OK, this one should be a tough topic to swallow for some of the folks reading, but the truth is the truth. Although there are several reasons we can discuss for why coin laundries fail, one of the big reasons remains an ongoing problem that exists not just in this business, but in almost any industry, and that’s the issue of being oversold. Sales is a very dangerous game when you’re the buyer!
What do I mean by that? Too many times, under-qualified or unethical sales representatives are misguiding the purchaser. It’s maybe unknowingly in some cases because of their lack of knowledge, but the buyers who trust these bad or “under-seasoned” sales reps when making equipment purchases should proceed with caution. Too many times buyers are oversold because the sales representatives have to meet aggressive sales quotas and move lots of boxes to justify their jobs.
This distasteful type of selling is just one reason why I left corporate America. Countless times I have seen companies do very borderline stuff just so that they can meet their sales goals for the year. This is a very tough subject, but some people do things that they should not be doing, and that’s why economics and ethics are a bad mix.
Now, this is not true in every scenario, and there are many, many good, or even great, knowledgeable people who can and do provide professional assistance. But when you are making a purchase, regardless of what it is, buyer beware! In addition, you can’t really expect a sales rep to tell you how to make money when purchasing washers and dryers if they have never owned a business for themselves. Doesn’t that make sense to you? It does to me.
Commerce is what makes the world go around, but free enterprise has some serious costs, and if the person you’re dealing with made a deal with the devil just to be a star in hell, you’re in trouble. The economy is uncertain, especially with some people building spec stores in marginal areas, building new stores with bad leases and doing retools with the wrong mix of equipment.
I have discussed in previous articles the importance of choosing a business partner/distributor who has a depth of experience and understands your marketplace. You absolutely must challenge your distributor to get a list of past and current customers and check out their credentials. There is no shame in making the right choice for a new distributor. It’s like getting married: You don’t marry the first girl you see.
Fortunately, we have many good eggs in the industry who support coin laundry owners, but in the end, you need to be fully armed and ready to fight the fight in this dog-eat-dog world. I just ask everyone to do their due diligence and not be so eager to jump into the deep side of the pool. Exercise all your options when exploring the purchase of a new coin laundry or new equipment.
My advice is to study the competition (maybe even talk to other owners), study your distributor and talk to lots of customers. I prefer to see everyone build their foundation in small steps so that they don’t find themselves upside down financially. Again, all I am saying is build the existing laundry in steps/phases, and when looking to build new, take my wisdom for whatever my 18 years in the industry is worth and save yourself from becoming a statistic!
I have developed more than 500 coin laundries nationally and abroad; you decide if you want to listen.