) WEAKNESS-

* Not much awareness

* Difficult to get employees.

* Managing more then 4 customers at a time

3) OPPORTUNITES-

* To tapp untapped market

* Less competition

* Working timings i.e. 9 am to 6 pm

* High sale of automobiles

4) THREATS-

* Customer going to dealers only.

* Reluctance of customer going out to workshops.

PRODUCT AND SERVICES

· Car Washing

The car washing services will consist of both exterior and interior cleaning services including exterior washing and drying of the vehicle and a modern, easily accessible, high quality car wash. The business will operate through its stand alone facility and several mobile tents that will allow the business to move from location to location throughout the area. It will depend on the customer whether to get water car wash or wax car wash which will vary in the cost. To be more environment friendly and helpful to society various other steps will also be taken.

· Car Detailing

The business will also offer car detailing services which including rim and hubcap cleaning and waxing. These services will bring in significant amounts of additional revenue for the business as management anticipates that approximately 25% of its car washing customers will opt for detailing services as well. The business will also offer internal detailing which includes removal of the floor mats, and a complete cleaning of all upholstery and the dashboard.

Description of Product and Service

Our mobile car wash company will use the highest quality car wash products and provide various services including:

* hand wash

* chamois dry

* bug removal

* clean tires, rims, and wheel wells

* wipe dash, console, and door jams

* vacuum interior

* dress tires and moldings

* clean glass and mirrors ;much more

We will hire employees and a manager as our business grows. Number of equipments and other things required will keep on increasing as the business will keep on growing.

Employees are tasked with enhancing the overall service experience, creating happy and loyal customers.

How we Are Going to Compete with Them:-

We have studied about the services provided by mobile car wash in U.S.A and U.K and price strategy followed by them and from this, we come to know that the price charge by them is very high. So, they are not competing in terms of price with their competitors but they are competing in terms of service provided by them.

So, we are also focusing to follow their strategy to provide services to our customers and we will also focus on customer's satisfaction i.e. on improving quality of our services rather than competing with our competitors on pricing strategies.

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However we will also try to use some promotional strategies like Discount Coupons and 5+1 services that mean with every 5 services, 1 is free. But, our main focus is to provide timely and quality services to our customers.

Marketing plan

Mobile car wash posses good information about the market and knows a great deal about the target customers. This information will be leveraged to better understand who is served, their specific needs and how Mobile car wash can better communicate with them.

Market needs

Mobile car wash is providing the market with a premium hand car wash service for the Jalandhar people. Mobile car wash seeks to fulfil the following benefits that are important to the customers :

· Exemplary customer service: the target customers have money and are used to having excellent customer service. They will not regularly use Mobile car wash unless they receive excellent service.

· Convenience: The hours of operation as well as the time needed to provide the service must be convenient and fast respectively to gain market share.

· High quality washes: the target market values a higher quality wash for their upper end cars.

Market growth

The car washing market has seen steady, 4% growth for the last six years. Growth is forecasted at 4% for the next four years.

Market trends

The market trends for the car washing industry have seen a gravitation from hand washing to automatic washing machine facilities. This trend has been fuelled by the progression of technology. The automatic washing machines have become less expensive and more efficient over the last few years to the point that it is typically cost effective to invest in these machines. While one might presume that this would lead to the demise hand washing, the abrasiveness of the machine will never be appropriate for expensive automobiles. This trend will not have a significant impact on hand washing facilities that have a sufficiently large customer base that possess expensive cars. Mobile car wash targets upper end client and with market supply decreasing demand for its services will increase.

Market segmentation

Mobile car wash segments its customers on the basis of type of car ownership. Mobile car wash believes that the type of car a person owns says volumes about their car washing and detailing requirements.

· New car owners: owners of new cars are more likely to use a hand car washing service. These owners take great pride in their cars and will bring them often to the wash and detail service. The goal with these customers is to promote regular use of the wash service. The aim is to inform these customers that mobile car wash will keep their car looking as good as it was the day they drove it from the showroom.

