SPRINGFIELD, Mo. — What really makes the laundry business great is the flexibility that comes with it. Owners can decide what amenities to offer based on their clientele and market. The variations of store sizes and machine capacity offerings alone are examples of just how much this business is not one-size-fits-all.
Then there are payment systems — coin, card, dollar coin, app-based payment systems, credit card, loyalty card — talk about flexible. Of course, behind all of that is the pricing of equipment. Owners today understand that if they offer a truly exceptional experience, above what the competition has, they don’t have to compete on price. The success of such an approach bears out in customers’ willingness to pay more for a better overall experience.
This philosophy is a change from the mentality of 10 or 15 years ago. Another transition we are seeing in our market with new and retooled stores is a move toward full-cycle pricing on tumble dryers.
Obviously, this is going to be driven by the market each individual store is in. I like having both stack 30-pounders and stack 45s in a store. Not only do the 30s match the lower-capacity washer-extractors better, but they also give the store a size difference that enables owners to charge more for the larger-pocket stack 45.
A basic pricing strategy might be $1.50 for a stack 30 pocket, $2.50 for the stack 45, and $3.50 for a 75-pound unit. With the efficiency of today’s units, dry time for a cycle could be roughly 27-30 minutes with perhaps a 4-minute top-off for 25 cents. Owners also could opt for set amounts of dryer credits for the different capacities of washers. This is a variant of full-cycle pricing; it just shifts a bit of the pricing structure to the wash side. The strategy is a great alternative to the free-dry angle, which can be a hassle to police. We’ve all heard the stories of folks bringing their wet laundry to the store to take advantage of the free dry.
New store owners or those having gone through a retool and adopting this strategy must focus marketing on the value proposition that appeals to the customer. It is clearly all about selling your store as the one that gets them in and out faster. As part of that, you also give them the chance to multi-task, because no longer are they checking and re-checking if the load is dry. They can reasonably assume that, when paired with the right washer, their load will be done after 30 minutes. This allows them the freedom to run an extra errand; they are not tied down watching and waiting for the dryer.
No doubt that establishing the fast-in-and-out story will benefit in terms of bringing in customers, but the efficiency story should help handle higher turns and lower utility expenses. We can all agree that running a cycle from start to finish is far more efficient than starting and stopping it. But that’s not always the case. Customers who don’t trust drying cycles and are trying to save on their quarters open and close the door several times, right? They may pull out a couple items that are dry to start folding and hit start again. That means the unit has to warm the cylinder again as much of the heat escaped. However, customers who gain confidence in the full-cycle drive generally won’t do that. Less starting and stopping means faster drying and more turns.
Additionally, with full-cycle dry, there’s one cool-down cycle: two minutes of the 27-minute cycle. That’s more efficient than two minutes of a 7-minute cycle per quarter. The result is that full-cycle drying is more efficient and should have a positive impact on utility costs.
For those who have reinvested in their store or are opening a new store, full-cycle pricing for drying is a great value for customers, and one they embrace if marketed correctly. But more than that, owners gain the flexibility to quickly respond to any changes in their cost structure in much smaller percentage increases, especially with loyalty cards and the advent of app-based payment systems that allow increases of just a few cents.
When paired with providing an excellent customer experience, full-cycle pricing for drying cycles can build exceptional customer loyalty and help stores become leaders in their market.
Miss Part 1? You can read it HERE.