Twenty years ago, helping others to become better car washers was thought to be good for the industry overall. Arguably, the playing field was more level back then and the beat-your-competitor approach was not prevalent. Today, however, the playing field is unlevel.
As shown in the figures below, the structure of the competitive environment has shifted to the conveyor segment. Car washes at gas stations are also in a weaker position. During the same period, the numbers of these units dropped by 38 percent and wash revenues by 34 percent.
According to marketing experts, if you are losing to the competition, and there is no reason to believe the situation will improve, you should find a different way to compete.
In the weaker position, it’s usually better to redefine offerings than try to compete against someone much bigger. For example, this might mean targeting a different segment in the current market where a competitive advantage could be created, or it could mean moving from products to services.
Consider the Mister Car Wash chain, with headquarters in Tucson, AZ. Instead of trying to kill off the competition standing in its way, Mister’s purpose is to provide the best car wash and customer service experience in the industry.
It attempts to do this in several ways. First, Mister isn’t a chain of low-priced, express exterior washes with free use vacuums. Opened in 1969, Mister began acquiring car washes and lube centers in 1997. It now operates 206 car washes and 34 lube centers in 19 states. Today, the company’s fleet of stores includes exterior, full-service, express detail, lube centers, emission inspection, and detail shops.
Since it’s such a large chain, the promise of delivering a clean, shiny, and dry car every time requires an exceptional team of employees. Mister has created this team by investing heavily in its people. For example, the company has its own car wash college. It has also created a customer-comes-first organizational culture.
Instead of trying to kill off competition with a $3 price like some operators are attempting in Chicago, Mister has a long-range plan. Mister’s investment model for expansion is private equity and a fragmented industry. Location problems are solved by acquiring rather than building single and multi-site washes in existing markets and new markets.
Properties bought are closely linked to the concept of service quality and customer satisfaction. For example, Mister’s recent acquisition in the
Milwaukee, WI market included six Sudz car washes and three lube locations. Two of the Sudz locations were the former Scrub-A-Dub Car Wash, a business started nearly 40 years ago. Subsequently, like a big chain store, stores re-brand and organizational culture comes in.
Arguably, it is stability and performance that allows Mister the opportunity to grow and make additional investments to further perfect its business. In the final analysis, killing off the competition may not be the best way to think about the car wash business.
Bob Roman is president of RJR Enterprises – Consulting Services (www.carwashplan.com). You can reach Bob via e-mail at email@example.com.