Cleaning Up

By Bob Nieman | Sep 20, 2010

By his own admission, Greg Koehler is a “clean freak.”

It’s a predisposition that has certainly served him well over the last year or so, since opening Spin Fresh Coin Laundry, a state-of-the-art facility in Appleton, Wis.

“My philosophy is, if a customer comes in at 6:00 in the morning and they’ve got a beautiful clean laundromat, the 7:00 customer deserves the same thing – as does the 8:00 customer, the 9:00 customer, the 10:00 customer and everyone else, all throughout the day,” Koehler said. “No matter what time of day they’re there, we’ve got to have this place at its best. We’re not sitting around, waiting for it to achieve to a certain level of dirt before we decide to clean. We clean it all the time, steady – all day, every day, every hour, every minute.”

It’s Koehler’s strict attention to detail that has no doubt lead to his successful career as an interior designer.

“I’m also a residential and commercial property flipper,” he added. “I buy old buildings and old homes, refurbish them and put them back up on the market. Between that and interior design, that’s what I’ve been doing.”

Not exactly.

About eight years ago, Koehler also opened a high-end furniture design studio in Appleton, which he currently runs as well.

And, on top of that, he’s part owner of a hair salon, which is located in one of his commercial properties.

This is where Spin Fresh comes in.

“I had just recently bought the building with the salon,” said Koehler of the 30,000-square-foot former car dealership. “It was in a bank foreclosure. I purchased it, refurbished it and got the place leased up.”

However, Koehler had an 8,000-square-foot section of that building sitting empty. Originally, that space had been earmarked as a warehouse for his furniture design business, but a coin laundry promised much more profit potential.

“Two of my best friends have a couple of coin laundries in Green Bay,” Koehler said. “So I was familiar with the potential of laundromats and what they are all about – that was part of my encouragement.

“The laundry fills space in one of my properties, which is good. It got me into a business that I felt I could probably manage. And, being an interior designer, I knew I could create something that would be really great.”

The “creative process” took about three months to complete, and it cost Koehler approximately $600,000 – $400,000 for the equipment and $200,000 for the space renovations.

“It was one big open box – 80 feet wide by 100 feet long – so that made it easy for me,” he said. “And, because I’ve been doing this for a living for so many years, I guess I didn’t think there were a lot of surprises.”

However, one thing that did surprise Koehler during the retrofit process were the details that other laundry owners told him were and weren’t important.

“Now that I’m open I see things I would have changed,” he admitted. “Being an interior designer, I’m very much into spacial planning. I love to have space. And others kept telling me, ‘You only need a few feet here for people to get by. That’s all your need there.’

“Now that I’m in here, I wish I would have pushed a wall back another foot or two, or changed the angle of the layout. I should have listened to my interior design spacial planning instincts a little bit stronger, and I would have an even better product layout than what it is.

“I see it, but I don’t think a lot of other people see it,” added Koehler, acknowledging his acute attention to detail.

Overall, Koehler utilized 5,000 of the 8,000 square feet available to him to build Spin Fresh, which opened in August 2009. The rest of the space is currently used for storage and allows room for future expansion.

The result is a laundry offering wash-dry-fold service, wireless Internet, cable TV, vending machines, large family room areas and a generous game room complete with foosball and pool tables.

“I have chandeliers shaped like bubbles in the foyer,” Koehler noted. “I have 50-inch plasma-screen televisions. I’ve got lamps in here. I’ve got marble-topped, mirrored end tables.”

In fact, the store boasts several architectural and design elements, which Koehler said he had been warned would be ruined by his lower-income customers.

“We’re more than a year old, and we still look brand new,” he said. “If you give something nicer to someone, they’re going to respect it more. For example, if I went to a laundromat that was dirty, with gum and stains all over the floor, and I spilled a soda there, I probably wouldn’t bother telling an attendant, especially if I see 10 other stains right next to it. If the owner obviously doesn’t care, why should I?

“That’s not really been the case here. The customers are like, ‘Wow, somebody actually cares about us. We’re getting respected. And we’ve got beautiful surroundings.’”

Spin Fresh is located in a largely Hispanic and Hmong residential area that’s dense with apartment complexes. And that makes up the store’s core customer base.

However, to a smaller extent, Koehler also attracts a number of homeowners who are looking to wash their comforters, quilts and other large items that they can’t easily launder with their own washers and dryers. Spin Fresh also gets its share of vacationers who simply don’t want to spend eight hours doing their laundry at home.

