Site Selection – Conquering the Biggest Risk of Your Car Wash Investment

March 13, 2023

Did you know that a site’s location can predict around 80% of its future performance? In this webinar, DRB® and SUDS discuss:

  • Common myths about picking the right car wash site.
  • What REALLY matters when it comes to site selection.
  • How site selection tools work
  • How to pick the RIGHT site selection tool

Site selection is too important of a decision to leave to chance. Watch this webinar to learn how to mitigate your site selection risk.



Kayla Ivey,  DRB Product Marketing Manager: As you guys are joining, we are here today to talk about site selection. So we are going to share what we've learned as we really dove into the topic of site selection and dove deep into the data to understand what actually matters when it comes to choosing the best site for your investment and what are some things that don't necessarily matter as much as one might think. So we'll share that and hopefully give you some tools and takeaways so that you can feel confident in the investment decision that you're making.

And looks like a few more people are joining. Quick housekeeping item before we dive into the content, there's a Q & A button at the bottom of your screen, and we'll save a few minutes at the end of the webinar to go through some questions. So go ahead as we go along, just put any questions in there. If we don't have time to get to everyone's questions, we will email you afterward with the response to everything. So make sure to feed us questions through there as we go. And if we don't have time, we'll circle back with you after the webinar. And if you have any like technical questions or any difficulties, go ahead and put those in there, too, and we'll do our best to have the team help you.

Alrighty, let's go ahead and get started. My name is Kayla Ivey, and I am a Product Marketing Manager for DRB. And so, I've been in the industry for about six years and really a lot of my experience in the car wash space has been working directly with car wash owners to help them with things like marketing and growth. And so I'm helping to bring some of that insight to the table as we talk about site selection because, when you're working on kind of that growth and marketing aspect, you see what makes a site challenging, what are hurdles that you have to get over, and you also see the flip side of that site and that campaign worked dramatically well. So what are things that we took note of about those very successful sites also. So that's what I'm hoping to kind of bring to the conversation today.

Kirk Fletcher, SUDS Director of Analytics: I'm Kirk Fletcher. I'm the Director of Data Analytics at SUDS. Prior to SUDS, I was working in the investment analytics industry for 10 years, and now I've been here going on three years. So I do lots of the analytics and oversee lots of the things we do with marketing campaigns or pricing analytics, consumer behavioral insights and investigations, and, in this case, location analysis for a car wash.

Kayla: Awesome. All right, so quick overview real quickly here of what SUDS does and kind of who we are in the industry. So SUDS is part of the DRB family of brands, and SUDS really focuses on the marketing and analytics and how to drive growth for car wash owners. And so a lot of times what that looks like is diving into car wash data and helping car wash owners understand what levers to pull, what specific actions to take that are going to have the most impact in their situation and for their goals. So some of the high-value questions that car wash owners might be asking that we help address are things like, my business has plateaued, what can I do about it? How can I increase membership capture? So we dive in to understand the behavior patterns of your customers and who's most likely to become a member. Help address that with tactics such as marketing campaigns or promos. How am I doing compared to the rest of the industry? So this is a really key benefit that we see a lot of car wash owners, you might have a great understanding of your own business and kind of what's going on in your wash, but how does that compare to your region or even to the industry as a whole? So having that perspective of kind of what's going on in the industry as a whole can be very beneficial. Why are my members churning? How can I keep them? So again, kind of understanding the behavior of your customers. What are those triggers that are maybe impacting or influencing behavior.

Are my prices optimized? So this is a whole topic in itself. Kirk and I did a deep dive in a different webinar last week about pricing optimization and how you can add additional revenue for your business just through optimizing your pricing and not even having to add an additional vehicle to your wash. And there's content on that on the DRB website in our Learning Library if you're interested in kind of diving into what we talked about last week.

And then last one here, where should I build my site? So this is why we're all here today. You're probably looking at adding sites to your portfolio, or maybe there's some of you that are just getting into the industry, looking at what are the right pieces of land or the right acquisition sites to start building your car wash business. So either way, whatever situation you are in in your kind of growth stage, the tools that we're going to talk about today are going to help you make the best investment decision, the most educated investment decision so that you know exactly what you can expect finances wise, like revenue wise from the sites that you're looking at, and be able to compare and make kind of the best decision with what options you have on hand.

