Coffee Franchise vs Auto Detailing Franchise

A coffee franchise is a popular business option among startups. But how does it fare vis-a-vis an auto detailing franchise, which is also viable ? Read on.

Coffee Franchise vs Auto Detailing Franchise
Coffee Franchise vs Auto Detailing Franchise
img src : unsplash

There’s no doubt – a coffee franchise is a popular business option among startups. But how does it fare vis-a-vis an auto detailing franchise, which is also viable ?

In this article, we’ll compare the two franchises in terms of future growth, costs, target market, location, expansion and growth prognosis, and ways to add value to the business.

Coffee franchise

Future growth

Yes, coffee is one of the world’s most in demand beverages. There is definitely no stopping the coffee franchise from dominating the industry even after several decades. According to the Houston Chronicle, coffee sales are considered lucrative with operating incomes of 2.5 percent of net sales and a gross margin of about 85%.

In fact, growth is not concentrated in US alone. IBISWorld, in its 2015 Australia Research Market Report states that:

Industry revenue is expected to grow by an annualised 7.4% over the five years through 2015-16, boosted by a large spike in 2013-14 caused by rising consumer sentiment and growing incomes.

However, according to an article in  Phys.org News , climate change is starting to affect coffee production. This is something that would-be coffee franchisees should be aware of.

Costs

Costs when opening a this type of business can vary depending on the brand, types of services rendered, etc.  Entrepreneur.com estimates the costs as low as $100,000 up to $1.6M.

Target Market

An advantage of a coffee franchise is its wide market range. Its target market is not limited to a particular demographic. It appeals to the young and old, students and professionals, regardless of socio-economic status. Recently, even senior citizens and families can be seen enjoying coffee shops all around the world. According to Small Business Development Center, 77% of U.S. adults drink coffee daily. In the West Coast particularly, the ideal ratio of coffee shops to residents in a particular area is 1:10,000.

Location

In the past, coffee shop sales were affected by the weather in certain localites or regions. Recently however,  coffee shop locations are more geared towards business establishments to cater to business professionals and business executives. Coffee shops have evolved from just beverage stores to lifestyle centers where students can study. It has become a hub where business people meet and conduct business transactions. It has transformed to a place where families meet to unwind and where a lot of people can spend some idle time in.

Expansion and growth prognosis

Coffee as a commodity has continuously evolved into various flavors, packaging and options. The versatility of coffee gives it the competitive edge. Get Entrepreneurial.com explains that along with the trend of organic and healthy lifestyles, shop owners have started to offer a wide range of organic coffee choices that match the emerging lifestyles of the market. More and more people are also moving to patronize environment friendly coffee shops. The rise of gourmet coffee shops also contributes to the coffee business’ advantage over other beverage shops.

Ways to add value to the business

A coffee cup has now transformed its image and function from just a warm or cold beverage for consumption to a cup of connectivity and lifestyle necessity. Thus, to enhance customer satisfaction that can lead to repeat business and customer loyalty, most coffee shops add value by providing free Wifi, gadget-friendly facilities and wireless technology options.

Auto detailing franchise

coffee franchise
Auto detailing franchise
img src : unsplash

Future growth

Another popular business opportunity is the auto detailing franchise. Research shows that the car wash and auto detailing industry yields a $10B  revenue.  Industry operators will continue to benefit from rising per capita disposable income, aiding the auto detailing industry revenue. Yes,  the auto detailing franchise continues to be a business opportunity worth investing in.

Costs

If you plan to start an auto detailing franchise business, you need to take a closer look into various factors in order to calculate the costs. These factors include location, the brand of the auto detailing franchise and more. Houston Chronicle mentioned that an average franchise will cost about $275,000 for startup while mobile auto detailing and car wash businesses can have a range of $30,000 to $100,000.

Target Market

The auto detailing industry will continue to exist as long as there are vehicles in a location. Your target market can be anybody owning or renting a car. It can also be any business that uses automobiles for services either directly like car rental services or indirectly like flower shops and restaurants needing auto detailing and car wash services for their delivery vans. Like the coffee shop business, auto detailing franchise options have a wide range of target market.

Location

However, unlike the coffee shop business  where traffic is the only consideration, choosing the location of an auto detailing franchise also depends on the following factors: location of competitors, costs of rent and facilities, availability of car wash waste disposal, etc. Of course, like the coffee franchise business, location where customer traffic abound is still the topmost consideration.

Expansion and growth prognosis

Armed with statistics to back it up, the auto detailing industry is definitely on the rise.  Most researchers now consider that the trend of auto detailing is towards convenience of service. We can clearly see the rise of mobile auto detailing service, car wash spa, and specialized auto detailing services. The trend to explore new markets is also on the rise. For the auto detailing business, we have millennials, retired professionals, etc.

Ways to add value to the business

Much like the coffee franchise business, the auto detailing business is also a flexible service business that has evolved through the years. Gone were the days were only fathers are the target market for auto detailing shops. In tune with the evolution of car enthusiasts and the way car owners have taken care of their cars, the auto detailing service has also evolved. More than the service itself, customers are now  looking at value added service of the company,  social responsibility of the brand, how the auto detailing franchise company takes care of its customers,  and company’s reputation.

Conclusion

Both the coffee franchise and the auto detailing franchise are viable business options in the market today. It is wise to be aware of the various business factors involved in the two industries if you are considering to venture into these businesses.

If you need more information about the DetailXperts business franchise opportunity, check this out and your questions will be answered.

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