Car Wash: A Growing Industry

What does “car wash and detailing” mean?

Operators in the industry are primarily engaged in washing, waxing and detailing automotive vehicles, including passenger cars, trucks, vans and trailers.

Key Statistics

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Industry Outlook

With reference to IBISWorld Industry Report OD5235, April 2016 – the report states that the Car Wash and Detailing Services industry in Australia has grown by 2.9% over the past five years, and the report expects the industry to further grow by 1.8% in the next five years.

According to the report, the growth of the Car Wash and Detailing industry has been supported by the growth in new car purchases. Industry revenue is forecast to grow by a compound annual rate of 2.9% over the five years through 2015-16, to reach $539.3 million.

The report also states that consumers with greater levels of disposable income are more likely to pay for a professional car wash, rather than to wash their cars themselves. Disposable income for the average consumer is predicted by the report to grow in the next 4-5 years.

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Additionally, when consumers are working more hours, they have less available leisure time. Consequently, they are more likely to pay for their car to be washed than to do it themselves. Consumers are also more likely to get their new vehicles professionally washed and detailed, as they aim to keep their new high-value purchases in perfect condition. When the average age of the vehicle fleet declines, the composition of vehicles on the road tends towards newer cars, meaning more consumers can be expected to use the industry’s services.

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New Car Sales

Over the past five years, new car sales have grown strongly, rebounding from the global financial crisis as the high Australian dollar has made new cars more affordable and consumers have transitioned to fuel-efficient small cars. The high rate of new car sales has also increased the total number of vehicles on the road. Consequently, strong new car sales have added to industry revenue.

Outsourcing Tasks

Households are increasingly outsourcing chores and activities. The level of outsourcing has been growing over the past decade, primarily driven by increased female participation in the workforce and busier lifestyles. Combined with rising incomes and a higher number of dual-income households, this has resulted in households outsourcing more unpaid work tasks.

While this trend principally applies to entertainment, food, personal services and tourism, car washing and detailing has also been affected. Consumers have been willing to pay more to have their vehicles washed outside of the home, placing a greater premium on maximising their leisure time. In conjunction with improved economic conditions following the global financial crisis and increased automation of car washing, profit margins have expanded slightly.

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A powerful combination

Think about how many car wash businesses are in your suburb. Then think about how many premium quality upmarket car wash cafés are around. Probably not many, right? Now think about the car wash cafes that are neat, clean, professional and provide a premium quality service.

Now put the two concepts together, and you have a powerful brand in hand car wash and detailing café franchising – which is why Geowash is committed to developing premium quality cafes from here on.

Our franchise system has grown amazingly in 2014 and 2015. We have grown from only 5 stores to a planned 25 stores in 4 states.

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