· Older luxury car owners: these people have either owned their high end luxury cars for several years or are unable to afford the expense of a new luxury car but want the feel of relaxed driving. Both of these groups want to keep their cars in the best possible shape. Those who have bought second hand cars will often spend many hours in their cars and will place high importance on keeping their cars looking good. These owners will bring their cars in for regular washes and occasional details.

· Sports car owners: these people are often young and middle aged and will regard the look of their car as important. They will also pride themselves on the look of their car and will have their car hand washed atleast weekly.

· Lifetime owners: many of the people have owned their cars for more than 5 or 6 years. They are attached to their cars and though it may be more sensible for them to purchase a new car, they will bring their car for wash occasionally when the car is dirty. They like their cars to look presentable and want to keep it in good shape.

· Local businesses: some local businesses have fleets of cars and small vans that must be kept clean to maintain their company image. These businesses will be looking for a cost effective, efficient car washing service to perform this service and will prefer to use a car wash service during the week rather than weekends.

Target market

· Individual car owners

· Leasers

· Local businesses

Marketing strategies of mobile car wash

The marketing strategy is to develop brand equity, increase customer awareness of mobile car wash and build the customer base. The strategy will use different tools to achieve this goal.

Marketing mix

Product/services : Mobile car wash will offer three kinds of services which are as follows:

· Car washing (Exterior)

· Car cleaning (Interior)

· Interior and Exterior

Place : Mobile car wash will provide their car wash service at customer's respective place on one to one basis so that customers will feel that they are valued customer of Mobile car wash and also that the employees care about the upkeep of their vehicle.

Price :

· Car washing (Exterior) : Rs. 200

· Car cleaning (Interior) : Rs. 250

· Interior and exterior : Rs. 400

Promotion : For promotion of our company, we will use following promotional tools in order to promote and create awareness of our services. So the promotional tools used by the Mobile car wash are:

· Advertisements in newspaper, magazine and radio.

· Pamphlet

· Broushers

· Membership card

OPERATIONAL PLAN

Considering operational plan to be the most important plan in any business idea special care is taken to cover all the major aspects. The Operating plan section describes everything about the physical necessities of business operations, such as our business physical location, facilities and the equipments required for our business. Depending on what kind of business you will be operating, it may also include information about inventory requirements and suppliers, and a description of the manufacturing process.

People:

As we are 5 persons who will be operating this business so, we have share the responsibilities in the following way:-

In this way we have distributed responsibilities among us. Except us following are the people which we are recruiting in order to run our business:-

1) 2 Experts ( which we will recruit from jalandhar )

2) 6 subordinate i.e. 3 subordinates for every expert. These subordinates will be diploma holders which we recruit from colleges or by giving advertisement in newspapers.

3) Total no. of 13 persons we recruiting in start of our business.

Process:

In order to run our business these are the two processes which we have to follow:-

1.) One is when customers come to us for washing of their cars and after servicing we have to take the car to their respective places. This process is main USP of our plan. So, we will try our level best in order to give proper and timely services to our customers.

2.) Second process which we are doing is when customers call us for the washing and cleaning of their cars then we will go to them in the mobile van. The main USP of this service that we will provide the service within 30 minutes That's why we are first covering only 40 km area of jalandhar.

· Suppliers

Supplies of all the material required will always be up to the mark. Suppliers will be on contract basis. Material required like soap, wax, tire shine will be sufficient enough to give 4 to 5 washes per day at starting of business and thus increasing them as business will grow time by time.

Our suppliers will be from Jalandhar itself. We will do contract basis supplying with them. All the material required like wax, soap, and other material will be from suppliers. Some amount will be paid in the advance for the material and rest will be paid later on after the delivery of the material.

· Equipment

The basic equipment required for mobile car wash is of main importance. Full work will take place at customer's site. Other important things required are water tank. Pump, pressure washer and a small generator mounted in the back of van or car that we are using.

Firstly we need a van for initial startup of our business. Then as our business will grow, required number of vans will also increase. In van, there will be initially installed calling machine, to give suitable timings to our customers. Pump and pressure washer are next items which we need during giving a car wash. Then we need water which will be required in gallons. If customer wants without water wash service, then we will give him wax mobile service for his car. In this no water will be wasted instead of it wax will be used for this.