Okay, so first off, how important is location in itself when it comes to determining the success of a potential site? So like I mentioned, I've been at SUDS for quite a while now, and through that experience, what we started to notice were these certain types of car wash owners that would repeatedly pop up year after year, which we were having conversations like "I built my site a year ago or months and months ago and I'm still not hitting the numbers that I was expecting. I only have a few hundred unlimited members." And the reason that we're all here in the industry is for the high recurring revenue and the revenue capabilities that the express car wash model offers. And so, getting into a site and only having a few hundred members can be scary and challenging, and it's not what you are expecting when you go into an investment.

And so in those situations, like I mentioned, SUDS does a lot of marketing, so we would kind of look at the sites from a marketing perspective and look at the market awareness, how are we doing in terms of making sure that the right people are hearing about us on the right channels. And so that was part of it that'll kind of get you part of the way there. But what we started to notice with some of these instances where we were doing the right things on the marketing side, the car wash owner was doing the right things on the operational side, but we still weren't hitting the numbers that we were used to seeing in some of these cases. And so we started to dive into those particular sites and try to really understand what was it about those sites that were different, and then also the reverse of that, what was it about sites that knocked it out of the park with similar marketing and operational tactics? And so through that is kind of where we uncovered how important, how truly important location is. And so we've found that location can predict about 80% of a site's future performance, just the address alone, and a number of factors that we consider about that location and that address can help us predict what that site is going to do, and a lot of it, 80% of it. And so that leaves about 20% up to things like marketing operations, the equipment, the quality of the service that you're providing, all very, very important things. But without getting that location right first, it's been very challenging to overcome some of these location hurdles. And so yes, location is probably the most important decision that you'll make with any of your car wash investments.

And so we want to share some of what we learned that matters and things that also don't matter as much as you might think. So starting here with some myths that we found. So when we started to really dive into what matters, what doesn't matter about a site, and we're talking about matters in terms of how much does that thing predict how much revenue or how many members that site is going to produce down the road. And so a lot of what we found was pretty surprising. So we'll share here our top three myths that we still see talked about in the industry and around in site selection conversations as people think that these things should be a decision making factor in what site to purchase. So we want to share with you some of those things to look out for that don't actually matter as much as you might think.

Okay, so myth number one, don't consider a site unless the daily car count is over 30,000. So this is kind of an arbitrary number and what we found out is, it seems reasonable that you're trying to get a lot of cars onto your site. So pick a site that has a lot of cars driving by it day after day. However, what we found when we looked at how much traffic actually predicts the future performance of that site, we found that predictive value is almost zero. So just by understanding, just by looking at the car counts and the traffic driving by that has almost zero predictive capability when it comes to how that site is going to do revenue wise, membership wise. And so what that means, it's not that it's not important, but it has to be considered in conjunction with numerous other factors. So looking at something like car count and like eyeballing it or looking at it in isolation, building an entire report off of it is not going to give you an accurate understanding of how that site could do. So just because a site has great traffic driving by doesn't mean it's going to be a great site, and the reverse is true as well. You can have a great site that doesn't have that certain threshold of car count.

So myth number two, kind of similar idea here. Residential, the site must be surrounded by a growing residential population. It's not necessarily a bad thing, but it doesn't predict the performance of the site like as much as we thought it would. So residential population growth can predict about 20% of a site's future performance, but again it has to be considered amongst all of the other variables about that site. So just kind of looking at residential population growth on its own or in isolation is not going to give you a good idea of if that site can perform at the level that you need it to. So you need to consider how all the variables relate to one another.

