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RALEIGH, N.C. — The yellows, blues, greens and shades of red at Calvary Laundromat in Raleigh are decorator-designed to create an inviting atmosphere, says owner David Makepeace. But the intangible atmosphere, the one that customers find welcoming, is created by his staff.

Makepeace says he’s “extremely” happy with sales at the 3,000-square-foot laundry, located in a small shopping center in the midst of large apartment complexes. “The success of it depends on the people you hire,” he says. “I have wonderful attendants.”

He names several other contributing factors, including the technological sophistication of its 30 front loaders and 28 dryers.

STARTING ON GOOD FOOTING

Makepeace is a former commercial banker in Charlotte and Raleigh who decided 13 years ago that “I wanted to go out on my own, to find a business and learn it and eventually buy it.” He was drawn to a cleaner/laundry because “It’s not going to go out of fashion like the buggy whip. Everybody’s going to need to get their clothes cleaned.”

He approached the then-owner of Medlin-Davis Cleaners and proposed, “You train me, and I’ll buy it from you.” Over the years, he rose to president, supervising three cleaning plants, three pickup and delivery routes and nine stores in Raleigh and neighboring towns, plus one small coin-op in the long-established Cameron Village shopping center in Raleigh.

Four years ago, unsure about the owner’s intentions of selling, he determined to start his own laundry while continuing to supervise Medlin-Davis. His wife Lee offered her full support.

It was at the beginning of the recession, but some businesses, including laundries, do well in that environment, he believes.

To financially strapped customers who need to clean their clothes, “This is a very affordable way to do that, rather than going to Lowe’s or Home Depot to purchase a washer and dryer.”

He’d worked with Medlin-Davis’ 1,500-square-foot laundry so he “had a general feel of how they operate.” Plus, T & L Equipment Sales gave him the specific knowledge he needed.

Makepeace discovered the Coin Laundry Association and joined immediately. “They had an absolute wealth of information they could give me.”

Co-owner Lee worked as full-time attendant the first six months, and David gives her credit for starting the laundry off on a good footing. “She did a wonderful job of establishing relationships.”

In 2010, he bought the part of Medlin-Davis that operated in Raleigh and the nearby town of Wake Forest: two cleaning plants, four dry cleaning stores, three pickup and delivery routes for cleaning and wash/dry/fold, and the Cameron Village coin-op.

His wife became head of accounting and administration, while he functions as head of operations. They have 60 employees.

Wash/dry/fold work for the routes is done at one of the cleaning plants. Wash/dry/fold work for the Cameron Village coin-op, which is unattended, is processed at Calvary along with its work.

Makepeace is a firm believer in keeping up not only equipment but appearances. Four-year-old Calvary has already been repainted once, and the checkerboard of floor tiles there is stripped and waxed every quarter, he says. Recently, some floor tiles were replaced, and a chair rail was added. “It’s very important that we keep up with wear and tear.”

At the 1,500-square-foot Cameron Village coin-op, Makepeace renovated everything: floor, walls, ceiling. He replaced all the machines with new ones after he found, “Stuff was always breaking down. I was losing business.”

Once again, he turned to his wife’s decorator friend for a color scheme. This one is more subdued—lots of pale blues and browns—in keeping with the supposed preferences of the retirees and North Carolina State University students who are its customers.

He added a large-screen TV, Wi-Fi, and new furniture.

He’s now enlisted the help of a marketing firm in designing not only a marketing plan but a logo, revamped storefronts for the cleaners, and even “the lettering on our vans.” And he says he wouldn’t mind having another coin-op.

After a 10-year apprenticeship and now four years of ownership, Makepeace believes he knows “what it takes to be successful.”

CHICAGO — Ralph Wagner, who owns Wash ’n Dry Laundry Services in Morris, Ill., has been working in the coin laundry business for 14 years. His store an hour southwest of Chicago occupies 2,000 square feet and features Maytag equipment totaling 33 washers and 26 dryers.

