The giant manufacturer of household staples including Pampers diapers, Crest toothpaste and Gillette razors is forging a new business model: franchising car washes.
To jump-start plans for a nationwide chain of Mr. Clean Car Wash franchises, P&G in December acquired the franchise assets of Atlanta-based Carnett’s Car Wash, which has 14 locations.
“We need to look for new opportunities to allow us to grow,” says Bruce Brown, P&G’s chief technology officer. “That isn’t limited to things within our current business model.”
P&G is under mounting pressure to find new sources of revenue growth, particularly as more cash-strapped shoppers think twice about buying its premium-priced products. Wall Street is increasingly skeptical that the mammoth company can garner meaningful gains in its slow-growing product categories and a tough economy.
Known for exhaustively testing new ideas, Procter & Gamble has been quietly experimenting with service businesses in recent years. Since 2007, it has operated two Mr. Clean Car Washes near its Cincinnati headquarters. Last year, it unveiled three Tide dry-cleaning shops in Kansas City, Kan., area. Also in 2007, P&G said it bought a minority stake in membership-based medical services firm MDVIP, based in Boca Raton, Fla.