You are here

Staying Ahead of the Competition (Part 1)

When a challenger appears, assess your own operation for improvement

CHICAGO — Your store is established and the money is coming in at a steady clip now. It’s taken you some time but you’ve built a customer base that makes visiting your vended laundry part of its routine. You’re operating comfortably in the black.

But, wait, what’s that happening up the road? A new store is being built. You’ve got yourself a competitor. It looks to be bigger, brighter. Rumors are it’ll have all-new equipment, including larger-capacity machines that your store doesn’t have.

American Coin-Op polled several distributors about the topic of competition this month. It’s understandable if your attention is on a challenger, they say, but you really should be looking at your own operation for the keys to staying at the top in your marketplace.


Once you learn new competition is coming or has opened a store nearby, you should assess the threat it may pose. But how should you do that?

“Store owners should mix up (travel) routes when visiting their own store,” advises Brad Steinberg, co-president of PWS – The Laundry Company, based in California. “This will give them insight into what their competitors are doing, and also see if any new competition is being built.”

“I would send in a secret shopper to actually use the (competing) facility to see what kind of equipment mix, what kind of ancillaries they have there, as well as what kind of staff they have,” says Michael “Stucky” Szczotka, president of Eagle Star Equipment, based in Michigan.

Some of the experts say the best way to ward off competition is to run your operation so well that challengers will set up shop elsewhere.

“When this whole competitor concept comes up, I think the biggest takeaway is don’t look like a victim,” asserts Bryan Maxwell, who works in sales and marketing for Western State Design, based in California. “If you’re the limping gazelle in the forest, you’re going to be a victim. You need to be a lion, and you need to be prepared to be attacked. The biggest thing I see is stores, somebody fixes up a store 15, 20 years ago, and then does nothing to it.”

“In my opinion, your store being attended, being clean, being bright and having the proper equipment mix is first and foremost,” says Szczotka. “Then (it’s) your ancillary services, or the products you may have.”

“There are a lot of little things that need to be done,” suggests Steinberg. “Cleanliness, safety, customer service and equipment in working order are the basics. Before offering other amenities, I would make sure a store owner has those down. I am obviously a supporter of replacing equipment, but if for some reason that is out of the question, small cosmetic changes go a long way: new paint, flooring, bulkheads, seating and folding are extremely important. Many times, a competitor will make you step up your game, which can be a good thing long-term.”

“Keeping your store current and your customers happy is one of the best ways to avoid the competition from coming in in the first place,” says Brandon Hoffman, salesman for Gold Coin Laundry Equipment, based in New York.

“The biggest and best answer for that is you’ve gotta look in before you look out,” says Brett Nolan, director of vended laundry systems for TLC Tri-State Laundry Systems, based in Georgia. “Honestly, it’s the best defense against a new competitor, to make sure that you’re on point, that your store is the best that you can make it, that you are engaging with your customer base on a regular basis.”


The impact of a new competitor on an established store could be felt almost immediately or take as long as 18 months after the opening, distributors say.

“Depending on the proximity, strength, size and promotions a new store is offering, the first six months normally have the greatest impact on business,” says Steinberg. “After six months, things generally seem to normalize. That’s to say, you will not know the true impact of a competitor until six-plus months after it opens.”

“I think it’s going to be a minimum of six months and may even go out as far as 18 months until the ‘honeymoon’ is over,” Szczotka says. “A lot of people would like to go in and try a new operation, because they’re coming into a neighborhood new and most likely lowering their entry-point pricing to try to bring, or draw, more traffic in.”

The store owner who keeps good financial records—profit and loss, projected growth, etc.—should know within the first month how a new competitor is or isn’t impacting them, Nolan says.

“You should, as a store owner, be keeping up with all of these metrics. Whatever your minimum reporting period is, whether you’re tracking it weekly, biweekly or monthly, you should be watching that. If you’ve got a new competitor coming in, honestly, I would say that you should take your minimum reporting period to a week and be tracking weekly so that you know if your business is going to be impacted.”

Whatever the impact, distributor experts warn against making operational changes immediately.

“I’ve seen stores that lose 20-25% of their business two weeks later because the new owner is doing free dry or dollar wash promotions,” Hoffman says. “Let the dust settle. Let the newness of the new place wear off before you go making any drastic changes in your place.”

“Many times, you will lose customers briefly,” Maxwell says. “They’re going to try the newest, if there’s some kind of entry special. Most Laundromats are personal, right? Is this new shiny place going to treat your customer better than you do? Lot of times, you lose a customer for a short period … but they come back to what they’re comfortable with.”

“Customers like routines, but they also like new. If you can upgrade your laundry, your existing customer base can keep with the routine of going to your laundry and also get new equipment at the same time,” says Steinberg. “If you are going to do some remodeling, I always recommend doing this before the competitor opens. You do not want your customers leaving your store to try something new and get out of their routine.”

“Our customers are almost exclusively entrepreneurs, and one of the few things an entrepreneur is not capable of doing is sitting still. So that drives that knee-jerk reaction,” Nolan says. “But if you start changing things without taking the time to analyze what’s going on and collect some data so that you’re using facts to drive your change and not knee-jerk-reaction emotion, you may change something that your customers consider to be a benefit.”

In Thursday’s conclusion: Price war perils, and using your advantage

151900905 jan otto web

(Image: ©iStockphoto/Jan-Otto)​

Have a question or comment? E-mail our editor Bruce Beggs at [email protected].