Canopy Car Wash in Portland, Oregon, is the latest big name to join the ranks of the elite car washing chains that have taken advantage of a loophole in state laws that allows car wash franchises to operate under the guise of “retail stores”.
Canopy’s Car Wash is owned by a family of car wash operators who were already the owner of a franchise in New Jersey, according to the Oregonian.
This is because the franchise law in New York and California allows the franchisee to operate out of a separate building, the Portland News-Herald reported.
The loophole, known as a “superstore loophole”, has allowed these franchises to make money by charging more for their services.
The owners of Canopy, the largest of these car wash companies, are not allowed to charge for the services they provide under the franchise laws.
It’s unclear why the Oregon Department of Transportation (ODOT) decided to shut down the franchise.
But in a statement on Tuesday, the department said it had determined that Canopy did not have a business plan that would allow it to continue operating in Oregon.
In April, OPDOT closed down the Portland Car Wash franchise after it was found to have not registered with the state for up to six years.
In June, the OPDOR announced it would close down the other franchisees in the state.
“I’m not sure what that loophole is,” Scott Riedel, a spokesperson for the department, told The Oregonian when asked about the franchisees closure.
“If you look at the business plan, it was created for a purpose.
It was not for a profit.
We don’t want to see car wash owners doing this.
We’re very concerned that these franchised car wash businesses are not in compliance with our laws.”