Compensation for Laundry Employees (Part 2)

CHICAGO — A day doesn’t go by that today’s laundromat owners aren’t competing with other small-business owners to hire capable, dependable workers.

With unemployment rates reaching record lows in various locations during the last few years, the competition for workers has intensified. Even as laundry businesses offer competitive wages that are frequently well above their local minimum wage, they can find it increasingly challenging to attract and retain good employees.

Job seekers may be “all about the money” but the average small business can devote only so much budget to labor. It can take some creative thinking by the laundry owner to come up with ways to incentivize attendants and managers beyond their wages.

ARE HIGHER WAGES OF CONCERN? (CONTINUED)

Have higher wages offered by other small businesses presented a real challenge to your laundry operation?

“Yes and no,” says Dave Menz, who operates the Queen City Laundry chain of four full-service laundry centers in and around Cincinnati. “Of course the higher wages have caused us to raise wages to remain competitive but we were already at the top of the respective labor pools, so we’re in a better place than most. We’ve found the key to being competitive in this market is having the margins to raise wages as needed. If we cannot justify top-of-the-market prices for our services, then we are dying a slow death.”

“Staying ahead of the lowest wage is important to me,” says Travis Unema of Washington state’s Brio Laundry. “Higher wages draw in better workers. As expenses rise, make sure you pay your team appropriately. Their expenses are rising as well, so being able to increase their wage in different ways can help.”

“We have to pay competitively to stay at market rate and we do,” says Kristyn Van Ostern of New Hampshire’s Wash Street. “We also have to raise prices as our labor costs increase.”

Higher wages for similar jobs have been an obstacle to hiring at four South Dakota laundromats, according to co-owner James (Clark) Sowers, “but we mean what we say in our wage offer and (that) doesn’t appear to be true with those advertising on billboards, etc. And we try to offer definite hours per week. That matters to many.”

James Radovic says he hasn’t found reported higher wages to be challenging in staffing his two Florida stores: “We have offered the highest starting wages, provide annual evaluations, and offer increases to those who are the best.”

STAFFING TACTICS

So what kinds of tactics can a laundry owner use to make their openings attractive to job seekers and to strive to hire the best people available?

Compared to large corporations, a small business can provide a more personal connection to their staff, says Sharon Sager, who owns the Sierra Madre (Calif.) Laundry.

“I like making my staff feel appreciated and recognized for their efforts. I have found that this type of feedback from my management and me can be motivating to our team members and develops loyalty.”

As far as incentives, she offers a SIMPLE IRA retirement plan to which the employee can contribute and her business matches up to a certain percentage. Staff can earn tips for “Drop and Go” service and for fluff and fold orders, and Sierra Madre Laundry offers more flexible hours than other companies, she says.

Beverly Kay Blank, former laundromat owner turned fluff-and-fold consultant, says there are a few ways to compensate employees beyond their base pay. Allow them to do their family’s laundry each week without charge. Offer a monthly bonus incentive if a pre-set drop-off service goal is met. Award a gift card for every new fluff and fold customer an attendant signs up. And throw a regular (quarterly or semiannually?) staff recognition dinner party.

“We are much more clear up front in the interview and training process about what we expect from employees,” says Van Ostern. “We also let employees go more quickly if it’s clear they won’t be reliable and efficient. Finally, we incentivize our employees with increased pay for more efficiency.”

Check back Tuesday for the conclusion