CHICAGO — The self-service laundry industry, like other industries, continues to evolve, especially during challenging economic times. Owners must adapt to stay profitable. How can you improve your store? How can distributors and manufacturers contribute?Several of the major manufacturers share their views on how each segment of the industry can contribute to its overall success.NEW CHALLENGES EMERGINGMarketing is the key to improving the industry, says Neal Milch, CEO, Laundrylux (Wascomat/Electrolux). “No business, including a laundry, runs itself,” says Milch. “While many operators offer wash, dry and fold service, how many truly optimize their revenue opportunity by soliciting laundry-processing business from neighborhood customers? Restaurants that offer tablecloth dining, doctors’ offices, smaller hotels/motels, and other businesses that utilize washable items are ideal to solicit. Why allow all potential revenue to be lost to commercial laundries and linen rental services?”Know your cost structure, Milch advises. “What does it cost you in utilities, labor, rent, equipment financing, etc. to actually process a pound of laundry? How does your pricing compare to the cost? This information will assist you in making informed pricing decisions in the context of local competition.”Milch believes customers will want to interact with Laundromats as they do with other businesses — using mobile technologies. “Customers will want to pay electronically, find highly rated stores easily, and know that equipment is available before they arrive.”Laundrylux can improve the industry by continuing to develop cutting-edge technologies that augment its equipment, consistent with its belief that consumers will want to interact with stores in more robust ways than in the past, he says.“If we help satisfy customers consistently, we improve the industry.”Certain distributors are also going to play an important role in the future, he notes. “The distributors that provide value-added training, knowledge and competencies to their customers are key to the future of distribution. Equipment sales are important, but every sophisticated industry recognizes that distribution channels need to provide ongoing knowledge, training and support so customers get the greatest benefit from equipment and maximize revenues.”Milch warns operators that “easy-money” financing is gone, but sees an upside to this. “[This discourages] building stores that, in truth, should not be built because demographics are weak or the store operator is overleveraged.“The economic downturn has made some desirable real estate more available, which is a benefit. Perhaps the biggest downside is not a credit crunch per se, but rather the decline in construction that has caused a loss of customer base in markets that depended heavily on home construction. Uncertainty as to immigration reform also impacts customer traffic in many areas.”Milch offers this bit of advice: “When considering equipment purchases, operators should do the same due diligence they would in making any important purchase.” He believes that price is important, but operators need to consider their cost of ownership (how up-front price compares to ongoing operating costs for utilities, service, etc.).The greatest challenge is rising costs, which are tied to impact fees, regulation, and other government mandates that discourage business formation and risk-taking, he says.Click here to read Part 2 of this story.Click here to read Part 1 of this story.
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