{"id":11016,"date":"2022-02-04T14:48:15","date_gmt":"2022-02-04T20:48:15","guid":{"rendered":"https:\/\/planetlaundry.com\/?p=11016"},"modified":"2022-03-07T12:15:09","modified_gmt":"2022-03-07T18:15:09","slug":"crunching-the-numbers-part-2","status":"publish","type":"post","link":"https:\/\/planetlaundry.com\/crunching-the-numbers-part-2\/","title":{"rendered":"Crunching the Numbers (Part 2)"},"content":{"rendered":"

A Look at Some of the Operational Metrics and Key Data Owners Should Be Monitoring to Keep Their Laundromats on Track for Success<\/h2>\n

[This is the second in a multi-part series on some of the key performance indicators laundromat owners should monitor regularly. You can read Part One here<\/a>.]<\/strong><\/p>\n

In Part One of this series, some of the laundromat industry’s leading manufacturers discussed what they considered to be the key performance indicators for today’s laundry businesses… and why these metrics were so critical to running a successful laundromat operation.<\/p>\n

This time, we asked a few of the top laundromat operators across the U.S. to share what specific numbers and statistics they regularly rely upon to assure their operations are on track with their business goals:<\/p>\n

Colleen Unema<\/strong>
\nBrio Laundry<\/strong>
\nBellingham, Wash.<\/strong><\/p>\n

I look at machine income month to month, but I also run comparisons of period to period from the previous year. I always want to see growth \u2013 not just \u201cincome.\u201d I\u2019m after that percentage increase\u2026 or decrease, as the case may be with the pandemic shutdowns.<\/p>\n

In addition, profitability and employee engagement go hand in hand. As a result, I also look at commission reports as an indicator of attendant engagement and our customer-centric approach to attending the laundromat. We sell a lot of soap and laundry-related products \u2013 so, if sales are slow, we have a problem.<\/p>\n

For me, the final piece of the puzzle is how many pounds of laundry are in the queue, as compared to previous week, the previous month, and so on.<\/p>\n

I\u2019ll consult these performance indicators a couple times a month. I have a spreadsheet in which I can enter a few numbers to see these statistics graphically. And the newer POS systems are keying into the business\u2019 KPIs \u2013 with the click of a button, I can track my progress and view statistical comparisons. In fact, I couldn\u2019t do any of it without quality POS software and cloud-based systems.<\/p>\n

After running a laundry business for a while, you intuitively begin to know some things about your operation. However, your senses can sometimes prove unreliable and cannot stand up to the cold, hard numbers. What you think and what is real are often two different things, especially when it comes to engaging your attendants to help you grow your business.<\/p>\n

I don\u2019t always look at \u201cwhen\u201d self-service customers come in, since we are busy seven days a week. In fact, after reviewing the numbers, we will be extending our business hours in the next month. We\u2019re simply too busy to close up at 10:00 p.m. Of course, being fully attended, this decision required the careful study of performance indicators, income and staffing in order to justify the cost of extended hours.<\/p>\n

In addition, the KPIs helped determine the direction of our marketing messages. After the COVID-19 shutdown and limitations, we advertised the notions of \u201csafe, clean and easy to do it yourself.\u201d And our growth curve for the self-service segment of the business rebounded quickly.<\/p>\n

The best advice I can offer is to stick with the program. Don\u2019t just read numbers. Compare them and calculate the rate of growth. Plot the rate of growth, not the income in dollars. Train yourself and your employees to focus on building business \u2013 not just counting coins.<\/p>\n

Personally, one industry statistic that I believe is overrated as a performance indicator is turns per day. TPD can be fudged. It\u2019s a nice number to look at for general purposes, but I would rather look at a count of something real \u2013 like money \u2013 than a calculation of turns as an indicator of income.<\/p>\n

Larry Adamski<\/strong>
\nMuskegon Laundromat<\/strong>
\nMuskegon, Mich.<\/strong><\/p>\n

I compare my monthly gross sales to same-month sales for the previous year, and then I calculate what percentage up or down my business is. This gives me an early feel of how the business is doing that year. Repeating this process for each month as we progress through the year usually solidifies the trend.<\/p>\n

Comparing annual sales to the prior year\u2019s annual sales establishes how the business actually performed after the year is over.<\/p>\n

I also like to calculate total utilities as a percentage of total sales to get a feel for my operating efficiency, versus my vend pricing. I like this figure to be under 10 percent.<\/p>\n

Lastly, I will multiply my total sales by 16.5 percent to establish a maximum budget for the following year\u2019s labor cost.<\/p>\n

Chuck Hinkel<\/strong>
\nLaundry Depot<\/strong>
\nWaterloo, N.Y.<\/strong><\/p>\n

On a monthly basis, I like to track turns per day, per machine model, to see what each size of equipment is most popular with my customers. In return, I can monitor usage and be able to phase out any unpopular or non-revenue-generating machines and replace them with more popular pieces of equipment that will generate more money for the business.<\/p>\n

I also monitor my monthly utility costs, with the target being that these costs represent 15 percent to 18 percent of my gross revenue.<\/p>\n

With the emergence of QuickBooks and other accounting software, I\u2019m able to compare month-over-month and year-over-year expenses and growth.<\/p>\n

It shows me growth year after year, because I can look at my numbers in real time, which helps me to make purchasing decisions for new equipment that will meet my customers\u2019 wants and needs.<\/p>\n

I think some laundromat owners get too caught up in what profit percentage they think they should be making. There are too many variables from store to store for there to be a truly universal number throughout the industry that everyone should be doing. Everyone has a different type of client base and business model.<\/p>\n

Marty Mullican<\/strong>
\nOwasso Express Laundry<\/strong>
\nOwasso, Okla.<\/strong><\/p>\n

At my laundry business, we focus mostly on ratios and percentages, rather than specific target numbers. For example:<\/p>\n