Free dry numbers

[Adamski]

Chad,

First, let me say that I completely understand where you're coming from with this whole idea. You have those new competitors who have been eating into your bottom line and you're sick of it. That's exactly where I was just 2 years ago. My reaction was to develop E-Cycles. Your reaction is to offer Free Dry (plus the $5 bonus). Either way, it boils down to reducing our prices to compete in a tighter market and (hopefully) gain market share.

I like how you are thinking this through. You have pretty much nailed down your costs. There are only a few unknowns remaining.

1. How will your competitors react to your change in pricing?
2. How will their customers react to your new pricing?
3. Will you be able to (or want to) revert back to your old pricing in the future?

Like I stated before, entering the realm of Free Dry is a bold move with unknown consequences. I hope this works for you. I guess we'll know before the end of the year.

Oh, one more thing - my attitude about top loaders is identical to your attitude. They're a necessary evil that is provided for those who really want a top loader. They are provided at full ($3.00) price and without discounting ... ever.

[Howard]

I like the idea of not including the tops, follows with what I was saying before about those customers not being satisfied with only one dry cycle - I think this is a good solution.

I really don't like the $5 bonus, and hope that is a very short term thing. Giving $5 on $20 is really just reducing your prices by 25%, and then you are offering free dry on top of that.

If you don't already have it you should add a loyalty program (I did this rather than the $5 type bonus). You give a free wash after "X" washes on the same card. Once you bring them in, you want them coming back. The loyalty program is similar to what airline frequent flyer miles offer. Thus, it is something that only the repeat customers get - which are the customers you want. It also cuts down on card usage, as you have to accumulate the points on one card only.

[silver56]

Originally Posted by chad

Problem is folks with a card system don't understand how the system works. No one is going to walk into my store put $20 and use the whole $20. there is a reason I have a float of about $50k between both my stores

Does the float earn anything these days or do you get to keep it after a perio of time?

[Howard]

Originally Posted by silver56

Does the float earn anything these days or do you get to keep it after a perio of time?

You get to keep it. I found that on average cards that never got used after six month would have an average value of $1.29 on them and they might cost about 20 cents each, so there was a profit of over a dollar on every card that stopped being used.

[chad]

Howard the $5 promo is to get folks into the door, once I have the amount of customers I want i will drop it down to $4 $3 then $2. My main goal is to get 400 new customers in 1-2 months max.

[Howard]

Originally Posted by chad

Howard the $5 promo is to get folks into the door, once I have the amount of customers I want i will drop it down to $4 $3 then $2. My main goal is to get 400 new customers in 1-2 months max.

That's fine, but $2 is still almost an across the board 10% reduction in price. A discount like you plan to offer for a short period of time is one thing, but too many card stores do this all the time, which in my mind makes little sense.

[CanCanCase]

I was driving US Highway 101 through Eureka, CA on Saturday. I saw a very large banner advertising "FREE DRY" at Launderland...

-Case

[Howard]

Originally Posted by cancancase

i was driving us highway 101 through eureka, ca on saturday. I saw a very large banner advertising "free dry" at launderland...

-case

and ????????????????????????????????????

[CanCanCase]

"and" what? With a car load of family and 1200 miles in 3 days, this wasn't a "gee, there's a laundromat...let's go have a peek!" kind of trip.

Just an observation...

Chad, is "Launderland" a franchise deal, or is that PWS selling spec stores to suckers?

-Case

[chad]

Originally Posted by Howard

That's fine, but $2 is still almost an across the board 10% reduction in price. A discount like you plan to offer for a short period of time is one thing, but too many card stores do this all the time, which in my mind makes little sense.

Howard I checked my card system today for last month the bonus of $2 was only 6.3% of my total gross revenue from wash and dry. Not a bad number.