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Survey: Operators Soldier On Amidst Lagging Economy, Increasing Costs (Part 3 of 3)

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Photo: ©iStockphoto.com/Victor Correia

Bruce Beggs |

Utilities, Employees, Lack of Customers are Top Three Problems

CHICAGO — How do you think your self-service business compared to others in the industry last year? Did you have a good year or a bad year in 2011? How does your pricing compare with others?

American Coin-Op’s annual State of the Industry survey offers you the opportunity to compare your operation to others in the industry. It focuses on 2011/2012 business conditions, pricing, equipment, common problems, turns per day, and utilities cost.

The survey is an unscientific electronic poll of American Coin-Op readers who operate stores.

ADDING EQUIPMENT IN 2011

Approximately 45% of the respondents purchased at least one piece of equipment (washer, dryer, water heater, vender or changer) in 2011. In 2010, that figure was 47%.

Here’s a breakdown of the 2011 purchases:

• 23.6% of respondents purchased at least one top loader. The average purchase was 17.1 machines (it should be noted that this statistic includes a single operator’s reported purchase of 97 machines; when excluding that operator, the average purchase is 9.1 machines).

• 28.9% of respondents purchased at least one front loader (a breakdown by capacity follows below).

• 12.4% purchased at least one dryer (regular or stacked). The average purchase was 11.3 machines (it should be noted that this statistic includes a single operator’s reported purchase of 97 machines; when excluding that operator, the average purchase is 5.1 machines).

And we break it down further by front-load wash capacity:

• 42.9% purchased at least one machine with a capacity up to 25 pounds. The average purchase was 8.9 machines.

• 48.6% bought at least one machine with a capacity of 25-50 pounds. The average purchase was 4.2 machines.

• 37.1% purchased at least one machine with a capacity of more than 50 pounds. The average purchase was 1.8 machines.

(Editor’s note: Some respondents didn’t identify machine sizes, so the front-loader breakdown doesn’t include their purchases. Also, the percentages do not total 100% because some buyers purchased equipment in multiple capacity categories.)

SHOPPING IN 2012

Respondents were asked if they have bought, or plan on buying, any new machinery this year. Approximately 36% intend to add something (washer, dryer, water heater, vender or changer) to their mix, or already have done so. Last year, this figure was 47%.

• 6.6% of respondents have purchased or plan to purchase a new top loader this year. The average purchase is (or will be) 10.4 machines.

• 21.5% have purchased or plan to purchase a new front loader this year. (A breakdown by capacity follows below.)

• 14% plan on buying, or have already bought, a dryer in 2012. The average purchase is (or will be) 7.0 machines.

And we break things down further by front-load wash capacity:

• 34.6% purchased or plan to purchase at least one machine with a capacity up to 25 pounds. The average purchase was 6.0 machines.

• 30.8% bought at least one machine with a capacity of 25-50 pounds. The average purchase was 4.1 machines.

• 23.1% purchased at least one machine with a capacity of more than 50 pounds. The average purchase was 2.5 machines.

(Editor’s note: Some respondents didn’t identify machine sizes, so the front-loader breakdown doesn’t include their purchases. Also, the percentages do not total 100% because some buyers purchased equipment in multiple capacity categories.)

WE’VE GOT TROUBLE…

What problems cause you the most grief? Here are the top-five industry problems, according to the survey respondents:

  1. High cost of utilities
  2. Dealing with employees
  3. A lack of customers
  4. Poor economy
  5. Equipment maintenance/repair issues

Gone from last year’s list is rent, although it did pop up on a number of surveys.

TURNS

The average turns per day for top loaders are 3.0, up slightly from last year (2.9). The average turns per day for a front loader is 3.8, also up from last year (3.4).

UTILITIES

We asked operators about their utilities cost (as a percentage of gross). The responses ranged from 5.6% to 50%. The most popular response is 25%, followed by 20%.

Operators are paying an average of 24.1% for utilities (as a percentage of gross).

2012 BUSINESS FORECAST

Slightly less than half of the respondents (47.5%) expect their 2012 business to be better than it was in 2011. Approximately 42% expect business to be about the same this year, and 10.8% expect their business to not perform as well this year as it did in 2011.

Click here for Part 1.

Click here for Part 2.

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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