CHICAGO — How do you know your store is performing up to expectations? Are you missing opportunities for service expansion? What about the potential for expanding your business to include a second store?
In order to make these types of determinations, you need two things: performance goals and performance data. Benchmarks can help a store owner decide if his/her operation is running well or if it might be time to make some changes.
This month, American Coin-Op polled representatives from several laundry equipment manufacturers and payment systems makers, all of which offer data collection and/or management tools, to review how store owners can crunch the numbers, then act on what they find.
HOW LONG TO COLLECT DATA?
When it comes to how long a store owner should collect data in order to generate that first meaningful benchmarking report, followed by subsequent analyses, there is some difference in opinion amongst the contributors.
“In opening up a new Laundromat, you want to monitor growth closely for the 12-18 months,” says Michael Schantz, president of payment systems provider Setomatic Systems.
“One week. This would provide a store owner with an understanding of the peak times (Saturday and Sunday) and the slower times (usually a Tuesday or Wednesday),” offers Chris Brick, NE regional business development manager for Laundrylux, North American supplier of Electrolux and Wascomat laundry equipment. “As you continue to gather benchmarking data, a store owner should continue to focus on the peak times (Saturday and Sunday) but focus more on a monthly basis to incorporate more of an understanding of how seasonal weather and holidays affect business on a larger scale.”
“That depends on what aspect of the business they are benchmarking,” believes Tom Weisheipl, a regional sales manager for laundry equipment maker Speed Queen. “It is important to have daily, weekly and monthly reports. The comparison should be made year over year, but there are little things that can be compared when you tweak pricing or something else in a monthly comparison report.”
“Depends. If the store is brand-new, it could take up to a year to get valuable benchmarking data,” says Steve Marcionetti, president of payment systems provider Card Concepts Inc. (CCI). “If the store is an established location, a few months of tracked data should provide good benchmarking info.”
“It really depends on your market and how seasonal or competitive it is, but I would say a minimum of 12 months is required before you have enough information to adequately start benchmarking,” says Amanda Konczal, director of marketing and customer support for laundry equipment manufacturer Dexter Laundry. “During this time, you definitely don’t want to ignore obvious changes in your business though. Listen to your customers, watch your competition, and trust your instincts. You don’t always need a year’s worth of data to determine if you are on the right track.”
“The length of time to collect data to set the first benchmarks would depend on whether this is a new or existing, operating store,” says Wayne Lewis, sales manager for payment systems provider ESD. “In either case, initial data should be collected and documented immediately. Weekly and monthly information should be obtained to continually provide new data and baselines to document continued growth or decline.”
“The typical customer does laundry once per week,” says Oleg Stepanov, representing payment systems provider Mitech Integrated Systems (Laundroworks). “At a minimum, I would look at a time window of four weeks. If you're making changes in the store and want to track their effects, you certainly need more than four weeks so that you can see the data before and after the change.”
“In general, longer is better,” says Dave Richards, vice president of payment systems provider CryptoPay. “Statistical significance is increased by controlling/eliminating variables that could affect the data. Example: Collecting number of turns in a day and forgetting there was a power outage from 9 a.m. until noon would provide a fairly distorted picture. On the other hand, if I’m looking at the number of turns per day over the last 12 months, the power outage has little effect.”
Kathryn Rowen, North American sales manager for laundry equipment maker Huebsch, says each time period contributes meaningful data to laundry operations.
“At a minimum, a week’s worth of data can help an owner identify high- and low-usage days,” she says. “A month of data will give a snapshot of if there are differences in usage between the beginning, middle and end of the month (perhaps there’s a predominant employer that issues paychecks at a certain time of the month). A year of data will paint the picture of any seasonality trends. There’s value to all such benchmarking reports. However, it is incumbent upon the owner to put the data into action and use it to drive marketing activities. Absent action, data is just data.”
USE DATA TO TAKE ACTION
Once the benchmarking data has been collected, how should a vended laundry owner put it to use?
“Analyze the data and identify opportunities for improvement,” advises Joel Jorgensen, vice president of sales and customer services for laundry equipment manufacturer Continental Girbau. “Compare yearly data to the Coin Laundry Association’s (CLA) Coin Laundry Industry Survey to see how your store performs against the national or regional average. … Then analyze internal sales and operations data and clearly identify methods for improving performance.”
“You need to drive your marketing program based upon the data collect,” says Setomatic’s Schantz. “Between social media and different loyalty programs … you can focus your efforts to help drive future growth.”
“Anytime you add equipment, change pricing, or make another major change to your business, you should reference track performance versus your benchmark,” suggests Dexter’s Konczal. “It is also a good habit to do a regular business check-up to make sure you aren’t missing anything that could make your business even better. Add it to your regular preventative maintenance schedule and get into a routine of looking at your revenue, turns per day, utilities, and competitive pricing. It will only make you a better, more informed, owner.”
“Store owners should use all data to provide information as to whether specific marketing campaigns are advantageous or not supplying sufficient new growth to justify their continued implementation,” says ESD’s Lewis. “Decisions on marketing platforms must be continually reviewed and evaluated.”
In our conclusion on Tuesday: More tips for putting data to use, and common benchmarking mistakes to avoid
If you missed Part 1, you can read it HERE.