A Tale of ‘Two’ Stores

By Bob Nieman, CLA Member posted 01-03-2017 09:42

  

The Midweek Laundromat Doldrums Drove Owner John MacKrell to Seek Out Additional Business, Leading to the Creation of Springboard

leader2.jpgIt was another quiet Tuesday. And, if John MacKrell were in the business of selling dryer lint, he would have told you – after a busy weekend of walk-in traffic – that his lint inventory was way up and business was booming.

However, John is not a lint salesman. He’s a 15-year veteran of the self-service laundry industry who owns two stores. That Tuesday morning, as he stood surveying his 6,000 square feet of mostly idle equipment, he felt the old adage – “if your machines aren’t turning, you’re not earning” – cycling through his head, along to the tap, tap, tap of the few spinning dryers. At least the quiet would allow him to catch up on paying bills.

MacKrell’s commute from North Kingstown, R.I., takes him through Providence’s well-to-do neighborhoods and the surrounding middle class suburbs. It was on that night’s return commute that he had his “Ah-ha!” moment.

“I’m heading home to four young kids and a very patient, overworked wife thinking it’s as if I have two stores – one that’s a great success but is only open weekends and nights, and a second that’s limping along midweek mornings and afternoons,” MacKrell explained. “I’m driving past house after house full of families all wrestling with the same time-crunch problem my wife, Katie, and I have – and I’m asking myself, how can I drive more midweek traffic to that ‘second’ store? Then, it hit me! ‘Drive’ is exactly what I need to do. These time-starved families have a problem, and I have a time-saving solution. If they can’t or won’t come to me, I’ll just have to go to them.”

With that, MacKrell decided to go all-in on home laundry pickup and delivery.

His initial foray into the delivery business was decidedly low-tech.

“We started with a phone, a wall calendar, sticky notes and an Excel spreadsheet,” he recalled. “My gut was right and the response from our steadily growing pool of customers was tremendous, but the operational challenges were taking a big bite out of revenue.”

MacKrell’s machines were busier, but the time required to manage the operation and meet the needs of his customers had grown exponentially.

“We quickly realized that the only way to make this work and maintain healthy profit margins was to move the business online,” he said.

Looking back MacKrell has no doubt they made the right decision: “Our delivery business is now bigger than our traditional laundromat business. We’ve more than doubled our revenues without increasing our two biggest costs: rent and equipment finance payment. Without the software, none of it would be possible.”

MacKrell explained that what started five years ago as a few online forms has matured into a “remarkably powerful, cloud-based software suite” that allows him to manage routes and driving manifests, track production and employee payroll, analyze metrics, securely bill credit cards, track and resolve issues, and maintain customer relationships.

“It runs every aspect of our business,” he noted. “It’s still a complete thrill to bill a route of 40 customers with an average ticket price of $45 in five minutes with just a few clicks. And I can do it from anywhere.”

Given the interest from other operators, MacKrell said licensing the software was the next natural step in its evolution.

“Spinning off the software under a new brand was really exciting,” he said. “We wanted the name to convey how our embrace of mobile technology had propelled us onto a whole new plane. Happily, the name suggested itself.”

MacKrell calls the software Springboard.

Since its quiet launch six months ago, 19 laundry owners in six states have signed on to power their pickup and delivery business with Springboard.

MacKrell contends that Springboard’s early adopters were attracted by the comprehensive feature set and ease of use, but just as importantly by the Springboard philosophy.

“We’re here to serve the owner/operator and help them build their own brand and business, not vice versa,” he stated. “We are 100 percent behind the scenes and do not co-own your business or customers.”

MacKrell believes that laundry delivery will always be a hyper-local business. Last year’s demise of Washio is a case in point, he said.

“A year ago, all the buzz was about Washio,” MacKrell explained. “They made a huge investment in technology and marketing; however, by contracting out production, they couldn’t control for quality and customer service, and that was part of their downfall.”