Up until last June, his business was strictly a self-service laundry. But since then, his sales have risen 25%. Why? Wagner attributes it to an extra service he started last summer, one that many laundries may already offer: wash/dry/fold.

Getting into wash/dry/fold was something he and his wife had always wanted to try. Wash ’n Dry competes with a couple other Laundromats in the market of about 25,000 residents, but the economy and the lack of actual wash/dry/fold service in the vicinity pushed Wagner to pursue it.

“We feel right now, with the economy coming back, that [it was] a good time to start it,” he says. “In our area, we only had one other Laundromat that offered the service.”

Wagner reached out to Kevin Meyer, president of distributor Dolphin Laundry Service, Bensenville, Ill., to help him get started. “It’s a tough thing to get going, but it’s gone pretty well,” Wagner says. “A 25% increase in our revenue is pretty good.”

Chris Brick, regional sales manager for equipment manufacturer American Dryer Corp., explains that up to 80% of attended coin laundries in the United States offer some form of wash/dry/fold service. “Wash/dry/fold brings a different customer base to a lot of laundries.”

“Household washers [or] small equipment within apartment buildings can have trouble handling comforters,” says Meyer, “so it solves a need for prospective customers.”

Considering the convenience such an added service offers to customers, it’s no wonder that many coin laundries have decided to cash in.

Dick Ruel, national sales manager at equipment manufacturer Maytag Commercial Laundry, attests to the profit potential. “If it were not for wash/dry/fold services, some laundries would not turn a profit.”

How much does such a service contribute to a store’s total gross revenue? Gary Gauthier, national sales manager for equipment manufacturer Milnor Laundry Systems, says it varies from store to store, while Meyer cites a range of less than 5% to up to 30%.

Considering how many laundries offer this service, what considerations must one take to truly profit from wash/dry/fold? Brick says the key to mastering the service starts with organization.

SELLING WASH/DRY/FOLD

Taking the extra step to keep customers happy is one way to ensure that your wash/dry/fold service stays afloat, but what can owners do to extend their reach to prospective customers?

Gauthier suggests that owners establish a strong online presence and consider investing in search engine optimization (SEO) services, such as Google AdWords, to attract business. “An established, effective online presence is a customer comfort and an inducement to try a new service. Roadside signs and direct mail are additional efforts, but they are typically limited to drive-by traffic and specific geographic territories.”

Store owners reaching out to community causes is another way to bring in new customers, according to Brick. For example, your store could host a fundraiser for a local church youth group or athletic team, and have them, alongside an attendant and adult volunteers, wash, dry and fold customers’ garments to raise money.

Even if they split the revenue fifty-fifty … it’s a great way for that organization to raise money, and it’s a great way for your Laundromat to get people that may have never even thought about using the laundry for that service.”

Meyer, on the other hand, pushes the benefit of seasonal coupons, such as deals on comforter cleaning in the fall and spring. “It’s a good way to educate individuals who take advantage of the coupon and convert them to drop-off customers.”

The success of wash/dry/fold not only comes down to marketing, but how well versed attendants are in assisting customers, he says.

“If the attendants are supportive and educated enough to explain the drop-off service, it typically translates to a successful drop-off program,” Meyer says. “We have seen stores go as far as incentivizing attendants by commissioning them 5 to 10 cents per pound on orders they process.”

Marketing is all about staying in tune with the lifestyle of the community, Brick says. “You really have to look at each community. What is the avenue that my customer base looks at, reads [and] listens to, and that’s where you want to go to promote what you’re offering.”

DELIBERATING DELIVERY

You may want to consider adding delivery to your wash/dry/fold service—which Brick calls a “great service” in urban markets—but tacking this on to your operation presents an added liability. “That’s when you would get into the extra insurance involved because you’re putting somebody on the road.”

Meyer echoes the sentiment, saying, “Delivery adds cost and opens the need for additional insurance coverage, as transportation becomes part of the equation. This needs to be balanced with the size of the delivery area [or] how much the potential market is increased through pick-up/delivery.”

