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Update and Improve Profits

Howard Scott |

To update or not? You have purchased an existing Laundromat, and it’s in pretty good shape. The walls are a mite gray, the ceiling has some spots, and the tile floor has a few cracks here and there.  For the most part, the place looks fine. Well, a few overhead pipes are visible. But the customers are used to the place, so why spend money for cosmetics? Why indeed?Every owner faces this issue. It’s a serious consideration because the first rule of business is: Don’t spend money unless there’s a gun to your head or unless there’s a great reason to spend it. I’m not talking a complete makeover, which might run $50,000, but an updating, which might cost $10,000.Spending $10,000 on new equipment would almost always make sense because new machines are more efficient, will lower your utility expenses, and make customers happy. But spending $10,000 on appearance is a more difficult proposition. Will the spent money generate more revenue? Will this provide a competitive advantage? How is the $10,000 best spent?TIME FOR A CHANGEAs a general guide, if you think it might be time to update, it is the time. After all, you are the best person to notice the wear and tear, and you can sense if the place looks dowdy, tired or overworked. But, if you are not sure, ask unbiased patrons, and listen to what they say.The best way to approach an update is to consider what you would do if funds were unlimited, and then see which goals you could accomplish with a limited budget. Sure, spending $100,000 would result in a brand-new place, but what could be done with $10,000 to replicate a big-buck makeover?Check the walls. Are the walls looking dilapidated? Would painting them bright yellow change the ambience? Maybe your college-age son or daughter could do the painting for you. This would save you quite a few dollars, and keep the money within the family.Take a good look at the floor. Is it time to replace the floor? After a washing, does the surface look scuffed and dirty? Could you find tile that would last and look like new for several years? Is there some other material that would last longer? You might resurface only the heaviest-used portion of the floor.Does the ceiling look dismal? Would replacing ceiling squares do the job, or do you need a total redo? Talk to your distributor and do some research to discover what product looks great and is inexpensive. Do you have a friend or neighbor who could do the job cheaply?Don’t ignore the lighting. Is it time to create a “really clean and well-lighted place” to borrow a phrase from Hemingway? Some strategically placed spotlights could illuminate dark corners. Could front lighting be put in to accentuate the 24-hour operation and call attention to the store?A really clean bathroom is always a plus, both for customers and employees. How can your bathroom be improved? Do you need a new sink, toilet or mirror? Home Depot and other discounters will have some great bargains on these fixtures. How about a modern sink, a cone made of wood on which the tub lies? These things are in the marketplace.The first thing people see is the front of the store. What can you do to “juice up” the front? Even such simple additions as wooden flower boxes in the growing season could spice up your look. A bright repainting might be sufficient to make the store look new. Paint flaking should not be tolerated. How about creating an angled wood look on the front wall? Is it time for a new door, possibly an automatic door? Your door is key since people are bringing in and taking out clothing.Signage can set a positive tone. Is it time to put a neon sign in the front window? A moving, neon sign is just the ticket to call attention to the facility for drive-by traffic. Of course, you must check out the town or city sign codes. Inside-wall signs with attractive borders might unify the overall look.Your folding tables are used all the time — they need to be blemish-free. If they are smudged, scratched or gouged, patrons will think their clothes are not as clean as they should be. Edges should be rust-free. This could be the time to replace all table surfaces with uniform Formica laminates.Lastly, what about the basic amenities? Are your chairs in good condition? Are the vending machines grungy? Are some of the coffee tables so cracked that a child can’t draw? Does your box of toys in the corner look like a junk heap? Consider spending some time on this area because your patrons spend a great deal of time at your store. Be bold. Maybe add a love seat or bring in some type of pet, such as a bird.IS IT REALLY WORTH IT?You want the laundry to look different — to create the “oh, wow” effect. When a patron comes in, he will say, “Hey, what did you do to your place? Pretty nice. Looks like new.” This doesn’t require a complete makeover, just an improvement of everything that looked dowdy.Why go through the effort? People notice improvements. The brighter the store is, the cleaner it is. After all, clean is what you sell. People are there to wash their clothes. They will walk out thinking their clothes are really clean if your place is bright, shiny and spotless. They will feel less satisfied with the experience if the laundry is dingy. Perception is reality.The bottom line is this: Patrons might come in more frequently because their experience is hassle-free. They might even bring in some of their better garments for washing. If you show that you care, they might take you up on an extra service, such as drop-off service. When their friends complain about their washing experiences, your patrons are bound to mention your great-looking Laundromat. More newcomers will make their way to your place. This could lead to your store being the dominant force in the marketplace. More importantly, all this spells an increase in volume of 10 to 20%.Is it worth $10,000 to push up your volume 10 or 20 percent? What is your profit on that volume boost? The only added expense may be utilities. How would you feel if this boost lasts a couple of years? Overall, things could work out quite well with a $10,000 investment.Make it your goal to update your store every three or four years. Give patrons something to celebrate. Give yourself something to celebrate.                                                                          

About the author

Howard Scott

H&R Block

Industry Writer, Drycleaning Consultant, and H&R Block Tax Preparer

Howard Scott is a longtime industry writer and drycleaning consultant, and an H&R Block tax preparer specializing in small businesses. He welcomes questions and comments, and can be reached by writing Howard Scott, Dancing Hill, Pembroke, MA 02359.

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