MacKrell maintains that, while technology is a critical part of the equation, without a great product and exceptional customer service it’s “not worth the ones and zeros it’s written with.”

Furthermore, he contends that local markets will be dominated by operators who consistently deliver superior service and convenience.

leader1.jpg“Springboard has been a complete game-changer for us,” MacKrell said. “Leveraging technology has allowed us to focus on our customers’ needs. And, at the end of the day, that allowed us to build a very profitable pickup and delivery business.”

Springboard is offered through a license agreement with no long-term contract. According to MacKrell, it’s a “turnkey solution” that includes everything from a branded mobile-friendly website to a complete set of customer account management and back office tools. In addition to the software, MacKrell offers customer service and digital marketing support add-ons.

MacKrell is bullish about Springboard’s future, as well as the future of laundry pickup and delivery in general.

“The need is there, as is the infrastructure to meet it,” he noted. “It’s just a matter of connecting the two.”

Clearly, MacKrell is looking forward to this year’s Clean Show in Las Vegas, as a way to spread the Springboard message: “We want to help other owners achieve what we’ve achieved and discover that – with very little additional investment, and a commitment to pickup and delivery – they can drive new business to their own ‘second’ store.”

In addition, MacKrell shared some additional thoughts on the future of the laundry business:

What is the most pronounced trend you’re currently seeing in the industry?

I think there are two trends – one in the owner/operator space and one in the consumer space. Ambitious operators are focused on maximizing the ROI of their existing infrastructure through add-on services. At the same time, you have dual income families and young professionals looking to “buy back” time by offloading household chores. Laundry pickup and delivery is a nearly unexploited “time buy-back” market.

What are you most excited about as we head into 2017?

Without a doubt, Springboard’s official launch. We’ve been running under the radar working with a select group of owners, but we’re taking the brakes off as we head into 2017. We’ve acted on a lot of great feedback from our early adopters, and their input has made Springboard a better product. It’s one that we’re extremely proud of and we’re looking forward to showing it off at Clean 2017. So come see us at Booth #3778.

What are you most concerned about, from a business standpoint?

The things we’re concerned about today are the exact same things that drove us to cultivate our own laundry pickup and delivery operation, HappyNest and, consequently, Springboard – the increasing costs of rent, utilities and equipment. We couldn’t be happier with our decision to go all in on pickup and delivery – so, while those things concern us, our concern is tempered by our optimism.

Where do you see the vended laundry industry headed?

Nowhere but up. There probably isn’t a lot of room to move the needle on midweek walk-in traffic (the world needs only so much free popcorn on Wednesdays) but the opportunities for growth in “hybrid” stores – those serving both the walk-in public and as processing centers for pickup and delivery services – are tremendous.

What’s the biggest reason for laundromat owners to be optimistic?

Opportunity. Opportunity. Opportunity. Every laundromat owner who is not already offering wash-dry-fold and pickup and delivery is missing a tremendous opportunity to significantly increase their revenue without adding anything in the way of lease or equipment costs. Embrace the idea that your store serves a 15-mile – not just a 10-block – radius, and you can tap into a significantly different demographic and realize great returns on a very modest additional investment.

What are the keys to successful laundry ownership today?

Great customer service. Regardless of whether you’re running a single unattended location or a chain of full-service stores, don’t overlook customer service. With so many opportunities for customers to offer kudos or complaints on social media, you want to make sure you’re always firing on all cylinders.

Technology. From webcams to card systems to pickup and delivery management software, there’s no shortage of hardware and software to help you keep your finger on the pulse of your business.

Hustle. Nothing replaces it. Create your own opportunities. If the business doesn’t come to you, go find it.

Looking to the future, where do you see the greatest opportunity for self-service laundry owners with regard to their wash-dry-fold operations?

High-quality, customer-focused pickup and delivery. Pure and simple.

0 comments
182 views

Permalink

Tag

Comments

Download New eBook

eBook

Click to download and read Speed Queen’s new eBook that discusses proven business strategies that are guaranteed to provide unprecedented levels of profitability.