Originally posted – Dec 12, 2013
Brian Brunckhorst is currently the owner of four laundromats in the San Francisco Bay area. He’s also the vice president and treasurer of the Golden State Coin Laundry Association, a real estate investor, the author of the popular business book – “Secrets of Buying and Owning Laundromats”- and the 2013 Coin Laundry Association Member of the Year.
Brian went from the high-tech world of computer software in Silicon Valley to the lower-tech business of owning laundromats.
When the high-tech startup company Brian worked for went out of business in 2002, he and his wife, May, began researching the coin laundry business. By 2003, they had purchased and remodeled their first store. As their coin laundry business expanded, by 2008, Brian became a full-time entrepreneur.
Brian has dedicated himself teaching fellow entrepreneurs how to find, evaluate, analyze and buy laundromats – as well as how improve their store operations. He is a frequent contributor to PlanetLaundry and has spoken at numerous Golden State CLA meetings.
What does being named the CLA’s Member of the Year mean to you?
What an unexpected honor and privilege. My wife, May, and I feel very blessed to have found the coin laundry business. This industry changes lives by giving people the opportunity to be their own boss and the freedom to live a more balanced lifestyle.
For us, it has provided the freedom to be there for our three children as they grow up. Because the industry has given us so much, I wanted to give something back, and that’s why I’ve been so active, both locally and nationally, in supporting the CLA.
Honestly, we’re just very humbled by this recognition and grateful for the friendships we’ve made in this industry over the years.
How did you first get involved with the Coin Laundry Association?
When we were looking for our first store, I attended the Clean Show in Las Vegas. I figured that, if I wanted to have a successful business, I needed to learn from and associate with the best laundry operators in the industry.
Of course, the best operators in any business are also those who belong to that particular industry’s trade organization. So, it really was a no-brainer. In fact, I signed up to be a member of the CLA at that show.
How has the association helped you along your journey as a laundry owner?
At my first Clean Show, I attended several informative seminars that the CLA put on. These seminars helped me understand the fundamentals of the laundry business and gave me a solid foundation. And this gave me more confidence to move forward.
Literally, I attended that first trade show before I even bought my first store. I happened to be in contract to buy the store at the time; however, I hadn’t actually closed on it yet.
As it turned out, that was only just the beginning of my self-service laundry education. Since then, my wife and I have attended every Clean Show and nearly every educational seminar we possibly could. We’re always taking away little nuggets that we try to apply to our businesses. Sometimes, those little nuggets are golden.
And, locally, we have really enjoyed meeting the members of the CLA’s northern California affiliate – the Golden State Coin Laundry Association – to share ideas and network with them.
Just being able to meet other successful operators, to share ideas and to learn from each other really elevates your game over those who don’t have that interaction.
What first attracted you to the self-service laundry business?
I was working in Silicon Valley at a startup company. And, when that company ran into problems and laid off the entire engineering team, I like to say it was one of those times in life where you have a paradigm shift. For me, I like to refer to it as a rude awakening, because it was really at that point in time when I realized that, as long as I worked for someone else, I was vulnerable. I was putting my family’s future at risk, because the notion of job security isn’t a reality today.
I loved what I did, but for my family’s sake, I knew I needed to have something on the side, some type of a safety net. That’s when I decided I would look at different types of businesses.
We looked at a lot of different business models – sandwich shops, window blind companies and maid services. We even considered buying a dating service company.
However, the problem with all of those businesses was that it would require me to work in them full time. So, after I spent anywhere from $200,000 to $500,000, I would still have to work as a full-time employee to keep those businesses running.
I didn’t want to work in a business full time. I wanted it to be part time. After all, it was supposed to be on the side.
That’s when I discovered the self-service laundry business. I thought it was a business I could run part time. Basically, that’s how we found it, during our search for different business opportunities.
At the time, I just wanted something that, if I ever got laid off again, would throw out enough cash flow so that I wouldn’t wind up living underneath a bridge somewhere.
What are the keys to a successful self-service laundry business today?
It all depends on what your goals are. If your goal is to own one or two stores, the keys for you would be a little different than the keys for somebody who is thinking bigger.
Of course, in general, every laundromat has the same keys. Those are a good location, offering your customers value at a competitive price, machines that work, a well-lit facility, and attendants to keep the store clean and help customers.
