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  • Case Study Question; High Fuel Costs, Bad Time to Start a Truck Wash Business?

16th October 2006

Case Study Question; High Fuel Costs, Bad Time to Start a Truck Wash Business?

posted in Trucks |

The transportation sector is under a bit of stress with high fuel prices. Does this mean there are less trucks on the road and thus less trucks to be washed? Actually, no there are not less trucks on the road, actually large truck fleets are making more money by adding fuel costs into customer pricing.

What about competition during a squeeze to save costs and streamline the sector, more money for fuel means less money for other expenses right? But the larger trucking companies generally sign up with Blue Beacon for $30.00 washes with a corporate discount and they have 90 plus truck washes plus their side brand Hand Wash Charley’s.

Now then the smaller trucking companies, which have long-term contracts cannot react to the increased fuel prices as fast like a FedEx, Swift, JB Hunt and they are really hurting. Small Trucking Companies and Independent Truck Drivers do not have the economies of scale to allow them to raise their prices and if they do they can lose contracts and if they don’t they can go bankrupt due to the increases in costs. Either way they lose and typically the Independents are the highest paying truck wash customers you see? Independents are more apt to be the best customers for $55-70 Truck washes, taking pride in their ride.

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