market strategies...

[Envious Eric]

What is your market, and why did you pick it? please explain why you do the work you do...



Im on the fence on how I want next year to go...50/50, 70/30, 100/0 (Envious/express business)

 

[David Fermani]

What do you enjoy doing?

What product/service do people mostly request?

Where would you like to see yourself in 10 years & how will you get there?





Every market is different, but isn't it wise to just follow the best trail to earning the most money? Whether that means doing things yourself, hiring a helper or a full time crew. Think BIG and try to differentiate yourself from your competition by offering something that is needed/not offered in the marketplace.

 

[togwt]

You also need to decide what niche market you want to concentrate on.



Production

Aimed towards the average vehicle owner, which caters to ‘wash & wax’ type clients, this market sector provides a higher cash flow but small profit margins. High turnover (volume) provides the biggest profits. It produces a steady work load and a guaranteed pay cheque. Other advantages are-

• It’s more productive, consistent because all cars receive the same service and you want to complete as many cars as possible per day.

• With a higher turnover and bulk buying of products greater profits can be realized

• You do not need special facilities; a garage or warehouse is all that is required.

• There is little need to advertise because you only have to depend on one or two dealer contracts.



Retail

Many operators of retail-oriented detail businesses simply will not do dealer work, as they prefer catering to higher end clients, usually ‘exotic’ or specialised automobiles, this market sector provides lower cash flow and higher profit.. There are several reasons for this, including a combination of job satisfaction, higher profit and emotion:

• The gross profit per car is less for dealer work than retail services.

• Retail vehicles are typically in better condition and the customer is generally more positive about the end results of the detail service.

• You are able to hire a better quality staff because you do fewer cars at higher revenues.

• The loss of one customer or two will not break your business in the same way losing a dealer contract would.

• The retail market is bigger and has great potential for growth.



The retail market would not be much affected by the loss of a customer, but the production market would be very negatively impacted with the loss of just one dealership





http://www.autopia.org/forum/detail...ng/136438-becoming-professional-detailer.html

 

[imported_Quenga]

Well, I'm still new and I certainly don't have a business that actually pays my bills yet (thank you GI Bill), but I have basically chosen my market. While I love polishing cars for hours on end and achieving that showroom finish, at the end of the day, as a business, it makes more sense to be production than precision.



I think the question is do you want to make good money doing what you love, or do you want to make a lot of money having to do a little more of what you don't.



I've questioned this myself many, many times. I've ran the numbers, interviewed shop owners and read many posts on every top detailer/shop owner across as many forums as I can register on. While I love high-end work, to me, detailing is a business.

 

[Envious Eric]

well, here is the deal...



Envious Detailing = higher end, doesnt do washings, and starts at $175 for a wash/wax/interior detail...low by some, high by MANY others.



More volume based business = more volume, lower profits per car, but made up in the amount of cars done, operated by an employee/sub contractor, ran and owned by me. I can also tweak it to where I hire someone else as an employee and we do a two man show doing the routine detail work...interiors, clay/wax jobs, etc (no real paint correction), but this is all faster and potentially more lucrative work...only if I can sacrifice quality to a certain point...



problem is, I tend to not be personally satisfied EVER doing a wash and a wax on a car I havent previously detailed...so therefore I go above and beyond...but when you spend an extra 2 hours for the same price, it becomes not worth it and I should have marketed more time and money into getting the higher end jobs that pay more



Thoughts???



oh yeah, I dont want to be the one slinging the polisher around in 10 years anymore either....

 

[Barry Theal]

oh yeah, I dont want to be the one slinging the polisher around in 10 years anymore either....

I wonder if thats what the owners of successfull car washes think as well? In my area the other 90% of people which is a big number who only care about a clean shiny car don't mind putting money into the big car washes hands. I managed a tunnel wash for some time by in the day and its such a money maker its not even funny. In my area the average car wash buff and interior detail is $159.99 and it takes to employess about 4 - 6 hours. At ten dollars an hour thats roughly 80 to 120 just in labor percentages. for that car. Add in the cost of chemicals. at 5-10$ and the owner will walk away with about 30 -40 bucks. Now he has to pay taxes and insurance and what not. In my eyes thats not making money. ON the flip side he can run 10 cars threw his tunnel at $15 each and make 150. The average cost of a car at the time with labor and all expenses was $.75 per car which comes to about $7.50 per ten cars vs. Well do math its not rocket science. Ill bet that car wash owner isn't busting his butt either slaving over paint. Eric you have been thinking long and hard about this for a long time. Seriously ask yourself this. What do you want to be? Do you want to be that 50 year old man busting your *** day in and day out, or do you want to enjoy life? Here is a great qoute you need to think about.



