Starting a Small Car Detailing Operation Questions

[PilotG97]

Hello everyone, new member here.
 

I’ve always loved detailing my car and something I believe I am good at. I’ve been doing it since I owned my first car in high school. It’s became a hobby of mine over the years, something I find relaxing. 

 

I just finished up my undergrad last week and already have my full time job. Since school is over with and I have so much more free time now, I’ve been thinking of starting my own little detailing operation. I would first start out in my neighborhood and see how things went. Can’t hurt to try right ? 

 

Some questions I have as this idea is going through my head: 

 

I have a finance degree so I know prices are based off location, the market, and enough to cover the purchase of your products and time, etc etc etc. Ultimately I would need to figure out a profit margin for myself. However, what are ball park or general prices personal car detailers charge for various jobs ? 

 

Next, what’s the best way of getting your name out there besides social media and word of mouth ? Since I’m just starting in my neighborhood, I was thinking of making pamphlets and putting them in peoples mailboxes (bottom slot). 

 

Let me know what you guys think. Thanks in advanced.

[falcaineer]

Here's a great video. I know all four of these guys personally, and they have some awesome insights. And @shane@detailedreflections has a write-up somewhere on here that is a great read, too (someone have the link?). It's a process, but can be an incredible experience. We'll be here for help you along the way. Enjoy, and good luck!

 

 

[shane@detailedreflections]

You ask some good questions.  Congratulations on the effort to make a business. I’ll share a few thoughts and maybe it turns into some discussion of further points. I’ve written about a lot of these topics here before if you search my history. That way hopefully it’s not too repetitive. 
 

The biggest thing I can say is that detailing for a business will likely take away some of the fun that it can be as a hobby. It introduces stresses that weren’t there before. Now you’re worried about client acquisition, retention, profit margin, product supplies. These are factors on every single job. Neglecting them is being a negligent business owner. 
 

For pricing you have to do market research. Find out what others are charging in your area. You don’t have to follow their pricing to the letter, but it gives you an idea. We are small, but we are not the cheapest guys around. That being said, I can sell our expense on the fact that we are heavily invested in equipment. Eight polishers, an extractor, dreamer, a lift, blowers, paint thickness gauges, etc. All things that add to our “value.” If you don’t have the proper equipment, don’t take the job.
 

Your pricing will also be set by the customer you’re attempting to acquire. Do you want a car wash customer in for a “wash and vac?” That’s not our target. It’s not our target because I don’t feel the return on my investment is there. Add up the costs of labor, supplies, etc and I can’t charge enough to make my money back and reasonable profit. 
 

Understanding profit comes from multiple jobs. On a standard detail (one step polish and interior), I’m making money...but after I pay the guys, supplies, etc there isn’t always a lot left on the table. But this work is necessary to spread the word of mouth that brings in money generating work for me. It also keeps my guys working and interested in keeping on. If they’re not making money, why are they going to work?  So these jobs to me while being slightly profitable are a “cost of doing business.”

 

Where I make money as a business owner is really on coatings. There’s good margin in them and room I don’t sweat the hours that go into them. That being said, we don’t just use consumer coatings and call it good. We are accredited/certified in professional level stuff. It took time to get there. A lot of it actually. 
 

Do not over sell your experience. You have to manage expectations of your clients. And when you oversell your ability, you set yourself up for failure. Better to underpromise and over deliver. 
 

Be mindful of how you buy as a business owner. Want to make more profit?  You can do it two ways. Raise your prices so you make more. Or you can reduce your costs. This is better buying or better process. This creates more margin without the client feeling the impact of that decision. Don’t limit yourself to a single supplier. It’s poor business unless that vendor is offering some significant perk for being exclusive. 
 

You most likely know this, but your hourly rate target needs to be inclusive of a lot of variables. Your labor, material cost, overhead expenses and money on the table for the business to retain earnings and to have cash available for when something breaks (we just smoked a polisher last weekend and had two new ones in two days). Your hourly rate target is likely higher than you think. 
 

Advertising is tough. We don’t advertise. We are word of mouth, or you can search us. Word of mouth is huge. So is having a professional appearance. Our website alone has landed us more than one job and we’ve retained these people as clients. That being said, I won’t get into a price war with the competition. Our prices are fair (but not cheap), and it’s what I feel we need to make to make this venture worthwhile. If a customer plays the “so and so can do it for this...” my typical reply is that if that’s what fits their budget it sounds like they’re a good fit for what they’re looking for. Often times the biggest bargain shoppers are the pickiest. Then you get the other end of the spectrum. We have a referral client picking up a C8 corvette. It’s coming from the dealer directly to us and he hasn’t asked me for a price yet. The referrals carry the weight of the asking price.

 

We started by doing our own cars. Then friends would ask if we could do theirs. And so on. It’s taken time to grow. 
 