And then myth number three, the site must have no other car washes nearby. So this is the one I think I find most interesting because it makes sense to think about if you were going to open a site you would want less competitors 'cause you want to have the most market share. What we have actually found is almost the opposite of this. So what can happen is if you open, let's say an express car wash site in an area that already has a decent amount of express tunnels in the market, what can happen is the pie of car wash consumers actually grows as a whole. And so this is counterintuitive when you first think about it, but then think about like if you're driving around and consistently seeing express car washes on every corner, maybe that peaks your interest after a while. It's almost like a subtle advertising effect that happens when you have a lot of these businesses around. So you're not necessarily pulling from each other's customers, maybe up to a point. So we can look at how the competition looks in terms of saturation in that particular instance, but just having competition is not a bad thing. It can actually be a benefit. We've had the reverse where we helped a car wash owner open an express tunnel in an area that has no tunnels, and it's actually very difficult because you have to educate the entire consumer base on what the heck the express car wash value proposition is. And there's a whole kind of that education and warming of the audience that has to happen before you can really make an impact on that market. And then another thing real quick to consider about competition is it also doesn't matter how far apart you are from a competitor necessarily. So you don't eyeball it and kind of think, as long as I'm not less than a mile away from another wash, what matters more than how far apart you are is the traffic and the driving pattern. So where are people coming from to get to these sites is way more important than how far apart you are. You have to have the right type of tools to see that. But with like a heat mapping tool you can see maybe two sites are less than a mile apart but one's pulling traffic from this general area, one's pulling traffic from here. So even though they're visually close by, they don't overlap with their consumer base as much as you might think. So there's a lot more to think about when it comes to competition other than just how many there are or how close they are to you.

Kirk: So given the myths that Kayla's just went over, first of all there's no surprise that there would be such myths because you've obviously seen plenty of car washes around, maybe you have some of your own, and you know that this car wash does well because of this factor, clear cut. This car wash doesn't have that same factor which is making this car wash extremely successful but this one is successful as well. And so it gets a little bit difficult to try and figure out what is that optimal solution, that secret combination, that key driver of success when it can vary from location to location. And obviously, if you're running some car washes, you know that there are multiple factors that go into the successful operation of a car wash, site selection being a very big key one. But we're going to go through a lot of those because the real answer to what matters is kind of an interplay between the different factors. So we're going to go over a bunch of those factors, and I've kind of broken them out to fall under three categories that kind of have associated questions that come with them. And those questions to answer, when you're either looking at a wash, an existing wash or a potential wash, and how it's going to be successful are: Who is there? Will they stop, and then will they come back? Now at the top of the list you're starting at a very high level, you're looking at the overall area, and you have very little control over this. But as you move down the list, you get into a lower level, kind of more at the business level and that's where you start to have more control as an operator. So we're going to discuss more of the first two questions here and all of the characteristics associated with them in different questions you can ask about a location in trying to determine whether it will be successful.

So first question then, who is there? So here we're talking about, in the general area, you have people, these people have cars, so these are going to be your customer base, the potential that you are trying to win over. So a big factor there is going to be, who's there, how many are there, how much opportunity is there for you to succeed? And so lots of it's about capacity. So starting with the number, obviously all else equal, the more customers you can potentially have, the better you're going to do. Now how many, that's a little bit tricky specifically on the how many are there or who is there. So what does "there" mean, and who can you reasonably assume that you may be able to attract as a customer? So this is where people will start to draw out trade areas to try and figure out where the customers are that they're going to potentially win. And there are different methodologies for this. In some cases, there are three-mile radius, five-mile radius and try to see okay, how many people are in that radius, what are their characteristics? Another methodology would be to use drive time. See within nine minutes, 10 minutes, how many places can you get to my car wash from or to this location from within a 1- minute drive time? And you kind of drive, draw your trade area there to figure out your potential base using that methodology.

So both of these, these are good starts, but one of the things that often gets missed is it's not just about who is there because often just because someone is there within one of these perimeters doesn't mean they will come to your site. And just because someone's without or outside of your perimeter doesn't mean that they won't come to your site. So really you have to take some time to figure out not just who's around but who's going to be sitting in front of your location, in front of your site in order to you potentially win their business. Because in most cases people aren't going to go out of their way to find a car wash unless you're the only one within a large distance. For the most part, car washes aren't that type of activity. And so you're going to look at kind of where the car wash is and then you're going to look at traffic patterns around it to see who is coming and who is potentially going to be around you. So the metric that's often used, and Kayla mentioned this, is traffic count, so that's a good start. You're going to look at how many people are in front of your site on the street, on the corner street whatever it is that you're looking at. So this is a good start but the thing that you also have to take into account is not all traffic is equal necessarily. And so what I mean by that is if you're next to a neighborhood and you have 20,000 cars going by your wash, are they the same people? They're probably more the same people who are going back and forth and back and forth. So you're having a lower amount of unique individuals who you can potentially win over. Alternatively, if you're next to like a mall or some big event place and you have that same 20,000 traffic count, that's going to be different because you have a lot more potential for customers because you have a lot more unique individuals who are going to be passing. So that's one of the things you have to take into account is you're trying to assess how many people, how many cars could I potentially earn business from. So you're going to want to look at that but not just how many.

