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The 10-Year Plan

Paul Partyka |

TRAVERSE CITY, Mich. — You have probably heard this story before: An individual spends a good deal of his/her life working, finally leaves the job and eventually decides to invest in a coin laundry — the “labor-free” business.Be honest, whenever you hear this story, you’re likely to envision a quiet, older person who wants to learn the business, but ends up spending more time at home than the store.You obviously haven’t met Jim Legato. Legato shatters that myth.A NEW CALLINGLegato spent 30 years at the phone company before finding his coin laundry calling. After he left the phone company, he found a part-time job but eventually got laid off. He wasn’t ready for retirement. Little did he know that a laundry-for-sale ad (owner-financed) was opportunity knocking. Legato would soon run the Eastfield Laundry in Traverse City, Mich.He purchased the 2,800-square-foot laundry, which had been in business since 1961, in 2004. When purchasing the store, he also had a long-term goal in mind. More on that later.Legato had run across some poor coin laundries in the past, but admits that this was the first coin laundry that he really ever took a close look at. “I also checked out the competition. This one looked like the best of all of them appearance-wise.” He was a believer in having an attended store, one that people left in a good mood.GREEN AND CLEANOne unusual feature of the Eastfield Laundry is that an employee makes soap for the operation.“I used to buy soap at the discount stores for the laundry. I also went through distributors and bought from everyone. I had hired an employee (Ruth McGuire Smith) who had made her own soap for years. Her family had allergies and she developed a back-to-earth formula.”The cost for the employee-produced soap, he adds, was cheaper than what he was paying for his soap. Legato considered using the soap at his store.“I was a bit skeptical at first, but I’m a gambler. So I said, ‘let’s try it.’ If someone can come up with a better idea to save a penny, I’m willing to listen. Plus it’s good for the environment. The future is going green. I give all the credit to Ruth on this, it was her own idea. Slowly but surely, we started to use it and pass it on to the customers.”With this decision, Selestial Soap, formulated to be a hypoallergenic product, made its Eastfield Laundry debut. Legato also sells other brands of soap in his venders in addition to laundry softeners/sheets, baskets and hangers (plastic, wooden and wire).Selestial Soap is used for drop-off work unless the customer requests a different brand of soap. He also sells the soap to customers, but this is still somewhat of a work in progress. A 32-ounce container of powdered Selestial Soap goes for $6.49. This container has enough soap for 32 loads, he says. (He also uses a liquid version of the soap in the store, but doesn’t offer that for sale.) The attendants sell the soap.“I’m pleased with the product, but we really didn’t start pushing the product until a couple of months ago. Customers used to walk across the street to purchase their soap and bring it into the store. Now we have signage in the store promoting [our soap]. We also have vended soap for 75 cents.”Legato is very generous when it comes to giving away free samples of the soap. “It depends on my mood, but I let a lot of people sample the product for free. When I see customers walk in here with their own soap, I talk with them and say we have a product that is just as good and may even save you some money. The attendants do the same thing. You know, a good percentage of the customers are allergy-conscious. Every customer has given positive feedback to the soap.”BUSY TIMESThe Eastfield Laundry is open from 6 a.m. to 8 p.m. daily. Traverse City is a tourist town of about 30,000, he says, but that figure swells during the summer.“We’re a tourist town on Lake Michigan that has skiing, hunting and fishing from Memorial Day until Labor Day. Business triples in the summer. In the summer, we go to about 80,000. We also have various festivals.” There’s even the “Horse Show by the Bay,” an equestrian event that Legato’s laundry sponsors.This event has generated some additional business. Events like this helped to open Legato’s eyes. They led to him starting a commercial laundry business.“It’s funny how things work out. I’m very aggressive. It took me about a month to realize that self-serve laundry by itself won’t make it. I’ve started to promote extra services.”Through the chamber of commerce, he participated in a business education session and met a cleaning company person who got him thinking about doing commercial work.                               “He was bidding on a resort that was opening. The resort wanted laundry service.” The individual wasn’t interested in doing the work. “I was interested, but didn’t have enough room at my laundry for this.” Legato started doing commercial work in 2006. “We did it for a time, but we were tripping over bags of laundry.”The work load started to increase, plus Legato took on some work (blankets) from the horse show.How did he balance the coin laundry work and the commercial work? He expanded. “I called my distributor and looked for warehouse space. I got the space, and signed a one-year lease. It was a big gamble.”Legato admits that his one-year lease was a mistake. The building got sold, and the lease terms became less favorable. “But things still worked out.”At present, he estimates that he has about 25 commercial accounts. He deals with a host of different businesses such as motels, bed and breakfasts, chiropractors, massage centers and hair salons in addition to accommodating the needs of horse owners (blankets, boots, etc.). Pickup and delivery service is available.Last summer his commercial division utilized 18 workers going 12 to 16 hours a day. The warehouse is about 2,800 square feet and features three 60-pound washers, a top loader, two 75-pound dryers and two 30-pound dryers.He plans to run the commercial division 24 hours this year, although he stresses that the intense schedule goes only from Memorial Day to Labor Day. “But this business keeps us going through the winter time.”His advice to other operators? “Networking is the key. I’m very happy with the commercial business, I only wish I had done it 30 years ago!”Legato also offers drop-off service. “The drop-off business had tripled since I bought it. It’s still growing.” He estimates that he has about 360 drop-off service customers. He also offers ironing services.However, being the aggressive operator, he still isn’t totally pleased and seeks more business, both self-serve business and drop-off business.