But adding delivery could certainly be beneficial to the business. “We typically see the offering of delivery as viable and profitable,” Meyer says. “Some stores will charge a delivery charge as well to recoup related expenses.”

Though the idea of adding delivery to a store’s wash/dry/fold service can attract customers looking for even more convenience, Brick estimates that less than 2% of laundries offer such an option.

THE FUTURE OF WASH/DRY/FOLD

Many stores may wonder if starting, or even further developing, wash/dry/fold service is worth the risk. Brick admits that he’s seen some of the best and cleanest stores “do everything right” but the service didn’t pan out. “It is kind of a fickle thing.”

Despite this, he believes the payoff is worth the gamble. Not only can owners make extra profit, their overall business can see a visible improvement.

If you can afford to have that attendant there every hour that you’re open, the vandalism is reduced tremendously,” Brick says. “The store will be kept much cleaner, because you’ve got someone there wiping machines down [and] picking up softener sheets from the floor.”

Wagner sees this improvement in his store, as having an attendant present “builds a confidence” in customers. “If [a customer] has a problem, instead of leaving a note or calling, you can fix it right there for them or give them their money back. There’s never any miscommunication or issues, it’s all taken care of right away.”

With his wash/dry/fold service still in development, Wagner wants to hire a full-time attendant, plus he has other goals in mind. “I’m just in the process of learning [but] we are looking for a second location with our distributor,” he says. “Our strategy would be within 30 miles … from our location.”

Larger stores are becoming the industry norm, according to Brick, which could lead to stores taking on commercial accounts and an expanded customer base. “I think you’ll see more stores begin to do more with the non-traditional laundry customer, meaning the people that have a washer and dryer at home.

Because it’s a bigger [and] nicer store, they have no problems dropping their clothes off. I definitely think that wash/dry/fold will become a stronger revenue source for laundries as they continue to build bigger, nicer, cleaner laundries.”

All in all, for a wash/dry/fold service to really take off, it’s about creating a positive, lasting impression.

The success of wash/dry/fold will have more to do with who you hire, and what you put in place than just about anything else that you do,” says Brick. “The experience that you provide to that customer will lead to them coming back, and lead to them telling someone else.”

CHICAGO — Ralph Wagner, who owns Wash ’n Dry Laundry Services in Morris, Ill., has been working in the coin laundry business for 14 years. His store an hour southwest of Chicago occupies 2,000 square feet and features Maytag equipment totaling 33 washers and 26 dryers.

Up until last June, his business was strictly a self-service laundry. But since then, his sales have risen 25%. Why? Wagner attributes it to an extra service he started last summer, one that many laundries may already offer: wash/dry/fold.

Getting into wash/dry/fold was something he and his wife had always wanted to try. Wash ’n Dry competes with a couple other Laundromats in the market of about 25,000 residents, but the economy and the lack of actual wash/dry/fold service in the vicinity pushed Wagner to pursue it.

“We feel right now, with the economy coming back, that [it was] a good time to start it,” he says. “In our area, we only had one other Laundromat that offered the service.”

Wagner reached out to Kevin Meyer, president of distributor Dolphin Laundry Service, Bensenville, Ill., to help him get started. “It’s a tough thing to get going, but it’s gone pretty well,” Wagner says. “A 25% increase in our revenue is pretty good.”

Chris Brick, regional sales manager for equipment manufacturer American Dryer Corp., explains that up to 80% of attended coin laundries in the United States offer some form of wash/dry/fold service. “Wash/dry/fold brings a different customer base to a lot of laundries.”

“Household washers [or] small equipment within apartment buildings can have trouble handling comforters,” says Meyer, “so it solves a need for prospective customers.”

Considering the convenience such an added service offers to customers, it’s no wonder that many coin laundries have decided to cash in.

Dick Ruel, national sales manager at equipment manufacturer Maytag Commercial Laundry, attests to the profit potential. “If it were not for wash/dry/fold services, some laundries would not turn a profit.”