“Success is doing what you want to do, when you want, where you want, with whom you want, as much as you want.”

― Anthony Robbins



There are hundreds of detailers that are capable of doing high end detailing. Just one the forums alone I can probally think of at least 100. Then you have to look into the people who arn't on the forums that no one knows about which are alot most likely. The issue is here is that were are all great at the trade, but not as a business person. You need to be a business man first! After all this is what puts food in your mouth and clothes on your back!

 

[CosminTX]

Thoughts???

oh yeah, I dont want to be the one slinging the polisher around in 10 years anymore either....

so far i been working on this system and it works , minimize the products you use per car, have down a technique for wash and wax, interior that works for most cars and give results in min time, address the issue the client has, have your mind programed that corrections only does not pay your bills all year around, have a helper.

you can still make $$$ by just washing/clean a car or a good few cars.

my service is flexible , i am not stuck into correction only , i focus on maintenance washes , now i plan advertise new car/preowned prep cars packages.

i will let my clients to decide the percentage if is correction or express.

is a business , let your helpers think about what they do tomorrow: polish or wash cars.

you focus on building a washwax system that gives results in a good time frame , train them with that system , market , quote , close deals, get materials, supervise

 

[Concours.John]

There are very good points here that I fully agree with. Having your processes down makes it easier to train someone you have help you or hire. It makes it much easier for someone to follow something that is consistent.



I've spent a fair amount of time writing down procedures, flowcharts, checklists, and appendix for troubleshooting for future employees.

Having worked on three different ISO procedure writing teams in the past;I have seen the productivity results firsthand of having everything written down and easy-to-follow.



To get an ISO certification a company has to prove that every department and every employee is doing the exact same thing every time achieving the same results. There are also failsafes for if a problem arises and how to solve it all in writing.



I hope not to bore every body but this is an example of how the system works. This may not all translate but it shows how effective proper training can be from an employer cost stand point.



The company had always monitored progress of a job through each department through a computerized swipe ,then start, swipe out, stop process. Employee ID numbers were attached to job ticket in each department. Two IDs meant someone was in training and would show trainer ID and trainee ID.



Here are some of the findings before ISO.



Keep in mind that all departments had procedures but nothing was ever set in stone.



The trainer produced 50% normal billable hours. The trainee generated 50% billable hours. This equates to 100% billable hours for two people. The training process took 45 to 60 days before Employee was up to 85-90%. Scrap rate was 17% or rework rate per 30 days.



After ISO procedures were put in place.



All trAiners and supervisors were required to review and follow all step by step procedures.

Employees were required to shadow and work with the supervisor/trainer as before. However they were required to follow allong with the flow charts and appendix.



Trainers productivity jump to around 85%. Trainees productivity jumped to around 70%. Training process was approximately 30 days to have productivity up to 85 to 90%.

Scrap/ rework rate fell to 5 to 7%.



While this is related to a several thousand dollar per job scenario this can relate down to a few hundred dollar detail with an employee or two.



Many small businesses fail because the owner /operator is the sole provider of billable hours. Without him there is no income being produced. This makes it essential to have properly trained employees to produce the same results that everyone has come to expect from the from the sole proprietor. At the same time the owner needs to carefully watch the amount of hours being used for training purposes and how it affects productivity.



Sorry for my rant, just an observation of what to consider when hiring new employees.

 

[Envious Eric]

Many small businesses fail because the owner /operator is the sole provider of billable hours. Without him there is no income being produced. This makes it essential to have properly trained employees to produce the same results that everyone has come to expect from the from the sole proprietor. At the same time the owner needs to carefully watch the amount of hours being used for training purposes and how it affects productivity.

key point here! I only make money if I do the work right now...this is what I dont want!



