Originally posted – Mar 28, 2014
Nearly every month since its inception, this magazine has provided readers with enlightening, behind-the-scenes glimpses at self-service laundry businesses across the United States. From new investors to veteran operators, sole proprietors to multi-store owners, smaller laundries to hug mega-mats and rural locations to urban hotspots, PlanetLaundry’s popular “Business Profile” feature has run the gamut while documenting the retail laundry business in the U.S.
This month, we’ve caught up with a few past “Business Profile” subjects to see just how their laundry operations, marketplaces and thoughts on the industry have changed (or perhaps remained the same) since they’ve last appeared within our pages. And, rather than have us tell their story again, here is their laundry evolution in their own words:
John Henderson
Liberty Laundry
Broken Arrow, Okla.
First Profiled: March 2006
(READ ORIGINAL PROFILE HERE)
We’ve come a long way since the profile our first location in Broken Arrow appeared in this magazine. We built a second location in Tulsa, which opened in October 2010 – and it did so well that we have just completed the build-out of a third store, also in Tulsa, which should be open by the time this article appears.
At the original store, we installed tank-less water heaters, which we discovered were not up to the task of supplying enough hot water for our volume of business. We have since converted to tanked systems using condensing technology. Although that requires keeping a tank of water hot even when we’re closed, we experienced lower gas bills due to the improved efficiency of the units, which are rated at 96 percent to 98 percent, compared to the 85 percent efficiency of the tank-less units we had been using. It was difficult to find room to accommodate the larger system, and thus required a bit of remodeling.
Our marketplace demographics haven’t changed significantly, although the city of Broken Arrow continues to grow larger, as does our customer base. Three years ago, the city’s largest employer, a plant that manufactures flight simulators, built a two-story, 340,000 square foot facility directly across the street from us. The city installed a traffic light to accommodate all the cars. At the light, you can turn into the plant, or turn into Liberty Laundry’s parking lot.
Our business has grown significantly over time for several reasons. The first is consistency in our product. We strive to continually improve our wash-dry-fold operation, which accounts for a third of our revenue. We stick to the basics of good customer service, which includes cleanliness and working machinery, as well as personal interaction with our guests. Our reputation has also enabled us to capture several commercial accounts, although we have not actively pursued them and don’t offer a pickup and delivery service.
As for marketing, we spend very little on it. Our primary marketing is location and signage. Beyond that, having a well-constructed website and claiming our listings on Google Places, Google Maps, Foursquare, Yelp and other online freebies. We have received only favorable reviews online, which also helps drive business into the stores.
When profiled, we were offered ironing and outsourced drycleaning. However, we quickly eliminated both, as the ironing was too labor-intensive and I had no control over the drycleaning. Other than that, we have changed our core business very little other than to continue to improve our processes.
I am more optimistic about the future of the coin laundry business than ever before. Our business model of a premium laundromat seems to have struck a chord with the neighborhoods we serve, and it has been gratifying to watch the resulting growth. With the opening of our newest store, I guess we will see if that theory holds true.
Deb Piccirillo
Pottstown Laundromat
Pottstown, Pa.
First Profiled: April 2010 (READ ORIGINAL PROFILE HERE)
Pottstown Laundromat opened in March 2009, and even though not much has changed since then, plenty of life lessons have been learned.
To begin, no major renovations have been made to the physical premises in five years. The HVAC system died during the first six months – so much for inspections! However, a fantastic landlord contributed to covering the expense. Lucite folders on the wall for local advertising have been added to generate additional income, which is a recent idea that is still being developed. Upgrading the store’s payment options has been considered, except the cost is too high, and my overall margin is too low.
My customers don’t seem to mind the absence of “bells and whistles,” like wireless internet or debit card acceptance. Most of them are seniors and lower socioeconomic families that don’t even have checking accounts.
Drop-off drycleaning and wash-dry-fold services are not offered, because there are only 1,025 square feet with which to work.