How much does such a service contribute to a store’s total gross revenue? Gary Gauthier, national sales manager for equipment manufacturer Milnor Laundry Systems, says it varies from store to store, while Meyer cites a range of less than 5% to up to 30%.

Considering how many laundries offer this service, what considerations must one take to truly profit from wash/dry/fold? Brick says the key to mastering the service starts with organization.

PROTOCOLS AND EQUIPMENT

For stores looking to get into wash/dry/fold, Brick advises owners to start with a solid foundation of policies and procedures.

Having a protocol on how to accept and organize garments is the first thing owners should lay out prior to starting a service. Establish procedures for weighing a load and asking the customer if they want any pieces spot-treated or loads separated by whites and colors, for example.

“Taking responsibility for customer goods means understanding fabrics and carefully processing those items,” says Gauthier. “Make sure that your wash/dry/fold staff takes the time to evaluate the goods they accept to ensure that they aren’t damaged.”

With a plan in place, owners may then turn their attention to equipment and the possibility of investing in new machines.

The experts agree that any coin store can start a wash/dry/fold service using the washers and dryers already in place, but there may be limitations.

“If all units within the store are top loaders, it limits your ability to process larger bulky items like comforters,” Meyer says. “[But] the majority of what a store will receive for wash/dry/fold is personals, which a typical coin store has sufficient machinery to handle.”

Wagner found this to be true, saying that he’s able to utilize the store’s current equipment for some of the customers he serves.

While he primarily processes residential wash/dry/fold, his initial goal was to go after commercial work. To date, Wagner has attracted business from what he calls “small commercial” accounts, catering to local hotels and senior housing facilities. For this reason, he installed a soaking tub and an Ecolab chemical and cleaning system for his machines.

Higher-capacity machines can process loads more quickly, but deciding which machines to invest in all goes back to a store’s policies and procedures, Brick says.

“If the customer wants to separate loads … then you’re going to use two smaller machines,” he says. “But if a customer does not want, or choose to separate [loads], then [you can] dump everything in a 60-pound [washer].

“In general, a 60-pound washer can handle the vast majority of commercial account needs a Laundromat might have,” says Meyer regarding higher-capacity machines. “However, if a coin store is in a market where an 80-pound machine might give it an advantage for attracting self-service customers, then that should be taken into consideration.”

Utility efficiency, a large profile for easy loading and unloading, and a five-year manufacturer-backed parts warranty are characteristics that Meyer looks for in assessing higher-capacity equipment.

Should a store that offers wash/dry/fold service make that equipment available to its walk-in customers? For Meyer, it’s all about catering to your customers, whoever they may be.

“We generally recommend making all equipment available to customers,” he says. “In practice, attendants will typically use the same one or two machines for wash/dry/fold accounts due to their proximity to the attendant station, or to high-visibility points in the store. But, there is no reason to limit availability.”

Though he limits the store’s cleaning system for commercial accounts strictly to employee use, Wagner has been able to process residential accounts while self-service customers are using the store’s washers and dryers, he says.

“We’re a smaller market so there’s always downtime,” he explains, adding that late morning and early afternoon is when the store usually experiences a lull in traffic. “We have enough machines for our market where there’s always some machines open. Most [customers] drop off regular loads for just one or two machines at a time.”

Check back Tuesday for Part 2!

CHICAGO — How would your customers describe your coin laundry? Would they say it’s dependable? Clean? Secure? Comfortable? How about customer-friendly?

It stands to reason that customer-friendly stores—those that are welcoming, bright and offer a sense of security, for example—have a better chance of drawing business than the store down the block that’s dark, dirty and run-down.

But there are many levels of customer service, and thus customer friendliness. American Coin-Op reached out to some store owners, manufacturers and distributors this month and asked them for their analysis of the elements of being customer-friendly.

