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Store Creation: Build New or Rehab? (Part 1 of 2)

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Photo: ©iStockphoto.com/Oxford

Bruce Beggs |

Distributors Weigh Pros and Cons of Options

CHICAGO — You’ve come to a point where you’re considering opening a new coin laundry. But should you build it from the ground up, or should you look at rehabilitating an existing store? What are the pros and cons of each?

“There are great arguments for both sides, but there are some catches that you want to look at, whether you’re buying a new store or retooling a store,” says J.D. Dixon, owner and president of National Laundry Equipment, a Huebsch distributor based in Nashville, Tenn. “Both can be great investments.”

Robert Renteria, president of Midwest Laundries, Chicago, and a regular contributor to AmericanCoinOp.com, says he’s seen more “born-again” laundries than ever before in the past year. “The key now is to find laundry locations that are in operating condition but in need of a facelift, or that are closed but have an up side when the competition and demographics are taken into account.”

Setting the laundry apart from its competition has to be at the heart of the decision-making process, advises Carl Graham, vice president of coin sales for Scott Equipment, a Dexter distributor based in Houston, Texas. “Unless you build a bigger, better burger, they’re not going to come.”

Infrastructure

When building new, you can start from the ground up to create a clean, modern infrastructure so it can handle the laundry equipment you plan to install, Dixon says.

“A lot of times, the problem we run into with retools is the owner wants to put in a whole new bunch of equipment and you walk in and find out, ‘Wow, we’ve got some serious infrastructure issues.’”

You may discover that the electric, water or gas service is insufficient for your project’s needs, or may even be substandard because “unlicensed electricians and gas people” have done the work in the past.

“You find wires and lines and plumbing going in all different directions,” Dixon says. “You wonder why the equipment acts like it has a ghost in it, and it’s really not the equipment. It’s really your infrastructure. You’re bleeding amps, or something weird is happening.

“That happens more often than not in a retool. It’s pretty amazing when you walk into these places and you see how things have been set up. And it seems like the older the laundry, the worse it is.”

But that isn’t always the case, according to Graham. “Rehabbing has its definite advantages, because you have most of your infrastructure in place. You just have to modify stuff.”

You can eliminate any concerns about infrastructure issues with new construction, according to Dixon.

“You don’t have any of those problems with a new store,” he says. “You get to put it in the way it’s supposed to be, and you know that you’re not going to have any odd issues with your equipment.”

Design

From the outset, building a new store provides the owner with what amounts to a blank canvas. There will be some constraints based on the space available, but the opportunity exists to design a store that is highly efficient and thus equipped to get customers in and out in the shortest time possible.

“You can tailor the space exactly to the demographics of your area,” Dixon says. “You can tailor the ergonomics of the space. You can tailor even the way the building is lit and colored, location, painted, and floored, everything, based on the folks that are living around there.”

What works in one store may not work in another. For example, you might choose a color scheme for a Miami store that you wouldn’t for a store in Lexington, Ky.

Rehabbing an existing store presents limitations, Dixon says, and Graham adds that a project could turn out to be more expensive than buying new if extensive work is necessary.

“You’re limited on your space and your setup,” Dixon says. “A lot of times, when you’re retooling a store, it’s going to be hard to change the ergonomics. Unless you want to get into tearing up the floor and rerunning drain lines, things like that, you’re basically going to put equipment where equipment already stood.”

“You might have to gut the whole place out and sometimes it costs more to rehab a place than to build new,” Graham says.

Advances in laundry equipment, particularly a shift from top loaders to front loaders, can enable a new owner to fit more capacity into the same space, Graham says.

“I’ve got two 7,000-square-foot stores that I’m revamping right now,” he says. “We’re reducing the stores by a third but we’re increasing the volume of capacity they can have and reducing their electrical and water usage.”

Building new means a much more extensive project than a rehab. “There’s going to be a whole lot of construction on this that you’re hoping to miss on the retool,” Dixon says.

Tomorrow: Location, risk, regulation and which is easier...

About the author

Bruce Beggs

American Trade Magazines LLC

Editorial Director, American Trade Magazines LLC

Bruce Beggs is editorial director of American Trade Magazines LLC, including American Coin-Op, American Drycleaner and American Laundry News. He was the editor of American Laundry News from November 1999 to May 2011. Beggs has worked as a newspaper reporter/editor and magazine editor since graduating from Kansas State University in 1986 with a bachelor’s degree in journalism and mass communications. He and his wife, Sandy, have two children.

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