AND NOW, I have a client who wants to possibly FUND a shop for me! This could be good!!!! If anyone has info or has done this route, please PM me your number and Ill be giving you a ring!

 

[Jean-Claude]

I used to do more volume but no where close to big volume. I had a helper and he was well trained. He was paid well and sent around to handle all but level 2 correction type jobs. But despite being well trained I struggled get constant quality from him. Due to his lack of reliable performance, he was let go. I let go of another guy after him and just got sick of dealing with poor quality/consistancy and have moved back to doing everything myself. I only market to retail but have had some dealership-type work that came my way. I charge a lot but guarantee my work and my clients are super happy. Bills are paid and clients are happy. The thing is, even though I am doing all the work and it's hard on my 31 year old body, I am happier knowing my clients are getting a very high level of service. In the long run, I don't see myself doing 100% of the work but for now I am rolling with it.

 

[Envious Eric]

but when does it turn over and stop JC? Ive been in your situation for the last 4 years...and Im really starting to look into the owner operated vs owner ran compromise considering I am about to buy a house, get married, have kids, etc...I dont want to be working 12 hours a day missing out on the day to day things in the next 5 years!



I think it will take some time to get the ball rolling, which is why I think I need to take the steps now in order to have it setup later!

 

[David Fermani]

AND NOW, I have a client who wants to possibly FUND a shop for me! This could be good!!!! If anyone has info or has done this route, please PM me your number and Ill be giving you a ring!

Run with it as quick and hard as you can and don't look back. Just make sure you have a contract in place so there won't be any regrets down the road. Surround yourself with successful business people and they will guide you down the right patch. They want to protect and grow their investment the best they are able. I'm in the process of acquiring venture capitalists for a detailing project I'm trying to launch in the near future. Let me know if you need to bounce any ideas off me.

 

[Jean-Claude]

Eric, I agree with your sentiments. I have some things in the works that I hope will enable me to be more owner and less laborer, but I am not rushing it. As it stands I make $400-$900 a day and even though I am not balls to the wall every single day, I keep busy enough to put money away and reinvest in other ideas. I think there's a fine line between wasting youth being a laborer with no direction and investing in the future so that you're not killing yourself and your back.

but when does it turn over and stop JC? Ive been in your situation for the last 4 years...and Im really starting to look into the owner operated vs owner ran compromise considering I am about to buy a house, get married, have kids, etc...I dont want to be working 12 hours a day missing out on the day to day things in the next 5 years!



I think it will take some time to get the ball rolling, which is why I think I need to take the steps now in order to have it setup later!

 

[RenuAuto]

This thread really hits home for me. Eric, I feel like we're in really similar positions. I'll probably go off on a couple different tangents here, but regardless.



On the original thread topic, I started my business with the original intent of providing exclusively high-end, high-dollar work and would turn down anything that was less than $200. I provided, what I felt like, were paint correction results well-above anything available in my area, and thus thought I would have a niche that was unfulfilled in my market.



I came to quickly find out that the market didn't "yet" exist in my admittedly small market. There weren't people in my area looking for that kind of work, or realizing that it even existed. Upon swallowing my pride I tailored my services to more of a premium, mass market appeal. Silver, Gold and Platnium detail packages that ranged from $99-249. Business started to slowly turn in. Even on some basic wash and quicky services, I was at least getting customers, and those customers are now people that are returning and referring others, when they never would have been inside my door if I was only providing high-end paint correction services exclusively. And so while the work might not have been glamorous, it was steady, and I felt a comfort in my business like I hadn't before. Everything about what Fermani and Theal state about volume really clicked.



That being said, I'm still a one man operation, and I'm getting physically beat up, with no intention of continuing like this forever. It has been a really good run for the past couple years like this, being single, making a bit of money, and blowing every last cent I make on motorcycles, alcohol and women. I won't for a second say I regret one ounce of it. Needless to say, I've had some fun. (Living this close to Vegas has been a wild ride).



But now I'm growing to the point where I'm trying to put some money back into the business, and intend to create and actual "business" instead of this "job" that I've had for the past few years. While my intentions are to create policys, procedures, and an actual business plan, it's a really big hurdle to make the jump from where we are, to a business with even it's first employee.



