Anyone ever buy up all 'mats in a town?

[silver56]

Given the intense competition in the industry has anyone ever successfully gone about simply buying up all the local laundromats and becoming the de-facto sole destination of doing laundry in a particular geography?

From what I've gathered on here it seems many of the regular contributors here reside in smaller towns where their 'mat is either the only game in town or at least the best one. The reason I'm thinking of this is because in my area (Chicagoland) it's very competitive so I'm trying to map out a long-term strategy for getting into the business and succeeding for the long-term. One idea I've had is focusing on a particular area and/or suburb and seeing if I can buy my way into the market, getting majority market share.

Anyone ever taken this strategic approach? Pitfalls, issues, etc?

[bo]

Second only to owning your own real estate, I think that is a smart move for a business owner. You have a lot of options when you make it known to your competitors that you are willing to buy their store. I once bought a competitor and closed his store. It was not very big and we were only sharing the two pieces of a very small pie. I help my competitors as much as possible and hope that they will consider me as a possible buyer or vice versa. I would prefer a buy out over a three way split any day.

[mjwalsh]

Sounds like some of the tactics of the "too big to fail" technology companies.

[bodman]

never been to chiago but heard there are some Italian brothers that run several large garrish mats ie; marble floors and folding tables , it will be tough to compete there. that said smaller areas not such a bad idea. Sometimes you should approach their landlords ask them to visit your place to see what an asset a good mat provides to their mall. and inquire when their mat lease expires and would they be interested in you going in and inproving their property, That way you do not have to pay anything for the space, machines or customers.from present mat owner.

[Xiong]

Originally Posted by silver56

Given the intense competition in the industry has anyone ever successfully gone about simply buying up all the local laundromats and becoming the de-facto sole destination of doing laundry in a particular geography?

From what I've gathered on here it seems many of the regular contributors here reside in smaller towns where their 'mat is either the only game in town or at least the best one. The reason I'm thinking of this is because in my area (Chicagoland) it's very competitive so I'm trying to map out a long-term strategy for getting into the business and succeeding for the long-term. One idea I've had is focusing on a particular area and/or suburb and seeing if I can buy my way into the market, getting majority market share.

Anyone ever taken this strategic approach? Pitfalls, issues, etc?

not a bad strategy, but always remember that buying to kill often can backfire.
perhaps own the business and real estate on each of your laundries would solidify your stake better, but this strategy requires risk taking and long term committment.

[CanCanCase]

I set out to open ONE new laundromat in our market - population approximately 30K. The week I opened #1, store #2 came inquiring to see if I would buy him out. We did, and that's where I drew the line in this town. Owning 2/5 of the pie is great...

Oh, one of the older competing stores closed and another is on its way if the owner ever sells her strip mall. So, I own half of my market.

Our third store was the only mat in a 5-mile radius, and as we were building the nearest competitor closed down permanently - didn't even try to take advantage of the 3 months with NO laundromat operating in the area. Now the nearest facility is....my #2 store to the South.

#4 in development now is one of 3 in that town. Competitor #1 is dumpy and old and looks like it will be run until broken then closed and scrapped. Competitor #2 is serious, but appears to be financed to the gills and is overbuilt... not even room to move a cart between aisles. Her pricing is also an exact match to my pricing at #3, so I'm thinking I can come in without any discounting and put a shiny new facility up against her formerly-shiny-new-facility.

My stores are the de facto destination to do your wash, but it didn't come about because I bought all the competition (just some of it!) Honestly, I don't know about buying up every store in the area... I'm never going to please every possible customer out there, so I don't mind leaving a place for the bums and price-shoppers to frequent... I'd rather have 3 TPD at premium rates (and lower maintenance) than 5 or 6 TPD at charity rates.

-Case