How Much Money It Costs To Build A Car Wash

Tunnel & Support Equipment

Blowers, Tire Shine, Conveyor, Hydraulics, Pumping Stations, Arches, Boiler

Car wash tunnels and supporting equipment are the backbones of any car wash business. They also have some of the highest base costs when it comes to the cost of a car wash. The cost of a car wash tunnel and support equipment can vary on a number of factors. 

Base Cost $650,000

Range of Variance +/- $150K

Primary Cost Variance Drivers

• Type of Conveyor Mechanism

• Belt conveyors have some clear benefits over the tried and true chain conveyor car wash systems, but those benefits do come at a higher ticket price

• Length of Conveyor

• Which has implications on arches and other supplementary equipment as well

• Ancillary Equipment Choices and Levels

• High level of discretion up to the owner and car wash tunnel designer here

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Water Treatment System

Water Reclaim System, Water Filtration System

Water treatment systems can help car wash owners save money on their water bills by recycling the water used for washes. In some municipalities, water treatment systems may even be required. The cost of a water treatment system for your business varies based on whether you install one at all, and the level of equipment that is purchased. 

Base Cost $150,000

Range of Variance +/- $100K

Primary Cost Variance Drivers

• Whether you implement a reclaim system at all
• Level of water filtration and type of water filtration and softening system implemented

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Electronic Components

Paystation(s), Tunnel Controller, Relay Station(s), Misc. Electrical

Electronic components are another necessary component of a car wash business, but the price of these components can range considerably. Not all electronic components, like pay stations, are required for car wash businesses. Still, the convenience and long-term savings they can offer may make them worth it for some businesses. 

Base Cost $275,000

Range of Variance +/- $125K

Primary Cost Variance Drivers

• Anticipated volume will have the largest impact due to the level of capacity your systems and payment terminals / auto-cashiers (if implemented) will have to be able and capable of processing

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Site & Landscaping

Paving, Leving, Asphalt, Greenery, General Landscaping

Yearly site maintenance and landscaping costs for a car wash system can get expensive depending on the complexity of the service requested. Some site maintenance tasks are not necessary each year, like paving or asphalt. On the other hand, grass mowing and mulch laying may have to be done several times per year. 

Base Cost $200,000

Range of Variance +/- $100K

Primary Cost Variance Drivers

• Size, shape, and frontage of lot
• Level of landscaping and extras desired by owner

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Vacuum System

Motors, Drops, Accessories and Hoses, Plumbing, Related Cement Work

Vacuum systems are necessary for a full-service car wash business. The price of vacuum systems can vary highly, depending on the complexity of the vacuum system in question. Luckily, vacuum systems tend to be a one-time investment for car wash owners, with repairs and maintenance being a small fraction of the cost of the overall system. 

Base Cost $180,000

Range of Variance +/- $100K

Primary Cost Variance Drivers

• Anticipated volume will have the largest impact due to the level of capacity your vacuum system and setup will need to be able to accommodate
• Type and quality of vacuum system and setup

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HVAC & Plumbing

Furnace, Heaters, Misc. Electrical, Misc. Plumbing

It may be surprising to some car wash owners to learn that HVAC & plumbing is one of the cheaper investments required for a car wash business. Based on the average temperature of where your car wash business is located, the price you’ll pay for HVAC & plumbing can vary. In general, HVAC & plumbing for a car wash business is less than $100,000, with repairs and maintenance again being minuscule in cost compared to the overall system. 

Base Cost $80,000

Range of Variance +/- $40K

Primary Cost Variance Drivers

• Geographical location of wash is important
• Levels of seasonal and temperature variation that will need to be accommodated for

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Signage & Marketing

Main Signage, Menus & Price Boards, Brand and Logo Design & Launch Marketing

As with any other business, if you do not market your car wash, customers will not know it exists. Signage has a fairly set cost, while marketing can widely vary depending on the kind of marketing you’re performing. Things like websites, digital marketing campaigns, billboards, and print advertisements can easily cost over $100,000. But, the costs range based on the level of marketing being performed for the car wash business. 

Base Cost $150,000

Range of Variance +/- $100K

Primary Cost Variance Drivers

• Desired level of passerby visibility
• Amount of street frontage available on site

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Planning & Permitting

Engineering, Architecture, Required Permitting

Most municipalities will require special permitting and in-depth planning before approving the construction of a new car wash. On the other hand, engineering and architecture is required to ensure that your car wash business is up to code with local rules and regulations. You can expect to spend at least $175,000 on the planning and permitting of a new car wash.

