Developing a Carwash Chain in Southern China
In Southern China, it’s highly developed and industrialized, in many areas with strong demographics conducive to high potential business revenues space is limited and comes at a premium. No surprise there to any business student or anyone who understands supply and demand – basic economics. Not long ago, I was discussing the concept of setting up a chain of carwashes in Southern China. Is that a good idea? Well, let’s talk.
How would one go about this – let me give you some of my thoughts here. First, let me say that as far as fixed site auto services go, a Carwash subscription is a decent business model to make money in Southern China, but more details are needed – for instance water supply, potentially harming arbitrary regulations on water. Even a directive asking citizens to limit their water use – that could cause a sense of national pride in not using water, not even at a carwash.
China could do in the Southern areas what they are doing in other areas and drastically increasing prices for high water users, for instance: an article published in the Wall Street Journal on January 4, 2014 titled; “To Conserve Water, China Raises Prices for Top Users,” by Brian Spegele and William Kazer. However, I ask why not raise the prices for everyone, big and small users? The article stated;
“China will roll out wide-reaching reforms in how it prices water by the end of next year, the government said, charging higher prices for the heaviest urban consumers to conserve diminishing resources and spur investment [in water conservation technology]”
You see, there are many ways to make money, and if you don’t necessarily have passion about any particular business model and are looking at this through the lens of a “numbers guy” or accountant as John D. Rockefeller did, I don’t see you repeating his rapid gain in wealth without considering all the details.
So, if as an entrepreneur in China you are looking at the bottom line and concerned about the “money” and if accounting and efficiency (Six Sigma style) are your strong points and you are relying on your ability to trim costs and run it tight to maximize profits, then maybe there are other non-automotive business models to consider. After all, “why start a Carwash, Quick Oil and Lube, or Combination Business?” might be a false choice. Think of how many business models there are?
Now then, considering all the potential in China and all the things people need, and also the future challenges with water supplies, is a carwash chain a smart concept? Well, it could be, but more real on the ground data will be needed first. Please consider all this and think on it.
In Southern China, it’s highly developed and industrialized, in many areas with strong demographics conducive to high potential business revenues space is limited and comes at a premium. No surprise there to any business student or anyone who understands supply and demand – basic economics. Not long ago, I was discussing the concept of setting…