We will also mount generator at the back of the van to give pressure washing service. All these equipments will be required initially to start the business

· Location

The business will be operated from the main showroom where we will deal with our suppliers, lenders; routine customer's etc. whole of the equipment required for full detailing of cars will be stored in our car which will offer the service to the customers at the required destination. An answering machine will be installed in van\car to answer or give time to customers who will call us for the car wash. Full work will take place at customers' site.

Main showroom of our business will be located in Jalandhar, where we will deal with our regular customers who come there for servicing. We have selected this location because it is close to highway and mostly cars need a wash after sometime. In today's time people don't have much time to get their cars to the showroom and get the wash done. Thus keeping in mind various points, we have selected this location for our business. Other customers whom we provide our service at their location, for them we will have special facility of providing service at their door.

Management Team and Ownership

Would you like to start a mobile carwash business, one which you can operate from your own home and not have to worry about leasing a building or finding a location. A mobile carwash business is that type of the business and you can operate from your home and park your trailer rig or your pickup truck with the equipment in the back in your own driveway.

I must warn you however that running a mobile carwash business is not easy work, in fact it is quite difficult on your body and you will be sore and tired each night until you get used to it. One thing good about starting a mobile carwash business is that it is easy to find customers even if you just do business within a few miles of your home in the office complexes where people work and in your neighborhood doing auto detailing.

The best way to advertise a mobile carwash business is to hand out flyers and business cards and a magnetic sign on your vehicle with your name such as; Paul's Mobile Car Wash and Detailing. In a mobile carwash business your best customers come from referrals from other people whose cars you have cleaned and done an excellent job at a fair price.

1810 management team will consist of 5 members, who together will be co owners maintaining a majority ownership interest in the company. They are highly focused, hard working, energetic and broadly experienced individuals whose combined talents provide a strong and qualified management team. Swati and Priya provide the needed experience in the areas of business administration, finance, sales and marketing. Their extensive business background and academic credentials compliment the strengths and talents. Raman, Bikram, Nishi provides strong technical and engineering expertise and will be responsible for mechanical and electrical operations and materials procurement.

Financial Plan

The following plan outlines the financial development of Mobile Car Wash Company. The business will be initially financed by apersonal investment of Rs.15 lac approximately by four friends Bikram, Raman, Swati, Priyam & Nishi; and will finance growth through cash flow. Each of 5 friends will invest around 3 lac. This will mean that the company will grow more slowly than it could, but it will ensure that partners retain control over the direction of the company. In year three, it is hoped that the company will be able to open a second location. It is envisioned that anoutside loan or equity funding will be sought at that time.

Important Assumptions

The financial projections for Mobile Car Wash Company are based on the following assumptions. These assumptions are thought to be quite conservative, as are the financial forecasts.

General Assumptions

Year 1

Year 2

Year 3

Plan Month

1

2

3

Current Interest Rate

10.00%

10.00%

10.00%

Long-term Interest Rate

10.00%

10.00%

10.00%

Tax Rate

25.42%

25.00%

25.42%

Other

0

0

0

Break-even Analysis

The table and chart below show the monthly break-even analysis calculations for Mobile Car Wash Company. Here we are focusing on both type of car cleaning that is exterior and interior both. So we are defining the projected financials according to these assumptions.

We have made BEPs through studied assumptions which are projected above.

Break-even Analysis

Monthly Units Break-even

423

Monthly Revenue Break-even

Rs.3,98,700

Assumptions:

Average Per-Unit Revenue

Rs.300

Average Per-Unit Variable Cost

39.5

Estimated Monthly Fixed Cost

Rs.3,82,050

Projected Profit and Loss

The following Profit and Loss table illustrates projected income and expenses monthly for the first year and annually for the next two years for Mobile Car Wash Company.

In starting four months, loss is occurring but from fifth month profit has started which is increasing with respective months.

