All Things to All People

By Joel Jorgensen, CLA Member posted 01-30-2018 12:07

  
A Seven-Step Plan for Successfully Developing the ‘Laundry Service Center’ Concept at Your Store

There’s no doubt that the “laundry service center” concept is gaining ground within our industry. And for good reason.

A true laundry service center packs multiple services into a facility’s footprint in order to appeal to – and benefit from – a broader demographic. As a result, owners of laundry service centers enjoy favorable financing, a diverse revenue-generating portfolio, more protection from economic downturns, fewer competitors within a given geographic area and, generally, boosted revenue-per-square-foot.

Laundry service centers successfully capture every possible customer within a given geographic area, while fully utilizing attendants and equipment.

If you own an existing laundry or are developing a new laundry business, strongly consider the “laundry service center” concept. Here’s how:

1. Analyze Your Location’s Demographic Makeup

This is your starting point. Analyze your location’s demographic makeup. This will help you effectively retool/equip your business; develop different services to appeal to an array of demographic groups; and provide amenities that bring customers through the door. Most demographic reports provide information on income, housing, racial/ethnic composition, transportation, education and population, among others. Most equipment distributors will provide demographic studies and help you analyze them. Think about the equipment, amenities, and services you will need to:

• Eliminate the competition
• Serve large families, singles and parents
• Attract college students, vacationers and campers
• Appeal to white-collar professionals and blue-collar workers
• Cater to small and large businesses
• Draw every ethnic group in your demographic
• Entertain and attract kids

2. Select Your Equipment Mix

Laundry service centers are equipped and staffed to support multiple streams of business. High-performance, energy-efficient equipment is essential to lower operating costs (and higher profits), while a smart mix of equipment will draw more customers and demand higher vend prices.

Your equipment mix should cater to every group in your demographic study and support every service you plan to offer. Try for a mix of small- to large-capacity washers and dryers.

Develop an equipment replacement plan. Replace outdated and inefficient equipment. If this seems overwhelming to do all at once, phase new machines into your equipment mix gradually. Consider installing soft-mount (freestanding) high-speed washers for maximum efficiency and revenue per square foot. High-speed washers remove more moisture during extract – reducing dry times. Customers complete laundry more quickly, which improves customer turnover (not as much standing in line waiting for a machine). Finally, lower dry times reduce natural gas consumption and utility costs.

Include large-capacity washers. Go with at least a couple of large-capacity washers to handle family-sized laundry loads and bulky items, such as comforters, sleeping bags, blankets, and rugs. This will help your store draw families, parents and students, as well as the homeowner looking to wash comforters and blankets.

I regularly talk to owners who say their 90-pound-capacity washers are their most popular machines. If 90-pound machines are too large to fit into your existing laundry, perhaps opt for more compact 70- or 80-pounders.

3. Develop a Services Plan

Refer to your demographic analysis to help you nail down offered services – such as wash-dry-fold, commercial laundry services, pickup and delivery, drop-off drycleaning, load-and-leave, student laundry services, etc. Your goal is to appeal to your laundry service center’s entire demographic (renters, homeowners, businesses, parents, families, students, professionals, vacationers, and so on).

Wash-dry-fold. By offering wash-dry-fold services, laundries draw customers who don’t do laundry themselves, such as professionals, college students or parents with big families. Additionally, they attract people in need of clean comforters and blankets. Wash-dry-fold harnesses attendant labor and idle equipment to create a new revenue stream and maximize profit per square foot.

Drop-off drycleaning. If you haven’t partnered with your local drycleaner, now is the time. After all, you’re already paying attendants to handle wash-dry-fold. Why not have them take in drycleaning as part of their job? Once again, a new demographic group will use your store, and hopefully in the process, come to rely on your other services as well.

Commercial laundry services. Eventually, many laundry service centers move into the commercial side of the business and handle laundry for salons, spas, small hotels, moving companies, and more. Some owners take it a step further and install on-site ironers to process bed sheets and table linens. In doing so, they open the door to more, and new, commercial business – operations requiring ironed linens. Once again, this added revenue bolsters the bottom line.

According to the 2017 Coin Laundry Industry Survey, 58 percent of responding laundries offer wash-dry-fold; 35 percent offer commercial wash-dry-fold and pickup and delivery; and 18 percent offer ironing services. For more on about developing commercial services, visit cgilaundry.com/support-materials.html and cgilaundry.com/coin-laundry-commercial.html.

At The Laundry Café in Kalamazoo, Mich., revenue flows from various income-generators, including drycleaning, self-service laundry, wash-dry-fold, rental income, and food and coffee.

“We love that our customers can drive up, pick up their drycleaning, a coffee and a wrap, and be on their way in a couple of minutes,” said co-owner Louie Cares. “We feel good knowing they are receiving quality products and services.”

4. Decide on Amenities That Set You Apart

Of course, laundry service centers also provide enticing amenities. These might include free Wi-Fi, televisions, snack bars, play areas, coffee bars, dog washes, vending machines, and video games. Owners get creative and embrace amenities that generate dollars and attract an array of customer types.

At Laundrywood in Los Angeles, visitors enjoy massage chairs, flat-screen TVs, a jukebox, video games and a kids’ play area.

“We kept everything shiny and fun in the back of the store,” said owner Gary Thompson. “In the front of the store, there’s a granite Wi-Fi counter with charging stations for laptops, tablets, and phones. We tried to make it a destination – a place to do laundry, have fun, chat, and hang out.”

Remember that even small revenue generators add up. An extra $200 a month from one video game can nicely benefit your bottom line.

5. Develop an Attendant Hiring and Training Plan

Attendants also are critical to the success of any laundry service center. They need to know how to assist customers with equipment and services. As services are added – from snack bars to wash-dry-fold to drop-off drycleaning – they should be cross-trained to handle any need in the store. Join the Coin Laundry Association (coinlaundry.org) and learn how other successful store owners train their employees.

6. Secure Favorable Financing

Now that you’ve outlined your plan, you’re equipped to secure favorable financing. Lenders want to see how your laundry will compete (and serve a broad demographic) before offering financing. Additionally, they are much more likely to offer favorable, low-interest financing to businesses that provide multiple services, tap into a broader demographic, generate multiple revenue streams, and fully utilize equipment and labor.

7. Execute

In the end, it’s about revenue and profit. Why wouldn’t you, as a laundry investor or owner, want to fully access equipment and labor to diversify and grow revenue? The laundry service center concept is successful because it gleans revenue from multiple services and demographic groups, embraces efficient use of equipment and attendants, warrants favorable financing, and outshines the competition.
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