If your goal is to have more than a couple of stores, your keys will change a little bit because you’ll need to have a team in order to grow. You’ll need to have systems and processes in place so that you can delegate activities and be able to give a consistent quality of services to your customers.
For example, consider a wash-dry-fold service. If you don’t have a system and you have three attendants, a customer could bring home her clothes three different times and theoretically have those garments folded three different ways.
Where is the quality control? Where are the systems? You need that to provide a consistent experience for your customers. Yes, even if you have only one store, you still need systems – but that need becomes critical if you want to grow your business.
How many stores do you own?
Currently, we have four stores operating in the San Francisco Bay area. We also have a fifth, brand new laundry we’re having built, which is due to open by the end of the year.
What other business ventures are you also currently involved in?
We invest in rental properties. We have some ownership interests in other private businesses, where we’re just a limited partner. And we’ve also done some investing in gas and oil wells throughout the country.
Of course, I also have a small internet marketing business, which helps educate those who are interested in getting into the self-service laundry business. And I do some business consulting as well.
Another thing that occupies my time is being the vice chairman and treasurer for the Golden State Coin Laundry Association. Next year, I’ll be transitioning to the role of chairman.
In addition, I’m the treasurer for the Dublin High School Band Boosters Club. Brooke is a senior, Brandon is a freshman and Brittany is in seventh grade – and they are all in band. And, honestly, I probably spend as much time working on the high school band activities as I do running my coin laundry business.
How do you find time for all of it?
Everybody has a lot on their plate, so I’m not an exception. We all have the same amount of time. We all get 24 hours in a day. It’s the allocation of that time that makes the difference, which is where the choices are made.
The short answer is that May and I have a team. We don’t do all of the work ourselves. Personally, my time gets allocated to high-level activities, while the lower-level activities get assigned to other team members. As a result, my wife has forbidden me from mowing the lawn; we have a team member do that.
Having a team doesn’t mean you need to hire a full staff working for you 40 hours a week. But a little help here and there can make a difference. For instance, we have somebody who comes in and cleans the house. We have a gardener. We have an assistant. We have a bookkeeper. We have a team.
And having that team has allowed us to spend more time doing the things we want to do, rather than the things we have to do.
Break down your typical day, if there is such a thing as a “typical day.”
At 5 a.m., May gets up. She’ll spend the first hour of the morning reviewing video from some of our stores that are open overnight, and planning the schedules for the day. She’ll typically do this from 5 a.m. to 6 a.m.
At about 6 a.m., the three kids are up. The two high school kids are out the door by 6:30, and my wife drives them to school.
Normally, I get up around 7 a.m. I’ll eat breakfast and get ready for our morning walk. At 8 a.m., May and I usually take a morning walk, which will last anywhere from an hour to two hours. Along that walk, we will drop off Brittany at school.
By the time we’re back at home from our walk, the office at the house is usually buzzing. Staff is here by then, and the first thing we’ll do is sit down with May’s administrative assistant, who is also our store supervisor in charge of the staff at the laundries. We’ll get our daily briefing from her – what happened the previous day and overnight.
Then, the workday begins for us. At that point, the “typical day”ends, and the specific day begins. What gets accomplished on any specific day depends on what’s on the schedule that day. One day may involve me going to the stores to stock the vending machines and the changers. The next day may have me working on presentations, writing an article or working on some of our other business ventures.
May usually spends her day running the household, running errands, paying bills and coordinating the various projects we may have going on. When I’m home, May and I will eat lunch together at noon. And, by 1 p.m., it’s back to work on various projects.
By 4:00, our staff leaves, and 5:00 is dinner time. The evenings are normally devoted to the kids and whatever school activities they have – as are the weekends.
How much time per week is spent on your laundry business – both in and out of the stores?
On a weekly basis, I am either traveling to and from or working in the stores somewhere between 15 to 20 hours a week. On top of that, May typically works between 10 to 15 hours a week in the office – reviewing video, processing payroll, meeting with staff, paying bills and so on.
Between the two of us and the four stores, we’re probably putting in approximately 25 to 35 hours a week.
You’re also a successful author. How did the idea for a book about the laundry business develop?
The idea developed when I finally decided to complete the journey of exiting corporate America. May and I had a goal for us to both be able to leave corporate America and be on our own. However, having that goal and actually executing it are two different things.