Q: SO, WHAT DOES BEING “CUSTOMER-FRIENDLY” MEAN IN THE CONTEXT OF RUNNING A COIN LAUNDRY?

Karl Hinrichs, president, HK Laundry Equipment: The basics of a “Customer-Friendly Laundromat” are clean, bright and safe, and are equipped with reliable, high-quality machines. These are the basic minimum requirements. However, in today’s world, owners should go above and beyond. Many Laundromats have added attractive décor that caters to their customers, like earth-toned colored walls with trendy art and clocks, comfortable seating with tables, entertainment that includes free Wi-Fi, high-definition flat-screen TVs, magazines and even children’s lounges that offer video games and computers.

Dave Phillips, national sales manager, IPSO: A customer-friendly store is one that is owned by someone who lives and breathes good customer service. And because of this, people want to come to their Laundromat and do laundry. The owner will monitor and be aware of and adapt concepts and ideas that customers want in a Laundromat to make sure the customers’ experiences are positive. Additionally, the Laundromat’s employees will embrace and be committed to the same customer-friendly principles.

Craig Kirchner, vice president of sales, marketing and customer service for Dexter Laundry: Customers and especially families are looking for a clean, well-lit environment where they feel safe for themselves and their children. They look for ample parking and sliding doors that make it easy to enter and exit with big baskets of laundry and plenty of equipment that’s available when they need it.

Dan Bowe, national sales manager, Speed Queen: The most customer-friendly stores are attended. When owners make the investment in good employees, they help elevate the customer experience. Attendants should be properly trained, friendly and helpful, but also feel confident in their position and enjoy what they do. Since attendants represent the store, they should be well-groomed, and greet customers, thank them for their business, help carry laundry out to cars if customers need assistance, and be there to answer general questions when they arise.

Ken Hebert, Deep South Laundry Systems: Being customer-friendly is defined by understanding your customer base and providing them with the environment/equipment they need to simplify their laundry time.

Q: WHAT RESPONSIBILITY DOES AN OWNER HAVE FOR MAKING HIS OR HER COIN LAUNDRY CUSTOMER-FRIENDLY? WHAT RESPONSIBILITY DOES A MANAGER AND/OR ATTENDANT HAVE?

Bowe: Customer friendliness starts with the management. If you don’t position your business to cater to your customers, you won’t be as successful as you hoped. Employees follow the examples management sets, so it’s essential that good customer service is an integral part in the business’ philosophy. For example, if a customer requests a refund, provide one without question. Offer to assist customers who are first-time visitors, and strike up a conversation to make them feel like they made the right decision in choosing the store.

Steve Koumaras, owner of four coin stores in Pennsylvania: Customers need to understand that although my stores aren’t staffed, the lines of communication are open. I have a way for customers to leave comments and suggestions, and I provide a phone number where I can be reached. If I miss a customer, I call them back and talk through the comment or problem with them. As an owner, I have to be customer-focused to really succeed in this business.

Hinrichs: Good customer service starts with management. If they want the store to be successful and generate revenue that will make them profitable, owners have to be customer-friendly. Otherwise, customers will go to another store that will provide them with the amenities they desire.

From an operations point of view, attendants should be welcoming, friendly and helpful. They represent the Laundromat and, indirectly, the owner. Attendants should greet all customers, ask if they need help, and if a problem arises they should help resolve it as soon as possible – whether it be soda spill clean-up or refunding money; if there’s a problem, they should do all they can to correct the problem and create a happy customer.

Jose Fernandez, owner, Mily’s Place Laundromat, Coral Gables, Fla.: It is imperative managers and attendants keep the store clean at all times. My attendants know it is a fundamental part of their jobs to pick up trash, clean up any detergent spills, etc. Also, it is our responsibility to maintain the equipment, check lint trays and ensure the washer and dryer drums are clean for the next customer.

