Breaking with Tradition

By Bob Nieman, CLA Member posted 09-29-2016 15:45


Here’s a Look at Five Self-Service Laundries That Are Succeeding in Somewhat Unconventional Markets

It comes as no surprise that people are protective of their traditions. After all, tradition is familiar and safe. Tradition offers the comforts of routine, habit and ritual. A step away from tradition is a step toward the unknown – and the unknown can be a scary place.

However, we all need to be aware of the subtle ways tradition traps us in the known world – and prevents us from disrupting the status quo and perhaps birthing new ideas. As a business owner, allowing yourself to be bogged down by the traditional thinking and norms of your industry can eventually close you off from opportunities that may be essential the future evolution of your laundry operation.

For most, the “traditional laundromat market” is a densely populated urban location – with low-income, blue-collar renters and large households run amok with small children.

This month, we examine five rather atypical laundry businesses that are making it work in non-traditional marketplaces:

Sofranko3.jpgFour Blocks from the Beach

Owner: Daniel Sofranko

Location: Perfect Wash Express Laundry Center – Huntington Beach, Calif.

Store Size: 1,800 square feet

Operation: Fully attended; open 6:00 a.m. to 10:00 p.m. daily

Additional Services: Wash-dry-fold, commercial accounts, drop-off drycleaning, residential and commercial pickup and delivery

Marketplace Stat: 50 percent of the households earn between $35,000 and $125,000 annually – and 30 percent earn between $50,000 and $100,000

Who Are the Customers? My demographic is 87 percent white. I get everyone from beach people to bankers. I get a lot of young singles and young couples; downtown Huntington is like a college town without the college. I’ve got people rolling in here in Land Rovers. I get vacation rental landlords, vacation rental tenants and a lot of service industry employees.

What Makes This Business Non-Traditional? The median income is a little higher than normal, and the average customer a bit more affluent.

What’s more, because it’s a resort area near the ocean, we are slammed with business during the summer. There are days when we’re just overwhelmed and frantic, while the rest of the laundry industry is kind of taking its vacation. People leave their markets to come to mine. And my store is jam-packed.

In July, I averaged five turns per day overall – and I was doing more than six and a half turns on my 40- and 55-pounders. That’s the craziness of being in a resort area.

The other part of the equation is the fact that two-thirds of my customers have access to on-site laundry equipment or facilities, but they come here because I’ve got high-speed, soft-mount machines that they know will get everything done quicker and cleaner.

Why This Store? Why Here? The store is more than 40 years old, and it had been abandoned. No work had been done on it for at least five years prior. Most of the machines didn’t even work.

It took me 13 months to acquire the location, and to be honest, it would have been cheaper for me to get a vanilla shell and start from scratch somewhere else more traditional. However, if I’m going to be successful in business, I’ve got to bust my butt. And, if I’ve got to bust my butt, I want to do it in a place like my store, which is beautiful, has great people in it and is only four blocks from the beach – rather than being stuck some place I can’t wait to leave.

We’re doing something this community needs. We’re making their lives a little bit easier, and it’s being noticed.

Advantages of This Market: The advantage of having the median income a little higher and having a bit more affluent clientele is that, on the drop-off and pickup/delivery side of the business, I’m going to get people who are willing to trade money for time. There’s also perhaps a shorter learning curve with my card system and more appreciation for my high-speed equipment. There’s a pleasant, easy-going atmosphere in my store.

Challenges of This Market: My typical customer can be a little needier at times – maybe a bit more demanding and used to receiving service.

Branding the Business: The first key to branding is letting customers know who we are and what we want to be. For us, that’s a clean store, a friendly face and a consistent offering of value. For instance, a clean soap dispenser is part of our branding and who we must be.

I do a lot with social media – Facebook ads, Yelp, Google and our website. It’s all tied together. Word of mouth is number one for us.

Best Advice for Other Operators: I know I can scale a lot faster than I’m doing, but I don’t want to grow and sacrifice our core – what we’re already awesome at – or our reputation. I’m not ramping up the pickup and delivery aspect as fast as I could, because I want to make sure that what we are touching is up to our standards.

My advice is to make sure you’re as prepared as you can be before you step up an offering. Get your self-service business down, and get comfortable with the store and the customers. Next, offer your drop-off service, and real dial it in before you add pickup and delivery.

