Carwash Business plan
... The hours of operation as well as the time needed to provide the service must be convenient and fast respectively, to gain market share. 2.1.3 Market Trends [back to top] The market trends for the car washing industry has been a gravitation from hand washing to automatic washing machine facilities. This trend has been fueled 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 machines will never be appropriate for expensive automobiles. This trend will luckily not have a significant impact on hand washing facilities that have a sufficiently large customer base that posess expensive cars. Luckily for Soapy Rides which does have an upper end clientele, market supply will decrease and demand will increase. Market Forecast Click to Enlarge 2.1.4 Market Growth [back to top] The car washing market has seen steady, 4% growth for the last six years. 4% growth is forecasted for the next four years. Target Market Growth Click to Enlarge 2.2 SWOT Analysis [back to top] The following SWOT analysis captures the key strength and weaknesses within the company, and describes the opportunities and threats facing Soapy Rides. 2.2.1 Strengths [back to top] · Good relationships with many perspective customers in the target market. · Strong family name recognition and equity in the community. · Well trained employees. 2.2.2 Weaknesses [back to top] · The need for reliance on outside investors. · The learning curve associated with entering an industry without direct prior experience. · The need to have a fairly constant volume of business to support the necessary service staff. 2.2.3 Opportunities [back to top] · Participation within a steadily growing industry. · A high likelihood of repeat business. · The ability to decrease the fixed costs as a percentage of an individual sale as volume increases. 2.2.4 Threats [back to top] · Future/ potential competition from a franchised firm. · A slump in the economy, reducing discretionary spending. · The perception that there is not a difference in quality between a hand and machine wash. 2.3 Competition [back to top] There is one other hand car wash shop in East Meadow. It is quite new and is trying to compete with automatic car washes by offering low prices. However, it is not targeting the customers who seek quality cleaning. The customers who Soapy Rides is targeting have their cars washed based on the quality of the job. They do not mind spending a little more each week to have their car washed and waxed in order to keep the paint work in excellent shape. The businesses that Soapy Rides targets will be more cost conscious, so prices will be approximately 30% less for these customers to promote volume usage. 2.4 Services [back to top] Soapy Rides will provide the following services: · Car washing (exterior). · Car cleaning (interior). · Car detailing. 2.5 Keys to Success [back to top] Soapy Rides keys to success are: · High quality services. · Benchmarked customer service. · Convenience. 2.6 Critical Issues [back to top] Soapy Rides is still in the speculative stages as a start-up organization. Its critical issues are: · Continue to take a modest fiscal approach, expand at a reasonable rate, not for the sake of expansion in itself, but because it is economically wise to. · Build brand awareness, increasing the customer base and developing brand equity. · Establish Soapy Rides as the premier hand car wash service provider in the East Meadow area. 3.0 Marketing Strategy [back to top] The marketing strategy will be to develop brand equity, increase customer awareness of Soapy Rides, and build the customer base. The strategy will use several different methods to achieve these goals. 3.1 Mission [back to top] The mission of Soapy Rides is to provide top-quality washing and detail service for luxury car owners in East Meadow, NY. Soapy Rides will work to keep employees satisfied in order to maintain impeccable customer service. 3.2 Marketing Objectives [back to top] · Increase repeat customers by 4% a quarter. · Steadily increase market share every quarter. · Develop brand awareness and acceptance, quantified by a decrease in customer acquisition costs. 3.3 Financial Objectives [back to top] · Increase the profit margin by .5% a quarter. · Achieve a double digit growth rate each year for at least the first three years. · Develop efficiencies in the delivery of the service through advanced training and work-flow analysis. 3.4 Target Marketing [back to top] Soapy Rides segments its customers by type of car ownership. SR believes that the type of car that a person owns says volumes about their driving, and, therefore their car washing and detailing requirements. 1. New car owners: Owners of newer cars are most 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 and detail service. The aim is to inform these customers that Soapy Rides will keep their car looking as good as it did the day they drove it off the lot. 2. 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 shape possible. 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. 3. Sports car owners: These people are often younger or middle-aged men 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 (at least) weekly. These drivers will have an occasional detail, but will keep their cars so clean the detail will not be necessary very often. 4. Lifetime owners: Many of these people have owned their cars for more than five or six years, and are more likely to be women. They are attached to their cars as friends and though it may be more sensible for them to purchase a new car, they will bring their car in for a wash occasionally, just when the car is dirty. They like their cars to look presentable, and want to keep it in good shape but are not tied up in the look of their car. For this reason, they will not have a detail carried out on their car unless they are selling it. 5. Dealerships: There are five new and used car dealerships within three miles of the proposed location of Soapy Rides. These dealerships often use outside car wash services to detail their vehicles before they are put up for sale. In addition, there are fifteen other car dealerships within a seven-mile radius of Soapy Rides. 6. 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 during weekends, like the general public. Please note for analysis purposes in regards to the charts and graphs, the different segments will be grouped into individuals and businesses. This will be done to allow the charts and graphs to have a clean look that will aid in the ability to quickly discern information from them. 3.5 Positioning [back to top] Soapy Rides seeks to position themselves as the premier hand auto washing service provider in the East Meadow area. This positioning will be achieved by leveraging their competitive edge: Soapy Rides' competitive edge will be Mark Deshpande and the quality of the family name in the East Meadow area. As mentioned, the family has been in the car business for over 30 years, and has an excellent reputation and a myriad of both business and personal contacts. In addition, Mark has put a great deal of emphasis on creating a system that is both fast and efficient, which will keep costs, in terms of time spent per car, to a minimum. 3.6 Strategy Pyramids [back to top] The single objective is to position Soapy Rides as the premier automobile hand washing company in the area, steady increasing market share. The marketing strategy will seek to first create customer awareness, develop a customer base, and work toward building customer loyalty. The message that SR will seek to communicate is that their hand washes are superior to the machine washed alternatives that can actually cause harm to cars. This message will be communicated through several different methods. The first method is the placement of advertisements in the local newspaper. The local paper, The Islander, is well read and will reach a high portion of the target market segment. The second method will be networking. Mark will leverage the equity already earned by his family from years of local business dealings. The networking will be a goo...