Hebert: Owners are responsible for choosing the right location and equipment mix. They are also responsible for regularly updating/replacing paint, equipment, signage and furniture. The customer’s first impression of the Laundromat will determine whether they will use it in the future. The manager is responsible for keeping the equipment running and (for) handling customer suggestions/complaints. The attendant is responsible for keeping the Laundromat clean and inviting.

David Cabral, vice president, New England Coin Laundry: An owner should always want the customers that visit his/her laundry to feel welcome and comfortable. You can’t simply assume your customer feels safe and welcome. You need to make sure first-hand.

Kirchner: Managers and staff play an important role in attracting and maintaining a customer-friendly laundry. They need to work regularly to keep stores clean and attractive, handle maintenance issues or down machines immediately, and keep the store a pleasant place to do business and for customers to visit.

Check back Tuesday for more on The Elements of Being Customer-Friendly!

CHICAGO — American Coin-Op covered a variety of topics this year. If you happened to miss a story along the way, then you might appreciate a brief recap. Here’s a quick look at some of the more informative articles presented this year.

BUILD NEW OR REHAB?

When considering opening a new coin laundry, do you build from the ground up or look at rehabilitating an existing store? Setting your laundry apart from the competition has to be at the heart of the decision-making process, says Scott Equipment’s Carl Graham.

When building new, you can start from the ground up to create a clean, modern infrastructure so it can handle the laundry equipment you plan to install, says National Laundry Equipment’s J.D. Dixon. And you can eliminate any concerns about infrastructure issues with new construction. Choosing to rehab a store means you're locked into that location, while building new gives the prospective owner the flexibility to select the best site for his/her business needs.

New construction provides the opportunity to design a store that is highly efficient and thus equipped to get customers in and out in the shortest time possible. But what works in one store may not work in another. For example, you might choose a color scheme for a Miami store that you wouldn't for a store in Lexington, Ky.

Building new also means a much more extensive project than a rehab, taking on greater financial risk, plus it's generally more expensive.

When choosing to rehab, consultant Robert Renteria favors repairing any machines that still have useful life, then looking to buy rebuilt or refurbished machines.

Buying and rehabbing an existing laundry can save the new owner some expenses, and may allow them to avoid bureaucracy such as impact fees and code restrictions. Another benefit for choosing to rehab an existing laundry is that it already has a customer base. With a new store, you must build that customer base from zero.

LAUNDRY FURNISHING OPTIONS EXPAND

The general structure of chairs and tables typically found in coin laundries today really hasn’t changed much in recent years, but the palette of colors and textures that are available has become quite expansive, according to some manufacturers of such furnishings.

CACO Mfg. has been making Sol-O-Matic© fiberglass seating and folding tables for coin laundries since 1960. CEO Randall Chaffee says his company can now create granite-type finishes commonly seen on countertops.

High Mark Mfg.’s high-pressure laminate furniture is available in more than 500 different colors, says President Peter Valconesi, whose company produces fiberglass and laminate furniture, both standard and custom in design.

RJ Papalini is celebrating its 50th year of manufacturing furniture for the industry. The customer is accustomed to seeing coin-ops utilize bright color schemes to attract customers, but President/CEO Richard Pennington says he’s seen that trend change in places “that are not quite as economically challenged.” Operators there are looking for softer colors, browns and earth tones.

Any time spent discussing coin laundry décor will be wasted if the furniture selected doesn’t stand up to the rigors of laundry life. Resist the temptation to purchase residential-grade chairs or tables from a retailer or home improvement store, because that’s just a short-term solution. “We see it all the time, but two or three years later, they come back to us because that stuff just doesn’t hold up,” Chaffee says.

CRITERIA FOR SETTING PRICE

Upon what criteria should a laundry owner base his or her wash and dry vend prices?

“It really comes down to two issues,” says Kevin Hietpas, vice president of sales and marketing for Dexter. “No. 1 is what’s happening to his costs. How have costs impacted the viability and profitability of his business? Owners should have a good sense of where their business is tracking from a performance standpoint. No. 2 is where is he competitively.”

