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Distributors Remain Optimistic (Part 2 of 2)

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(Photo: ©iStockphoto.com/porcorex)

Bruce Beggs |

CHICAGO — Upon studying the results of this year’s American Coin-Op distributor survey, there are reasons to be optimistic about the state of the self-service laundry industry.

Nearly half of respondents said business was better in 2010 than it was in 2009. Better yet, nearly two-thirds of respondents predict that 2011 business will be better than 2010.

Every distributor listed in the American Coin-Op Distributors Directory prior to June 1 was invited to participate in the unscientific survey.

DOES SIZE MATTER?

So, is a smaller store the way to go, or is having a larger store the growing trend?

Here are the most popular store sizes, in square feet, for those that were built in 2010:

  1. 3,000
  2. 2,500
  3. 2,000
  4. 2,800
  5. 3,500

Twenty-two percent of the newly constructed stores are 2,000 square feet or less. Fifty-two percent are between 2,000 and 3,000 square feet.

The largest laundry mentioned in the survey results is 7,300 square feet, and the smallest store is 700 square feet.

The average newly constructed store in 2010 covers 2,663 square feet. Averages from other recent surveys were 2,712 square feet (2009), 2,743 square feet (2008) and 3,200 square feet (2007).

LOOKING BACK

If you built a store in 2010, how does it match up with the numbers from this survey? Here’s a quick equipment snapshot of newly constructed stores to give you some perspective.

Newly constructed stores in 2010 feature 3.8 top loaders, 26.9 front loaders and 32.1 dryer pockets. The stores are, on average, 2,663 square feet.

Here are the new-store profiles for the previous three surveys:

2009: 5.7 top loaders, 27.3 front loaders, 32.6 dryer pockets, and 2,712 square feet.

2008: 5.8 top loaders, 27.8 front loaders, 32 dryer pockets, and 2,743 square feet.

2007: 6.7 top loaders, 27.7 front loaders, 35.2 dryer pockets, and 3,220 square feet.

STORE-BUILDING SUCCESS

In 2010, the top two reasons for store-building success were the availability of better locations (either more sites were available or the costs to rent or purchase were lower) and less competition.

For those whose new-store construction lagged last year, the difficulty of obtaining financing was the primary culprit. The slow economy and impact fees also were frequently mentioned. Other reasons were high rents, too much competition and stringent government regulations.

DISTRIBUTOR ACTIVITIES

Twenty-five percent of the distributors that responded broker self-service laundries (compared to 36% in last year’s survey). Thirty-one percent of respondents (compared to 36% in the 2010 survey) operate some type of route laundry.

Are open houses or service schools a distributor offering that you find valuable? Forty-eight percent of respondents plan to host some type of open house or service school in 2012.

As usual, most of the events will take place in the spring and fall. Seventy-one percent take place in the fall, while the remainder is scheduled for the spring. (You can check on upcoming distributor events 24/7 by clicking the Calendar tab above.)

ON THE HORIZON

So, are distributors optimistic or pessimistic about 2011 overall sales projections?

Sixty-four percent expect 2011 sales to surpass those of 2010. Thirty-six percent expect overall sales this year to be the same as last year. No one who responded to our distributor survey believes that 2011 business will be worse than 2010.

Click here for Part 1.

About the author

Bruce Beggs

American Trade Magazines LLC

Editorial Director, American Trade Magazines LLC

Bruce Beggs is editorial director of American Trade Magazines LLC, including American Coin-Op, American Drycleaner and American Laundry News. He was the editor of American Laundry News from November 1999 to May 2011. Beggs has worked as a newspaper reporter/editor and magazine editor since graduating from Kansas State University in 1986 with a bachelor’s degree in journalism and mass communications. He and his wife, Sandy, have two children.

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