Highveld Detailing Business Plan — Operating Model

Bay layout, throughput, chemical and equipment handling, and the scheduling discipline behind vehicle volume.

Section 15 of 38

Operating Model

Jump to section

The operating challenge is not technical. It is running a consistent process across thirty-six geographically dispersed locations, most of which sit inside somebody else’s building, staffed largely by people the company trained itself. Everything in the operating model is designed around that problem.

Studio configuration

Each studio operates eight bays over 26 days a month, divided by function rather than by customer. The allocation is deliberately skewed toward protection work despite protection representing a small minority of vehicles.

Table 26. Studio bay configuration and steady-state throughput

Bay type	Bays	Work performed	Throughput	Target utilisation	Why this allocation
Volume bays	3	Express valeting and studio-routed dealer reconditioning	5.5 vehicles / bay / day	82%	Absorbs overflow dealer work and walk-in traffic; keeps junior staff productive
Detail bays	2	Premium multi-stage detailing	1.6 vehicles / bay / day	78%	Mid-tier retail work; the training ground between volume and protection
Protection bays	3	Ceramic coating and paint protection film	13 slots / bay / month	78%	Highest contribution per hour in the portfolio at R752 and R818; dust-controlled and temperature-stable

Figure 1. Studio bay allocation, vehicles and revenue

The implication for management is that studio profitability is determined almost entirely by protection bay utilisation. A studio running full volume bays and empty protection bays is a loss-making operation regardless of how busy it appears. This is the single most important operational metric in the retail half of the business and it appears in the management dashboard in Section 32.

Utilisation and ramp

Figure 2. Utilisation ramp profile by channel

Utilisation assumptions are among the most consequential in the model and among the hardest to defend from a standing start. A ten per cent shortfall against these assumptions removes 73.2% of FY2032 EBITDA. Utilisation is the second-largest driver in the tornado analysis in Section 31.

The in-dealership operating model

An embedded unit is a team of roughly 7 people working inside a dealership, using space, water and power the dealer already pays for. Highveld supplies the team, the equipment, the chemistry, the process documentation, the supervision and the liability cover.

Table 27. In-dealership unit: work mix, staffing and commercial terms

Parameter	Assumption	Comment
Used-vehicle preparations per day	7	At R400; the core retail-ready preparation
CPO preparations per day	3	At R882; the highest-value dealer work
New-vehicle PDI preparations per day	4	At R279; cyclically exposed to new-vehicle sales
Service-department washes per day	12	At R122; low margin but it fills the day
Operating days per month	22	Six-day operation
Steady-state utilisation	86%	Allows for vehicle flow variability and public holidays
Full-time employees per unit	7	Detailers plus a team leader; supervision shared across an area
Volume rebate to dealer	10%	Applied to gross contract value; a real margin cost
Equipment capital per unit	R320 000	Redeployable if a site closes
Mobilisation cost per unit	R145 000	Recruitment, training and set-up; expensed on mobilisation
Travel and supervision per unit per month	R16 500	Plus one area manager per 10 units
The dealer relationship is an operating dependency, not just a customer relationship Highveld’s embedded teams work on premises it does not control, on vehicles it does not own, alongside staff it does not employ. If a dealer changes its stock policy, reduces its used-vehicle intake, restricts access, or simply has a difficult general manager, the unit economics move without any failure on Highveld’s part. The contractual response is minimum volume commitments with take-or-pay provisions on the guaranteed portion. In practice, dealers resist these, and the plan assumes the company will secure them at some sites and not others. The model does not assume any take-or-pay protection.

Seasonality

Retail vehicle appearance demand is markedly seasonal, peaking ahead of the December holidays and troughing in the mid-winter months of June and July. Dealer volumes are far more stable because they follow the dealer’s own stock turn, and the model damps the seasonal factor on B2B revenue to 50% of the retail amplitude. This damping is itself a benefit of the contracted mix that is rarely credited: as the dealer share of revenue grows, the group’s cash flow becomes structurally less volatile.

Quality, compliance and the things that go wrong

Damage liability. Every vehicle is photographed on receipt and on release. Damage claims are the principal operational risk in a business handling customer vehicles, and the plan targets claims below 0.5% of vehicles processed. Insurance cover is carried at each site.
Coating warranty. A provision of 2.5% of protection revenue is charged against profit for rework and warranty claims on coatings and film, which carry multi-year customer guarantees.
Water and effluent. Studios operate closed-loop reclamation recovering roughly 85% of process water. Embedded units use the dealer’s supply, which transfers the compliance exposure to the dealer but makes Highveld dependent on the dealer’s own permits.
Chemical handling. Coating and film chemistry includes hazardous substances requiring documented storage, ventilation and disposal, with staff training records maintained per site.
Electricity. Studios carry solar photovoltaic capacity with battery storage covering the majority of demand. Embedded units depend on dealer power and are exposed to whatever backup the dealer has.