Despite the simple accommodations, Pottstown Laundromat has grown at a steady rate of about 10 percent per year, mostly through word of mouth. Other contributing factors to growth include a vend price increase and changing the store’s hours to 24/7, which helped attract second-shift workers to my store. Additionally, the store is located across the street from a Super Wal-Mart, and many customers like the idea of making one trip out for most of their needs.
Grossly underestimated when analyzing the area’s demographics, though, was the impact four local hotels within a two-mile radius would have on revenue. Also, since a couple of nearby laundromats have closed down recently (primarily due to neglect), Pottstown Laundromat has been fortunate to pick up their business, resulting in the hiring of two employees who help keep the place clean and friendly.
Regardless of what’s happening with other locations, I continue to be optimistic about today’s laundry business because people will always need clean clothes, despite the ups and downs of the economy. One of the biggest lessons I’ve learned during the past five years is to “go with the flow” through it all.
In a perfect world, equipment would never break down, customers would never be crabby or messy, and “slip and fall” would be erased from the dictionary. However, operating a small business has helped me foster many meaningful relationships and has developed my character in a way that might not have been achieved by any other means. Everyone should have a mentor, and I’m grateful for the valuable advice I have received from QualClean’s Bob Eisenberg, who designed Pottstown Laundromat. I am also always very careful to thank God for all of my blessings, especially the simple ones.
If I had the chance to change anything about my store since it opened, what would it be? Very little – which is pretty much how it’s gone and how it will continue to go. Check back in another five years to see if the status quo survives.
Rich Sodemann
Beach Laundry
Osage Beach, Mo.
First Profiled: November 2004
(READ ORIGINAL PROFILE HERE)
Since being profiled, we’ve made a number of changes and revisions to our store. These have been the result of experience, as well as taking advantage of the excellent advice and information provided in this publication.
For energy efficiency, we’ve undertaken several things. Most notably, we installed high-efficiency water heaters, which have reduced our propane gas usage significantly. Also, installation of a silver reflective coating on our building’s roof surfaces has drastically reduced the summer heat inside our laundry and saved electricity usage due to air conditioning. To reduce utilities consumption, we also replaced six topload washers with new 30-pound variable frequency drive frontload washers. Not only have we reduced energy consumption, our revenues generated by these larger washers increased dramatically because our costs are less and we can charge more for the same square footage of floor space.
We’ve also added amenities like free WiFi access, larger flat-screen TVs, a large snack vending machine, an automatic entrance door and a customer rewards program. And we’ve launched a website, since last we appeared in the magazine.
We are still using coins in all our machines. We’ve investigated several card systems but, as of yet, have not made a decision. We’re leaning toward a combination of coins and cards. The wireless technology appears to make the installation much easier. The central credit/debit card acceptance and issuing our own in-house card seems to be a convenient way to integrate our rewards program and make it available to more customers.
Since our profile appeared, the state re-routed the main highway, which previously passed directly in front of our store. This new highway bypass diverted all traffic, except for local traffic, to the business areas. The change left us with a major interchange approximately one block away – and the population growth and business expansion has been very good for us. Since 2004, the area has seen major businesses such Target, Home Depot, Menards, Marshalls, Pier One Imports, Kohl’s, Dick’s Sporting Goods, Petco, Walgreens, CVS Pharmacy, Steak & Shake, Chili’s, Applebee’s, Outback Steakhouse and Golden Corral Buffet open new locations here. The general population has increased as well, and new low-cost housing is being developed for the influx of construction workers.
When we came to the lake area, we didn’t realize the true potential ahead of us. Since our opening in 2001, three local competitors have closed their doors, and our closest competitor is more than 12 miles away. We have never tried to be the low-price leader; in fact, our prices have always been higher than any other store.
Our business has not grown dramatically. This has been due to a number of factors, including the downturn in the economy in 2008. Again, we have been fortunate to have the ever-continuing construction of buildings and highways, which have allowed us to become the “last man standing.”
In all, we’re very optimistic about our future in the laundry business. Our experience shows that the need is here to stay. Laundry is one of the necessities of life.