You also want to know who, and that could play a difference as well. Ages, that's important. Are these college kids largely, are we in an elderly community? Are they middle-aged? That tends to be a little bit more of the sweet spot. People have money and they care a little bit. So, you're generally going to have a little bit more success there, but you're going to want to know the breakdowns of those individuals who are going to be there as potential customers. Also other demographics like income, discretionary income. Do these people largely own their own homes? Do they rent? These are all lots of the other characteristics that are going to be important when assessing your potential consumer target base. So if that is who is there.

Moving on now to will they stop? So it's not just enough to have people there. Once they are there and you've figured that part out, next you have to figure out why would they stop at your car wash, what is the likelihood? So in this case you kind of have to get into the mindset of the driver and how that mindset works relative to a car wash. For car washes, most people don't get into their car to go to the car wash and then come back home. That tends to not be how that part works. And essentially it's more of a convenience and impulsive decision, not for everybody but tends to be much more less planned in order to go to the car wash. We all have our to-do list so to speak. We have our hard to-do lists which is go to work, eat, pay the bills. These are things that we're going to do. But we also have what I'll call a soft to-do lists. These are more subconscious. I'm going to start eating healthy sometime. I'm going to fix the fence when I get to it. Washing the car tends to be more in this group where it's like, yeah car's dirty when I get to it at some point, I need to wash that car. So where that comes to you then is you have to capture when that intention, that subconscious intention "I need to wash the car" is combined with the opportunity, and you have to provide that opportunity so that when they see your car wash, they're going to take advantage of it.

So different things that are going to affect their likelihood of doing that. So first and foremost, do they know you are there? So one of the things we've seen lots of locations that are trying to figure out why they can't get more traffic. They're on a busy street, but when we start to look at their car wash, all we see is a building with a sign with the words car wash. So the problem with that is most people don't read when they're driving. You'll see things, but they don't make it inside. So if the only thing that you have identifying your location is a car wash, then realistically you're not going to get as much. What people do see when they're driving they see pictures, they see logos that are different. So this is where signage and figuring out how you're going to show people where you're at, identify what you are is going to play a big piece. In addition, what people see when they're driving is things that are happening. So if I'm driving and I see cars going in and cars coming out and I can see that that's a car wash or alternatively, anytime you see people out vacuuming their car, that's something that you notice. And so this all comes down to, would fall into the category of visibility of a location, and that's going to be a big part. So part of that is under your control, and that's how you structure your site, how you do your signage, but another part is just where it falls on a street. At what point can you see it, and how clearly can you see it? So part of that contributes to, are people going to stop today? But another part is are they going to remember? When they need a car wash, I know where it's at, I'm going to be in that area, I'm going to do that, put that on my to-do list for today.

So seeing it is part of it, but then there is another part. When they do see the car wash, can they react to it, and will they react to it? Because when someone's out driving, they're doing something, they have a mindset, they're on a mission, they're on their way somewhere, and your goal is to get them to deviate from whatever that is. Deviate from a going somewhere to stopping at the car wash. So as we're driving we have to switch and create a new plan. Okay, I'm going to get my car washed, how am I going to get there? What am I going to do? And that's when you start looking around and trying to figure out what is the path of least resistance. So as someone's doing that, they need to come up with a plan to get to the car wash and either they're going to find it easy, or they're going to find it difficult. So the more resistance that someone feels when they're trying to come up with that plan, the least likely they are to follow that plan or to act on that impulse.

