For some time now we’ve been delivering successfully growing that PEMIX into the upper end of the spectrum. So Mo and the team have done a really nice job with that. And I see that continuing through 2024. Towards the end of last year, we did add one item which is which is a fuel additive service. Hence we’re calling a Big Five now as opposed to Big Four historically, that has been a nice kind of growth lever for us this year. It’s an easy service, it fits in really nicely with our fast, friendly and simple model. So the team has done a nice job driving that and will continue to drive that through 2025. And the team also starting in Q4 of last year started to focusing a little bit more on CoolIT, which is an existing service that we’ve been doing for some time.
And we’ve seen nice growth out of that service. And that’s a really healthy margin service for us. So, we’ll see more of that continue in 2025.
Chris O’Cull: That’s helpful. And then just quickly on Car Wash, can you help us understand what the margin recovery potential is from variable saving or variable cost savings? I’m just trying to understand where the cost savings kind of max out and sales recovery is needed to get back to that 30%-plus wash margin.
Jonathan Fitzpatrick: Yeah, Chris is Jonathan, I’ll take a shot at that, look, we’re pleased with the progress the sequential progress at a segment level from 17% to north of 23 in Q3 to Q4, as we think about 2024, at a minimum, we’d expect to sort of hold on to that sort of 23%, consolidated margin. And then obviously, as Danny continues to work on the business, hopefully get that expanded again, that’s on a total Car Wash segment. So I would hope that that 23% is sort of a floor number. And that will continue to chip away at that throughout the year.
Chris O’Cull: Thanks, guys.
Operator: Thank you. And your next question comes from the line of Jason Haas from Bank of America. Your line is open.
Jason Haas: Hey, good morning, and thanks for taking my questions. Maybe sticking with the Car Wash segment. I’m curious if we could hear a little bit more on what’s being done in what’s needed to be done to get those comps back to positive. I don’t know if you could give us a timeline. But curious if that’s a possibility for this year?
Danny Rivera: Sure, Jason, this is Danny. So look, I’d say number one, as we look at Q4 for those specifically not for the US Car Wash business, we really focused in on the variable cost structure that business, we wanted to get that right, and we set out for it from the outset that we’re going to focus in on that part of the business. I think the team did a really nice job with a laser focus on mostly, let’s say labor in determining costs. And we saw that 600 bps improvements sequentially there in Q4. Coming into 2024, we’re going to do kind of two things. Right. So number one is let’s hold on to that variable cost structure improvement that we delivered in Q4 and then shift our focus into really driving predictable revenue both on the retail side and the membership side. So, more to come and 2024 as we really lean into to that part of the business.
Jason Haas: That’s great. Thank you. And then as a follow up, unfortunately I missed it. But I wanted to follow up on Platform Services, it looks like the franchise sales were down quite a bit in 4Q I think the revenue was actually up year-over-year. So wasn’t sure exactly what sort of the dynamic was there? A positive but was there any commentary on what was driving that system wide sales and it was driven by the franchise sales being beaten down?
Gary Ferrera: Yeah, that mean that’s the 1-800-Radiator business, which is a small piece of that I totally think in my script about 15% of the revenue of that segment.
Jason Haas: Got it, okay.
Gary Ferrera: With growth and everything else.
Jason Haas: Okay, that’s helpful. Thanks.
Operator: Thank you. And your next question comes from the line of Christian Carlino from JPMorgan. Your line is open.
Christian Carlino: Hi, good morning. Thanks for taking our questions. I was wondering if you could talk about how membership penetration has been tracking in the Car Wash business. And have you seen any improvement in there since the locations have been rebranded to Take 5, and you’ve done some of the cross marketing work there. And then to clarify when you talk to improvement in Car Wash and Glass comps is the expectation that they should come positive or just less negative in 2023?
Danny Rivera: Hey, Chris, Danny again. So as far as the Car Wash membership question, like we don’t get into specific KPIs on the membership side, I will say we’re happy with the fact that in 2023, we did grow members. So that’s good. We are right now we’re really focused on making sure that we have the right membership structure. So it’s less about the number of members that we have, but having the right members at the right price, you’re going to see us continue to experiment with that here in the beginning of 2024. Once we feel like we’ve got the right structure and program in place, and you’ll see us accelerate that through the back half of the year.
Christian Carlino: Got it. That’s helpful. And then can you talk about the path forward for Glass? Do you still expect to be able to pick up some of the regional insurance business later this year? Or is that more of a 2025 story? And, you’ve talked about 10% calibration penetration, not looking for guide specific guidance here. But what where could you see this realistically going over the next year or two?
Danny Rivera: Yeah, great. So, from a Glass perspective, look, I think, first and foremost, super excited about the fact that as Jonathan mentioned in his opening remarks, as of today, the integration work is behind us, right. So very excited that the team can actually focus now on growing the business into 2024. I think the path forward looks really good. If we talk about the revenue side of the business, we’ve talked about this before, there’s basically three sides of that. So you’ve got retail, you’ve got commercial and insurance. We grew all those in 2023. And we’re going to really lean in and since 2024, and grow that side of the business. Particularly excited about seeing Auto Glass Now really lean into the insurance side, to your point with the regional insurance, particularly in 2024.
