PEMBROKE, Mass. — Data shows that 35% of Laundromat operators own multiple stores. The remaining majority own single operations that provide the bulk of their income. Let me suggest that you make it a goal to own three or more stores. Here’s why.
Everyone needs a goal, and owning a chain of Laundromats is a worthy career achievement and a realizable challenge. A chain turns a ma-and-pa operation into a substantial business. With a three- or four-store chain, you might do a million dollars in volume. Most importantly, it makes you more of a manager and less of a worker. If you own one store and depend on it for your livelihood, more than likely you are an active participant. You fix machines. You work as an attendant. You process the wash/dry/fold and make deliveries. You carve out your own income, and that’s fine.
With a three-store business, you have to depend on employees, which makes you more of a businessperson and less of a staffer. You oversee the enterprise rather than run one store. You have to develop a larger vision. Profit, turns, costs, capital investment and ROI will become more than just terms. They will become the concepts that you employ to run your business.
You will have to become a savvy marketer and understand your customers and the different markets in which you operate. Since you are no longer a worker, you’ll be freer in many ways. That is, you don’t have to be there to cover a shift every day. Sure, you fill in when someone’s sick, but that’s not the same thing. As soon as you learn to handle the stress and the people management aspect of the business, a manager’s job is easier in many ways. However, your mind will be taxed more. Such a shift bodes well for a long career in the industry.
Other benefits come from owning a three-store chain. You are able to buy supplies at bottom-line pricing. Each box of soap will earn you 50 cents each rather than 40. Depending on your area, your utility rates might even be bulk-rated and cost you less on a poundage basis. Because you give the mechanic who fixes your machines so much business, you receive a lower per-job rate. If you decide to upgrade, three stores are cheaper than one since you can negotiate for a better price for 12 machines than for three.
You can save on operating costs. The truck that delivers for one store will cost more than the one truck that delivers for three stores, simply because the driver can economize on routes, and vehicle costs can be apportioned out over more deliveries.
Bulk advertising rates can be found. If you do Valpak marketing, the more mailings you send out, the cheaper the per-unit offering will be. If you operate in one market, ad rates can be ganged for better pricing. If you offer dry cleaning, you can bargain down your wholesale price from 60% to 50%. Vending machine suppliers will be more cooperative, because three times the machines will be utilized.
Then there is flexibility. Washers and dryers can be moved around to respond to changing requirements. Staff can be switched to better handle traffic or to cover for absent staffers. Even customers could be better serviced. If a customer wants to do extremely large loads, then you could send them to the store with the largest load capacity. If one store has a fire, a flood or is out of commission for a while, you’re not out of business. You can simply reroute your business to the other two stores. Or even better, you can collect the work, take it to the other stores, do the work, and return it as wash/dry/fold work.
BENEFITS OF STAFF
If you don’t currently have attended stores, perhaps creating a chain will prompt you to man your stores. Certainly, you can hire a staffer and get him/her to do the wash/dry/fold business. Plus, now you can offer other services, such as dry cleaning and shoe repair on an outsource basis. The additional volume should, in time, cover the staffer’s salary. At that point, you are ahead of the game. You have an on-premises staffer to help customers, fix machines, and add a layer of safety. All these aspects can’t help but add to your operation. And the cost of this multi-benefit package is more or less covered by the additional trade.
Best of all, you’ll become a more astute practitioner. One store will teach you things you can apply to the others. You can compare figures and examine why one store has lower costs, then use that knowledge to help the other stores. You will really understand bottom-line managing. Your take-home pay will no longer be a function of your contribution. Now, it will be a function of your managerial skill, which, in turn, is based on bottom-line profit.
My point is not to nag. You’re doing a great job running your shop. You’re paying the bills and making a living. Good for you. Why not stretch yourself and open up a second shop? After you get that going, open a third. Who knows, maybe you’ll want a fourth outlet? Because, then, you’ll be not just a “Laundromateur,” you’ll be an entrepreneur.
Who knows, such success might prod you to get into other ventures. I know someone who owned a store. After four years of running his place, he started to expand. In a short while, he owned five stores. Then he set about to buy the property at each location. When he retired, he owned seven stores and four properties and was a wealthy man. To this day, he attributes his success to opening a second store. That was his biggest hurdle, but once he made the jump, it was easy to continue to expand.
This could be you.