Arkansas-based Splash Car Wash ramps up expansion plans as industry sees surge in popularity

After a record year, Arkansas-based Splash Car Wash is poised for more growth, especially in Northwest Arkansas.

In 2022, the car wash company grew to 300 employees and served 798,328 car wash and 95,388 oil change customers. The company has 21 locations statewide and looks to nearly double that number over the next two years.

According to Grand View Research, the value of the U.S. car wash services market is expected to increase at a compound annual growth rate (CAGR) of 5.7% to $23.79 billion in 2030 from $15.86 billion in 2023. A key market player, Splash Car Wash looks to contribute to the growth as more people choose to have car washes clean their vehicles.

Paul Stagg, founder and CEO of Splash Car Wash, said the industry is changing consumers’ buying habits as car wash subscriptions allow people to wash their vehicles every day for less than the price of two car washes. Repeat business is encouraged as those who get a car wash at least two or three times monthly maintain their subscriptions. He noted the cost isn’t in the car wash but in the building, equipment and land.

“The car wash business is so popular, and there’s so many being built,” Stagg said. “Arkansas’ our home, and we want to saturate our market.”

Recently, Splash opened two 35,000-square-foot stores in central Arkansas, where it maintains corporate headquarters in Little Rock. According to company news releases, they are among the top 10 largest U.S. car washes, with the 38,204-square-foot Maumelle store the state’s largest. The newest store in west Little Rock includes two car wash tunnels, two express interior cleaning conveyor belts, indoor vacuums, high-speed electric vehicle chargers and an on-site 10-Minute Oil Change store.

Stagg said the new stores resemble upscale indoor car washes in Europe and feature flat conveyor belts instead of the troughs that customers must fit their vehicles’ wheels into to move them through the tunnel.

“The idea is people like nice things,” he said. “I’m giving them a choice: If you want to come to a place that gives a much better customer experience, then we’re your guy. The good thing is that it’s not any more expensive for the car wash than if you’re going to a regular express.”

Splash offers monthly subscriptions that are less than the cost of two car washes. Subscribers receive unlimited car washes at Splash tunnel car washes statewide. They also receive discounts on oil changes, which can be completed while customers wait in their vehicles. Waiting areas are also available.

CONTINUED GROWTH
Over the past six years, Splash has nearly quadrupled its employees, from 80 to 300, Stagg said. The number is expected to rise to 400 by the end of the year as the company adds new locations. Over the next two years, the company plans to add 15 locations and is focused on growing in Northwest Arkansas.

Stagg attributed the focus on the area to the growth in Northwest Arkansas and the property availability. Its sole Northwest Arkansas location opened five years ago in Rogers on Huntington Drive, north of Pinnacle Hills Promenade. It has a tunnel car wash, free vacuums, and offers interior vehicle cleaning and on-site oil changes.

Justin Young, vice president of marketing at Splash Car Wash, said seven new Northwest Arkansas stores are in development, including in Bentonville (two), Centerton, Farmington, Fayetteville (two) and Pea Ridge. The Bentonville stores on Bright Road and Walton Boulevard are expected to open later this summer. The stores in Pea Ridge and on College Avenue in Fayetteville should be open by the end of the year. Groundbreaking on the other stores, including on East Joyce Boulevard in Fayetteville, is expected by the end of the year.

LONG-TIME ENTREPRENEUR
Stagg started in the car wash industry more than 25 years ago after co-founding a business that provided coin-operated air machines at convenience stores. The company began distributing car wash systems to the stores and other businesses after a manufacturer asked the company to represent its car wash equipment. Between the late 1990s and early 2000s, the company built self-serve and in-bay automatic/rollover car washes for the stores and other businesses.

“As our industry changed, the express tunnels became more popular, and we put together a franchise called Boomerang,” Stagg said. “We built 20 stores, many of them in Northwest Arkansas.”

The stores were built throughout Arkansas and surrounding states and have since rebranded to Zips Car Wash after he sold his interest to focus on Splash. The company was established in the 1990s for his employees, and his focus on Splash started in 2009.

“I wanted to become an operator, not a developer,” said Stagg, adding that being the sole business owner allowed him the freedom to innovate.

In 2015, he attended an international car wash show in Amsterdam and toured some of the best car washes in the world in the Netherlands and western Germany. That led him to employ some innovations that Splash stores feature, including the flat conveyor belts. The interior cleaning area also includes the flat conveyor belts, and staff clean the vehicles’ interiors while on the moving belt.

He noted full-service car washes, some of which he’d owned, all went out of business because at least half of the expenses went to labor. “But if you automate it and if you have everything right where it needs to be and if you have standards in place, then you can do it profitably,” he said.

His hub-and-spoke business expansion plan comprises building a large store offering interior cleaning and having smaller stores in surrounding areas. “We’re growing at about seven or eight stores a year right now, all in Arkansas,” he said. “We’re the only company that cleans the interiors of cars.”

Young said the company started doing interior cleaning in the mid-2000s. It entered the oil change business after acquiring five shops in 2014. Formerly, the oil change shops were tenants of the company’s stores.

‘FAMILY BUSINESS’
“It’s a family business,” said Stagg, who serves on the board of directors for the International Carwash Association. “My son and daughter are in it. … Two of my son’s brothers-in-law are key leaders in the business. … I’m a car wash guy. This is who I am.”

Stagg, who declined to share revenue numbers, said his focus is on his company’s long-term success. He noted that others in the industry are often only in it as investors or looking to grow and sell a business after a few years.

“By taking the long-term approach, our culture, the team we’ve assembled, the reinvestment back into the business — we don’t have any shareholders to satisfy — we get to do what we want to do for the long-term best interest of the company,” he said. “We believe that by building the right culture and by offering a quality of service and primarily a unique customer experience, we’ll be uniquely positioned as things get more competitive because they will.

“What’s important to me is not the P&L this month or this quarter, but I want to win,” he added. “When someone builds across the street from me, I want to put myself in the best position to win, and that’s location, the facility and the most important thing is our people.”

Stagg was raised near Clinton and lived in North Little Rock for 40 years. He and his wife, Lisa, moved to west Little Rock a year ago. They have three children and five grandchildren.