Understand that every time you add these non-traditional services, you’re buying yourself another job. With a drop-off service, you’re buying yourself the job of manager of a cleaning service; and with pickup and delivery, you’re buying the job of driver – at least until you can hire one.

Above all, you’ve got to be patient and make sure that you’re properly funded for whatever is next.

Scott%201.jpgOil & Water

Owner: Matt Scott

Location: iWash Laundry – Odessa, Texas

Store Size: 5,000 square feet

Operation: Fully attended; open 8:00 a.m. to 10:00 p.m. daily

Additional Services: Wash-dry-fold service and commercial accounts business. The store features a drive-through window for drop-off laundry customers.

Marketplace Demographics: We’re in oil field country, so the median income and population is based on the oil market. We could get an influx of 50,000 people when the oil industry is going well. That’s when the laundry business also does well, because there are workers staying in local hotels and RV parks. In addition to the local customer base, we get that transient clientele.

What Makes This Business Non-Traditional? The closest laundromat is five miles away, and the majority of stores are 10 miles away. I’m out of the range of your typical laundromat. We are located just north of the Odessa Country Club and not traditionally where you would build a laundromat, especially a 5,000-square-foot store.

However, I accommodate the customers on this side of town by being closer and more convenient for their needs, while also offering a nice enough laundry so that it’s worth the drive to come here from other parts of town, which may have more traditional self-service laundry customers.

In addition, iWash is atypical in its size and amenities. It’s a large, spacious, well-lit store in a great neighborhood with a lot of room, comfortable seating, 11 televisions and central air conditioning.

Why Here? I built a car wash here six years ago, and I wanted to expand with a laundry business – but I didn’t want to have to be in two places at once. I’m a hands-on owner, and I didn’t want to be a one business and not available for the other. Therefore, I built them next to each other.

Who Are the Customers? Wash-dry-fold represents 30 percent to 40 percent of the business. Also, the commercial accounts business is a growing segment, with most of the work coming from oil companies that bring in their uniforms.

Of course, we get local families from all over Odessa and nearby Midland, along with many of the workers in the oil fields.

Advantages of This Market: Being visible to a diverse clientele. I’ve got a nice enough store to where people who normally use a laundry are willing to make the drive here – but I’m also visible to non-traditional customers who don’t normally use a laundromat, to the point where the convenience factor comes into play. For instance, if they’ve got four kids playing baseball and soccer – with uniforms and school clothes to wash – and they don’t want to spend all day doing laundry, they can come here, sit in a leather chair, watch TV, have a Coke and a snack, and do it all at once. Or they can drop it off and let us do it. We’re getting that kind of business, because our location is convenient for these non-traditional customers.

Challenges of This Market: Timing. I opened up at just about the time the price of oil began to plummet. And, as I noted, we are very much tied into the oil industry.

Also, just simply getting the word out to other markets is challenging. I need to get the word out to those who don’t drive by my store every day. I’m in a non-traditional location. People looking for a laundromat aren’t necessarily looking where I’m at.

Best Advice for Other Operators: Be prepared for slow growth. Our long-term goal is to build a large, diversified customer base that appreciates the non-traditional decisions we’ve made in building in this market and in the style of laundry we have. I built a store that I would want to utilize. I didn’t do it on the short. Hopefully, that communicates to the customer base.

Berenato3.jpgThe Hole in the Doughnut

Owner: John Berenato

Location: Woodstown Wash Tub – Woodstown, N.J.

Store Size: 1,100 square feet

Operation: Fully attended; open 6:00 a.m. to 10:00 p.m. daily

Additional Services: Wash-dry-fold

What Makes This Business Non-Traditional? We are located in a rural market. However, it’s also a higher end market – our median income is nearly $92,000 per year.

This market is like the hole in the doughnut. The borough of Woodstown is the hole, and all around me is an area called Pilesgrove Township, which is a very rural farming community. There are a lot of wealthy farmers here who probably live in Woodstown because it’s the community center, but they own property in Pilesgrove. It’s a very affluent area.

Why Here? I own the real estate, which is a 9,000-square-foot strip center, and this particular storefront was vacant for eight months after a tenant moved out. However, there are apartments directly behind the building, and a new 100-unit moderate-income housing project just opened about a quarter-mile away – so I chose to open a self-service laundry in the space.