Conrad Cutler
MegaMat Super Laundromat
Mount Vernon, N.Y.
First Profiled: July 2010
(READ ORIGINAL PROFILE HERE)
Over the last 36 months, I have reinvested in the store significantly. In an effort to reduce our natural gas consumption, I removed our two 750,000-BTU hot water boilers and installed a tank-less hot water system. This system is set up with six 199,000-BTU units cascaded together and has a reserve storage capacity of 480 gallons.
Since the upgrade to this system, we have experienced a significant decrease in gas consumption and our hot water cycles are delivering constant hot water at 140 degrees, which has benefited washing results. In addition, the system features a 3M water filter that removes additional sediment from the water prior to heating, in an effort to prevent corrosion and deterioration of the units.
Last month, we completed a total overhaul of the retail environment of the store. We installed subway tiles on the walls, replaced the flooring with new porcelain tile and built bulkhead partitions around each platform of machines to enhance the store’s appearance. Both the men’s and women’s restrooms have been refurbished with new flooring and fixtures, complete with brighter lighting and timers on the sink faucets.
Also, we had been experiencing a problem with customers washing clothing in the restroom sinks, so we installed low-pressure sinks with timers to prevent this from occurring.
Lastly, we removed some of our old hard-mount washers with new high-speed soft-mount machines. I chose this option because of the water and utility savings the machines can deliver. In addition, they are highly programmable, which I felt was important to be able to create custom wash programs and have complete control over every step of the wash process.
As the final component of our recent store overhaul, I also introduced a new card system to all of the washers and dryers, which will enable me to capitalize on all payment methods.
Our primary business is servicing the Mount Vernon community as a walk-in laundromat, but we also have built the facility with large-capacity machines to handle other laundry-related revenue streams. I have a commercial laundry division that operates out of the same building. Through this division, we are a third-party contractor for laundry platforms that operate throughout Manhattan, and service universities and residential neighborhoods under different market names. Additionally in the summer months, we wash pool towels by the truckload for nearby summer camps.
Like most stores, my staff is my most valuable asset. Having colleagues that understand the business and are able to have the same passion and dedication I have for it is something I pride my operation on. Investing in key senior staff is something to which I attribute a large part of my success. I place a lot of responsibility in my operations manager’s hands to carry out day-to-day responsibilities.
Mount Vernon is home to 68,000 residents within four and a half square miles; however, the retail laundry competition is fierce, with nearly 50 laundries within the city. In the last three years, four additional laundromats have opened, which has resulted in our area becoming extremely price sensitive.
Of course, the New York Metro market also is saturated with laundromats. Driving around the five boroughs, one will observe several laundromats on the same block in some cases. This oversaturation has led to a big price war throughout the area, and operators have not been able to adjust their vend prices to accommodate for inflation, utility costs and the increased cost of doing business. As a result, many owners have had to diversify from their core business and sublet space to cell phone stores, nail salons, tax prep clinics and others just to offset their overhead.
This is a major issue in my area, which leads me to be less optimistic about the future. However, I’ve recently been very impressed with the technological advancements that have been made, and I’m confident that, with the implementation of new technology, those who see the value in reinvesting in their stores will do so and distinguish themselves from the competition.
Nikki Peterson
American Dry Cleaners & Laundromat
Riverton, Wyo.
First Profiled: July 2008
(READ ORIGINAL PROFILE HERE)
Since American Dry Cleaners & Laundromat was profiled, we have gone through a number of changes – both on the laundry side and the drycleaning side.
The biggest change is that we are trying to make the business a cool place to be as a customer, as well as a team member. This involves marketing, team meetings and extra greetings to our customers. When the original article appeared in 2008, it was in wonderful condition with then-owner Sarah Hinkle. However, in subsequent years, the store faded a bit, so we’re working hard to bring it back.
I took over the business as manager about six month ago. Since then, we’ve done a lot of work to get the company growing again. In fact, the last three months have seen income nearly double. We’ve been trying to make the business a more fun and hip place to be!