So that's where we look at different things that cause resistance or discomfort to someone who's driving. And this would fall under ingress egress is what we call it. So different things that would contribute to that would be seeing a car wash but not seeing exactly how I get there. So sometimes, and this is some things that sometimes you can't control, is where is the turn-in point, and how visible is that turn-in point. So sometimes signs will help with this, but if someone can't easily see how to get onto your property then that's going to make things more difficult. Now when they're driving down the street, do they have to switch lanes quickly? How fast are they driving? So meaning do they have to hit the brakes? We don't like doing that. Do they have to switch lanes while hitting the brakes? We don't like that. Are there multiple lanes? Do we have to cross traffic in order to get there if we're coming the other way? Stuff like that. If I have to go past your site and then turn around and then go in and out of a neighborhood or whatever it is to get there, all of these things cause resistance in that decision-making process. And so that's an important part of looking at a location to try to determine, yes, there may be traffic there, there may be people there, but is someone going to stop, and how easy is that going to be for them?

Egress is another important part that we don't always pay attention to, but how easy is it to get off the property. If I'm trying to go right, trying to go left, if we start to see stacking where I'm looking at a car wash, and I see that the cars are all backed up trying to get out, that's going to make me less likely to turn in there, and it's going to make me less likely to have a good experience there. Lots of times, people focus on corners, which is fine. Corners are good for a number of reasons. One of them is getting in, getting out, usually gives you more options. But in terms of visibility, usually with corners there's some form of slowing down 'cause people are turning. The slower people go and the more they're changing their courses, the more likely you are to get more visibility from those drivers. Same thing with stop signs or stop lights. They slow down traffic, and they allow for more ease into turning into a car wash, but they also offer more visibility. So more time to act on that impulse.

Okay, another thing to take into account, where is the driver going? So they're going somewhere, in some cases it's going to be both ways. If it's just going to work, they're going to pass you on the way home. The question then becomes which are you? And this is where, which side of the street you're on plays a difference because people do like to make right-hand turns more than they make left-hand turns, especially if there is if there's more traffic going that you have to cross. If you have the median in the middle of the road, the side of the road matters. And what we find is people do tend to go to car washes more on the way home. And that's not a surprise because usually when we're on our way to work, we're not going to stop anywhere because we've got to get to work. But we have a little bit more flexibility when we're heading home to add something to our route.

So another thing to take into account, someone's going somewhere. So they're starting at point A, they're going to point B. So where does this location fall relative to point A and point B? It's not quite the same if you're next to point A or next to point B as if you are right in the middle. Because again, people when they're driving they get into mindsets, I'm going somewhere or I'm stopping somewhere. If you're in the middle and there's nothing around you, directly around you that would make someone stop, you're going to have a harder time getting people to stop because you have to change their mindset into a stopping mentality. Alternatively, if you are right next to where they're coming from, they're already stopped and it's easy to make that transition. Or if you're next to where they're going, that's going to make it easier because they're getting out of that going somewhere to stopping somewhere mentality, and it's going to be easier for them to stop. Beyond that also, just what is around you. If you are right next to 'em, like I said, A or B, or alternatively if you're sharing a parking lot with something that attracts a lot of people, that's going to help because they've already stopped. You're not having to perform that task. In addition, if you're in a parking lot, you're getting out of your car, you're walking somewhere, you're walking back, that adds to the visibility factor of will someone see and feel the impulse and act on the impulse to stop at the car wash. And then, not just beyond where you're at, but what are those things right around you? What are the different, we call 'em anchors. What is anchoring people to that area? That's where things like high-frequency retail are important because high-frequency retail, like a grocery store, that's going to pull people in, and it's going to pull people in on an ongoing basis. But not all things that pull in people are the same. For example, if you go to an amusement park for example. After an amusement park, generally you don't feel like washing your car or stopping anywhere, you're thinking about getting something to eat, you're thinking about going home. So it's a little bit different. What you want around you are the things on that to-do list. When someone's in the efficient, productive, getting things done, boom, boom, boom, picking up stuff in the store, wash the car. That's more what you want to be. The convenience-type activities is what you are going to want around you.

And then finally, why else would someone not stop at your location? And Kayla touched on this, competition. If they already have a car wash that they're loyal to, that's going to make them less likely to stop at yours. So third question, and this is a little bit less relevant for this conversation, will they come back? And that's more going to be specific to your business and to your operations, to how you market your company, how you're engaging with the customers, what experience they have at your site, how you interact with them. So we're not going to talk about those because those don't have much to do with site selection, but that is a very important piece in determining whether your location or your car wash is going to be successful. Because you can have the best car wash in the world excuse me, best location in the world, but if you're not taking care of your customers, and they're not having a good experience while they're there, then again, you're not going to be able to take advantage of that and your customers are going to go somewhere else.