Who Are the Customers? My customers are diverse. We’re getting everybody. We’re getting homeowners from the nearby golf course community, who come in to wash their comforters and larger items that their home equipment can’t handle. And, seeing as renters now represent about 27 percent of this market, we’re getting customers with no access to in-unit equipment who come in on a weekly basis.

Also, there is a nuclear power plant about 17 miles away. This plant shuts down for 90 days twice a year for scheduled maintenance, and during these shutdowns, they bring in 2,500 workers. Those people rent houses and live in trailers and on campgrounds within my marketplace. So I get a lot of those seasonal customers.

Furthermore, my drop-off service currently accounts for about 20 percent of my overall business.

Advantages of This Market: We have public sewer and water, which gives us the ability to handle the water discharge, while the communities surrounding us have none of these services. They have either wells or septic systems. Again, we’re the hole in the doughnut.

Challenges of This Market: Our biggest challenge is letting people know we’re here. I’m located on a highly traveled highway, with almost 21,000 cars going past the front of my store per day. However, even though we’ve been open for more than three years, people still say, “I didn’t know you were here!”

Keys to Success: Being friendly. Offering good value. And providing a secure and safe environment. Just following good business practices, as you would with a traditional laundromat.

Carter%201.jpgFilling the Gaps

Owner: Paul Carter

Location: North Fort Myers Laundromart – North Fort Myers, Fla.

Store Size: 5,000 square feet

Operation: Fully attended; open 7:00 a.m. to 11:00 p.m. daily

Additional Services: Wash-dry-fold

What Makes This Business Non-Traditional? The two biggest factors are our size and location. We’re one of the largest laundromats in southwest Florida, which has forced us to seek out non-traditional markets. We can process 1,500 pounds of laundry an hour. We have a lot of capacity to fill, so we’ve done a number of things to fill it.

We started our own outreach program, where we went out into the community to see what the needs were – and we came across a number of nonprofits that offer laundry services to those less fortunate. For instance, we bring in a group from the local VFW every Thursday morning. We give them a discount, and that program is growing. We also work with The Laundry Project every quarter, which holds “laundry days” for the less fortunate.

Most owners think you’ve got to give it away, but you really don’t. We’ve found that treating them right, going the extra mile and helping people who need help doing their laundry is paying off dividends for us. Focusing on nonprofits taking care of lower-income folks is a real non-traditional approach we take.

We also work with local public high schools. For instance, the last thing a school’s coach wants to deal with is dirty laundry. As a result, we’ve been very well received. It costs the schools a bit more money, but they see the value in it. We will pick up on Saturday morning after a Friday night game and return it on Monday morning – on hangers with plastic around it.

And the schools are discovering that their uniforms are lasting longer because our cleaning process is superior to what they can do with their traditional home washers and dryers at the school.

Of course, going into those more business-to-business markets, there’s the component of the pickup and delivery. And, once you’re committed to driving, everything opens up. You’d be amazed how many potential customers are out there – and they’re willing to pay for it.

One of those business-to-business markets is the hotel market. Yes, hotels either have commercial washers and dryers on site or they likely use a large commercial laundry service. However, we’ve been able to show many of them how contracting with a local provider like us can saves money in the long run.

Another good non-traditional market for us are sports teams, such as Major League Baseball farm teams, traveling Little League teams, football teams and so on. Basically, it’s about developing relationships with the hotels and the coaches. When teams are traveling, the last thing they want to deal with is laundry, and the hotels welcome us because teams often complain about the laundry facilities at hotels being inadequate. If a hotel can offer a team our service as an alternative, we all look good. And we’ll even pay the hotel a commission.

One of the things we discovered this year was that the dye used in the clay for baseball infields around here isn’t going to come out with normal laundry detergent. In fact, we’ve spent a significant amount of time and energy developing a system that will remove this dye from white garments.

Why So Much Capacity? It was an existing store. There were some inherent costs that we didn’t have to come up with, due to the fact that this building was already built as a laundromat.

When we compared this store to opening up a smaller laundry, it made sense to go with the larger store – understanding, of course, that there was more risk involved because of the capacity needed to be filled.