“I’m an early riser. I’m open at 6 a.m. Despite some promotions, there is no 6 to 8 business. I could open at 8, and not lose a single self-serve customer. Other stores open even earlier.” The following example is indicative of his quest for more customers.One of the other stores opens at 5:30 a.m., 30 minutes earlier than his laundry, he says. “I always see one car there, and wonder why this guy can’t wait 30 minutes and come to the best laundry in Traverse City.”Being a hands-on owner is important, he believes. “Every machine, changer, etc. will screw up at some time. When I’m here, I help people with these things. I tell them this is why you come here. You won’t get this at the non-attended stores. I give the personal touch.”The laundry provides free coffee and tea, plus free Wi-Fi service. Two computers are available for customer convenience. Any student with a valid student ID is entitled to free Selestial Soap at any time.Customers can choose from 25 washers, including top loaders and three 50-pound washers. As for drying, there are 30-pound single units, some stacks and three 75-pound units. The attendants also use this equipment to handle the drop-off work. “There’s no problem with [doing the drop-off work and having the regular customers do their loads] because of our long hours. I also get here early and can handle some of the work.”GETTING THE WORD OUTLegato has a Web site (www.eastfieldlaundry.com) where visitors can check out his hours, read about Selestial Soap, and learn about his various services,  including the commercial laundry division.His Web site also has a special section that provides seven reasons why customers should clean their clothes at his store. Here are the reasons:1) Our machines are clean, our hot water is really hot, our wash cycles are full-length and our dryers give full, 10-minute-length cycles of 195-degree heat. In other words, you get honest value for your hard-earned money at Eastfield Laundry.2) You won’t have to worry about quarters because we have a changer, which gives you a true four quarters for every dollar to operate all of our machines. Our attendants will show you how to get started — it’s easy — and they’ll take all those quarters you’ve been lugging around. Plus, if you have too many quarters we will convert them back into paper so you will not be lugging them around until your next visit.3) You need our big 50-pound washing machines and 75-pound dryers for those comforters, blankets, sleeping bags, rugs and the other oversized items that your washing machine at home can’t really clean.4) We have the nicest, friendliest attendants in the city.5) Free Wi-Fi Internet access (and high-speed Internet ports), or use our computers for your convenience.6) Free coffee or tea for the early birds each day.7) Voted best people’s choice award three straight years.The most unusual thing to happen with the Web site, he says, is when a truck driver called from Milwaukee. “He saw my site, was coming through town and wanted to use my wash. He actually did come to the wash, asked about where one could get some good pizza, and ended up buying pizza for us. That whole thing was certainly surprising.”FULL SPEED AHEADLegato’s customers like the friendliness of the employees and the store cleanliness, he says. While business has increased, there are still ongoing challenges.“I always wonder what my utility bills are going to be next month.” He isn’t afraid to charge more than the competition. He gets $2.50 for a top-load wash, for example. “Some operators get psyched out about price. When new customers come in, we talk. I tell them I’m expensive but also that I’m the best store, so in the end you’re going to save money.“My dryers are hot. You get 10 minutes for 25 cents. One distributor tells me to lower the minutes, but I don’t. This is my drawing card.”Despite his success, he has dealt with his share of frustrations. Dealing with employees can be especially frustrating. “I’ve gone through [many employees]. I was an employee for 30 years, so now I can understand what some of my bosses went through,” he jokes. “Finding good, dependable help can be frustrating.“The other problem is customers who leave a mess; the ones who don’t respect the store.”However, some people make things a bit easier. “I really enjoy meeting and talking with people. In the summer, a lot of tourists come in.”Earlier on in the story, Legato made mention of a long-term goal when he purchased the store. The goal? He told his wife that he would build the business so that he could put it on the market in 10 years.Will he step away? “That was the original plan. There are six more years to go. I don’t know though, because I really enjoy this.”Regardless of the final outcome, the smart money says this store will continue to grow, fueled by one aggressive owner. 

About the author

Paul Partyka

American Coin-Op

Paul Partyka was editor of American Coin-Op from 1997 through May 2011.

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