From the chart it is clear that profit is less during first year of business but as the time goes profit increases year on year.

Mobile car wash is showing gross margin less in starting months but as the business accelerated it shows good monthly margins with time.

If we study the gross margin on year basis, company is giving gross margin in increased value year on year.

Projected Profit and Loss

Year 1

Year 2

Year 3

Sales

Rs.54,90,000

Rs.77,66,950

Rs.1,16,10,200

Direct Cost of Sales

Rs.2,29,150

3,49,700

Rs5,52,350

Other

-

-

-

Total Cost of Sales

Rs.2,29,150

Rs.3,79,700

Rs.5,52,350

Gross Margin

Rs.52,60,900

Rs74,17,250

Rs 1,10,57,850

Gross Margin %

95.83%

95.50%

95.24%

Expenses

Payroll

Rs.30,84,000

Rs.44,15,600

Rs.56,58,700

Sales and Marketing and Other Expenses

Rs.1,30,000

Rs.77,500

Rs.85,000

Depreciation

Rs.1,03,500

Rs.1,03,500

Rs.1,03,500

Leased Equipment

-

-

-

Utilities

Rs.1,66,250

Rs.1,75,000

Rs.1,87,500

Insurance

Rs.90,000

Rs.90,000

Rs.90,000

Rent

Rs.2,40,000

Rs2,75,000

Rs.3,00,000

Payroll Taxes

Rs.77,1000

Rs.11,03,900

Rs.1,41,4700

Other

-

-

-

Total Operating Expenses

Rs.45,84,750

Rs.62,40,500

Rs.78,39,400

Profit Before Interest and Taxes

Rs.6,76,150

Rs.11,76,550

Rs3,21,85,00

EBITDA

Rs.7,79,600

Rs.12,80,250

Rs.33,22,000

Interest Expense

-

-

-

Taxes Incurred

Rs.1,60,200

Rs.2,94,200

Rs.8,18,050

Net Profit

Rs.5,15,900

Rs.8,82,550

Rs.24,00,450

Net Profit/Sales

9.40%

11.36%

20.68%

Projected Cash Flow

The following Cash Flow table illustrates that if M C W meets projected sales, it will have positive cash flow afterhalf a year of operations.

Thus during starting five months, there is cash out-flow but after sixth moth cash in- flow is rising.

Year 1

Year 2

Year 3

Cash Received

Cash from Operations

Cash Sales

Rs.46,66,500

Rs.66,01,900

Rs.98,68,700

Cash from Receivables

Rs.6,54,850

Rs.10,95,100

Rs.16,23,500

Subtotal Cash from Operations

Rs.53,21,350

Rs.76,97,000

Rs.1,14,92,350

Additional Cash Received

Sales Tax, VAT, HST/GST Received

-

-

-

New Current Borrowing

-

-

-

New Other Liabilities (interest-free)

-

-

-

New Long-term Liabilities

-

-

-

Sales of Other Current Assets

-

-

-

Sales of Long-term Assets

-

-

-

New Investment Received

-

-

-

Subtotal Cash Received

Rs.53,21,350

Rs.76,96,000

Rs.1,14,92,150

Expenditures from Operations

Cash Spending

Rs.30,84,000

Rs.41,15,600

Rs.56,58,700

Bill Payments

Rs.16,52,600

Rs.23,41,850

Rs.33,87,150

Subtotal Spent on Operations

Rs.47,36,600

Rs.67,57,450

Rs.90,45,850

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out

-

-

-

Principal Repayment of Current Borrowing

-

-

-

Other Liabilities Principal Repayment

-

-

-

Long-term Liabilities Principal Repayment

-

-

-

Purchase Other Current Assets

-

-

-

Purchase Long-term Assets

-

-

-

Dividends

-

-

-

Subtotal Cash Spent

Rs.47,36,600

Rs.67,57,450

Rs.90,45,850

Net Cash Flow

Rs.5,84,750

Rs.9,39,550

Rs.24,46,350

Cash Balance

Rs.10,19,750

Rs.19,59,300

Rs.44,05,600

Projected Balance Sheet

Mobile car wash's balance sheet illustrates a healthy financial position for this new company. The monthly estimates are included in the appendix.

