Start a car detailing business by following these 10 steps:
- Plan your Car Detailing Business
- Form your Car Detailing Business into a Legal Entity
- Register your Car Detailing Business for Taxes
- Open a Business Bank Account & Credit Card
- Set up Accounting for your Car Detailing Business
- Get the Necessary Permits & Licenses for your Car Detailing Business
- Get Car Detailing Business Insurance
- Define your Car Detailing Business Brand
- Create your Car Detailing Business Website
- Set up your Business Phone System
There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your car detailing business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Exploring your options? Check out other small business ideas.
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a car detailing business?
Unlike most new business ventures, a car detailing business requires very little investment capital. Industry leaders estimate an initial budget of $5,000 to $25,000.
When detailing your business plan, include the following items in your budget:
- Auto detailing certification - certification will set you apart from your competitors. There are a number of classes offered throughout the country.
- Insurance - coordinate with a trusted agent to determine the best liability coverage for your needs.
- A business cell phone
- Auto detailing tools - save in overall cost by purchasing items as a startup kit. These range in price from $1,900 to over $14,000.
- Reliable transportation
- Trailer - some find it more convenient to keep all their tools in a trailer
- Lease - if you decide to have an on-site location, you will need to find a workspace that’s both affordable and designed for the services you perform.
If you are considering investing in one of the many franchising opportunities, your startup budget should be significantly higher. While the capital investment starts at $118,000, this does provide the support and training necessary to ensure long-term support.
What are the ongoing expenses for a car detailing business?
Like the start-up costs, your ongoing expenses will be fairly minimal. Items you should include in your monthly budget are:
- Fuel costs
- Replenishment of supplies
- Routine upkeep on vehicle and trailer
- Equipment maintenance
- Insurance - $75 t0 $150 per month
- Payroll and taxes
- Marketing - $50 to $100 monthly
Who is the target market?
When first starting out, many detailers accept almost any job that comes their way. As your name starts to carry more weight in the community, your focus will be in the high-value market of your region. This will generate more referrals and higher paying jobs.
How does a car detailing business make money?
Car detailing businesses generate revenue through the services they offer and are paid on a per-job basis.
How much can you charge customers?
Your prices will vary depending upon the specifics of the services you perform. The region you service is also a factor when setting your prices, which typically range from $75 to over $250.
How much profit can a car detailing business make?
Experienced car detailer owners report annual profit ranging from $40,000 to over $100,000, depending upon the number/type of additional services offered, number of employees, and region in which they reside.
How can you make your business more profitable?
To ensure a profitable business, consider implementing some of the following strategies:
- Partner with hotels to offer concierge services
- The following are also effective businesses to partner with, generating steady business: car shows, auto and RV dealerships, car rental companies, and limousine companies.
- Offer additional services such as: mechanical services, windshield crack and chip repair,
- 24k gold plating systems
- Headlight restoration
- Odor elimination
- Body pin striping and side molding
- Window tinting
- Invest in a water reclamation system/strategy, which will significantly boost your profit margins.
What will you name your business?
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Car Detailing Business Name Generator
When registering a business name, we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability.
It's very important to secure your domain name before someone else does.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your car detailing business is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
- LLC Taxes
- Sole Proprietorship vs LLC
- LLC vs Corporation
- LLC vs S Corp
- How to Start an S Corp
- S Corp vs C Corp
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
Besides being a requirement when applying for business loans, opening a business bank account:
- Separates your personal assets from your company's assets, which is necessary for personal asset protection.
- Makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.
Open net 30 accounts
Net 30 accounts are used to establish and build business credit as well as increase business cash flow. With a net 30 account, businesses buy goods and repay the full balance within a 30-day term.
NetMany net 30 credit vendors report to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended: Read our best net 30 vendors, guide and start building business credit.
Get a business credit card
Getting a business credit card helps you:
- Separate personal and business expenses by putting your business' expenses all in one place.
- Build your company's credit history, which can be useful to raise money later on.