I can’t say this enough, and it’s a common mistake...DO NOT undercut pricing to get started. You teach your customer that you can do it for less. If you don’t value your work, who will?

 

 

[RayS]

5 hours ago, shane@detailedreflections said:

Your pricing will also be set by the customer you’re attempting to acquire. Do you want a car wash customer in for a “wash and vac?” That’s not our target. It’s not our target because I don’t feel the return on my investment is there. Add up the costs of labor, supplies, etc and I can’t charge enough to make my money back and reasonable profit. 

 

7 hours ago, PilotG97 said:

I just finished up my undergrad last week and already have my full time job. Since school is over with and I have so much more free time now, I’ve been thinking of starting my own little detailing operation. I would first start out in my neighborhood and see how things went. Can’t hurt to try right ?

As always Shane has some great information and feedback and I highly recommend you look at some of his other threads on his business model.  Given that your education is in the financial side, I am hoping you received a good understanding of the tax liabilities.  My wife is an accountant and one of the frequent items that come through are small business who didn't plan for, didn't hold back enough and even worse didn't pay their taxes.  The tax man is unforgiving, they will take your savings, equipment and house if needed to collect the taxes.

 

In the quote above from Shane, his use of the word Customer is an important part of the conversation.  When you read the overall post, you'll see the word Client used and the question is what you are trying to attract, Customers or Clients.  The fact is that you are going to have Customers and it is part of the process in trying to get Clients and given your thought about a neighborhood model, you will need to make sure even the Customers are happy.

 

While this year will be a bust for using a neighborhood promotional model, you can start setting the groundwork for next by building your skills and acquiring the products and equipment needed.  A marketing technique to get visibility into your capabilities and target customers that you want to become clients is to do a Prom Special.  You can do this as a Exterior only or Exterior and Interior if you have the people to work with you and equipment.   Interiors can be a lot more difficult to deal with than exteriors and it comes down to how many cars you want to turn over in a day.  The focus is on getting your work visible from a marketing standpoint, because no flyer or advertising will do as much as having people see your actual work.

 

Setting yourself up for success is the key, specify what is included and keep it simple, an example might be:

Hand Wash, Clean wheels and tires, wash windows and Wax for $$ - by appointment only and don't take on more than you can do.

 

Know that most kids get their parents cars for the Prom, you are actually targeting Mom & Dad since they are the one that usually have the money.   If the car is a decent vehicle and one that you can do a whole lot more with, provide them a flyer on your full detailing services.  Point out where you can do a correction, a coating, etc..  If it is 8 year Camry that only gets taken care of when it rains, make it look good for the Prom, but the probability is that they were a customer.  However, you never know whether or not they have a new SUV sitting at home, so include a flyer anyway.  The person that comes back asking for a wash and wax at the same price, is the one that you have to up sell and make sure that you stick to your guns about the Prom day special is a once a year event.  

 

My advertisements are the vehicles that I do and I know my limitations in both skills and equipment.  I do not hesitate to send someone to another detailer if that is what their vehicle needs and I also get referrals from other detailers.  My specialty area, besides Red vehicles, are the ones that have been neglected and aged.  A couple weekends ago it is a Roush Mustang, this past week it was 1972 Datsun 240z, who knows what will be next.   At some point, Shane will get to do a coating on one of my personal vehicles.  I am a hobbyist and can do a good job, but I also recognize the level of a professional and their extra investment in equipment and education. 

[shane@detailedreflections]

Thanks @RayS.  I'm looking forward to the time coming that we can put a coating on your vehicle for you.  You're welcome to sit in on the process when the time comes if you'd like as well.

 

Ray brought up a good point that I overlooked, and it's a major one for me.  I do view customers as different from clients.  So there's two different acquisitions that happen.  The first is potential customer to customer.  Then you have to acquire them again to make them a client.  There's a difference between the two, and it's significant even though both provide revenue.

 

A customer is generally a one time transaction.  They have a dirty call, and they have a service done and you never see or hear from them again.  These are people who may have zero or limited experience with a detailing service and are trying it out for the first time.  Or someone who has a special need ("someone got sick in my car and I can't get it out.")

 

Your job is to convert that customer to a client.  A client is someone who has a repeated relationship with you.  They come back over and over for service, and they're also your biggest champions when it comes to word of mouth.  These are your clients who provide you with continued revenue.  That continued factor is important.  Do a coating for a client?  You want to see them once or twice a year.  Customers are usually the ones who will be the pickiest about things for some reason.  That's where managing expectations comes in.  

 

Treat everyone the same.  Don't change work for who you perceive the person in front of you to be.  Treat people well, treat people the same.  You're trying to build relationships.  We have clients who are now friends.  That acquisition can be difficult, and the distinction needs to be made so you can understand what you'll have for renewed revenue and workload.  After all, servicing the new customers/clients is additional revenue to maintaining the old ones.