Going Beyond the Laundromat

By Dave McMahon | Aug 16, 2011

Gina Villi gushes with enthusiasm about being a business owner. If there were ever a laundromat owner who thrives by providing customers with a service they can’t refuse, it’s Villi. As president of the Coin Laundry Association’s Western Pennsylvania affiliate, Villi remains in close contact with the industry and its challenges.

There was a time when Villi also had keen insight into the real estate management industry. During that era, however, she felt as if her portfolio was missing something.

“I had worked for a real estate developer and helped manage the day-to-day operations for five shopping centers and four office buildings in the Pittsburgh area for many years,” Villi recalled. “I truly enjoyed my position but it just wasn’t enough for me. So I decided to take some time off and discovered that I wanted to be in the laundry business. Can you imagine?”

In 2004, Villi opened Salem 22 Laundromat in Delmont, Pa. Since then, the laundromat has expanded to become the Salem 22 Dry Cleaning & Linen Laundry Service. Salem 22 services the entire Pittsburgh area with free pickup and delivery service for drycleaning and linens. The state-of-the-art store offers wash-dry-fold services, along with outsourced drycleaning and shirt laundry services on the retail front.

Salem 22 also offers route delivery services, including pickup and delivery of wash-dry-fold and drycleaning services to businesses serving Allegheny, Westmoreland and Somerset Counties in western Pennsylvania.

In 2006, Villi expanded the business to include commercial laundry services to hotels, motels, tanning salons, fitness facilities, specialty linen rental companies and restaurants. Villi’s expansion proved to be a wise move, as the commercial laundry service increased and outgrew the laundromat.

Always looking ahead, Villi’s next move was to build a commercial laundry plant in Jeannette, Pa., which gave birth to Salem 22 Linens. In 2010, Supreme Linen Service, LLC, was created from Salem 22 Linens to diversify into the healthcare and other service and product lines.

“I would really like people to understand that they have to be very, very committed to own a laundromat,” she said. “I turned my laundromat into something very big. Now I’ve branched out and have the plant to service the healthcare linens.”

How did you get involved in the coin laundry industry?

I did a lot of due diligence and decided that it was the best opportunity for me at that time of my life.

What attracted you to this business?

It’s a cash business and also it’s self-service. It pays for itself.

What are the keys to a successful self-service laundry business?

First and foremost are the cleanliness and appearance of your coin laundry. Second, customers love newer laundry equipment. Also, it is very important to have security cameras. Customers want to feel safe and secure and to have knowledgeable attendants.

What are some of the hot-button issues for laundry operators in your area?

Utilities are the biggest issue. Utility costs have gone up and continue to rise. The cost of electricity is skyrocketing and deregulation for electric began on January 1. That means that any business owner can pick their electrical provider that’s in their area.

Natural gas seems to be staying the same, but water and sewage is another uphill battle. You are charged for one amount for water, and then double the amount for sewage. It’s not regulated at all.

You get the water bill and are charged $1,000 for water on a two-month basis. Your sewage bill will be double that. They used to be the same, but now the sewage is double. That’s my biggest pet peeve with owning a laundromat.

What major trends are you noticing in this industry, particularly in your marketplace?

The one big thing that I have noticed is that our regular customers are doing their laundry less often in an effort to save money.

What is the biggest concern you hear from the customers in your area?

Pricing. Customers don’t understand the costs associated with owning and operating a laundromat.

What’s the greatest technological advancement you’ve seen since you’ve been in business?

The most fascinating thing that I’ve seen come out recently is the Electrolux combo washer and dryer.

Do you have a business philosophy that guides your decisions?

Value-added solutions to today’s problems.

Specific to your market and region of the country, what are your thoughts on vend pricing?

My vend prices are the highest in Westmoreland County. My toploaders are $2.25, my 30-pound frontloaders are $4.50 and my 60-pounders are $6.50. As for my dryers, my stacked dryers are 50 cents for the first nine minutes and six minutes for each additional quarter, and my 50-pound dryers are $.175 for the first 10 minutes and four minutes for each additional quarter.

I believe that, if vend prices are high, you will get less volume and, thus, less wear and tear on your laundry equipment, and you’ll be able to save on your utilities.

How do you think laundry owners should approach the issue of attendants and their training?

Attendants should be very friendly, and knowledgeable about treating fabrics and stains. They need to be able to help the customer any time about anything.

Are you a big believer in marketing your business?

It is very important to advertise your coin laundry in the Yellow Pages and in your local newspapers. Become a member of your local chamber of commerce. Send mass mailings with coupons, or hire someone to distribute door hangers. In addition, the Coin Laundry Association has some great templates for advertising and great prices; CLA members should take advantage of that.

In your experience, when a coin laundry fails, what is the most common reason?

I believe that customer service is the most important aspect in dealing with a coin laundry. Without good customer service, you are certain to fail.

Make sure you educate yourself on the different types of laundry equipment out there and educate your customers. Don’t forget, you get what you pay for. Also, with vend pricing, make sure you have the option with your laundry equipment to offer different pricing on different cycles. Talk to your distributor and they can educate you on this. You should never decrease your price and try to increase it later, because then you set yourself up for failure.

Personally, what’s the biggest mistake you’ve ever made in this business?

I would have bought an existing store first, before building one from scratch.

From a business standpoint, what goals are you still looking to accomplish?

To increase business.

What advice would you give a new store owner just getting into this business?

My advice would be to do your due diligence, especially in your demographic area. Make sure it’s accessible and that the size of your store is what it needs to be. The most important piece of advice is to make sure that they purchase the proper sizes of your laundry equipment for their market.

And, of course, location, location, location. Once you have the desired location, anything could happen. Once you have established your store, you need to decide what types of services you want to offer to your customers. Now, if you are really serious about making money, you need to establish profit centers within your business.

In your market, is the coin laundry business still a good business to get into?

Absolutely. In today’s economy, every aspect of the laundry industry, whether personal or commercial, is a necessity.

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Anonymous Wed, 08/31/2011 - 14:15

Those of us in the laundromat business have sold ourselves short for the last fifty years always worried about the customer and what he thought about your prices.We should have taken into account what it was we were doing competing on price instead of competing on the quality of the store we were running. Today a 20lb washer, a front load should be a minimum of $4.00 to $5.00 and not including FREE DRY.
I remember listening to Richard Weisinger giving a seminar at a NJCLA meeting some ten years ago, he was talking about the price of a wash and he broke it down in a way that I didn't think many there at the time completely understood what he was saying. He was taking into consideration rent, electric, water and sewer and of course replacement because no machine lasts forever. In the end the questions were about how do I raise my price when the competition won't because that has been the mind set of operators over the years.
Now we are in a marketplace where the cost of water and sewer are being raised substantially, the cost of the small front load which was $750.00 when you bought it twenty plus years ago is now almost $4,000.00 and we're not talking about gas and electric while most in our industry are getting only $2.50 or there abouts for a twenty pound front load washer. Oh, and I forgot to talk about rents, no more can you find $8 or $10 per square foot locations, even buying a building in a decent area has gone up to almost being prohibitive. The time has come for the industry to reevaluate the way we have been doing business.
With the cost of building a good store today being what it is or buying a good store and paying maybe five or six times its net then working hard to administer the business so that it runs correctly shouldn't you be rewarded properly...
Does anybody out there think I'm nuts or what?

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