Calling Them Investors

[Howard]

Originally Posted by kimfenolio

The Coin Laundry Association has a free webinar coming up on Tuesday specifically for potential new investors like yourself Jwvent. I welcome you to attend: http://www.coinlaundry.org/resources/webinar.cfm

Kim this should be called something else. Smart people invest in stocks, and bonds, and commodities, and even real estate - they do NOT or should NOT "INVEST" in laundromats. Well I guess they could if they were speculators. My point is that people need to look at this as an actively managed business not an investment. That was a folly started by distributors to sell equipment to doctors and lawyers a few decades ago. It is a major disservice to any potential participant in the industry to let them think they are making an investment. They are buying or building a business. Maybe a trivial point to some, but it might save many potential big losses.

[kimfenolio]

Originally Posted by Howard

Kim this should be called something else. Smart people invest in stocks, and bonds, and commodities, and even real estate - they do NOT or should NOT "INVEST" in laundromats. Well I guess they could if they were speculators. My point is that people need to look at this as an actively managed business not an investment. That was a folly started by distributors to sell equipment to doctors and lawyers a few decades ago. It is a major disservice to any potential participant in the industry to let them think they are making an investment. They are buying or building a business. Maybe a trivial point to some, but it might save many potential big losses.

Thanks Howard, we appreciate the feedback. We're pretty comfortable referring to people who are potentially going to get into the business as potential investors. In fact, anyone who views or participates in one of our potential investor webinars is presented with facts to support the idea that it involves active management as well as a monetary investment in their business. I welcome you to view a webinar to see how we approach that. Previously held potential investor webinars are located at the link above and are free and available to anyone.

Thanks!

[Howard]

Kim -- my point had nothing to do with your specific content - its regarding the marketing. I think when distributors do this it draws in too many people that feel they are making an investment. They then prove to these novices that using "the industry average 5 TPD" How much money their "investment" will yield them. This information is used to push un-savvy people into bad decisions. This leads to some of these big stores that either never make money or make money for the third or fourth buyer when they are actually sold based on true market value as opposed to many questionable projections.

My feeling, and I think you will find many others here feel the same way, is that the trade association should not be marketing the participation in the industry as an investment. It might seem like a minor point, but that minor point causes a lot of people that should never be in the industry to determine that it is a good thing to do.

[chad]

Interesting point Howard, I would agree with you on this. I think that is why we have such a high failure rate in Los Angeles is because most owners act like this is an investment and forget to keep the place in shape and just rather collect the dollars and go.

[couvsuds]

Originally Posted by Howard

My feeling, and I think you will find many others here feel the same way, is that the trade association should not be marketing the participation in the industry as an investment. It might seem like a minor point, but that minor point causes a lot of people that should never be in the industry to determine that it is a good thing to do.

I, too, am in this camp. Investing is for stocks and CDs. This is a small business, and should be marketed as such.

[silver56]

Originally Posted by couvsuds

I, too, am in this camp. Investing is for stocks and CDs. This is a small business, and should be marketed as such.

Me too. I approached this business a few months ago from the perspective of the investor but can see clearly that this is not the case. It's a business. One that has to be managed, marketed, repaired, etc.

I'm surprised that some distributors have learned nothing from homebuilders. Putting up spanking new 'mats filled with your equipment on spec does nobody any service other than the distributor. It creates oversupply, massive price competition, and eventually, kills the industry. From my little time here this seems to be exactly what is happening to the industry and it will end up badly for everyone - owners and distributors alike. And it takes YEARS to overcome.

[rbh]

Howards point is dead on. Funny, I own two 'small businesses', one a liquor store and the other the lmat. No one would think of saying I 'invested in a liquor store'. I own and operate it. Same for the lmat. So when I hear it referred to as 'investing in laundromats', I have to laugh as it does sound like the distributor marketing approach!

[silver56]

Originally Posted by rbh

Funny, I own two 'small businesses', one a liquor store and the other the lmat.

So you solved the age-old problem of bums sleeping in the 'mat....at least sell them the booze!

[MrMachine]

Originally Posted by Howard

Kim -- my point had nothing to do with your specific content - its regarding the marketing. I think when distributors do this it draws in too many people that feel they are making an investment. They then prove to these novices that using "the industry average 5 TPD" How much money their "investment" will yield them. This information is used to push un-savvy people into bad decisions. This leads to some of these big stores that either never make money or make money for the third or fourth buyer when they are actually sold based on true market value as opposed to many questionable projections.

My feeling, and I think you will find many others here feel the same way, is that the trade association should not be marketing the participation in the industry as an investment. It might seem like a minor point, but that minor point causes a lot of people that should never be in the industry to determine that it is a good thing to do.

I agree Howard. Technically, people are investing their money so one can call it an investment, but people should also realize that it's also a career choice too.
An investment implies a passive act. Owning a Laundromat is FAR from being passive as many Newbies find out at their peril.

[apartment_guy]

Originally Posted by MrMachine

An investment implies a passive act. Owning a Laundromat is FAR from being passive as many Newbies find out at their peril.

Perhaps. However, I am a very "hands on" landlord and I actively manage, but I nonetheless describe myself as an "investor", inasmuch as my goal is long-term capital appreciation, which is best achieved (IMHO) by investing in technologies which will reduce operating costs (such as front-loading washers... among many other things) and investing in things which will permit me to increase gross income (such as front-loading washers... among many other things).

In other words, I interpret "investing" as adding value.

Nonetheless, I understand your point. FWIW, I found this chart on the website of a local equipment distributor, comparing investing in laundromats vs. mutual funds, money market accounts, and savings account.

Which pretty much proves your point

See the attached.