Car Washing As An Investment By Gus Trantham Pg 2

CAR WASHING AS AN INVESTMENT

Text Box: the real estate as part of the overall sale. Prices of self service type operations can run from a low of $400,000.00 up to $2,000,000.00 with gross sales from these operations ranging from $60,000.00 to over $400,000.00 per year. In turn the range of Net Incomes from the operations run in many cases from 50% to 63% of the Gross Sale. The depreciation schedules and other investor advantages are numerous, and in 5 to 7 years the investors are faced with accumulating more operations or divesting into other endeavors as they face accelerated tax rates on profits. Car wash conveyor operations (both full service & exterior) provide an entirely different investment challenge and in most all cases require full time management, or the obtaining of professional management for day to day operations. Prices for conveyor type operations can range from a low of $700,000.00 up to $5,000,000.00 with many different profit centers like detailing, convenience stores, gift shops, and a host of extra services. These operations are fairly labor intensive depending on the range of service provided to the customers and labor can run as high as 34% of gross income. The average conveyor car wash in America today washes about 65,000 cars per year, and its net income for the investor can range up to 20% of the gross. Many of today’s conveyor car washes have been owned by the same owner for up to 20 years and are producing outstanding profits. However, with changes in family structure etc. most are now being sold to outside investors and entrepreneurs coming into the industry from other fields. We find all the time potential investors originally looking at apartment complexes, offices, etc. turning to car washing for there business opportunity because of the potential for much greater returns then in there former investments. And the vast possibilities of location advantage, marketing, and the age old love affair with the automobile drive the American public to continuously be orientated to clean cars and wanting it done professionally. That makes a good investment. Financing for car wash operations is readily available from commercial banks as well as local community banks and other fine sources, the average down payment on the business is generally 20% down with long term amortization for payment. All in all this proves out to be some of the highlights of why CAR WASH BUSINESSES are very well one of the best business investments in American. For further information on the car wash industry as an investment, or Gus Trantham’s book “The Great American Car Wash Story” he may be reached at RE/MAX Suburban, 630/790-0163 or fax 630/469-7948.

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