RIPON, Wis. — Providing a clean, safe store with reliable, working machines in the right location is the foundation of a successful coin laundry business.
Unfortunately, these basics aren’t always enough to differentiate your store from competitors who offer the same.
“The only way to be successful is to do what other stores aren’t doing,” says Oliver Lay, owner of Connecticut-based Wash Works. “All Laundromats offer washers and dryers, so you have to provide services that get customers to travel across town to go to your store.”
This is where ancillary services, or extra-profit centers, can play a key role in getting customers in the door, while providing additional sources of revenue.
With numerous options, it’s important to carefully choose what services will work in your store, while also keeping in mind that trial and error may be necessary.
If you’re in the position to add services, consider the following extra-profit centers—those that are Laundromat mainstays, those that are up-and-coming, as well as a few that may be losing their effectiveness.
ON THE DECLINE
While some extra-profit centers (as described in Part 1 of this story) increase in popularity, one service that continues to become less popular in the coin laundry industry is video/arcade games.
With the prevalence of smartphones, this should come as no surprise, according to Lay. However, he says modern technology isn’t the only factor that should steer store owners away from offering gaming.
“Video and arcade games ultimately don’t have a huge impact on the bottom line or lead to foot traffic,” he says. “I think it’s better to direct time and resources towards a service that will make a difference—usually services that require more hands-on management.”
Adrian Najera Jr., owner of Mi Lavanderia (My Laundromat) in Illinois, agrees. He equipped his store with numerous video games when it opened, but admits they are seldom used now.
Another service declining in recent years in the Northeast is drycleaning services, according to Peter Limoncelli, chief operating officer of Yankee Equipment, a Speed Queen® distributor based in Barrington, N.H.
“I believe it’s because society is moving towards a more casual, wash-and-wear culture,” he says. “Over the last 15 years, people are trading suits for khakis, which don’t require as special of care. Wash-dry-fold can take the place of dry cleaning in some cases.”
However, with the right demographics, dry cleaning can have a huge payoff—“almost a 100% profit margin,” estimates Chris Balestracci, president of Super Wash Laundry, based in East Haven, Conn.
The bottom line is to do your research on what’s working at stores with similar demographics.
Lay adds, “It doesn’t take a lot to go above and beyond the competition. It just might take a little innovation and creativity.”
UP-AND-COMING
Innovative and creative. One might use these words to describe the numerous laundry drop-off and pickup mobile applications that have emerged in recent years.
While some may see these laundry service providers as negative because they decrease foot traffic, these companies can actually benefit a store owner by increasing overall machine utilization.
Essentially, a mobile app such as Laundry Locker, FlyCleaners or Washio will pick up a customer’s laundry at a designated time from a designated place.
These companies then partner with local Laundromats to wash, dry and fold, and then return clean laundry to the customer at a specified time.
“I believe these apps lend the greatest opportunities for growth when it comes to extra-profit centers, especially as the services expand to include more metro areas.” says Balestracci. “There are many options, but a clear leader hasn’t emerged yet—time will tell.”
“By partnering with one of these services, a Laundromat owner can negotiate a portion of the profit,” explains Limoncelli. “Furthermore, it expands a store’s marketable area by serving customers that would otherwise frequent a closer Laundromat.”
While mobile apps appear to be a source of opportunity, Balestracci cautions store owners to start with the basics before hopping on the bandwagon, and before implementing any extra-profit center, for that matter.
“It’s surprising how many Laundromats still don’t even have a website. With consumers turning to search engines to find their local Laundromat, it’s an obvious tool to have, and one that can lead to foot traffic and profits,” says Balestracci.
“At the end of the day, success can be traced back to the basics.”
Missed Part 1 of this story? You can read it now HERE.
Have a question or comment? E-mail our editor Bruce Beggs at [email protected].