It’s easier to say it than do it, because all your life you’ve been taught about job security. But, once I actually did it and got back those 50 to 65 hours a week I was putting in at the job, I wondered why I waited so long.
All of a sudden, I’ve got all of this free time. So, I decided there would never be a better time to give back to the laundry industry. I wanted to put some thoughts down – little tidbits and ideas that I’d learned along my path to hopefully make it easier for someone else in the future. The business has meant so much to our family that, for me, it was my way of giving back and thanking the industry.
What was the toughest aspect of that entire process?
Writing a book takes a lot of time and motivation. May was great in helping to motivate me and keep me going. My problem is I’m great at starting projects, but I am lacking in follow-through skills. So, May helped drive me to the finish line with gentle – and sometimes not so gentle – encouragement.
It’s hard. It takes a lot of time to sit down and actually formulate your ideas. Luckily, I had a friend of mine help me with some of the logistics, as well as with ideas about what chapters to write and what different topics should be covered in the book. We would often brainstorm on different ideas.
Additionally, May and my father played critical roles in the editing process.
Beyond writing your book, you’ve certainly given very freely of your time and advice to help other laundry owners and potential investors. Why is that so important to you?
When we first got into the business, there really wasn’t any program or class we could take to teach us how to go out and find a store, how to analyze a store, or what the process was to actually buy a store.
During our journey, friends and family members would ask us how we were doing it. We were both working for startup companies – then, all of a sudden, May is not working at a job and is able to lead a more balanced lifestyle and spend more time with our kids. Next, all of a sudden, I’m able to do the same thing.
How did we do it?
For me, it’s important to tell that story, because I want to make it easier for others to follow me into this business. It’s a great business. It has afforded us a fabulous lifestyle, and I want to share that. If I can do it, other people can do it, too. Why not? That’s the dream, right?
The bottom line is that it makes me feel good to be able to give back.
In 2014, what will be the hot-button issues for laundry owners?
The biggest issues I see revolve around utility costs. It’s been a problem, and it’s going to continue to be a problem.
As the economy begins to recover, rent costs are starting to change and rents are going to begin going back up, and overall expenses will be higher. So, controlling costs is a huge problem. Although costs have gone up, vend pricing has not kept pace with these rising costs.
As an example, payroll is going up. In my state of California, the governor just signed into law that the minimum wage statewide will increase to $9 an hour next year. And other states surely will follow suit.
As wages go up and as utility costs rise, our costs are going up. However, at the same time, the economy is recovering very slowly; in fact, many economists have downgraded some of their forecasts. The recovery is not as strong as they thought. And that makes it difficult to increase vend prices to counteract these increasing expenses.
The only way to manage those costs is to have more energy-efficient, water-efficient equipment.
For that reason, I think 2014 might be a very good year for equipment distributors and manufacturers, with laundry owners retooling their stores to try to cash in on the low interest rates. There are signs that those rates are going to start to climb, and if they don’t do it now, they may miss the boat.
Of course, if the economy starts to drop, the brakes will be put on.
What major trends are you noticing in the industry?
On the West Coast, the trend is toward newer, larger stores. There already are some megastores in the middle of the country and on the East Coast.
In general, I think the average store nationwide is probably between 1,500 and 2,000 square feet, and I see the trend to be an increase in the size of the average store. Of course, this also may mean that there will be fewer stores, because the larger stores may put some of the smaller laundromats out of business.
Secondly, there is no question that there is a trend is toward larger equipment. That’s a given. One store I know of has seven 125-pound washers – and they’re spinning all the time.
As rents increase, owners are looking to maximize the dollar revenue per square foot. I’m waiting for the emergence of the 200-pound washer!
A third trend is that more and more stores are becoming credit-card-capable. In one of my stores, we’re testing out a system that would let customers pay with their mobile device.
Lastly, social media is going to be a big trend in how owners market their stores – how they will take advantage of social media and incorporate it into their promotional strategies.
Do you have a business philosophy that guides your decisions?
Our philosophy has always been that we want to provide a better experience for whatever it is we’re doing. When it’s a coin laundry business, we want to provide a better washing and drying experience for the customer.
When I was growing up, I was involved in the Boy Scouts, and they had a saying: “Always leave the campsite better than you found it.” And that has always stuck with me.