So given those questions and all of that, where does that leave us? So in terms of site selection tools, how do they work? Ultimately, there's a lot of information that you have there that we've went over and lots of information that is available. So trying to figure out what to use and how to use it gets to be a little bit tricky. So there are a few different options out there that use some of the more popular characteristics and we certainly look at those as well.

So moving on to the next slide, we have some of the different things that people will often look at. You have your high-frequency retail, some of the things we talked about with the visibility, the ingress, egress, lots of those things you'll find when looking at a site. So there are no real big secrets here about what are some of the more important things, but the real question comes down to how much are they and how important are each of them, how to weight them in terms of importance in determining how a location is going to be. You could have the best visibility in the world and best ingress egress. If you're out on a farm in the middle of nowhere and there's nothing stopping someone from seeing you or getting onto your property, but if there's nobody there then that doesn't do much for you. Alternatively, if you're sitting on the highway and people are going by at 80 miles per hour, you're getting a lot of traffic. Not a lot of people are going to stop there, though. So it gets a little bit tricky when figuring out how to put these together to use.

So typically what will happen when people are trying to figure out how to determine how successful a car wash is going to be, we often see two approaches. One is you'll take kind of those different areas, those different characteristics, and you'll give them a grade on a scale from one to 10, for example, and you'll just grade each of them, take an average and give you a score on a scale of one to 10. This one's a seven, this one's an eight.

So that's something that gives you a little bit more than you had before, but it really doesn't tell you is this going to make money or does it just look nice on paper? So another option that people will use is they'll build out a formula to try and project it. So they'll use lots of those same characteristics, but what will happen is they'll pick three or four different variables that they think are most important and they'll take it, for example, population or traffic count, they'll plug it in and it will come up with a projection. So again, that gives you something, but as we discussed before, you can look at multiple sites that have different strengths and weaknesses, and the most important thing for one site that makes it successful is in no way applicable to another site that is equally as successful. So that's where it's the interaction between them in different scenarios, in different locations that makes it tough.

So that's why our approach, we kind of take a hybrid blend of those different approaches where we will, first of all we'll pull in a lot of data, lots of the data is available just on the internet. So certainly do your own research there. You can get that. Lots of data we'll pull in from third-party providers that specialize in certain forms of data and the analysis of it. And we will also combine that data with some of those traffic pattern effects, which we said are important because you've got to figure out where people are going and are they even going to be there. So we'll combine that. And then in addition, there are a number of the qualitative aspects that we talked about.

So for example, visibility of a site. We can't pull in data on that anywhere. There's no reporting on that. So same thing with ingress, egress and trying to figure out that level of resistance that the drivers are going to feel as they're approaching a site looking at competition and trying to assess them. Just because there are three car washes near doesn't mean that all car washes with three washes, car washes near are the same. So we have a team that looks at those, and they have a specific methodology that they use in order to come up with a grading and scoring for those qualitative metrics and then using those.

And we combine all of that data into one, and we use what's called in data science, some machine learning tools. They're kind of in that AI type sphere of tools. But what they do is they will take all of that information for sites. But first before that, let me not get ahead of myself. The first thing we need to do is we need to come up with a model similar to if you were just creating a formula. If you're creating a formula to try and create a projection, you're going to look at those things, those things that are most important, and you're going to put 'em in, and then you're going to test it against a site. And if you're off, you're going to try and tweak some things, say, well, maybe traffic's more important than competition, so maybe I'm going to weight that a little bit higher. So you're going to tweak those weights and the importance of them in your formula to try and get it right. But again, what's difficult is if you're just using a formula, it's going to be consistent across site from site to site. And as we've discussed, that doesn't always work. So what this model does, we kind of go through the same process but it's a machine learning tool so lots of it is computer automated and done with some advanced mathematics where we'll take some locations that we know the outcomes for and we'll essentially create all of this scoring and pull in all of this data, and we'll align it with the outcome of the locations, and we will let what's called the neural network, it's a machine learning tool, we'll let that go to work to find the relationship between all of those different data points with the outcome, and we'll repeat that for hundreds of locations in order to come up with a predictive model that's able to come up with a projection that matches what we already know to be true for these sites. And then we'll take that, and we'll remove the outcomes, but we'll look at it for other sites that we know the outcomes for and we'll test it. So we'll feed it in and come up with a projection and then we'll test that projection against the known outcomes until we're insured of its accuracy, to which point we can reliably predict how good something's going to do.