We have redesigned our logo to convey a more fun, “retro” feel. And we now put a lot of emphasis on customer service. Our attendants have been focusing on “creating conversations” with our customers that show them we care about how their day is going, not just that they are doing laundry at our location. We also have made an extra effort to thank customers for coming in and choosing us.
Our staff has completely turned over within the last three months. It was time to make some big changes. Although we gave everyone on the team a chance to make changes with us, it turned out to be best to build a new team in the end.
While there is a new manager and staff, we also have brought in an experienced drycleaning expert who had been trained by the business’ original owners, Joe and Alys Hinkle. Annette had been working at the company’s industrial laundry plant – Eagle Uniform and Supply – for the past several years, and ti’s great to have her back with the laundromat/drycleaning operation.
At our laundromat in Lander, Wyo., we’re in the process of installing a new VTM that will accept debit, credit and EBT cards only. However, our Riverton location still takes cash as well as credit and debit cards. Additionally, we are marketing our wash-dry-fold more than ever.
There are many opportunities to make the business grow. From the growing population to the wonderful staff to the new emphasis on marketing, the future looks great. This doesn’t mean there won’t be bumps along the way, but we’re ready to take them on and keep moving forward.
Scott Williams
Speedy Wash ‘n Go
Alton, N.H.
First Profiled: October 2012
(READ ORIGINAL PROFILE HERE)
I’ve always been interested using solar power, and I built the building that houses our laundromat with solar power in mind.
I was going to include it right out of the gate, but I really didn’t know what my load was going to be, so I waited a year until I knew what the air conditioning costs were going to be and how much power the machines use. Otherwise, it would have been crap shoot if I just did it from the get-go.
Therefore the biggest change to my laundry business since being profiled has been the addition of solar power. At the end of one year in business, I started researching it more. I decided we needed to have about 18 kilowatts of photovoltaic solar panels, which translates to 72 panels.
We went online with solar power in August 2013, so it will take another year to see how the whole thing actually boils down. However, our first power bill during the summer months was approximately $670, and the very next month it dropped to $170.
My average load is 73 kilowatts a day. On my highest day, I’ve generated 140 kilowatts – and my lowest day, when the sky is overcast, is next to nothing. I’ll be interested to see how my percentages work out, because it’s the daily average I’m looking at. We intend to hopefully generate about 90 percent of our electrical needs through solar.
I’ve calculated that it should be a little bit less than a six-year return on my investment. The system cost me $59,000. But, between the state and the local utility, I received a whisker over half back in cash; my net cost was in the $27,000 to $28,000 range. And, on top of that, the federal government provides a 30 percent tax credit.
I also own a second laundry in Belmont, N.H., which wasn’t profiled. However, in July, we completely revamped that store. We tore it back to the studs, put in new equipment and a new décor. And we closed for only eight days.
Mike ‘Stucky’ Szczotka
New Wave Laundromat
Sterling Heights, Mich.
First Profiled: July 2003
(READ ORIGINAL PROFILE HERE)
Since being profiled, I’ve replaced three of my stack dryers with three additional 75-pound dryers. I found that customers wanted more larger dryers to go along with my big washers.
I also brought in a flatwork ironer, which has made my commercial business extremely profitable. These days, we do anywhere from 2,500 to 3,000 pounds of commercial work per week.
One of the biggest changes I’ve seen is the exodus from Detroit proper. We’ve had a lot of people who used to live in the lower-income areas of the city who now can afford to move into apartments in my area, which is more lower-middle income. So, more people who were in depressed area have entered my marketplace. It’s really helped my walk-in business.
With that said, the commercial accounts business is where we’ve really grown. When we first opened, the self-service aspect of the business was tough to penetrate, because of the other stores that were already here. The walk-in business wasn’t evolving the way we wanted it to, so my youngest son, Darren, came up with the idea of going out to look for commercial work. And that has made a dramatic difference.
