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What do you think of this business idea? (not IM)

Discussion in 'Making Money' started by kivd1, Feb 15, 2013.

  1. kivd1

    kivd1 Junior Member

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    Hey guys,
    I have a small business idea, and I want to know what you guys think of it.
    Its not internet related.

    Step 1:
    Buy a car detailing kit,
    detail the cars of friends and family for a few months and familiarize myself with the trade (become experienced at it)

    Step 2:
    create a company

    Step 3:
    get hard working employees who can work for roughly $15/hour

    Step 4:
    Personally/hire someone to teach them to detail cars

    Step 5:
    get customers by
    a. putting up flyers around town
    b. offshore cheap telemarketing
    c. calling up local car detailers and asking them to send me excess customers if I give them a cut of the price
    (I think this could work bc a car detailing shop can only handle a certain amount of customers per day and if they get too many many they have to turn them down, so instead they could send them to me for a cut, I live in a huge city so I could have this deal with multiple car detailing shops)

    This would be a mobile business, so I would be sending my employees to the customers houses to detail cars

    Cost For high quality in depth detail: $300 which is the industry standard
    this is one days work, about 8 hours, so I pay employee $120 per car, pay roughly $20 for supplies per car, make $300 per car(if the customers from the partnership maybe more like $260 but still), pay for employee gas which is a few bucks, offshore telemarketers = cheap

    I would probably scale this to 2 employees = 2 customers per day
    is that many customers realistic?

    so.....

    what do you think?

    Good plan?

    btw I have $1,500 to invest for the startup
     
  2. Furious George

    Furious George Supreme Member Premium Member

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    my 2 dollars:

    I like it so far. One issue... a kit? Car detailing can get rather complicated. I'm assuming you need a mobile kit? Something you can take in a van or car?

    I wouldn't create a company until you start to get customers. There's no reason to waste money forming an llc if you don't have customers. (with this type of business)

    That's a lot of money to pay someone to wash cars. I'd go with minimum wage, or 10.

    You should do the training.

    Telemarketing won't work. When I was younger, I got a lot of business offering to change oil for people who were shopping at the mall. I'd go buy the filter and oil after they paid, and I'd be done in 15 minutes.

    It's 2013... I'd go with a website. Flyers are a waste of money. If you get a website you could set up a deal with groupon or living social. You'll get MAD business then.

    Don't try to call competitors. They'll never help you.
    Pay piecework, in other words, don't pay by the hour, pay by the job.

    Pay them piecework, make them pay for their own supplies. Don't reimburse for a thing. They're sub contractors, and they need to pay that stuff out of pocket. The second you start reimbursing anyone you basically write them a blank check. A perfect example... about 10 years ago I got a GREAT job (well, at the time it was great). I was reimbursed 100 dollars a day while I spent a month training. (in addition to pay) I spent it all at the bar. They didn't even need itemized receipts. Point being, if these guys want a job, make them pay for their own gas. Does taco bell give drive thru workers gas money? Does bank of america give the CEO gas money?

    Telemarketing anything over 19.99 is extremely difficult. Plus, how is someone going to pick out the kind of person who wants to pay 300 bucks for a really nice car cleaning?

    That's a good goal. The problem I have with goals like this is that you might stop at 2. Just set your goal to x+1, where x is whatever you have.
    Sounds good. I would focus on doing the work the work yourself until you have so much business you need to hire someone. Then hire an apprentice.

    Get a good website. Market it.

    Don't just waste money... look at it like every dollar is the last one you have. Money goes fast when you're starting out. Everyone will want some of that 1500 dollars. EVERYONE.


    Hey, good luck!
     
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  3. kivd1

    kivd1 Junior Member

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    Making the company won't be hard bc I'm doing it with a government program so they take care of that stuff.

    Thanks for all of the valuable advice, really appreciate it! Im going to incorporate almost everything you said to my business plan.

    few things

    the groupon idea is amazing, but i think it will give me a large blast of customers at once that I might not be able to handle, will people be okay with waiting? is there a way to fix that and keep customers coming over a period of time?
     
  4. pnvhq

    pnvhq Junior Member

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    Make your service by appointment only, and make sure your groupon lasts long enough to be able to handle everyone who buys one. You can also define a set quantity of groupons you want to sell, so you're not selling 1,000 or something ridiculous.
     
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  5. kivd1

    kivd1 Junior Member

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    good point, thanks
     
  6. mraddison

    mraddison Newbie

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    My two cents. Pass and find a different idea. The profit margins are low with a detail shop, I have seen many come and go. I have also seen other people try and make an attempt at the same business model. I have only seen one that is still in business and that is only because he caters to very high end cars and clients. One question I have is that since the business will be mobile then what will you do if it rains? Where exactly do you plan on performing the service? In their driveway? Garage? Just some things to think about.

    If you do move forward with it then I have one suggestion for marketing. Create a referral card that contains the business information on one side and a discount offer for a new customer. Word of mouth referral is the most powerful and effective method of marketing.
     
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  7. BHopkins

    BHopkins Moderator Staff Member Moderator Jr. VIP

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    You're starting a business doing manual labor, unless you're in a skilled trade where the barrier to entry is high, this is a bad idea.

    On top of that, you need a pressure washer, trailer, water tank, chemicals, you'll probably be looking at $2000 in startup costs.

    I have had a lot of detailing done and never paid $300. Two weeks ago I had a guy do a full interior detail (windows, shampoo, floor mats, etc.) and a exterior wash (no wax). He was at my house with an employee for about 4 hours and he charged me $155. Wax would have been another $30.

    I would seriously reconsider this before investing any money.
     
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  8. Furious George

    Furious George Supreme Member Premium Member

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    Groupon will ask you how much business you can handle as part of an approval process.... so you have a a full staff, and you can handle anything.

