The Bernard Challenge: a carwash with no water
By Marthe-Christine Dorum Embretsen, Kericho Fellow 2014
Outlining the main problems
Since 2011 Bernard has been running Roben Carwash at Kericho’s Green Stadium. During our first meetings with Bernard we discovered that his business drifted into troublesome waters. Unlucky circumstances had turned the once prosperous business into a very unprofitable one. The main problems to blame for the business running at a loss every month is an unreliable water supply, caused by frequent construction works on Kericho’s water lines. When this happens, he is not able to perform his services and consequently needs to turn down customers – with some of them leaving for good. An unsteady water supply might seem like an issue that would affect every cash wash in the area, but the majority of his competitors have found a way to avoid this problem. His main competitor, located just down the road, has unlimited and free access to water from a river close by. Other carwashes utilise Kericho’s daily rain showers to provide them with a constant supply of water. Competitors are therefore able to offer the same services at a much lower cost.
In addition to the temperamental water supply, the business suffered from an almost permanently muddy ground which made the vehicles immediately dirty after being cleaned. The mud caused discontent among his customers and created difficult working conditions for Bernard and his two employees. These two issues severely affected the general health of his business and the situation had become so serious that he had restricted his own diet by not eating throughout the day in order to reduce costs, hoping it would help keep his business alive.
The one thing that was clear to us from the beginning was that Bernard is an exceptionally hard worker who would happily get up at the crack of dawn if customer were unable to come during normal opening hours. He sees problems as opportunities for improvement, and this attitude would prove to be invaluable as the challenges we faced were were plentiful and hard to overcome. Although the problems were waiting in line, there was no lack of ambition or ideas on how they could be tackled from Bernard. His business might have been small but his dreams were the opposite. He had turned to Balloon Kenya in the hope that a fresh pair of eyes would be what he needed to turn his business around and implement the plans he had. Although a daunting task at first, Bernard’s positive attitude and genuine passion for his carwash helped us see past the inherent problems and focus on finding unrealised potential in his business. He already had a clear idea of how he would tackle the main issues affecting his business, however, fixing these problems would prove much more difficult than we thought.
The temperamental water supply could be solved by having a water tank, which would allow him to collect rain water like many of his competitions were already doing. A cemented ground would help battle the problematic mud. His long term goal is to get a power washer which would make it possible for him to offer his customers a more efficient service. The power washer would also give him a competitive advantage, a necessity in a country where a “copycat culture” is prevailing among entrepreneurs and small business owners. However, all of these investments were costly to undertake and because his busess was running at a loss every month we had to significantly increase his customer base in order to have a chance of reaching any of these goals.
With a limited budget for testing new solutions, we were unable to do anything about the water supply and mud issue. We therefore decided to focus on alternative ways to improve his business in order to convince the investors that Bernard deserved funding for the sorely needed improvements. We started searching for solutions that would produce immediate results and prove that there was potential yet to be realised in his business.
After breaking down the cost structure of the business, we realised that there was little room to make changes with a rapid effect. Hence, our focus shifted to Bernard’s revenue model and his marketing strategy. Marketing in Kenya’s informal sector is mainly focused around word of mouth, meaning that there is usually plenty of room for improvement. Customer surveys showed us that customers had limited awareness of a carwash at the Kericho Green Stadium, and we started to think of ways to change this. The market research also made it clear that the customers were highly price sensitive and time conscious. However, after examining the customer segments more closely it became apparent that Bernard had a very loyal customer base which went to him because they trusted him. Theft is a recurring issue for car owners using a carwash, but with Bernard’s customers we found that trust was one of main reasons for their loyalty. “I come to Bernard because I know that if I leave any belongings in my car while it’s being washed I will find it at the exact same place I left it,” said one customer.
To target a broader audience we developed a simple marketing campaign which offered a small discount to customers who prebooked a wash. The idea was that as well as increasing awareness around his business, this strategy would make help Bernard to plan ahead and have a more presictable revenue stream than provided by drop-in appointments alone. If the campaign continues to be successful, the long term plan is to keep a discount for prebooked washes on Mondays and Tuesdays, providing customers with an incentive to return in addition to allowing Bernard to fill his quietest and most unprofitable days.
We also expanded his current services by offering a dashboard clean, a service with a larger profit margin that few of his competitors offered. Bernard’s next plan is to establish partnerships with public institutions which provide transport, such as schools, in order to attract larger vehicles. Although the marketing efforts were only recently started, a handful of new customers have already found their way to Roben Carwash.There is still a long way to go, but by finding new ways to deal with old problems Bernard’s carwash is in better shape than it has been in a long time.