So now in terms of a report, what is included? When we create the report, we will come up with a projection, it's going to give you a projection for revenue. It's also going to give you a separate projection for member count. And we actually run through those differently because one of the things that you'll see is different locations do things differently in terms of how much they utilize membership models versus retail models. So we don't necessarily know for a given operator how much of their profitability is going to be based on memberships. So we'll do a separate projection for each and it'll be a range. And then what that range will ultimately predict is once you have your car wash, get past an initial ramp up phase, obviously you start a business and it takes some time to get up to speed to where you're not new anymore. So what our projection is, where will you be at that time, which is usually depending on the site and the operator, 18 to 36 months. So it'll give you an idea of where you're going to be there. Now, that doesn't mean that's all you're ever going to make because obviously you fluctuate with over time and you get better. So the presumption would be that you would continue to get better, but it's once you get past that initial ramp up phase that we're predicting how profitable someone in this location could be. And then we'll also include some other data just in terms of demographics and data on competition, high-frequency retail, other stuff that will tell you about the site. Now what that'll give you ultimately it'll give you just an idea, a test of what this location is capable of. We certainly would not say rely only on this, you should certainly do your own due diligence on the location because we're not going to be there in person and we don't know you as well as you do. So that would be something that you would also include as well. But what this really does is it helps people give them some certainty into their decision making process.

Kayla: All right. And then just a couple of last things to note here, and then we'll get to some questions. If you have any, go ahead and start putting those in the question and answer.

So everything Kirk just talked about was about how SiteSelect works essentially. And so a couple of things I think are important to remember as you're navigating the various options that there's a lot of options when it comes to site selection and it can be a little bit confusing. So what Kirk talked about was really important on like how this model actually works so that you know, what SiteSelect does and what it's based off of. A couple other key factors to consider, SiteSelect is built using car wash-specific data. So this is not necessarily the case for all site selection tools that are marketed to the car wash industry. And we've found that it's really important that we're only using car wash data just because a company or a model is good at predicting how a C-store would do or how a retail store would do, it does not necessarily carry over to car wash. And we found the factors that make a good car wash are actually very different than let's say what makes a good C-store or some other type of business. So that's important that we're using car wash-specific data to predict with this model.

Next piece is SiteSelect focuses on accuracy versus assurance. So another theme that we have seen historically in site selection in the car wash space is historically models were built more around providing assurance on a site. So something you could maybe take to the bank, and SiteSelect is not like that at all. So we don't have a dog in the fight. Essentially we're going to give you the cold hard truth when it comes to the sites you're looking at. So you can bank on this being accurate, it's not going to try to provide you assurance to buy that site, and that's important.

And then last differentiator here or thing to consider is SiteSelect only leverages the metrics that are proven to drive site success. So thinking back to the myths and everything Kirk went over in terms of what actually matters for that specific case, that's what we're taking into consideration. So we're not building the model off of kind of vanity metrics that don't actually predict how that site could do.

So then the last little piece here before we do questions. So I wanted to just share this story of one of our SiteSelect customers who is located down in Southern Idaho area. They were looking at a number of different options. They were adding a couple of sites to their portfolio, and basically what happened in their situation is they had a list of sites they were evaluating, they used SiteSelect on all of them. There was one site in particular that was lower on their list, it was kind of maybe going to fly under the radar a little bit, and when they got the site selection reports back, that one immediately jumped to the top of their list and, like you can see in the quote here, they were under contract in a matter of days. And so I think this is a great example just to showcase how SiteSelect is, it's going to help you not pass over an investment that could be very beneficial just because you don't have the right tools to understand the difference between the options that you're looking at.

Okay, let's get to some questions here. and then we'll let everybody get back to your day. And again, if we don't get to your question, we will circle back. I don't think we're going to get through them all so we'll have to email you guys with some other responses afterward. Okay so first one, what's the timeline for the project? How long does the analysis typically take? You want to take that Kirk?

