Sample Business Plan: Car Wash Service in Nigeria

Car Wash Services provide a specialized, convenient service to car owners who need presentable cars on the move. The market is large just as the competition is also very rugged, but this is a very low cost, low risk, high profit margin business which can be setup and run by almost anyone.

Market Opportunity

Picture this situation, you live and work in a busy city with many untarred and pothole riddled roads. Mobility would be very unpleasant with your car getting covered in dust (during the harmattan and dry season) or mud (during the raining season). This becomes worse if your car is constantly on the road for business and official functions. There is a “social stigma” and embarrassment that comes with having a dusty, dirty car with you. To make matters worse business and work commitments may not permit car owners to clean their cars on their own (wake up 4am, leave for work by 6am to return 9pm every weekday). Here is the breakdown;

33 million cars in Nigeria ply busy routes daily 1 in 12 car owners patronize car wash at least 3 times a week 2,750,000 cars washed at least 2 times a week = 5.5 million weekly washes Average price per car wash = 500 naira Potential Market Size = 13.2 billion naira Less than 10,000 car wash centers mostly informally operated Averagely  car wash centers can fetch between 6,000 naira to over 45,000 daily sales

Challenges Affecting Car Wash Service Business in Nigeria

The problems are numerous but there are 5 I want to talk about in this article. The first main challenge is regular water supply. This should not be a problem if you have a borehole but unless you own the building or the borehole you are either going to invest in digging one or simply buying it from water vendors. There is the problem of financial accountability, if you are not at the car wash point throughout you can’t really tell how much is made in your absence, your workers may pocket the money knowing you won’t find out. Third problem location, getting a strategic location that will boost sales is very difficult to achieve. There is also the problem of having permits, local government revenue task force are  constantly on the move and pressure car wash owners with levies – which is not a bad thing but can be excessive to the car wash operators. Car owners pose a problem themselves, they may leave some of their valuables in the car as it is being washed, when something is stolen from the car during the wash, how will the owner be appeased?

Financial Summary

You can generate at least 1.8 million per annum in sales from this business if you can wash 12 cars per day for at least 300 days in a year. Assuming your daily sales targets are met your first year financial projections should look like this;

Startup Cost Summary

• Rent: 240,000
• 3 Months Operating Expenses: 150,000
• Water Supply: 60,000
• Washing Tools and Equipment: 120,000
• Marketing and Branding: 30,000
• Other Tools: 60,000
• Total: 670,000

First Year Profit and Loss

• Total Sales:    1,800,000
• Cost of Sales: 180,000
• Operating Expenses: 720,000
• PBT: 900,000
• Taxation: 300,000
• PAT: 600,000
• Breakeven Month: 6^th
• Payback: 14^th month

 Conclusion

This is an easy business to start and run and can provide a steady flow of income, year on year but even when business isn’t booming your low overheads can ensure you remain in business while many others shut down. There are 4 success secrets in car wash service as well as other detailed market information which is available on request. If you need a business plan on setting up and running a viable car wash service, call me on: 0803 206 4106 or email me: paulonwueme@gmail.com for details