New Venture Lab: Equipping Christian Entrepreneurs

Day Two (a continuation of Training My Son for Entrepreneurial Success)

The next day -- Saturday -- I accompanied Adam on his initial car washing outing to help him with quality, safety, and customer service.

First, we headed to Home Depot where he invested in some supplies.  He must have assumed that I was going to pay when picking out the supplies, but when we got to the checkout and I told him to pull out his wallet, he went back over the supplies to make sure he was only getting what he absolutely needed, thus learning a valuable lesson in stewardship and accountability.  He opted to use our double baby jogger rather than buy a wagon to pull around his car washing supplies, which was an excellent decision.  He did not want to be seen pushing a baby jogger around the neighborhood, but after a brief internal struggle, he opted for the jogger rather than spring another $50 or more for a wagon.

We laid out the supplies prior to loading them...

...and then loaded them into the jogger.

His routine included soaping up and washing the cars with a brush...

...brushing while rinsing (while repurposing the bucket)...

...and drying.

While we were out washing the cars for customers he had sold the previous evening, he, with no prompting from me, sprinted across the street between customers to pitch two other neighbors that he saw out and about.  He sold one of them for the following weekend.  He also up-sold one neighbor to a second car wash while washing one of his cars and received a tip from another.

When we returned, we sat down together and built a financial model for his business.  I started with the Startup Financial Model and made some quick modifications to fit his car wash business, while teaching him accounting at the same time.

His car wash model includes a detailed Capital Expenditure (CapEx) and Depreciation schedule (note that we capitalized his durable supplies and assigned a life based upon our guess at how long they would last)...

...a Revenue Detail input page to capture his customer sales info (we also have details on how often they want Adam to return to wash again and other cross-sell opportunities such as cat sitting for one customer)...

...a Balance Sheet reflecting his initial capitalization of $50 of equity from his wallet...

...a Cash Flow Statement...

...and an Income Statement (note that he expensed the soap, the only "consumable" compared to capitalizing the bucket, nozzle, and othe items shown on the CapEx view above).

The Startup Financial Model is fully integrated and his version will help guide his business decisions as well as inform him of how accounting works.

In the final analysis of his first two days of training, he turned a profit in his first day, gained a full return on his initial investment, acquired some additional customers, noted when to come back and wash those initial customers again, sharpened his sales and customer service skills, and gained an understanding of accounting specifics such as when to expense vs. when to capitalize an item that he purchases for his business and how the statements all interact.  Priceless.