Kirk: Sure. So typically it depends on our backlog, but typically around two weeks. Sometimes, we're able to get them a little bit earlier to you, but the general rule will be a two week turnaround once we have the location.

Kayla: Okay, perfect. And then that leads into the next one, which is what is required of us on our end? What would you need to provide. or what would you need us to provide for you to be able to do the report?

Kirk: Sure, yeah, one of the things that we need, and I assume you'll get into contact with somebody, we have contact information where they can go for these if they have questions.

Kayla: There is a QR code here if you're interested in learning more or have any particular sites that you're looking at, go ahead and scan that. It's also on the DRB website. If you lose this and need to come back later, you can get a consultation on the DRB website as well.

Kirk: Cool. Yeah, so one of the things we'll have you fill out a form just if there are certain things that we wouldn't be able to see 'cause we don't actually go to the location. So if there are things that changes that may occur that we would not be aware of that we need to take into account or it's different things that you would help us with plans that you have in addition, to making sure we do know where specifically you're talking about. Plus at times we'll get requests that will come in and they'll say on this intersection, well, you have four corners on an intersection. So, we do need a little bit more than that. So yeah, you'll get a form that we'll have you fill out that'll help us get the information that we need so that we can do that.

Kayla: Perfect. Let's see. So this is a good one. Does the SiteSelect analysis essentially predict the maximum that a site could do, or could a site exceed what the results show?

Kirk: Good question. And that's an important piece is because site selection is one of the most important things that you need to look at, but part of it is operations because not all operators are the same. So that's a piece, but in addition there's no way for us to predict how you are going to or how a location is going to do every year over the next 10, 20 years because that goes up and down with the economy and that will fluctuate based on the operator and how quickly and aggressively they pursue the business.

So it's definitely not a max, it's more, like I said it was once you get past that ramp-up phase. And one other caveat there, lots of times people are looking for that best site in the world, usually the best site, those pop sites, they're not always predictable because there's some unique but be it the operator or something else. So what we like to say with this projection is this isn't to tell you whether or not the site's going to be Michael Jordan, this is more to tell you whether or not the site could play in the NBA. So we can't quite predict that one that's going to be the top of the top of the top 'cause those would be outliers. So statistically, we would not want to be predicting those.

Kayla: This one came up a couple of times. So are there any factors about a location that you would consider more important than others?

Kirk: More important? Yeah, so I think when it comes down to it, definitely and if you break it down into those top two questions because it's within, and that's who's there and will they stop. And there's no one thing In each of those that is going to answer that question in its entirety. You have to look at a collection of those different questions in order to answer that question. So is there enough people there, are there enough people there combined with is this a location where people are going to stop? So there's no one single factor that we've been able to see where this one will predict it every single time. One of the things, obviously the more cars that you can get access to or get familiarity with, that will see you, the better. So that's probably one of the big ones, and largely what's around you and what is pulling people to that area that you can piggyback off of their clientele. That's going to be a big piece, but again it's going to come down to the interplay of the different factors and how they work. So it's a little bit tricky to answer that question. Of all the locations that we've looked, there's definitely not a one-size-fits all number one thing to look at that will always predict it.

Kayla: All right, and then let's do one more and let people go about their day. Do you examine an area where you're thinking of building and suggest the best site in that area, or do we pick a site that we think we're building on, and you tell us what the analysis is of the site?

Kirk: That's not the first time we've gotten that question. So the question is, you say Dallas, find us a site and then we go and find you the best site in the city? No we don't. We don't canvas. It's an intriguing idea but no, we have not undergone that product yet. So what we'll do is we'll look at, when you give us the location, we will do the analysis on that specific location in order to figure out how that's going to be. So if you're going back and forth between different areas that's where we'd be able to help you compare against different sites. But we do make you do a little bit of the legwork in terms of finding the addresses that you're potentially going to be looking at.

Kayla: Awesome. Okay, so I think we can call it there. Do you have any last things to say, Kirk? Are you good on your end?

Kirk: Nope, I'm good.

Kayla: All right. Thank you all so much for joining. We will be sending out a recording of the webinar in a few days here, and we'll also get all the other questions that we weren't able to get to, we'll get you those. We'll provide actually all the questions re-answered in case you missed anything. And yes, thank you again so much for joining and we hope to hear from you guys soon. Thank you.

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