I have a shop location and there are days I really feel like its somewhat unnecessary for my current situation, but it is comfortable, puts out a good professional image and I feel completely necessary for the "next" stage of business (employees, ect). I just feel like I may have jumped into that boat (having a shop) a little sooner than needed. It's a really big, stressful overhead to have every month. Like Fermani said though, if you've got a backer, and can put everything on paper (as water-tight as possible) JUMP on that like a fat kid on cake. Capital raising is one of the biggest hurdles in a business.



I'm really curious to talk in person/phone with you more Fermani, especially about your next venture. You've really proven yourself to be a true BUSINESS man in this industry, and I look up to you a LOT for that. Many can polish paint to perfection, few can really BUILD a business like you, Theal, and some others have.



Eric, David, you guys gonna be at SEMA this year? Drinks at Spearament Rhino are on me if so. We can discuss further there.

 

[David Fermani]

I'm really curious to talk in person/phone with you more Fermani, especially about your next venture. You've really proven yourself to be a true BUSINESS man in this industry, and I look up to you a LOT for that. Many can polish paint to perfection, few can really BUILD a business like you, Theal, and some others have.



Eric, David, you guys gonna be at SEMA this year? Drinks at Spearament Rhino are on me if so. We can discuss further there.

I'm in! I'd love to brainstorm with you. Keep in mind that my advice is based on my own experiences in my neck of the woods and isn't the end all, be all for everyone. But regardless, I'm sure I can get the creative juices flowing.

 

[tssdetailing]

key point here! I only make money if I do the work right now...this is what I dont want!



AND NOW, I have a client who wants to possibly FUND a shop for me! This could be good!!!! If anyone has info or has done this route, please PM me your number and Ill be giving you a ring!

Run with it as quick and hard as you can and don't look back. Just make sure you have a contract in place so there won't be any regrets down the road. Surround yourself with successful business people and they will guide you down the right patch. They want to protect and grow their investment the best they are able. I'm in the process of acquiring venture capitalists for a detailing project I'm trying to launch in the near future. Let me know if you need to bounce any ideas off me.

I have a close friend who knows an investor. My friend has been approached by said investor with something like a blank check as the investor feels that my friend is incredibly smart (which he is-turning nearly 400% profit for the current company he's with in a 3 year span). My friend wants to in-turn invest in ts|s Detailing and help make it a shop w/mobile division. I genuinely hope it comes to fruition as I could never find or approach anyone myself. My friend is soon to have twins and I just had another boy in August-so things aren't going to move very fast but if the money is real, this could be the most life changing event i've ever experienced.

 

[vizvek]

Our market is a little bit of retail and production. I think if you are interested in entering this business, aside from having the proper technical skills; knowing which route you want to travel and how you plan on getting there is just as important.



Our business started off as a weekend thing for my brother to make a little additional money and as it began to grow it became a full time thing for him. He was the laborer with a helper and the business grew to where he was able to send staff out to do the work. The problem there was finding staff that would consistently provide his level of service. It seemed that it didn't matter how extensive training was nor the pay rate, we couldn't find suitable employees, so he had to stay out in the field. That's when I came on board to handle the operational aspects of the business.



So, if your goal is not to be the "laborer" for ever, you need to decide how you plan on growing your company and effectively training your staff. When it comes to training, it can't just lie with the technical aspects, they need to be able to diagnose problems, come up with cost and time effective solutions. There needs to be specifically outlined pricing structures. It's also important for the staff to be able to sell and understand how the customer thinks and what type of relationship they have with their vehicle (just something to get them from point a to b, focused on resale value, etc). If you have that in place, then you can start to think about marketing your business in hopes of growing it. But, the key is providing that consistent level of work, which will be the hardest thing to do, because no employee will treat your business and its reputation like you will.



You have to know your strengths/weaknesses as well as the strengths/weaknesses competition & market. Also, realize the role the weather in your area plays in your success/failure and make plans that will allow you to still make $ despite weather (this may be diversifying your service set).



The best way to figure it out is jump out there and get your feet wet. Just pay attention to everything that happens and don't get caught up in the day to day numbers game. You need to be able to see what is working and not working, while your out there working (if that makes any sense).