SBA 7(a) Car Wash Feasibility Study in Washington

Washington's 7(a) car wash cell has an odd shape. The median loan is $510,000, or 0.65x the nationwide 7(a) car wash median, but the middle half stretches from $60,000 to $1.3 million, an enormous range for a single class. Forty-seven loans add up to $45.4 million over FY2017 to FY2026. Washington is 14th by loan count, the use ranks 19 of 39 within the state, and franchised loans are 2.1%. A reader should hear in the wide spread a mix of small mobile or single-bay operations and large tunnel builds.

Two lenders, two very different books

Six loans at Stearns Bank National Association add up to $13.1 million; six at U.S. Bank, National Association add up to $121,000. Same count, yet the dollars differ by a wide margin: the first is plainly holding the large projects and the second the small ones. These figures are SBA's holder records, they describe the loans each institution holds or held, and they imply nothing about anyone's practices. Counties lead with Pierce at 9, King at 7, Yakima at 5, and Clark, Skagit and Thurston at 4 each, then Cowlitz and Snohomish at 3.

Timing

FY2017 produced 10 loans and $11.8 million, then FY2018 only 2 with $105,000. The middle years were 5, 7, 3, 2 and 2, with the FY2022 pair at $222,000. A revival came in FY2024 with 8 loans and $7.8 million, followed by 5 and $7.9 million in FY2025, and 3 and $1.5 million in FY2026. At minimum 10.3% of approvals up to FY2024 were cancelled, and adding undisbursed loans leaves the share where it is.

What cannot be read from the numbers

No charge-off figure can be given for Washington washes, as very few loans are old enough. Truck washes, mobile units and fixed car washes are filed under one code, which means these statistics blend operations with very different capital needs.

Questions for a Washington car wash study

A study has to name the format first: tunnel, in-bay automatic or mobile. It should test traffic counts and visibility at the site, the local rain pattern and its effect on wash counts, water and sewer capacity and discharge rules, equipment cost and its useful life, and membership versus single-wash revenue. Coverage should be run with a wet season of reduced volume. Because the building is mostly equipment, the appraisal should divide real estate from machinery.