“I bought my first car wash in 1989 in Saint Paul Minnesota and then City of Saint Paul decided they were going to tear up the entire length of the main road that my wash was on. I had a brand new wash and traffic through the wash was at an all time low once construction started. I was certain it was going to ruin me if I did not figure out something to drum up more business.”
Nearly every car wash operator has read an article or has seen a presentation on the benefits of accepting credit cards and loyalty cards. In fact there are dozens of equipment manufacturers that now offer built-in credit card acceptance and loyalty card programs. Car wash operators in 2007 can’t swing a stick at a car wash trade show without hitting the latest cashless acceptance solution for the car wash. But how did cashless acceptance within the car wash industry all start?
The Origin of Cashless Card Systems in the Wash Industry
Eighteen years ago accepting credit cards in the bay was unheard of and loyalty programs were nothing like they are today. The concept of a loyalty program consisted of discounted tokens, token notes, and coupon books. Seventeen years ago the concept of card-based cashless acceptance in the wash bay was only realized and evangelized by one man in the wash industry while the rest of the car wash industry was content selling tokens and coupons. You may remember seeing a guy at the ICA trade show in the early 1990’s with a fish tank in his booth that had goldfish and a card reader in the bottom to demonstrate the readers ability to work in “wet conditions”. That man with the fish tank was Dan Yarusso and he started a company back in 1990 called WashCard Systems. Based out of his garage in Hugo Minnesota, Dan started his business as a one man show. In an interview with Yarusso I had the opportunity to learn that WashCard was not originally invented to be sold to other car wash operators. In fact it was created out of a necessity to market his own struggling car wash.
Dan recalls, ” I bought my first car wash in 1989 in Saint Paul Minnesota and then City of Saint Paul decided they were going to tear up the entire length of the main road that my wash was on. I had a brand new wash and traffic through the wash was at an all time low once construction started. I was certain it was going to ruin me if I did not figure out something to drum up more business.”
What was to be a profitable little side business was quickly becoming a huge stress factor for Dan and his family. Dan spent nights and weekends at the wash keeping things in repair and doing whatever he could to keep his customers happy while the road construction in front of his wash dragged on. When away from the wash during the weekdays Dan worked for a company that designed access control technology for security systems. It was with this knowledge of access control technology that gave Dan an idea how to fix a pet peeve of his. Dan hated carrying pockets full of tokens around just so he could wash down his self service bays. After weeks of tinkering he had wired in waterproof access card readers into each of his bays. The readers were wired into programmed control panels in his equipment room that were then wired into the bay timers. By sliding a valid card through the reader it would send a signal to the wash bay and started up the wash bay and it would not turn off again until he would slide the card a second time.
Eureka! The Big Breakthrough
It was late one weekend when Dan finally got the system working. He was running around from bay to bay sliding his card that would activate the bay. He then would run back into his office and would verify the bay activity on the black and green terminal monitor that sat on his desk. With all of the commotion it did not take long before a customer approached Dan and asked him what all the commotion was about. Dan recalls that he was perhaps a bit overly excited as he motioned the customer into the bay and explained, “Ok, so I take this card and slide it through the reader… and now the bay turns on! When I slide the card again it turns off! I have a screen in my office that records the wash so I can track any washing that I do with this card.” The customer standing in the bay listening to Dan thinks for a moment and then says, “Thats really cool. So how do I get one of those cards for myself??”
Dan ran back into the office, entered a new card into the system for his first card customer. He took a black marker and drew an arrow on the card to indicate the direction in which to slide the card through the reader and handed over to the customer. They agreed to settle his bill on the first of every month for any washing that he did. Several weeks later the customer came back with friend and he too wanted his own washing card. This time Dan ran back to his office and returned with the another card marked with the arrow indicating it’s use and the new customer asked, “So what do you call it?”
Dan pondered for a moment and with his magic marker in hand wrote two words that would forever impact the car washing industry, “I don’t know… I guess it’s a Wash Card” he said as he happily wrote the letters on the front of the plain white card before handing it over to his newest customer.
Success is Setting Yourself Apart from the Competition
It did not take long for Dan to realize he had something that no other car wash that he had ever heard of could offer to customers. He went to the local police departments and small businesses in the area and got all of their washing business which carried him through road construction. He approached anybody that would be interested in having an “account” with the local car wash. Within no time he had six local police and sheriff departments on account and WashCard and was soon catching the eye of other local car washes. The first few washes in town that approached Dan asked if he would build them a card system. He politely turned them down because it was the only thing that allowed his car wash to maintain a competitive advantage over any other wash in town. “Why would I give them the ability to directly compete with me?” remarks Dan. “Once somebody had my WashCard they would never even consider washing anywhere else.” What experience had shown is that a business that used to buy $50 dollars in tokens or token notes a month would invariably double or triple their monthly washing expenses when they were put on an open invoiced account.
It did not take long before word spread about the “wash with the cards” and wash owners from out of town offered Dan good money to build them their own card system. Eventually he agreed to build and install WashCard systems for several other car washes throughout Minnesota and Iowa.
Taking the Show on the Road
As interest in cashless payment systems would start to catch on Dan Yarusso had some difficult decisions to make. He could either keep his full time job and continue selling WashCard locally on the side or he could take his “idea” on the road. According to Dan, in retrospect the decision was an easy one to make. He then spent the better part of ten years traveling to the numerous trade shows with his card readers telling car wash owners about the profit building potential of adding a card system to their car wash. With the success of so many car wash owners due to their WashCard program it was inevitable that there would finally be some new cashless products on the market. As it turns out several customers of WashCard felt so strongly that a cashless car wash system was such a great idea that they decided to build and sell systems of their very own and became the first competition for WashCard. As they say, imitation is the highest form of flattery. The notion of replacing dirty tokens with cards, keys, and bar codes swept through the car wash industry in no time.
The Status Quo of Cashless Payment Systems
The number of cashless payment solutions has skyrocketed as result of demand from consumers to use their credit cards or put their commercial vehicles on account at the car wash. Consumers get to use their plastic to pay for gas and groceries, why not soap and water for their cars? By finding a solution that caters to both the consumers desire for credit card acceptance and the ability to offer commercial fleet accounts is a sure fire way to take advantage of how potential customers are looking to spend their money in 2007. These days it is just as important how customers can spend their money as it is where they can spend their money. If you are not catering to the hundreds of thousands of card-carrying consumers you are losing money every day in potential profits.
The Future of Cashless Payment Systems
In the future, cash will no longer be the mainstream form of payment. Harnessing the power of the Internet and advanced communications technology, multiple businesses will be tied together within one large payment network. Customers will hold unprecedented control over their account settings. Saving receipts and passing out tokens will recede into the past because Fleet Managers will now run their own activity reports and manage their account balance online from anywhere in the world. Purchasing and managing car washes will be just as secure as online banking.
It is clear that advances in technology will be playing a large role in how businesses such as a car washes will be operated. There are now car washes that have CEO’s and influential investor groups funding continued growth of their company. It is more important now than ever for individual wash owners to re-evaluate how they are conducting business today. The car wash industry is full of new technologies and new solutions to bring in new business. Ask your sons, daughters, nephews, and grandkids how they pay for goods and services today. Will your car wash business struggle or will it thrive when customers that carry no cash become your primary demographic?