CHICAGO — For the second consecutive year, the share of distributors reporting their business had improved year-to-year was larger than the prior year, according to the results of American Coin-Op’s annual Distributors Survey.
As for how distributors expect their 2020 overall sales will compare to those of 2019, there is almost an identical three-way split between those thinking it will be better, the same, or worse.
Nearly 68% of distributors polled say that their total business—including sales of newly constructed vended laundries and replacement business—was better in 2019 compared to 2018.
Approximately 13% of respondents say their 2019 business was worse than 2018’s, while 19.4% say that business stayed the same compared to the prior year.
But now operating in a COVID-19 environment with the world awaiting an end to the virus pandemic, just 32.3% believe their company’s 2020 overall sales will be better than 2019’s.
Distributors listed in the previous edition of the American Coin-Op Distributors Directory were invited to participate in this year’s unscientific survey, which charts 2019 business and makes comparisons to previous years. In this three-part summary report, percentages may not add up to 100% due to rounding.
This year, 67.7% of distributors who were polled said business was better in 2019 than 2018. That’s up from last year’s survey in which 56.3% of distributors said 2018 business was better than 2017. The share of distributors reporting better business compared to the prior year was 53.1% in the 2018 survey, 63.6% in the 2017 survey, and 67.4% in the 2016 survey.
Those describing their 2019 business as being “better” attributed their company’s performance to there being a strong interest in new-store development, attractive financing options, more corporate-type investors seeing laundry ownership as a career change, better maintenance/remodeling efforts, and plain, old hard work.
The share whose business suffered in 2019 blamed it on lack of product availability, higher product costs, and fewer deals being available in their market.
Slightly more than 61% of distributors polled say their replacement business was up in 2019 compared to 2018. That’s a few points higher than last year’s survey in which roughly 58% of distributors reported better 2018-to-2017 replacement. By comparison, the share was 68% in the 2018 survey, 62% in the 2017 poll and 64% in the 2016 survey.
Roughly 10% of respondents say they saw 2019 replacement business decrease from that of 2018, while 29% say it remained unchanged.
American Coin-Op asked distributors to list the number of new laundries they built and/or to which they supplied equipment in 2019.
In this year’s survey, the share of distributors that built and/or supplied equipment to three or fewer stores accounted slightly more than half of poll respondents: 51.7%. In comparison to previous surveys, that number was 58.6% in 2018, 62.1% in 2017, 48.8% in 2016, 40.5% in 2015, and 69.2% in 2014.
Companies building, or supplying equipment to, four or more new laundries in 2019 accounted for 48.3% of the total. That compares to 41.4% in 2018 and 37.9% in 2017.
The actual number of new laundries that distributors were involved with in some way in 2019 ranged from just a single store to one respondent reporting his or her company dealt with 93 stores.
Following is a rundown of the most popular answers from this year’s survey:
2) 4 and 15 (tie)
4) 1, 3 and 8 (tie)
Nearly 62% of distributors surveyed said their new-construction total for 2019 was higher than the previous year. Comparing to previous surveys, 46.9% said their new-construction total was up for 2018; 23.3% said it was up for 2017; and 33.3% said it was up for 2016.
Approximately 10% of distributors surveyed said their new-construction total was lower in 2019 than in 2018. Earlier surveys showed 22% with lower totals in 2018 than in 2017, 47% with lower totals in 2017 than 2016, 29% with lower totals in 2016 than 2015, and 24% with lower totals in 2015 than 2014.
Roughly 29% of distributors polled said their new-construction total for 2019 remained the same as 2018’s. That compares to 31% of distributors reporting no change in 2018 from 2017, 30% in 2017 from 2016, 38% in 2016 from 2015, and 41% in 2015 from 2014.
In Part 2 on Thursday: equipment mix and store size trends