In the ever-evolving landscape of business and technology, the car wash industry finds itself at an inflection point. As the world grapples with economic shifts, supply chain challenges, and changing consumer sentiments, there emerges a developing ‘toolbox’ of solutions powered by artificial intelligence (AI). This transformative force, once confined to science fiction narratives, is now a tangible reality allowing us to think differently of how we do business, interact with our customers, and work smarter moving forward.
As a Certified Public Accountant (CPA) and seasoned business advisor, I invite you to explore the profound impact AI is poised to have on car wash operations. Whether you’re a seasoned carwash owner or a service provider within the industry, fasten your seatbelts as we delve into some of the areas AI may impact the industry the most in the coming years.
Before diving into this, a quick trip down education lane is the concept of ‘Generative AI’ and ‘Narrow AI’. These refer to what the AI is focused on and how it returns results. I want to give a very brief overview as both these applications will appear below. When we hear ‘Generative AI’, picture it as an imaginative artist—a creator that generates new content, pushing the boundaries of what’s possible. Generative AI isn’t confined to a single task. It learns from existing data and patterns, then crafts something novel. Generative AI thrives on creativity. On the other hand, narrow AI, is the workhorse of today’s AI landscape. Imagine it as a highly specialized employee—exceptionally proficient at a specific task but limited to that role. Narrow AI operates within its predefined boundaries. It won’t suddenly start recommending gourmet coffee blends or solving Sudoku puzzles—it’s focused and task-oriented.
The Customer Experience
It’s all about the customer. With an app centrist wash, a customer could be assisted with AI chatbots while on property helping to guide them through the process, help answer any questions, and help make on-site purchases. Through a narrow AI chatbot, information could be at your customer’s fingertips through instant assistance, answering common queries, and guiding customers through the car wash process. Investments here can generate improvement in customer satisfaction and streamlines in the overall operations.
AI-Driven Systems for Efficient Washing
AI-powered systems assess a vehicle’s size and shape, optimizing water and detergent usage. This reduces waste and enhances wash quality. Imagine a car wash that adapts precisely to your vehicle’s contours, ensuring a thorough clean without excess water or soap.
Automation is a dominant trend, with touchless and soft-touch systems offering precision cleaning while minimizing potential damage to vehicles. This not only improves the user experience but also reduces labor costs, crucial in a margin competitive industry.
Also playing a hand in this ‘efficient washing’ under an AI structure is the benefits to a more sustainable wash. As global environmental awareness grows, so does the demand for sustainable practices. Green technology is a significant focus in the car wash industry.
Water recycling systems dramatically reduce water consumption, while solar-powered car wash stations harness renewable energy. Biodegradable car wash soaps and detergents are gaining popularity, aligning with environmental standards and catering to eco-conscious consumers.
Using AI to Drive Revenue
The power of AI, in conjunction with good customer data and customer behaviors, can create marketing campaigns that work for you. Rather than general and blanket marketing campaigns, the AI technology can craft specific marketing campaigns for your customers. Campaigns that are highly targeted and highly reflective of their specific buying habits. This would be another way to elevate and reward your most loyal customers in a much more personalized and responsive manner.
Optimized Pricing and Offers
We will stop well short of any recent Wendy’s claims on dynamic pricing menus; however, the power of AI algorithms can analyze market trends, competitor pricing, and customer behavior to optimize pricing strategies. What this may look like is pricing models reflective of real-time traffic volume, current weather, recent financial performance to ensure budgets, forecast, and market potential align to place your wash in the most optimized position to hit operational and financial objectives.
Power of AI and Site Selection
A common industry anchor for wash sites was the ‘5-mile rule’ looking at density and traffic within that circle to drive optimized results. With the collection of customer data, algorithms, and AI to bring this all together so many other factors are now entering the conversation of ‘how to drive success’. Asking better questions is now at the heart of the conversations; questions such as what are the relocation patterns as people shift where they live, work, and play for a variety of reasons; urban and suburban expansions using prediction models to assess where the ‘next big thing’ may be; and changing demographics and social economic matters. All of this is vital data that can make a car wash successful. What the power of AI can do is create more data points and allow decisions to be anchored more in data driven decisions.
The above represent visionary applications of where this technology may find a footing in the years to come within the car wash industry. To see these and other visions come true, a few ‘pillars’ need to fortify and strengthen as these become ever so important in making any AI strategy work and work well.
The Need for Data –> Any artificial intelligence application is only as good as the data it has to draw upon. Thus, if the data source is incomplete, ‘dirty’, not specific enough, or not current, outputs from any application will miss the mark and end up being a missed opportunity. Thus, before any thought of implementing any kind of artificial intelligence, consider how your car wash is collecting, organizing, and maintaining one of your most valuable assets—the data generated by your wash, by your customers.
Crafting the Strategy Roadmap –> The technology of artificial intelligence is here, however how we apply it to our business is what takes a true strategy and team. From inception to operational, this takes a sound strategy and the right team to execute. Thus, not only are we assessing the outputs we desire and determining how we will go about achieving those, this call to action is also to assess who is the team leading these transformation changes. From IT/systems, to operations, to accounting and finance, all aspects of the car wash need to understand their role with such a change in how the business operates.
People Above All Else –> The roles and who is responsible for those roles in our washes today may look a lot different 5 and 10 years from now. But so did the jobs of 10, 20, and 30 years ago. If this industry knows one thing—it’s having the fortitude and resilience to change for the better. A great story I heard recently on AI and the power of people was through the creation of an AI chatbot for customer experience (see above as I mention this too). In short, the first application of the AI chatbot continued to fall short of expectations and left the customers, in some cases, more frustrated than at the start of the experience. Compare that to similar experiences of direct representatives solving problems to the satisfaction of customers. So what was the difference? The institutional knowledge within that person—their knowledge of the operations, of the service, of the process. What this AI application was missing in this particular situation was a defined process to properly train the application for what the customer service representative already knew. Thus, what did this create? A whole new department that took the valuable institution knowledge these valuable team members had and helped create a more thorough application. This new department has continued to help solve these problems, enhance the customer experience, and move the entire business model forward. Never lose sight of what makes our car washes great—people. And though we may change, adapt, and move into the next generation of technology, rest assured behind any successful wash is a connected, committed, and dedicated team ready to serve.
This conversation and visionary exercise was meant to spark ideas, discussion, and progress as we move forward with the technology advancements happening all around us. As the technology of AI continues to grow, become more refined, and produces practical uses for our industry, it is our jobs as industry leaders to assess how we might better our car washes, our customers, and our team members through AI and all evolving tools. As mentioned before, this business started as a people-centered business and will remain a people-centered business. What technology advancements can do, though, is enhance ‘how’ we interact with those people.
As you continue to follow this AI trend, I would ask you to consider how an Advisory Board may benefit your carwash. Advisory Boards are assembled to tackle some of the most challenging questions and opportunities facing our business owners. Here at Apple Growth Partners, we work alongside car washes and other businesses to commission advisory boards to better the business for tomorrow. If you are looking to take the next step in growth for your car wash, an advisory board may be the strategic catalyst you have been looking for.
Contact Brandon Fredericks, CPA at bfredericks@applegrowth.com to get started.