Who Are the Customers? The core business is still made up of traditional lower-income folks who live within a five-mile radius, but we certainly draw from farther away than that.

The real challenge, which is another non-traditional market factor, is when the snowbirds leave Fort Myers in the summer. It’s not an insignificant number. All of a sudden, we’ve got three months where business drops off significantly, and we’ve got to fill that up.

Best Advice for Other Operators: Get out from behind the counter. Get out into the community. Join the local chamber of commerce. Start networking. Start building relationships, because word of mouth is your best marketing tool – and that’s not going to happen if you never get out of the store.

Horton3.jpgNeighborhood Gentrification

Owner: David Horton

Location: Our Beautiful Launderette – Los Angeles, Calif.

Store Size: 2,200 square feet

Operation: Fully attended; open 6:30 a.m. to 11:30 p.m. daily

Additional Services: Wash-dry-fold

Marketplace Demographics: We’re on Beverly Boulevard, which is a popular retail street. However, along the side streets, every one of the homes is worth more than $1 million. That’s part of the gentrification that’s taken place in this area.

Additional, we’re on the edge of West Hollywood, which has a lot of multi-housing, and there are several streets that feature primarily apartments. We have very few Hispanic customers and virtually no kids.

Who Are Your Customers? To go along with the gentrification of this neighborhood, there also is a strong LGBT community here. The average income is $60,000 to $70,000 per year; however, many people are living in these older L.A. buildings that don’t have adequate laundry facilities.

We also thought there would be a large wash-dry-fold market here, and it turns out there is. We get a lot of drop-off laundry business from these people who live in some of these million-dollar houses. In fact, wash-dry-fold represents roughly 30 percent of our overall business. We’ve had to hire outside cleaning crews on occasion, because our attendants got so busy processing drop-off orders.

Advantages of This Market: The advantage we have going for us is that the average rent in this neighborhood is about $5 a square foot per month. Not many people are going to build new laundries at $5 a foot. So, even though the market might be thinner, it’s one of the few places in Los Angeles where that’s not so much competition.

For example, if you stick a pin in the middle of L.A.’s Koreatown, which is about three or four miles east of us, and draw a one-mile circle, you’ll find 60 laundries in that space. In this market, there are one or two. Even though this is a thinner and more upscale market, we get the business that’s here.

Also, we’re able to operate at the higher end of the vend price spectrum, because our customers tend to be less price-sensitive.

Challenges of This Market: Parking is very limited, but that’s not unusual in Los Angeles. There is street parking with meters, which works for this business. Although it may not work in a traditional, low-income laundromat market, our customers are less sensitive to price, so they don’t mind parking on the street and feeding the meter.

Another minor challenge is the fact that, if we lose or damage an article of clothing, it’s more likely to be an expensive garment. For instance, a wash-dry-fold customer accused us of losing swim trunks. When we went replace them, we realized they were $300 Dolce & Gabbana swim trunks.

Keys to Success: We built this store to appeal to the kind of gentrified customers we were bound to have. Our customer base has certain tastes we’re trying to appeal to – in terms of the décor, amenities and overall look. For instance, we completely redid the restroom with all new fixtures, and it rivals the restrooms in many high-end restaurants.

There was a small planted area in the front of the store that we transformed into an outdoor seating area. A lot of customers will go outside and read there – and others will go out and fold, because we’ve got four tables out there, too.

We understand the customer, respect them and look to meet their needs. For instance, we don’t have 65 televisions all blaring different programs. We tried to create a more peaceful environment. We have a beautiful mural on the back wall of the laundry, which just another part of how we pay attention to the overall Zen of the store.

Instead of bench seating, we have individual chairs. We also have stools customers can sit on while folding. All of these things make the store more comfortable.

In addition, one factor that has put this store over the top is the fact that we accept credit cards on every single machine. And we also offer full-cycle drying. Our customers really seem to like that.

Best Advice for Other Operators: Operators need to learn their customer base and learn to appreciate what the customers really want and need, as well as what kind of services they’re looking for.

What we did in this particular market could apply anywhere. If you go into a traditional, heavily Hispanic market, the same rules apply. Figure out what it is those customers really want. Really understand the demographics of where you’re putting the store, and then tailor the way the store is built and operated toward that demographic. In an upscale neighborhood, you simply create an upscale place.