Recommended: Apply for an easy approval business credit card from Divvy and build your business credit quickly.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
Make LLC accounting easy with our LLC Expenses Cheat Sheet.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
In most states, it is necessary to obtain a car detailing license) (Certain state permits and licenses may be needed to operate a car detailing business). Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Car detailing businesses should consider requiring clients to sign a service agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example service agreement.
Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your car detailing business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.
Certificate of Occupancy
A car detailing business is generally run out of a garage. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a car detailing business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your car detailing business will be in compliance and able to obtain a CO.
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
If you already have a logo, you can also add it to a QR code with our Free QR Code Generator. Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.
How to promote & market a car detailing business
When first starting out, offer to service your friends’ and family’s vehicles. Set it up during regular business hours and go to their workplace to perform your services. This offers an instant opportunity to showcase your talent and, hopefully, gains their co-workers as new customers. Keep business cards on-hand at all times. You never know when you might meet your next best customer.
Additionally, pass out mailers at local businesses and homes in the area you service. A magnetic vehicle sign is also an effective way of advertising your services. Spend some time each week pounding the pavement. Visit businesses, both large and small, and hand out your business cards. Be persistent, but not pushy. If you haven’t heard from anyone at Business XYZ, visit them again in a month or two. Car detailing is a service many consumers need, but it’s generally not at the top of the to-do list. If someone is in need, but haven’t had a moment to call and make an appointment, your visit will be a welcomed surprise.
Every modern business should maintain an online presence, particularly on social media sites. Keep your clients apprised of the latest industry news and company specials by regularly posting on these sites.
How to keep customers coming back
In this industry, it is critical that you do your best work every time. When it comes to “luxury” services, one poor job will leave a lasting impression.
Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2022 to find the best phone service for your small business.
Recommended Business Phone Service: Phone.com
Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.
Start a Car Detailing Business in your State
- District of Columbia
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
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Is this Business Right For You?
This is the perfect opportunity for the entrepreneur is who ready to venture out on their own, yet has little startup capital to work with. Successful car detailers enjoy working with their hands, braving the outside elements day in, day out.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a car detailing business?
While the vehicles you detail will vary, your days will be similar in nature. Your duties will include the following:
- Marketing your business
- Checking in on current customers to see if their vehicles are ready for another detail job
- Conversing with clients, answering any questions they have
- Researching the latest in industry trends
- Reviewing inventory numbers and place orders when necessary
- Performing car detailing services
- Performing administrative tasks
What are some skills and experiences that will help you build a successful car detailing business?
Like any business venture, running a car detailing business requires a certain level of business finesse. This goes beyond being able to manage your books. It means understanding how to interact with customers, properly market your services, and properly price your services for maximized profits.
To realize long-term success, you should also be knowledgeable and skilled in automotive detailing. The International Detailing Association offers members information regarding how to get started, advice on managing your business, and the latest in industry trends.
What is the growth potential for a car detailing business?
Auto detailing is one of the fasted growing industries, generating an annual revenue of over $10 billion. Growth is expected to continue at a rate of 3.1% per year, leaving much opportunity for new entrepreneurs entering the market.
Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Learn from other business owners
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a car detailing business?
Leaders in the auto detailing industry offer the following advice:
- Before investing in any equipment or tools, check the water discharge laws in your region.
- Consider utilizing waterless car wash products.
- Know your worth and be unwavering when discussing fees with customers. If you have a customer come to you with $150 worth of work and they want you to detail for $75, you must be able to say no.
- Invest in high-quality detailing supplies.
- When you’re first starting out and things are slow, ask used car dealerships about detailing for them. The pay is low, but it is consistent and will offer immeasurable experience.
How and when to build a team
Car detailing is a one-person job, so you will want to start out on your own. As you start to build a customer base that you cannot service on your own, consider adding a team member. This will not only allow your business to service more customers, it will also allow your to expand your service area. Just make sure each employee is experienced, professional, and personable.