Justin Murphy said:
One other thing.....
I would rather have 5 customers that spend 75.00 a piece with me than one that spends 500.00. The five will tell five...that five will tell five and so forth. The one high end customer will usually tell no one since he wants to have the best looking car all to himself!
Volume alone can pay for your advertising budget.
Exactly Justin. Great way of thinking about it. That’s how businesses grow exponentially and how 1 man show detailers are pigeon held into a low ceiling of income, profit & growth.
brwill2005 said:
Just a few thoughts. Regardless of how you position your product, you must have an effective marketing strategy working for you. Without it, you will not get the customers, their repeat business, and their recommendations of your business. As for calculating costs; lets not forget marketing, insurance, labor costs (w/c & payroll taxes) either. This would be more of a factor when doing volume work for a dealership. More insurance coverage would be needed and obviously much more labor costs/taxes involved. This would take away from the already low margins of doing this type of work. Obviously if you reach a certain scale with your operation, it may be well worth it.
I wouldn’t call it a “marketing strategy” more than a business plan for growth while using basic client-centric business common sense. Marketing mostly centers around advertising and this isn’t needed one bit with dealership detailing. Even though I did a good amount of retail work, I did 2 advertising campaigns in 10+ years and each time it didn’t really pan out.
As far as expenses with high volume work; the economies of scale are dramatically less with this business model if done correctly. The expenses such as rent, insurance and utilities are not that different from a business producing $150,000 and one doing $500,000. Product expense per vehicle should actually be less as the products are purchased in bulk and you are able to demand a greater discount from the supplier in many cases. And with my business, the workers were classified as sub-contactors and were paid a percentage of the detail. They earned the same % on a $20 wash as they did on a $250 detail. Whether you detail 1 or 1000 cars for a dealer, Insurance coverage is pretty standard. When doing work for dealers as they usually require you to have a $1,000,000 liability limit. So, bottom line, the profit margins are much greater as your sales go up and your expenses are reduced. Say your break-even point is $12,000 per month. Your profit margin would be a lot more when you hit the $30,000 mark than it would be at $15,000 or even $20,000 mark.
LUSTR said:
David, I was never knocking it... I might actually be going after some of this work if an opportunity that came up pans out. I just never did a "dealer" job so I'm wondering how exactly it compares to the work I do currently. I can see myself finishing up a basic one-step within 2-3 hours fairly easily by lowering the attention to detail, polishing time, etc. I'm just curious how those of you that have tons of experience with the dealer work divide up the time... how long for the wash, clay, do you even clay, etc.
No worries Ivan. Doing high volume work requires a totally different mindset in respect to the final outcome requirement on each job. You really need to have the ability to “see through” each project at inception. Establish a game plan and constantly keep your mind turning as you are always focused on getting the car done in the least amount of time. I could ask my detailers at any step in the detail what they had left to do to finish and they could quickly name them and give me a completition time. You also need to be able to do each task right the 1st time as redoing it a second time wastes time and ultimately profit.
Time frames depend on how your shop is set up. The most important step is the prep because if a vehicle isn’t properly prepped, it can waste valuable time trying to correct mistakes throughout the detailing phase. A full prep should ultimately take no more than 20-30 minutes to do. That includes washing the exterior, acid washing the wheels, degreasing the engine, wheel wells and door jambs, powerwashing the floormats and claying/4000 sanding the paint. Because the vehicle is being polished, you don’t need to dry it. It will totally dry while you do the Interior (30-40 minutes). Dress tires and wheel wells and do the Exterior (1-1.5 hours). Pull it outside and spend about 20-30 minutes doing your final wipedown, windows and door jambs. Done!