Benefits of an ‘Errand Path’ Location (Conclusion)

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Howard Scott |

Encourage cross-selling by offering discount coupons for nearby retailers

PEMBROKE, Mass. — Choosing a location for a new Laundromat or to relocate your existing store is a challenge.

The proximity of your competition, site visibility, area demographics and ingress/egress are all important factors to consider, but one area not discussed too often is the opportunity for customers to multi-task.

Wouldn’t it be better if your customer could do a few errands at the same time as she’s doing her laundry in your store? Perhaps she needs to go to the post office. Or look for a gift for an upcoming event. Maybe she needs to buy a sympathy card at the card shop. Or get a check cashed at the money store. Or buy a needed provision at the dollar store. It would be helpful if these stores are right there.

An errand path is having a routine of doing different chores at a single location. She—the customer—calls it multi-tasking.

You might even encourage this errand path flow. If you employ an attendant, he or she might go to individual customers and tell them that if they want to run an errand, he/she—the attendant—will look over the wash. If their load finishes before they return, the attendant will make sure no one takes out the clothes to use the machine.

A sign does the same thing. It might read, ‘If You Want to Run an Errand, Just Tell the Attendant.” If you don’t have an attendant, have magnetic signs available that the customer can put on his/her machine that read, “I Will Be Back Within the Hour.”

A further strategy is to encourage cross-selling by offering discount coupons. Talk to the stores in your immediate area and arrange a discount. Ten percent is adequate, but 20% would really make a difference. Hand these coupons out to customers who say they need to go the XYZ store. If you don’t employ an attendant, the person who cashes out could offer these coupons, when he/she comes every day.

Just imagine how this coupon distribution will ingratiate you to your customers. Not only are they getting their clothes cleaned, but they are getting chores accomplished at a discount. In time, you’ll become the place to go for discounted opportunities. Prospects who use another Laundromat will gravitate to your store just because of the offer. People who ordinarily don’t go to a Laundromat will come in just to see what the fuss is about. They might calculate that doing the laundry at your facility is less expensive than doing it at home, when they can save $5 to $10 on every occasion.

The problem with a location such as the one I’ve described is not parking, not access, but usually the rent will be higher than a low-key, stand-alone store. Of course, cost must be balanced against expense. If a 20% higher rent would generate 10% higher volume, it might be worth it to take the more expensive location.

Consider this example: When rent is $20,000, volume is $200,000. But when rent is $24,000 (20% more), volume increases to $220,000 (10% more). Which operation should make more money? By all means, the operator should turn the additional $20,000 revenue into about $12,000 more profit (after paying the additional $4,000 rent and another $4,000 in utilities).

When deciding on your next store location, consider how appealing an “errand path” location could be. Your customers will become efficient multi-taskers.

Miss Part 1? You can read it HERE.

About the author

Howard Scott

Industry Writer and Drycleaning Consultant

Howard Scott is a former business owner, longtime industry writer and drycleaning consultant. He welcomes questions and comments and can be reached by writing Howard Scott, Dancing Hill, Pembroke, MA 02359; by calling 781-293-9027; or via e-mail at dancinghill@gmail.com.

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