Year 1

Year 2

Year 3

Current Assets

Cash

Accounts Receivable

Rs.10,19,750

Rs.19,59,300

Rs.44,05,600

Inventory

Rs.1,68,650

Rs.2,38,600

Rs.3,56,650

Other Current Assets

Rs.33,400

Rs.50,950

Rs.80,450

Total Current Assets

Rs.50,000

Rs.50,000

Rs.50,000

Rs.12,71,750

Rs.22,98,800

Rs.48,92,700

Long-term Assets

Long-term Assets

Accumulated Depreciation

Rs.5,00,000

Rs.5,00,000

Rs.5,00,000

Total Long-term Assets

Rs.1,03,500

Rs.2,07,000

Rs.3,10,500

Total Assets

Rs.3,96,500

Rs.2,93,000

Rs.1,89,500

Rs.16,68,250

Rs.25,91,800

Rs.50,82,200

Liabilities and Capital

Current Liabilities

Year 1

Year 2

Year 3

Accounts Payable

Current Borrowing

Other Current Liabilities

Rs.1,54,850

Rs.1,95,850

Rs.2,85,800

Subtotal Current Liabilities

-

-

-

Long-term Liabilities

-

-

-

Total Liabilities

Rs.1,54,850

Rs.1,95,850

Rs.2,85,800

Paid-in Capital

Retained Earnings

-

-

-

Earnings

Rs.1,54,850

Rs.1,95,850

Rs.2,85,800

Total Capital

Total Liabilities and Capital

Rs.15,00,000

Rs.15,00,000

Rs.15,00,000

(Rs.5,02,500)

Rs.13,400

Rs.8,95,950

Net Worth

Rs.515900

Rs.8,82,550

Rs.24,00,450

Rs.15,13,400

Rs.23,95,950

Rs.47,96,450

Rs.16,68,250

Rs.25,91,800

Rs.50,82,200

Rs.15,13,400

Rs.23,95,950

Rs.47,96,450

*NOTE: If Secured loans for Rs.15 lac would be taken from HDFC bank in third year of business .Amount of 15 lac would be invested in assets as follow.

Land 10 Lac

Hitech-Macinary 5 Lac Only then change could be done in the third year of business.

Supportive material for Financial plan...

Sales Forecast

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month

10

Month

11

Month

12

Unit Sales

Full Wash

0%

90

130

170

190

190

185

135

135

120

120

140

155

Exterior Wash

0%

90

130

185

220

230

220

180

170

150

150

160

165

Interior Clean

0%

40

50

50

55

60

65

70

80

80

85

75

60

End User Detail

0%

3

5

7

10

12

12

14

9

11

14

15

17

Business Fleet Washes

0%

25

40

55

60

60

55

55

55

55

50

50

55

Car Dealership Details

0%

15

17

20

26

32

40

56

45

56

60

60

67

Total Unit

Sales

263

372

487

561

584

577

510

494

472

479

500

519

General Assumptions

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month

10

Month

11

Month

12

Plan Month

1

2

3

4

5

6

7

8

9

10

11

12

Current Interest Rate

10.00%

10.00%

10.00%

10.00

%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

Long-term Interest Rate

10.00%

10.00%

10.00%

10.00

%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

Tax Rate

30.00%

25.00%

25.00%

25.00

%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

Other

0

0

0

0

0

0

0

0

0

0

0

0

BIBLIOGRAPHY:-

Book:-

Robert d Hirish , Michael P Peters, Dearn a shepherd , Enterpreneurship. - Mcgraw hill publication, 2009 edition.

www.hjventures.com/Mobile-Car-Wash-Business-Plan.html

www.ehow.com › ... › Starting a Business

www.explorestartups.com › Entrepreneurship Blog

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www.dri-wash.us/eti/waterless_mobile_car_wash.htm

www.dailymotion.com/.../xba3zu_mobile-car-wash-business-by-wash-my_auto