Last month, I had the opportunity to attend The Car Wash Show in Las Vegas. This year’s event had more than 400 exhibitors and more than 9,000 attendees and featured engaging presentations and insightful discussions showcasing the latest industry developments. For those of you in the industry who didn’t have a chance to attend the event, or even those of you who did but couldn’t make it to every session you wanted to attend, I would like to recap some of my key takeaways.
Resilience and Revenue Surge
While the greater economy is less predictable, the event highlighted the car wash industry continues to demonstrate its resilience, with strong consumer demand and robust revenue generation. Despite economic fluctuations, car wash businesses have maintained their momentum and showcased their ability to thrive.
Driving Growth Through Innovation and Technology
One of the standout themes at the Car Wash Show was the industry’s relentless pursuit of innovation and the integration of cutting-edge technology. The aptly named “Innovation Alley,” along with the captivating presentations, provided a glimpse into the future of car wash equipment, automation, management, and customer experience enhancements. Embracing these innovations and new technologies will provide a competitive edge and undoubtedly open up new avenues for growth in the industry.
Navigating Macroeconomic Factors and Valuations
While the industry continues to flourish, it wasn’t lost on anyone in attendance that the industry isn’t immune to macroeconomic factors. Rising interest rates have brought about a decline in valuation multiples, and car wash owners have to navigate the changing dynamics and challenges around obtaining financing.
However, the strong interest from investors and capital for acquisitions, consolidations, and recapitalizations demonstrates the industry’s enduring appeal. Despite the evolving financing landscape, creative solutions such as the sale-leaseback market have grown as attractive alternatives for car wash owners seeking funding for future expansion plans.
Strategic Planning for Multi-Location Operations
The Car Wash Show reinforced the significance of strategic planning, especially for car wash businesses that want to set themselves apart or attract outside buyers. Those businesses with well-defined plans to own and operate multiple locations stood out as attractive prospects, offering scalability and growth potential.
Changing Industry Dynamics
While private equity investments have made a significant impact on the industry, especially on larger chains, the car wash industry still consists of owner-operators. As the industry evolves, these dynamics will continue to shift, and it is essential for car wash owners of every type to stay informed and adaptable in the changing landscape.
Success Requires Sound Accounting and Finance
As the industry continues to grow, ensuring transparent financial management, adherence to accounting standards, and strong reporting becomes increasingly critical. These practices not only differentiate car wash businesses but also accelerate strategic conversations and elevate valuations. Robust accounting and finance teams are now indispensable assets as the industry advances and expands.
Consider partnering with a team like Apple Growth Partners for all your accounting and finance needs so you can set your business up with the most accurate and up-to-date accounting and finance standards in place while keeping your focus on where your strengths will help your business grow.
Into the Future…
The 2023 Car Wash Show demonstrated that the industry is solid and will continue to grow due to its commitment to embracing innovation and technology. The car wash industry is poised for a bright future, from strong consumer demand to the drive for cutting-edge technology and strategic planning.
Despite the challenges brought about by macroeconomic factors, the industry’s appeal remains strong. By embracing innovation, prioritizing sound accounting practices, and staying abreast of industry dynamics, car wash professionals can navigate the ever-evolving landscape and carve out a path to long-term success.
A final takeaway from the show came from International Carwash Association President Justin Alford: “Do your homework, do your due diligence.”
As the car wash industry changes and shifts, partnering with expert accountants and consultants like ours at Apple Growth Partners that can manage your day-to-day and even help develop tailored strategies for success will position your car wash to maintain a competitive edge in the market and drive sustainable growth.
At Apple Growth Partners, we are here to help you with all your accounting and financial deal-related matters. Contact us today and let us guide you toward making the best decision you can for your business.
We hope to see you at The Car Wash Show 2024 next May in Nashville! Until then, for further information or support related to the car wash industry, please contact Jeff Brooks at jbrooks@applegrowth.com.