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Is it Time to Retool Your Laundromat? (Part 1)

ID’ing opportunities to make over existing stores to capture greater volume, revenue

CHICAGO — Your self-service laundry is looking a little worse for wear and your customer base is thinning out a bit. It might be time to make a change in an attempt to capture (or recapture) market share and boost revenue.

You have a retool in mind, but what precisely is a “retool”? And is such a concept limited to equipment only or can it involve other aspects of your operation?

American Coin-Op invited several representatives from vended laundry equipment manufacturers to answer some questions about the nature of retooling projects and what operators stand to gain by making over their stores.

Q: In laundry terminology, what is meant by a “retool”?

Matt Conn, Senior Marketing & Product Development Manager, Whirlpool Corporation Commercial Laundry: From the perspective of a laundry equipment manufacturer, a retool is the time when a store owner chooses to update old equipment with new. This is also a time when the owner likely makes aesthetic improvements to a store and begins considering system upgrades (payment, accounting software, security systems and more).

Gary Gauthier, National Sales Manager, Vended Laundries, Pellerin Milnor Corp.: When talking to customers, I always use our factory as an example when talking about retooling. We are constantly looking for ways to improve efficiency and become more productive and profitable. A vended laundry is similar to a factory – it features independent workers using machinery in an assembly-line process to get work done. Any steps that can be taken – large or small – to make a vended laundry more productive and profitable should be considered when the time is right.

Kevin Hietpas, Director of Sales, Dexter Laundry: A retool is generally thought of as a pretty substantial updating of a location, and an update that impacts multiple aspects of the business: equipment, décor (walls and flooring) and/or infrastructure (lighting, plumbing, air conditioning, etc.).

Joe Purbaugh, Senior Direct Sales Specialist for Alliance Laundry Systems: Removing old equipment and replacing it with new equipment. This can range from simply replacing washers and dryers only to replacing all ancillary equipment as well. Often, this also includes repainting the store and can also include a new floor and new ceiling tiles. A retool is a partial or complete “upgrade” to your Laundromat.

Tod Sorensen, Sales Manager – Western U.S., Continental Girbau: Out with the old and inefficient and in with the new and efficient. A retool is when new equipment – washers, dryers, water heaters, etc. – are installed in order to boost revenue, efficiency, performance and customer turnover.

Q: When considering a retool, how might the following aspects of an existing store’s laundry equipment impact the decision?

EQUIPMENT AGE AND/OR GENERAL CONDITION

Purbaugh: This usually plays a key role in the decision to retool. Old equipment tends to require much more upkeep and repairs, costing the owner/operator thousands in repair costs and lost revenue due to downtime. With service technicians charging anywhere from $60 to $90 an hour, repair costs can add up quickly. Especially when it comes time to do a bearing job on a washer-extractor, which can cost thousands.

Sorensen: When your washers and dryers are aged-out or ineffective, it’s time to retool and differentiate your laundry from its competition, attract new self-service customers, increase the ability to process new commercial work, or maybe it’s the ability to take advantage of new tax law changes.

Conn: Age and condition could impact an owner’s decision on which machines to repair or replace. An owner may have a wall of stack dryers that still function well but have washers that are showing their age. Maybe one or two washers have been upgraded over time and still have some service life remaining. This could affect an owner’s choice to retool.

EFFICIENCY

Sorensen: New equipment can greatly impact efficiency, especially when you replace top loads with front loads, or upgrade from hard-mount washers to soft-mount washers. Soft-mount washers are high-speed, freestanding machines capable of reaching extract speeds of 400-plus G-force. This matters because high-speed, soft-mount machines remove significantly more moisture from every laundry load. By removing more moisture, loads dry faster, which not only cuts overall laundry processing time, it reduces natural gas consumption and dryer wear-and -tear. … Another way to cut utility costs is by removing water-guzzling top-load washers in favor of water-efficient front-load machines.

Conn: This is the time to consider higher-G-force machines and how an owner might reposition the value proposition of her/his Laundromat. Investing in machines that extract more water will save customers time in the dryer. The concern here is always losing valuable vended dry minutes. The owner may want to consider the tradeoff of time savings versus the incremental revenue and the possibility of a reimagined store layout.

Purbaugh: This is another key component in the retool decision-making process. Older, mechanical timer machines use roughly 40% more in utilities than the new, efficient, inverter-driven machines. Inverter-driven motors tend to ramp up more smoothly, eliminating the amperage spikes that consume more electricity. More importantly, washer-extractors are also using much less water than their inefficient predecessors due to government restrictions on water consumption and Modified Energy Factors (MEF).

LAYOUT

Conn: Decisions on the store layout will vary based on how dramatic the retool will be. Creating a welcoming environment for customers is important. Now might be the time to open or close a bathroom for customers (our research shows that there is a strong preference for available bathroom facilities among Laundromat consumers), add a family area for parents to entertain kids, and reevaluate ancillary vended equipment (video games, soda/snack machines, laundry accessory vending machines and more).

Purbaugh: Laundromat layout is important, and it is recommended that a store display the larger-capacity, higher-revenue-generating machines in the front of the store. This acts as a sort of front-line advertising as potential customers drive by. Large-capacity washers are expensive, which is why many investors shy away from them. If you display your 60-, 80- or 100-pound capacity washer-extractors in the front window of your store, they will be noticed and used.

Sorensen: When you retool, you can change your machine placement and layout for improved efficiency, customer flow and revenue – especially when you’re installing soft-mounts, which don’t require bolt-down.

Check back Tuesday for Part 2, including whether retooling would make financial sense