“The higher end customer is not intimidated by our place,” Koehler said. “Rather than going to the drycleaner with some of their items, they come here because they see a nice, respectable place.”

Of course, customers who have the option of washing their clothes and other items at home are much more discerning. They want the machines clean, Koehler stated.

“They don’t want to open up the top of a washer and see soap spilled over it,” he said. “They don’t want to see bleach left in the dispenser. These are all things that we constantly check. We wipe the glass doors, inside and out after every use. We definitely flip the lid to make sure that no bleach or soap residue is left. That is flushed constantly. And we’re checking the dryers, too. It’s definitely a constant battle to remain at the standards we’re at.”

But perhaps the most surprising battle for Koehler after opening Spin Fresh was the language barrier between him and the majority of the residents in his marketplace.

“I never even gave that a thought, and I don’t know why,” he marveled. “The language barrier has probably been the biggest obstacle for me in communicating with customers and customer communicating with me, as well as for me knowing where to advertise and how. I’m a 45-year-old white guy. How do I get the Hispanics and the Hmongs to come here? It caught me off guard.”

Koehler’s first step was to hire bilingual attendants. Of his five-person staff, he has two bilingual Hispanic employees and a bilingual Hmong staffer.

“It makes a big difference, especially to help the customers feel comfortable,” he explained. “That’s helped our growth. It’s not just a ‘white-owned’ laundromat.

“The laundry doesn’t look cultural. I didn’t make it look Hispanic. I didn’t make it look Hmong or Asian. So, the fact that there is a Hmong person on staff breaks down the barriers. Visually, Spin Fresh has nothing to do with their culture, but the staff has helped take down those walls.”

Koehler’s advertising and marketing strategies also have helped him gain acceptance in a market that has five other competing self-service laundries.

“People get into habits,” explained Koehler, whose store is open 6 a.m. to midnight daily. “They get in their cars and go to a laundromat. It’s just like when you leave work, sometimes you can drive home and, all of a sudden, you’re in the garage and you don’t know how you got there. That can definitely happen for a routine business like coin laundry. It takes a lot for customers to leave their comfort zone and try us out.”

To nudge potential customers out of their comfort zones, Koehler uses direct mail with a strong visual appeal, advertises regularly in a local Hispanic publication and has done live radio spots on the area’s Hmong station.

As far as in-store promotions, Koehler enjoyed a good deal of success with a referral program that ran for the first six months Spin Fresh was open.

“If we had a customer who was already in the store as a customer, we gave them a punch card that they could give to a friend,” he explained. “On the friend’s third visit to our store, he or she got a free wash, and the referral customer got $5. We had 40 percent to 50 percent growth during that time.”

Spin Fresh also holds weekly $20 drawings, which have proven quite popular with customers.

However, according to Koehler, what really attracts people to Spin Fresh is the customer service.

“Our staff does not sit down,” he said. “If they see somebody walking in the door, they open the door and ask if they can help: ‘Do you need help in? Do you need help out?’

“We have to look approachable, and we have to be able to approach our customers in a friendly manner. I tell my staff to treat it like a home. Would you let a stranger walk into your house, sit down and turn on the television – and not look at them or say hello. No. Well, this is no different. They’re coming into our space, and we want them to feel at home. We don’t ignore anybody.”

Not even those who would rather just drop off their laundry, as opposed to doing it themselves.

While the self-service side of the business generates the majority of the store’s revenue, Spin Fresh offers a wash-dry-fold service for 80 cents per pound, with a 10-pound minimum. Thus far, drop-off laundry accounts for only about 10 percent of overall revenue. However, Koehler plans promote and grow this segment of his business in the near future.

And apparently that’s not all he’s got up his sleeve. A funny thing about Spin Fresh Coin Laundry is that it almost opened up as Linwood Coin Laundry.

“Everybody told me to name the laundry after the street I’m on because it’s easy advertising,” Koehler said. “It was going to be called Linwood Coin Laundry. But this is where the businessman in me thought, ‘Why would I spend all of this time and effort calling it Linwood Coin Laundry?’ What if this thing takes off? Why wouldn’t I want to capitalize on my success? I can’t got to another location and call it Linwood Coin Laundry.”

As a result, he came up with a name that was brandable.

“Spin Fresh,” he said. “That’s what it’s about. And now I’ve branded myself, so success from this one can carry over to the next one.”

It sounds like this is only the beginning.