Well 6 months are under our belt and, unfortunately, things are not going so well. My gross income is not meeting what my projected gross income was expected to be. Before I bought the business I audited the previous owners books and calculated what the average monthly gross income would be. In the last six months I have had a low of -6% to a high -20% below that. The six month running average is -16% below calculated Gross.
I have had some thoughts as to why this might be. I came up with the following:
The previous owner lied to me (cooked his books)
We switched to unattended hours in the morning and lost sales
Whiplash from a poor previous owner (he only owned the store for 6 months or so?)
We discontinued Val Pak in favor of direct mailings.
Poor customer service (due to some poor attendants? We had some problem attendants)
Lost commercial accounts we lost one large account and that hurt.
Competition increase (none that I know of)
I think that we are doing a much better job then the previous owner running the store. We are keeping the store spotless, replaced all of the lighting, and replaced the HVAC unit. We have not had the quality issues he had when I took it over (customer complaints).
I find it hard to believe we cannot match his claimed gross doing a much better job then him.
At this point I am not really sure what to think or do. 16% is a lot to recover from. I am curious if you guys have any comments or suggestions.
Can I just be in a cyclical low period? Have I not waited long enough to reap the benefits of our efforts yet? If not how long should I wait? I am starting to become very concerned.
The Illinois Coin Laundry Association will hold its Summer Meeting on September 18th at Colletti's Restaurant. You will not want to miss this event!!
TOPIC: Managing Rising Water & Sewer Costs
Brian Wallace, President and CEO of Coin Laundry Association, is a 22-year veteran of the coin laundry industry. He meets and works with operators across the nation on issues affecting their businesses. Wallace's national exposure to coin laundry owners and their challenges with rising water and sewer costs gives him great insight into this growing menace to your business. Wallace will be able to offer solutions, based on the proven results of others, that can help you improve your business' performance and bottom line.
I know each situation is different but I'm trying to get a sense of a "typical" annual increase in rent. The previous owner signed a five year lease (which I took over as is) with an annual 4% increase each year. I have 2 (5) year options with that same built in 4% increase. Is this normal? It seems like a lot to me. I'm not sure I can just keep passing on this increase on to my customers? I haven't spoken with my landlord yet, but just trying to prepare for the worst. This was my first business purchase and dealings with a commercial lease. Many good, hard lessons learned... but costly.
One of my landlords is requesting me to sign an estoppel because the building is going to be up for sale. Does an estoppel put me at risk with the new owners? I have what looks to be a good lease with options up to 2029 but dread the thought of getting into problems with a new owner.
I have some history with the current landlord. When I sold a different business in the same center he strong armed me for $5k in "legal fees" and another $3k for maintenance which he 100% neglected to do. He agreed to allow a transfer of the lease to the new buyer for the $8k in fees.
I wonder if there is something in it for me to agree to sign the estoppel such as a strengthening of my current lease terms or recouping some of the money he shook me down for. What are the pitfalls of a tenant signing an estoppel?
I'm curious about how various operators get rid of unwanted employees so I've set up this poll. You may vote for more than 1 selection.
I often use my Employee Disciplinary Report to confront the employee with serious issues. This lets her know that I'm on to what she is doing wrong and I will not tolerate it. Often, an employee will quit right after being disciplined this way. The report also creates that all-important written record that may come in handy at an unemployment compensation hearing.
As many of you, I also have video surveillance in my mats which has come in very handy in a variety of situations.
There's nothing like a video clip to show visual proof of a situation that occurred in the mat. It usually ends any argument and often helps to nail people for prosecution.
People often bother me to "see" my systems so they can verify if something they own was lost, forgotten or stolen. It seems to happen a lot these days and sometimes I don't want to be bothered to look up every little situation, yet I do want to make my customers happy.
The last one was a guy who thought he left his expensive Nike sneakers on a washer. Turns out he took them into the parking lot and left them on the roof of his car!
So.....Is it smart to show every event to every person who asks?
What if they ask for a clip to show the Police and other customers happen to be in that clip? Is that a violation of their privacy? Could we be sued for that?
Hi everyone. I have a question for those of you that have negotiated leases before. I'm close to signing a lease that is for a 10 year term and it has a 5 year option that is defined as "to be negotiated at that time at fair market value". I'm not comfortable with waiting until year 8 or so and then trying to negotiate the option but the broker representing me says that this is typical and good to have in the lease vs continuing to pay the rate increases we have for years 1-10. If the lease terms were not already high I might be more comfortable but I'm already paying steep rates for the first ten years and the landlord hasn't given much up in the months that we've been negotiating. I just thought that I've learned from all of you to define the terms up front including the option but I'm being told differently now. I ran this by someone I trust that doesn't have any skin in this and they say I'm being raked over the coals. Can I get other opinions to confirm what I think I already know?
I have my eye on a second location within the same city of approx 70,000. I have obtained a demographic report on the location I am looking at and can compare it to my current location's demographic report. Since I know what I am grossing at the current location, I am working to project my gross at this new location. So far, the population base is larger, it is also more diverse in that there are more minorities. There are more renters, and the income average is lower. Median family size is larger. So, on the surface I think things look good. But, based strictly on demographics, what else should I be concerned with? What am I missing or not taking into account that would be important to you (demographics), if in my situation? Thanks!
I recently read the news article about Best Western refusing a service dog into their hotel (Baton Rouge) when a couples teenage son has a rare form of epilepsy. It prompted me to re-read the laws and go over our previous discussion on this site. Doing that review opened up some new information that I had not seen before.
Here is a quote from part of this article. I've underlined the part I didn't know before.
"The work or tasks performed by a service animal must be directly related to the individuals disability. Examples of work or tasks include, but are not limited to:
assisting individuals who are blind or have low vision with navigation and other tasks
alerting individuals who are deaf or hard of hearing to the presence of people or sounds
providing non-violent protection or rescue work
pulling a wheelchair
assisting an individual during a seizure
alerting individuals to the presence of allergens
retrieving items such as medicine or the telephone
providing physical support and assistance with balance and stability to individuals with mobility disabilities
helping individuals with psychiatric and neurological disabilities by preventing or interrupting impulsive or destructive behaviors The crime deterrent effects of an animals presence and the provision of emotional support, well-being, comfort, or companionship are not considered work or tasks for purposes of the definition of a service animal."
Here is a 2nd article supporting this and it makes the distinction between service animals and emotional support animals as well as the legal rights. It does mention to check with State Laws as well. http://www.servicedogcentral.org/content/node/76
So what I gained from the articles is that people who bring their pets into businesses for "emotional support" don't have "service" animals according to this and thus you have no requirement to actually allow them access to your Laundromat provided you have checked your individual State Laws to be sure.