For example, I have a 40-pound washer that vends for $4.60 – every time that washer turns, I generate $4.60. However, if I have some commercial work, and let’s say I’m getting $1 a pound and I put 20 pounds in there, I’m generating $20 to turn that wheel.
And the flatwork ironer enables me to go after catering businesses and some party rental shops. Although they don’t have a tremendous amount of flatwork, they do have some, and the ironer has allowed us to be able to capture those entire accounts.
As far as the medical side, we also service some cosmetic surgery accounts. We have a large washer behind the counter that has a small residential hot water heater hooked to it, which is at 165 degrees – so I can meet and exceed any regulations for doing medical laundry.
I think the biggest change to the business, since we appeared in the magazine, is the attitude of the staff understanding who they are there to serve; empowering the people who are on my payrolls to understand that they are there to serve and take care of the customers, and they have the latitude to make it right.
There is no “they” – it’s “we” and “us.” No one throws anyone under the bus. No one is out to try to cover their backend. They understand that the true boss is the customer, not me. Without them, my signature on their paychecks means nothing.
I’m more optimistic about the self-service laundry side of my business than I am about the drycleaning side. “Casual Friday” has turned into “Flip-Flop Friday,” and the entire week is casual for corporate America.
However, with what’s happening in our economy – so many people losing residency who now have to rent – I honestly believe, especially here in the tri-county area of Michigan, that we have more laundromat customers. Unless things change dramatically in this country, I think there are going to be more people displaced, struggling and who have to rent. And that increases our demographics number-wise.
Reynolds Smith
West Side Laundry
Vero Beach, Fla.
First Profiled: June 1998
When The Journal first profiled my brother, Scott, and me, we had three stores – two in Vero Beach and one in Palm Bay. Today, we still have those three, but we’ve added a fourth 4,000-square-foot laundry in Melbourne, as well as a small route operation.
Of course, after the hurricanes came through in 2004, we had to completely replace the roofs at both of the Vero Beach stores. And, over the years, we’ve switched out a lot of toploaders, although not all of them. We’ve probably taken out about half of our toploaders and replaced them with the frontloaders.
Although we’ve kept our stores coin-operated, we’ve been looking at the dollar coin option. That’s the way we’re going to go, because our coin boxes are filling up too quickly with quarters. Plus, it’s a hassle for customers these days when you consider that some machines vend for $8.
At some point, we may look at credit card acceptance, but not yet. Certainly, our younger customers would prefer using debit cards. In fact, they’re not used to using or even having cash.
Our demographics have evolved since the first article in 1998. After the hurricanes in 2004 and the building boom, our business went back to what it was six or seven years before that; we were down 40 percent, and it was a big issue for us.
It’s come back now. Our Melbourne and Palm Bay stores are doing great. But our Vero Beach stores are not doing as well as they were, and a lot of it has to do with the citrus industry. We used to get a lot of citrus workers in those stores, but the citrus industry has been hit by all kinds of diseases, so they’re picking a lot less fruit than they used to. Immigration also has hurt a little bit on the citrus side.
We’ve been able to offset that with our route business, which actually came about through word of mouth and connections. I went skiing with a guy from FlightSafety International; it’s the largest flight school in the world, with locations all around the globe. This guy was responsible for some of the dormitory laundry, and he said he wasn’t happy with the service he was using. So, I made a proposal, and it’s been a great route for us. We also service some condos and apartments, including units renovated by the Department of Agriculture’s Housing Authority. All of the accounts are nearby, and we handle them ourselves.
Another change to our business has been our staff. We used to have 15- to 20-hour-a-week employees. But, today, more and more of our attendants want to get more hours, so now most of our employees are in the 35- to 40-hour range.
Ever since we started this business, we’ve always worried that it wasn’t going to be around. But it’s been pretty resilient. We’re still just keeping it simple and keeping it clean – with friendly attendants, who make a huge difference.
Art Jaeger
Santa Fe Lavanderia
Los Angeles
First Profiled: December 2004
(READ ORIGINAL PROFILE HERE)
In the original profile, I talk about how I believed I needed three stores to provide me with the income I needed to have, and I was right about that – except I had the wrong three stores at the time. After that article appeared, I sold all three Santa Fe Lavanderia locations in 2005 and 2006. And I was out of the industry for about 18 months.
