The Right Mix (Part II)

Paul Partyka |

CHICAGO — If you read part one of this story, you realize that putting together the ideal equipment mix can be somewhat of a challenge. Two more distributors weigh in on the subject. One of the subjects they address is the need to re-evaluate one’s equipment. How often should you do this? Does it matter if you intend to be in the business for a long time?THE RIGHT EQUIPMENT FOR THE RIGHT CROWD“Demographics are what we typically look at; the type of people in the area determines the sizes of the machines,” explains Mike Hurrell, Garden State Laundry Systems, Gardena, Calif. “For example, in high Hispanic areas you need larger-capacity front loaders; in college areas, the smaller front loaders are needed.”Hurrell says he will look at what the competition is doing, but doesn’t necessarily base what he will do on their judgement. “When we check out the competition, it might tell us what we want to do differently. The competition might [lack a certain type of machine]; this would allow the new owner to offer a different mix.”When putting together an equipment mix for a new store, he specifically checks to see if the nearby laundries have enough dryers and what size washers are being used. Hurrell likes to maintain a simple washer/dryer ratio: for every 100 pounds of washer capacity, there should be 100-110 pounds of drying capacity.Hurrell is aware of the latest equipment trends, although he’s not quite sure why operators still desire top loaders. When asked if top loaders were making a comeback in his area, he replied, “What top loaders?” He says the stores he is building are still getting a few token top loaders. “It still blows my mind [that operators want top loaders]. I guess it’s important for some of them to say that they still have a 75-cent wash.”In his area, larger washers mean 55- to 75-pound units, and larger dryers mean 45- and 50-pound stacks, as well as 50-pound, single-pocket units. “More owners are going with the larger equipment. Whenever I sell larger washers, it’s automatic for the owners to go with more drying capacity.”Hurrell believes that poor equipment placement can offset a good equipment mix. “You want to put the machines that you really want people to use in a spot that they can get to easily. You don’t want your larger machines in the back. By the same token, you don’t want the largest machines up front because people will come in and plop all their stuff in the doorway and then no one can get in the store.“You want to get people in and out of the store easily, and have them use the machines you want them to use. There’s really no firm layout to do this. It all depends on the store. Some companies have a ‘boilerplate’ layout and all their stores look the same. We want big machines visible, but not by the doors. If you put the big machines up front, maybe you should set them off to the side a bit so the aisle way is open.”Re-evaluating one’s equipment mix can be a challenge. “It doesn’t happen that frequently. The machines last longer, and the front loaders are more expensive than the top loaders. People may re-evaluate every five years, if that. If their revenue drops, we’ll come to the area to see what’s changed, what’s getting the most play.”Owners may find that the 40- and 50-pound machines are doing better than the 20- and 30-pound machines. “We’ll go into a store with a lot of top loaders and tell the operators that they need to do something different.”If you want to know what customers think about your equipment, a survey might be good, he adds. “The owner should be doing something like this in the first place. Let the customers help out.”Hurrell’s best piece of advice: “Put the equipment in that fits your area. This gets back to whether you are in a college area or a family area.”LONG-TERM OPERATORS NEED TO MAKE ANNUAL CHANGES“There is no such thing as a cookie-cutter store in terms of equipment mix,” says Tony Byrne, Western Equipment Co., Albuquerque, N.M. “The demographics are very important to this process, even if it’s in a small town. The type of clientele will dictate the mix, such as whether you serve large families vs. seniors in mobile home parks, etc.”The competition will have an effect on your equipment mix, he believes. “It depends on what the competition is offering or how directly they compete with you. I would want to offer something the competition doesn’t have, some of the same but some different in order to get people to jump to you. People will jump to a new store for other reasons [than equipment mix], but some won’t move if the store they use is properly run.”One of the “other reasons” mentioned above is comfort. “I own 13 stores. I have noticed that the Hispanic market really likes to feel comfortable in the store. They don’t always need the newest equipment; they like a store that is comfortable, clean and attended.”The current trends are bigger washers, energy-efficient, high-extract, high-spin machines, he says. “What’s popular also is the stacked 45- and 50-pound dryers. They will make a significant difference in the business.“Top loaders are still being used in my area. I build a lot of stores and what I see is a decline in the double-load (18- and 25-pound) washers. The customers are bypassing these. From a cost-effective point of view, the smaller front loaders are not as cost effective.”Byrne’s washer/dryer ratio is simple: one to one or even more. He believes the 45-pound stack dryers will really help. It can be hard, he adds, to convince new investors about the need for enough drying capacity because of the cost factor. “The old formula of two top loaders to a single dryer went out the window long ago.”He doesn’t believe that equipment placement will negate the value of a good mix, but he says you will get more usage and profit if you have your big machines near the front door.Overcrowding a store can be an issue in some areas. “I have seen stores overcrowded, but it depends on the markets and the rent. You don’t see overcrowding in my area, but in Las Vegas, Phoenix and San Diego you might see it because of the high cost of real estate.” With higher rent costs, the importance of stack dryers and larger washers grows because they can generate more revenue per square foot, he explains.Byrne says most operators don’t examine their equipment mix. “I believe if you are looking long-term in the business, you should almost always replace some equipment annually. Watch for the equipment trends.”Costs are affecting the business. People aren’t keeping the equipment updated. “I see this with some of the mom-and-pop operations. They live off the store income and don’t replace anything until it’s too late. Now they must close the store or spend a ton of money re-equipping. It’s a recipe for disaster. Ninety percent of them will sell out or go out of business. It’s just a matter of when.”Byrne offers this final bit of advice: “When you’re building a new store, have several mixes of equipment; a minimum number of top loaders or small front loaders, then jump to about 40-pound machines, then 60- to 80-pound washers. You obviously want stack dryers, and the bigger ones at that. Look for high-speed machines with high extracts.”To read Part I of this article, click here

About the author

Paul Partyka

American Coin-Op

Paul Partyka was editor of American Coin-Op from 1997 through May 2011.


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