Auto Detailing Businesses – Surviving During a Recession Considered
Well, before I retired, I was in the franchising business, in the automotive service sector. One thing I had noticed over the years was that the economy was either doing well, or doing poorly. That is to say there was an expansion period or a contraction period, growth or recession. One thing I can remember is many of our franchisees complained when the economy was bad as it was hard for them to make money. In reality, by simply adjusting your menu and the types of services you offer it is rather easy to switch over to a low-cost high-volume business model and actually make more money during a recession. Okay so let’s talk shall we?
Indeed, I realize that is a very bold statement, but I can tell you from experience and real life observations that it is indeed true. All too often the wealthier crowd stops wishing to pay for $150 auto details, and the middle class finds other options, perhaps even doing their own car once in a while. One thing I can say that never goes out of style is the five dollar exterior car wash. You might say that’s crazy, washing a car for only five dollars. Nevertheless, during a recession, there will be plenty of business at that price point. Better yet, it’s not too difficult to do upwards of 100 cars per day in office building parking lots.
Why do I mention this now you ask? Well, our economic growth has only been about 1.7% in 2012, and I imagine in 2013 we will go back into a recession, and have a negative growth rate. This means that there will be fewer people with jobs, and less money floating around in the economy. It also means that many of your competitors will go out of business, and who knows, if you don’t follow my advice here you might as well. Of course, that leaves more business for those who are still in business because they were not too proud to try something new.
You don’t have to ruin your prestige or your auto detailing branding. You can simply call the new line of services that you do; mobile car washing. The rest of the time you can do auto detailing at the higher price. This way you are now offering two types of services, even though the auto detailing business will be much less than it was during the good economic times.
I think what you will also find out is that by having hundreds and hundreds of mobile car wash customers with significant volume, that through those economies of scale you will find more people willing to get a detail than you ever had in the past. Yes, you may have to lower the price of your full detail as well, but you should be able to stay in business throughout the recession without any problem. Please consider all this and think on it.