It gave me an opportunity to reexamine other investment opportunities and to re-hone what a more successful laundry strategy would be. It also gave me a chance to attend another Clean Show, look at the newest equipment that was coming out and get comfortable with what was then going to be the high-efficiency equipment that would help me lower my utility bills. Those things satisfied me that I wouldn’t be in the same situation as with my first three stores.
I now have three much different stores, and as I re-read the original article from 10 years ago, I was able to find areas in which my thinking has changed.
The first area would be in finding suitable sites, which is one of the most important things any laundry owner does. And I’ve changed almost 100 percent on this, and it’s probably the greatest difference between my first three stores and my current three stores. Back in 2004, I was looking for “70/70/70” – 70 percent Hispanic, 70 percent apartment dwellers and 70 percent family household income of under $25,000… with household density of 3.5.
I’ve completely changed in that regard. I’m now looking for a situation where I’m able to sell more expensive services, like wash-dry-fold, and also be able to charge fairer vend prices.
With my original demographic, I could only charge so much, because of household budgets dictating what my customers were able to spend, even if I was by far the best laundromat in the area; if there was another one that was less expensive, even though it might clearly be lower quality, that’s where they were going to go. I wouldn’t be able to reap the benefits of being the best laundry in the area.
And those customers weren’t looking for higher level services, like wash-dry-fold, which is a high-margin service for our industry.
Today, I’m looking for 40 percent Hispanic, 40 percent Caucasian and 20 percent “other,” with household incomes exceeding $55,000 and households in the 2.5 range, which indicates to me there might be young couples within the market. And young couples are more likely to use wash-dry-fold services. So, I’ve totally altered what I consider to be an acceptable laundry site.
In the article, I discuss how I was hands on in terms of sourcing different treatments and materials for the store. That has continued, to the point where on my most recent laundry project I was the general contractor. I had spent so much time on the job sites, worked with all of the subcontractors and been through the inspection processes – so I finally took the plunge, and on my last project, I was the general contractor. And we came in on time and $14,000 under budget.
I also talked about branding. At that point, I was naming all of my stores Santa Fe Lavanderia. I felt my branding should give people a comfort level so that, when they saw the brand from neighborhood to neighborhood, they knew what to expect as far as quality and level of service.
That’s totally changed, because of internet search engines. Now, I name my stores with regard to the region I’m in. After all, potential customers tend to type in the name of their region and “laundromat. So, today, all three of my stores have different names. They all have the same basic look, décor and equipment, but they have three different names, geared toward the region in which they are located.
In the original piece, I talked about the size of the store and the targeting of the family. Generally speaking, I was correct in that having large equipment is the key to a successful laundromat. You have to provide customers with what they can’t get at home or in laundry rooms – access to a lot of larger machines. The only difference is targeting-wise; today, I also target couples and singles with my wash-dry-fold service. And I’m doing a lot of advertising directed toward that end.
I talked about card systems in the article, and I’m still a strong believer in them. Of course, for my first three stores, cards were in their relative infancy – to the point where we were still utilizing dial up.
Along those lines, I was one of the early adaptors of credit cards. In fact, at one of my stores, credit card revenue represents somewhere in the range of 40 percent to 60 percent of my overall revenue. The cards also provide me a wealth of management information, as well as a several marketing options and incentives.
Since the article in 2004, increased technology has made it possible to add multiple washing options for my customers, as well as multiple price options. It’s a way of increasing value to them and gross margin to me. I’ve taken advantage of that in all three of my stores, and I’ve also taken advantage of ozone technology at one of my stores as another value option that allows me to charge a higher vend price. Today’s owners now have opportunities to find many different ways to increase their gross margins, not by simple raising prices, but truly giving the customer value.
I believe a well-run, well-located laundromat can give you an above-average return on investment and a good lifestyle for you and your family.
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