    Groupon deal lasts for a few days on their site... but you can make the coupons you sell expire in a year. That way you'll be able to fill the orders, and still make a lot of good start-up cash.
     
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  9. ChEcKeD

    ChEcKeD Senior Member

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    If it's something that you will enjoy doing, and you'll work hard for it, then go for it. Check out the 'offline marketing' section.
     
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  10. kivd1

    kivd1 Junior Member

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    You don't need a water tank, there chemicals to do it without water. You also don't need a pressure washer.
    All the chemicals will cost a few hundred bucks

    also a wax isn't considered a complete exterior detail. Charging $155 for four hours of work would be great for me, bc i was planning on charging $300 for eight hours of work(the complete exterior detail)
    four hours x $10/hour employees = $40, and I make $155? seems like a pretty good profit margin to me!
     
  11. kivd1

    kivd1 Junior Member

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    Doing it in the garage isn't a big deal.
     
  12. BHopkins

    BHopkins Moderator Staff Member Moderator Jr. VIP

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    How are you going to do mobile detailing without a water tank? You assume the customer will always have a hose nearby? Chemicals can clean without water? How will you wash the outside? Maybe you can get away without a pressure washer but you're going to be scrubbing a lot harder, especially tires/undercarriage and floor mats.

    $155 is your gross profit, you have to pay income tax and self employment tax which will be at least 25% probably more. That leave you with $116. $40 for your employee. You should have some small liability insurance for damage you cause and employee accidents but I won't count that.

    Budget at least $20 for chemicals and you're left with $56 in net profit. Pay yourself $14 an hour. You're jumping into the rat race. You can probably get a job for $14 an hour and not have to deal with the expenses of working for yourself and the difficulties of not finding clients.
     
  13. djadstar

    djadstar Junior Member

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    Ive only every seen this really work with already established companies, ones such as car modifiers and so on.
     
  14. tnjrash

    tnjrash Registered Member

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    Don't forget to factor in:
    1: Payroll taxes - If you are paying an employee wages, you can't forget taxes. If you are going to pay as a sub-contractor than payroll taxes will not apply'

    2. Workers Compensation - If you plan on scaling up, you will need to have insurance in case one of your employees are injured on the job.

    3. Liability Insurance - What happens if a customer claims you damaged their car.

    4. Health Insurance - In order to attract quality employees you need to offer some type of benefit package.

    5. Sales Tax - I live in a state where services are sales tax exempt unless it is a commercial account. Check your lacal taxing authority for more info.

    6. Auto Repairs - If you are using a truck/van for your moile detailing, eventually you will need to replacer an engine/tranny or something other than routine maintenance.

    7. Office expenses - Printer paper, invoices, advertising material, computer expenses, rent,power, internet, utilities.

    8. Advertising Expense.

    9. Misc. Expenses - There is always something that pops up unexpectedly.

    I am reminded of all these things as I sit at my desk today paying all these bills and stumbled across this thread as I was taking a break.

    I wish you luck in your new endeavor.
     
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  15. Duffers5000

    Duffers5000 Elite Member

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    I have plenty of experience in this field. Ive often said that one of the easiest ways to make money in a hurry is to get a bucket and sponge. In saying that though its a very competitive, labour intensive market and I dont know anyone thats made anything other than a decent income out of it.

    First off what experience do you have ? although it might look like you just get stuck in and clean, it is actually a learned trade and most valeters I know are pretty poor for there first two years.

    What chemicals are you planning on using ? This stuff is pretty expensive but you can get deals off certain companies if you use and advertise their range and purchase in larger trade orders. Even if you keep things tight there is a wide range of chemicals you will need in your toolkit. I could recommend some suppliers but Im in the UK so my contacts are no use to you.

    I wont go on Ill just give you examples of the people I know that make money in this field.

    1/ The guy that gets in the door with a big company that has a carpark full of cars. One guy I know only targets large call centres etc where he knows there will be 300+cars parked all day in the carpark. He is presentable and professional and once he gets in the door and starts doing a few cars he gets constant daily business. Needless to say giving priority to management who park their exec mobiles in the most prominent parking spots.

    2/ The guy who runs a roadside carwash with parking for customers to park their cars for added detailing. He makes his money by having a diversity of income streams. car wash-car detailing with a full menu from a $10 shine to a $125 full interior/exterior valet. He brands his pitch with the company whos product he uses and he makes money by reselling their waxes and products. He can also offer other services and if he has a brain will park 3-5 of his own cars at the side that are on sale. The location is all important some roads are just busy. Sometimes even a busy road wont get traffic because its difficult to pull in/out of the pitch.

    3/ The specialist detailer whos spend years in the trade and taken every possible training course thats come his way. Guys like this do full flattening/polishing-clay bar preparation etc and use some really expensive high carnauba products like swissol(although some poorboys and meguars products are fine). A good detailer like this can make thousands of dollars difference to a car and if you get known to a dealer network of prestige car dealers you probably wont ever be out of work.

    So yes, go for it. If you are prepared to work really hard you can make a good living out of this.
     
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  16. kivd1

    kivd1 Junior Member

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    right, $14 an hour x 2 employees working = $28/hour for the work day but once I have everything up and running I won't be working for the entire workday, maybe only a couple hours a day to stay on top of things

    also, yes, chemicals can clean without water
     
  17. radarsurge

    radarsurge Regular Member Premium Member

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    I'd dump it for this:

    Window replacement. set up shop at your local car wash (I'm talking nice wash where people come inside and sit) and offer windshield repair. They don't have to pay upfront because you bill directly to their insurance. It's an easy sell and a car wash is an automotive conscious captive audience.

    Sure it will take a little more investigation to get rolling but $500 per job is a better rate + you can still drive to people's homes!

    my 2 cents.