This is why we want to provide a better service. If that means having machines that get customers in and out of the store faster, that’s great. If it means having better lighting, OK. If it means having an attendant at the store, we’ll do it.
It all goes back to trying to provide the best service we can and remembering the roots of that Boy Scout experience.
Personally, what’s the biggest mistake you’ve ever made in this business?
Just one? There are so many.
Most mistakes in business and in life result either from a lack of knowledge or because you weren’t paying close enough attention.
A perfect example was when I was pricing a group of washers for a weekly special. I had installed a bank of new 40-pound washers, which I planned to vend for $2.50 on Wednesdays only. It was a crazy special.
However, while I was programming these machines, I made a mistake and left off the zero. And I didn’t realize it for six weeks.
The funny thing is that my revenue wasn’t down, which is why I didn’t realize my error right away.
During that time, those machines on Wednesdays were turning 24 times a day! Customers were literally lining up outside the door at 5:00 a.m. for a 25-cent 40-pound wash. Can you imagine that?
Then, I just happened to be in the store one Wednesday, and a customer came up to me to ask if I could direct him to the 25-cent washers.
I said, “Excuse me?”
He replied, “Yeah, every Wednesday you guys have 25-cent washers. Which ones are those?”
So I told him, “Hurry up and get your clothes in there, because that price is changing in about five minutes!”
What one piece of technology could you not live without?
From a day-to-day point of view, I’d probably say the smartphone is the one piece of technology I use the most. I can remotely monitor all of my stores on my phone.
I never imagined in my wildest dreams that I could press a button on my phone, ask it a question and have the answer show up on the screen. How awesome is that? It’s definitely the most used piece of technology I have.
What do you like to do for fun?
We spend a lot of time with the kids and their activities. We also like to go on vacation. Lately, we’ve taken some cruises; we actually did four this year. I love going out for long drives. We enjoy good food and going to nice restaurants.
But, mostly, it’s about spending time with the family. And that could include doing volunteer work at a 49ers game, trying to raise money for the high school band. For me, being able to give back is rewarding kind of fun.
What might others be surprised to learn about you?
When I was in high school and college, I was a disk jockey. In fact, I was co-owner of a DJ company.
In my youth, I also worked as a karate instructor for several years.
If you could magically sit down with the 18-year-old version of yourself, what life and/or business lessons would you bestow upon “young Brian?”
I was pretty fortunate that my dad instilled a lot of those secrets in me growing up. But I guess, looking back, I would have followed the dream of entrepreneurship much sooner.
I started young, at 12 years old. When I wanted to buy a bike, my dad told me I had to go out and earn the money. So, we made lemon-walnut bread and sold it to all of the neighbors, until I had earned enough money to buy the bicycle I wanted.
So, I got started early in entrepreneurship, but then I went to college – and the school system trains you to go out and get a job. So I followed that path.
I believe that doing those jobs for other people certainly gave me a lot of experience I wouldn’t have had otherwise received. I don’t regret doing those jobs. I just wish I would have started earlier and not let so much time lapse between the time I got out of college and the time I actually began working for myself.
What are your business goals for 2014?
In 2014, I’d like to get up to six stores, and also see our fifth store become profitable.
Long-term, we’d like to continue growing this business. I can see 10-plus stores, eventually maybe 20.
The one thing that working for other small businesses has taught me is that there is some risk in expanding too fast. That’s why we have tended to exhibit a more moderate growth rate over the last 10 years. However, I think for the next 10 years we will have the ability to increase that growth rate.
What advice would you give to a new laundry owner just getting into the business?
Educate yourself. That’s so important if you’re going to get into this business. After all, you wouldn’t open up a restaurant and not know anything about the restaurant business. So, what makes somebody think they can open a laundromat without knowing anything about the laundry business?
In a lot of ways, the self-service laundry business is a very simple one. But there are still an awful lot of particulars that people need to understand. Making sure you buy a store for a fair price. Making sure you properly analyze that store. Making sure this is the business you really want to get into.
Education shortcuts your path to success. One way or another, you’re going to do the homework. That’s guaranteed. You will get that education. The only question is how quickly you want it. Do you want to get it before you get started and go in with your eyes open? Or do you want to learn along the way? Most people learn along the way – and then those lessons become very expensive.
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