PASADENA, Texas — The vast majority of the vended laundry business is comprised of single-store owners. We’ve always been viewed somewhat as a mom-and-pop industry. However, many of us in distribution ask the same question: For how long? We continue to see current owners adding second and third locations to their business.
We are also seeing a change in the new investors coming to our industry. The retirees who came to us with a plan to open a store and run it to supplement their income are more frequently being replaced by well-capitalized new investors who are planning three to five stores out of the gate. With all this activity ramping up, particularly, as our industry reinforced its recession resistance as an essential business during the COVID-19 crisis, how should investors approach scaling?
In Part 1, I addressed the basics and technology. Let’s wrap up today by looking at structure and teamwork.
STRUCTURE
Investors planning to scale quickly but not leverage the franchise model must still pattern their operation after it. That means codifying standard operating procedures (SOP), branding, operations, etc. The reason the franchise model works is that a customer knows the Big Mac they get in San Antonio will be the same as in Houston. You want your customers to have that same confidence.
Stores should maintain the same look and feel. Maintain the same branding, and don’t forget that you are creating an experience. Years ago, it was about leveraging every square foot for profit. Today’s laundries are successful because they are a bit airier. Each location should be consistent in representing the quality of the laundry. That consistency should touch services as well. If the store at XYZ Street offers wash-dry-fold and is fully attended, all stores should. Customers love consistency, and all elements of the laundry will contribute toward building a strong brand.
A STRONG TEAM
One of the long list of upfront questions we ask of an investor looking to scale the business fast is how they plan to manage.
While technology opens up the ability to scale larger operations, oversight is a must — trust, but verify. Investors should plan to hire a regional manager to help manage the day-to-day operations. Depending on the proximity of the stores, a regional manager could manage five to 10 stores.
Similarly, a service manager will be key to maintaining the operation. This person will be responsible for everything from changing light bulbs to preventative maintenance on equipment, as well as lighter maintenance tasks. This is again where a strong distributor will be key in providing service training and other educational opportunities. A good-quality distribution partner will be committed to sharing their knowledge to ensure a solid team is in place. There are service tasks that make sense to call a highly experienced technician, while many others can be accomplished in-house with a bit of distributor/company training.
Scaling and providing the same experience at every location is also about ensuring staff is well-briefed on standard operating procedures. Delivering an elevated customer experience requires all staff being on the same page and understanding what is expected of them. That means not just codifying the SOP but having a structured training plan for new employees. By maintaining this structure in operations, employees are able to operate effectively at any of your locations — a giant bonus in the event resources need to be shifted from one site to another.
IN CLOSING
Multi-store owners are quickly becoming the norm in our industry. Technology has basically opened the door for owners and new investors to not just scale faster and more efficiently, but more effectively, to create a superb customer experience.
Scaling, however, cannot be accomplished by ignoring the basics of owning and operating a vended laundry. Chief among them is performing due diligence in selecting a strong location and the right technology. Likewise, you must have confidence in the right distribution partner. Their ability to manage multiple retools/builds will ultimately mean a smooth scale or a rocky one. Make sure you visit stores they have built and chat with those owners about their experiences. Did they hit the deadlines? Was the build-out of good quality? Was technology well-supported? Were they strong in helping train staff?
Scaling is all about assembling the right team to build and get you off on the right foot, and the right team to deliver great service and management, once operational.
Miss Part 1? You can read it HERE.
Have a question or comment? E-mail our editor Bruce Beggs at [email protected].