CHICAGO — I’m sure you chart the course of your self-service laundry business month by month, but wouldn’t you like to know how your store measures up to others in the industry? Did you have a “good” year or a “bad” year in 2017, comparatively speaking? Is your pricing strategy in line with others?
The answers to questions like these and more can be found in American Coin-Op’s annual State of the Industry survey, which offers store owners and operators a valuable opportunity to compare their operation to others in the industry.
This year’s survey focused on 2017-18 business conditions, pricing, equipment, common challenges, turns per day, and utilities cost.
When asked about their 2017 business results, respondents were given the opportunity to state whether their results were up, down or unchanged. This is a departure from surveys compiled in 2011 and earlier, when respondents were asked only if their business was up or down. Keep this in mind as you’re making comparisons to previous years’ results.
The survey was an unscientific, online poll of American Coin-Op readers who operate stores. Some percentages may not equal 100% due to rounding or other factors.
What do you think are the biggest challenges facing your self-service laundry? American Coin-Op provided a list of eight, plus the opportunity to write in “other” choices, and asked operators to select all that they thought applied.
Here are the results (remember, respondents could pick any or all from the list):
1. High cost of utilities (55.7%)
2. Maintenance costs (41.4%)
3. Finding/keeping good employees (32.9%)
4. Labor costs (28.6%)
5. Equipment abuse/vandalism, or rental costs (tie, 24.3%)
7. Too much competition (22.9%)
8. Other (18.6%)
9. Poor industry image (8.6%)
TURNS PER DAY
Turns per day refers to the number of cycles (turns) that each of a store’s machines completes daily. For each machine class (top loader or front loader), you can calculate it using total cycles for a one-week period divided by total number of machines in the class, then dividing by seven.
Currently, the average turns per day for top loaders amongst respondents is 3.2, down slightly from last year’s survey (3.6). For front loaders, the number is 3.9, up from last year’s survey (3.8).
Operators were asked about their 2017 utilities cost (as a percentage of gross). The responses ranged from 5% to 40%. Collectively, respondents paid an average of 20.3% for utilities (as a percentage of gross), down slightly from 21.7% last year.
The most common individual response was 25%. Whereas 38.4% of respondents reported a utilities cost of 20% or less last year, 51.7% reported the same this year.
For many operators, utilities account for their largest store expense; 83.9% of respondents place it either first or second on their list of five common expenses (rent, utilities, payroll, insurance, and loan payment on new equipment). Meanwhile, insurance is the smallest store expense, numbered four or five on the list by 70.1% of those polled.
FORECAST FOR 2018
Roughly 60% of respondents are optimistic that their 2018 total business will be better than 2017’s. About 33% expect business to be about the same, while roughly 7% say it will not perform as well in 2018 as it did in 2017.
If you missed the earlier parts of our analysis, here you go: