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2020-2021 State of the Self-Service Laundry Industry (Part 1)

Endures pandemic downturn but many operators predict better biz this year

CHICAGO — Most of us have never experienced a year like 2020. The coronavirus pandemic gripped the world and COVID-19 became a part of our daily lives. And as you’ll see in this annual State of the Industry Survey report, the self-service laundry business wasn’t immune to its economic impact.

We have to go back more than a decade, to our 2009-10 survey following the Great Recession, to find certain industry performance numbers as low.

But there’s reason to hold out hope, to believe the decline is a “blip” caused by a pandemic that government and healthcare officials are striving to end sometime this year. Many respondents to this year’s survey say their business performance will improve in 2021.

American Coin-Op’s annual State of the Industry survey report provides a litany of statistics valuable to store owners and investors. This year’s survey focused on 2020-21 business conditions, pricing, equipment, turns per day and utilities cost.

When asked about their 2020 business results, respondents were given the opportunity to state whether their results were up, down or unchanged. Surveys conducted prior to 2012 asked respondents only if their business was up or down, so keep this in mind if you’re making comparisons to results of that vintage.

The survey is an unscientific, online poll of American Coin-Op readers who operate stores. Some percentages may not equal 100% due to rounding or other factors.

AUDIENCE BREAKDOWN

Roughly 59% of respondents own just one self-service laundry, while 40.7% are multi-store owners (22.1% of total respondents own two or three stores, 18.6% own four or more stores).

Approximately 49% of respondents own their store space, 37.3% rent their store space, and the remaining 13.6% say the arrangement varies by property.

Fully attended stores among the audience account for 37.3%. Roughly 32% are partially attended, and 17.0% are unattended. Among the remaining 13.6%, the arrangement varies by store.

More than 93% of laundry owners polled employ full-time and/or part-time workers in their stores. Nearly 56% of those respondents have four or more employees, while 31.5% employ two or three. The remaining 13.0% have only one employee.

On average, responding store owners have 3.0 full-time employees and 6.4 part-time employees (this calculation reflects averages by respondent, not by store).

As for payment types, 84.8% of respondents say they offer coin, 44.1% offer card, and 20.3% offer other non-coin systems (store owners were asked to identify every type that applies to their operations). Roughly 48% of respondents offer customers more than one type of payment, compared to 49% last year.

2020 BUSINESS VS. 2019

For 2020, 35.6% of operators say their overall vended laundry business in gross dollar volume increased from that of 2019. The last time that share was that low was in 2009-10, when just 40.2% reported better business performance.

In our 2019-20 survey, 74.6% reported an increase, while 81.5% reported seeing sales growth in the survey prior. Beginning with the 2012-13 survey, between 54% and 81.5% of respondents had reported business increases annually until this year’s survey.

The average 2020 business increase was 7.1%, down from 12.6% in 2019. Other past average business increases have been 9.9% (2018), 9.4% (2017), 11.2% (2016), 9.6% (2015), 8.9% (2014), 9.6% (2013), 11.7% (2012), 11.5% (2011) and 10.8% (2010).

Following is a breakdown of 2020 business increases (the figures relate to those reporting increases, not all respondents):

  • Operators with a business increase of less than 10%: 66.7%
  • Operators with a business increase of 10-14%: 19%
  • Operators with a business increase of 15% or more: 14.3%

Nearly 58% of operators faced a decrease in total business (in gross dollar volume) in 2020, compared to roughly 12% in 2019. The percentage was 8% in 2018, 10% in 2017, 22% in 2016, 17% in 2015, 29% in 2014, 25% in 2013, 30% in 2012, 35% in 2011, and 58% in 2010.

The average 2020 business decrease was 20.5%, nearly triple the 7.5% decline reported for 2019. Other prior average decreases have been 5.0% (2018), 6.7% (2017), 9.1% (2016), 16.3% (2015), 6.6% (2014), 8.7% (2013), 9.5% (2012), 10.2% (2011) and 11.2% (2010).

Following is a breakdown of 2020 business increases (the figures relate to those reporting decreases, not all respondents):

  • Operators with a business decrease of less than 10%: 21.2%
  • Operators with a business increase of 10-14%: 21.2%
  • Operators with a business increase of 15% or more: 57.6%

Among respondents who reported experiencing decreased business in 2020, the decline was as low as 5% or as high as 50%.

Roughly 7% of respondents say their 2020 business was unchanged compared to 2019 business.

So, it’s clear that the self-service laundry industry had a challenging year in 2020. It can join many other business sectors in blaming, at least in part, the effects of the coronavirus pandemic. It took a while after the national emergency was declared before laundry services were deemed essential and allowed to remain in operation. Meanwhile, stay-at-home orders mandated by state and local governments in the early months of the outbreak kept people at home for long periods.

In Part 2 on Thursday: Drop-off, commercial laundry and vending sales numbers; average turns per day