Base Cost $175,000

Range of Variance +/- $100K

Primary Cost Variance Drivers

• Geographical area and local government

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The Highly Variable Costs

With the more predictable of the car wash construction and build costs now established, along with a reasonable range of variance conveyed depending upon the specifics of the wash you are looking to build, the time has come to focus on the hardest of the costs to predict and which vary the most from one car wash build to another.

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Real Estate and Land

Land costs vary widely

Real estate is one of the highest variable costs when it comes to building a car wash. Things like the geographical location, quality of the land, and size of the land are all factors that can change the cost of real estate for a car wash business. Doing your research on the land being purchased for the car wash is critical to building a successful business, regardless of city or state. 

Base Cost $1,250,000

Range of Variance +/- $750K

Primary Cost Variance Drivers

• Geographical area
• Quality and grading of site
• Size of the lot

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Consultant & Third-Parties

Not always necessary and very situation dependent

Base Cost $250,000

Range of Variance +/- $250K

These add a meaningful cost line item to your total build cost. Whether correct for you will depend on your situation, desired level of time involvement, your goals – and most importantly – the quality and tangible value the consultant brings and provides during the build process.

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Financing and Debt Service

Car wash financing varies greatly. Financing for building car washes vary even more than acquisition financing.

Financing has a highly variable cost based on how much money is needed to be borrowed to construct a car wash. When it comes to car wash financing, it’s important to understand the different types of loans and how they can impact a business for years to come. Car Wash Advisory is happy to walk customers through the different types of car wash financing at their convenience. 

Base Cost $175,000

Range of Variance +/- $75K

Primary Cost Variance Drivers

• Cash equity % down
• Quality and grading of site
• Type of Financing (SBA 7a, SBA 504, Conventional / Commercial, Alternative Financing)

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Carwash Build Construction Costs Summary

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

Cost Component	Lower End	Base Costs	Higher End
Building & Fixed Site Improvements	$1,000,000	$1,250,000	$1,500,000
Water Treatment	$50,000	$150,000	$250,000
Primary Tunnel & Support Equipment	$500,000	$650,000	$800,000
Primary Electronic Components	$150,000	$275,000	$400,000
Site & Landscaping	$100,000	$200,000	$300,000
Vacuum System	$80,000	$180,000	$280,000
HVAC & Plumbing	$40,000	$80,000	$120,000
Signage & Marketing	$50,000	$150,000	$250,000
Planning & Permitting	$75,000	$175,000	$275,000
TOTAL - KNOWN QUANTITIES	$2,045,000	$3,110,000	$4,175,000
Consulting and Other Third Parties	$0	$250,000	$500,000
Real Estate and Land Costs	$500,000	$1,250,000	$2,000,000
Financing and Debt Service Costs	$97,605	$176,802	$255,999
TOTAL - HIGHLY VARIABLE	$597,605	$1,676,802	$2,755,998
GRAND TOTAL - CARWASH BUILD COST	$2,642,605	$4,786,802	$6,930,998

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Summary

The cost to a car wash varies. However, hopefully the above analysis does provide a meaningful starting point and bounds for estimating how much you should anticipate spending to construct and build the car wash you considering making a reality.

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Final Word

Although we’ll certainly have some pieces and materials coming out more specifically on this topic, the CWA team would like to leave you with one final thought and suggestion for those considering building a new car wash (regardless of whether or not deciding between building vs. an alternative route of acquiring or not).

We highly recommend being heavily focused on a single measure and metric of potential operating and financial performance when considering the potential payout and financial prudence (not to mention the site, path to build, etc..) when building a wash – your breakeven annual car count. As with anything, or at least we’re believers in this, it’s always safest to hope for the best, but plan for the worst. So when considering building a car wash, go to your downside case that you have built pro-forma projections for, extract the effective ticket price (make sure to keep anticipated unlimited membership pricing and expected volume attribution and not just use a simple and dangerous weighted average single wash ticket, along with your anticipated downside annual car count volumes, and figure out what level of safety and margin and error from this scenario you have in comparison to that of the ongoing maintenance costs and debt service costs given the total build cost you are expecting now after using this guide. If your downside / conservative pro-forma does not realistically have a considerable margin of error in comparison to your ongoing simple total maintenance and “keep-the-lights-on” costs – please don’t take this lightly. It may be the case that you have an error in your math, or you need to revisit and further sensitize your underlying projection assumptions. But this number, the minimum cars you have to wash to service the ongoing debt service based on your new build as well as the standard operating, maintenance and payroll costs to run the car wash – please make sure the math works before committing yourself to building a new wash.

Car Wash Advisory is an M&A firm dedicated to serving the car wash industry. Contact us to learn more or to speak to our car wash brokers.