Payment Trends: What are the Options? (Part 2)

CHICAGO — Using coins as a payment method to operate a self-service laundry’s washer or dryer has long been the tradition. But driven by advances in technology and changing consumer sentiment, it’s becoming more commonplace for laundromat customers to have the option to instead use their debit or credit card, a store card, or a smartphone app to pay for a wash cycle.

Coin remains the dominant payment type among self-service laundries based on industry data, but for how long?

For this story, American Coin-Op interviewed representatives from nine companies that offer payment systems and related products. As we continue here in Part 2, let’s hear what they have to say about today’s payment trends and where they see things going as technology and customer preference evolve.

ASSORTMENT OF BENEFITS

According to the reps, implementing either a hybrid coin/cashless payment system or a fully cashless system can offer an assortment of benefits to both the customer and the store owner.

For the customer, there is flexibility in payment options and no longer having to worry about not carrying cash. They can take advantage of marketing features not available in coin stores, earn rewards for store loyalty, and maybe even save some money thanks to special time-of-day pricing or store promotions. Automated text and/or email notifications when cycles end become possible.

Store owners can offer the best of both payment worlds while streamlining their operations. Flexible pricing can generate greater revenue because convenient payment may have customers thinking less about how much they’re spending. If a system eliminates coins entirely, there will be savings in the labor and time previously needed to physically collect them. Computerized systems can easily gather important customer information and collect data to help guide owners in their management decisions. And if a store utilizes a loyalty card, the owner can enjoy the “float,” the funds that customers have loaded onto their cards but not yet used.

A BIT OF A BOOSTER

When the COVID-19 pandemic began in 2020, consumer interest in payment acceptance beyond coins was already growing. As consumers scrambled for ways to avoid physical contact, cashless payment gained momentum.

“The COVID-19 pandemic has undoubtedly accelerated the shift towards cashless payments,” believes Michael Kitchen, chief revenue officer of PayRange, which markets a mobile payment system designed for vended laundries. “As people sought to minimize physical contact and maintain social distancing, the convenience and safety of cashless payment systems became even more apparent. It is a trend we see continuing post-pandemic, as users have now become accustomed to the convenience of digital transactions. And lest we forget, there have been frequent and ongoing coin shortages as well.”

“The pandemic has led to an incredibly significant increase in credit/debit card usage, specifically contactless credit/debit cards,” says John Kelly, vice president of sales for Setomatic Systems, which offers a system that accepts all forms of payment. “Customers want to minimize the amount of physical contact they make.”

“With physical branches limiting operations or closing temporarily during the pandemic, there has been an increased reliance on online and mobile banking services,” says Jim Garrity, CEO of The Laundry Boss, which offers a cloud-based integrated payment, control and POS system. “Consumers have turned to these platforms for managing their finances, making payments, and conducting transactions remotely.”

“I believe that the pandemic changed the way that many approached the everyday tasks that were previously accomplished without much thought,” says Wayne Lewis, CEO of ESD Inc., whose product range spans mechanical products for coin acceptance to smart card, magnetic stripe and store-branded loyalty card systems. “The cleanliness of a store, minimization of exposure to contaminants, and changing social habits have affected where, when and how people now do their laundry.

“The increase in (wash-dry-fold) services, along with the expansion of pickup and delivery services, are the results and benefactors of these circumstances.”

“Don’t forget the change shortage that also occurred during this period,” says John DiStefano, vice president of sales for Paystri, which specializes in payment processing and integrated payment solutions. “While we were short of change, hiring personnel was also difficult at both the laundromat and the equipment manufacturer level. The manufacturer shortages in personnel and microchips resulted in delays in production.”

“For laundromat owners, adapting to these (payment) trends is crucial to meet customer expectations and maintain a competitive edge,” says Steve Marcionetti, president of Card Concepts Inc. (CCI), which offers various products that include payment acceptance by credit/debit card, loyalty card, and mobile. “It’s also worth noting that while these trends were accelerated by the pandemic, they are part of a broader, long-term shift toward digital payments that is likely to continue in the future.”

“The rate of conversion from cash to cashless payments, especially contactless payments, skyrocketed during the pandemic – and it isn’t going back,” asserts Stacey Cooper, general manager – Retail, for KioSoft, whose varied product line supports mobile, laundry/loyalty card, and credit/debit card payment acceptance.

WEIGHING PAYMENT SYSTEM OPTIONS

When a vended laundry owner whose operation has strictly been based on coin payment is considering a system that incorporates cashless options, there are some questions he/she may want to get answered before committing to buy. The reps suggested many, including the following:

Will the new system be compatible with my existing laundry machines?
Is the system easy to install and use?
What type of investment will be required for a good list of features?
Is the hardware or system PCI-compliant?
Does the system provider work with a proprietary merchant processor or is it an open platform?
What other services does the proposed seller provide beyond payment systems, if any?
Who decides when a customer gets a refund? Can I issue the refund directly or must I call a customer service line to get someone to process it?
Are there recurring fees that I’ll need to pay?
Can the credit card processing fee be passed on to the laundry customer?
How will this system make my store more profitable?

Oleg Stepanov, representing payment systems provider Mitech Integrated Systems Inc. (Laundroworks), suggests that the prospective buyer seek out other operators (or distributors) who are experienced with the system in question and ask how their store customers like it, if there have been any major issues, and if it has improved their operation and lifestyle.

Check back Thursday for the conclusion!

Miss Part 1? You can read it HERE