A store owner needs to be aware of and factor in the competition’s prices when determining his or her own pricing, says Kent Walters, national sales manager for Maytag/Whirlpool Commercial Laundry. “The owner’s goal should be to produce the best experience for the customers, from ambiance to equipment to services—and the costs associated with washing and drying play a large part in this equation,” he says.

While customers may not react warmly to a price change, they will understand if you explain the reason behind the change, such as higher utility rates. Hietpas believes that customers are more sensitive to how long it takes and how much it costs to dry than to small changes in wash prices.

Vending technology has enabled owners to change prices on equipment easily—during slow hours or days, for example—but avoid changing prices too often, as the practice can turn off customers.

BECOMING A MULTI-STORE OWNER

When you’re thinking about opening a second store, it’s important to go back to the basics and look at everything from location to equipment and store naming, advises Pittsburgh Laundry Systems’ Sonny Rogalla.

Carve out an area of no more than an eight-mile radius from your original store and use that as your market. Having your stores in close proximity—no more than 45 minutes from each other—allows you to easily more between stores.

Make sure to continue cultivating your relationship with the distributor that assisted you in building your original store. Distributors typically have information on existing Laundromats coming up for sale and will approach you to judge your interest. And the distributor can easily identify whether a laundry is a potential good investment.

Whether rehabbing a store or building one from the ground up, rely on what you’ve learned from your first store. You already know what works—now it’s time to make it even better. Look at the machines your distributor offers; there are probably new advances since you last purchased equipment. It may also be time to look at investing in advanced controls if your previous store doesn’t have them; these controls can be a great resource for multi-store owners.

Financing through a laundry manufacturer is better than using a bank, Rogalla believes, because manufacturers understand the industry better and can tailor a financial solution to meet an owner’s needs.

ONE LITTLE IDEA AT A TIME

Little changes over time can make a difference for your business, advises columnist Howard Scott. Here are a number of little ideas he’s seen in different Laundromats, or been told about, or that just popped into his head:

• Hang a purple neon sign in your window
• Put a sandwich board sign on your front sidewalk
• Announce that you offer high-quality equipment
• Place a wooden bench out front
• Sell three sizes of laundry bags
• Offer a deal for wash-dry-fold service
• Hang a large clock in your store
• Give machines names, not numbers
• Sell a value card
• Paint a mural on your exterior side wall
• Set up a glass display of your merchandise for sale

TRACKING ENERGY EFFICIENCY

The specter of ever-rising utility costs should be enough to spur the average laundry owner to track this expense and explore ways to minimize it. Owners looking to determine their store’s level of energy efficiency need to compare the cost of utilities vs. revenue, says Maytag’s Walters.

If the store’s utilities cost is above the industry average of 20-25% of total revenue, the owner should look for ways to decrease this cost, starting with equipment. Look in the washer-extractor control software, Huebsch’s Gary Dixon advises. Are the water levels set where you wanted them? Is the water temperature different than where it was? Is the software notifying you of potential leaks?

Walters says the first place a store owner should investigate is the dryers. “Specifically, an owner needs to ensure all ventilation is free of lint, which can cut down on the amount of air getting to the dryer, as well as make-up air.”

Store owners who want to maximize equipment performance must regularly perform proactive and preventive maintenance tasks. “By following a recommended maintenance schedule, the laundry owner is ensuring that their equipment is operating at optimum efficiency,” Dixon says. “This translates to lower utility costs and keeps downtime to a minimum. The result is happier customers and more profit.”

EXTRA CREATIVITY, EXTRA PROFIT

Extra profit centers provide a variety of additional revenue opportunities, and some require little extra work from you and your employees, says Todd Santoro of Clean Wash Laundry Systems. Try partnering with a local dry cleaner. Establish a program where customers can drop off at your location for both services; work with the cleaner to determine the timeline and revenue split.

Pick-up service is another way to adapt wash-dry-fold to suit your business. Set a delivery radius around your store, up to 20 miles, and charge per pound to accommodate the increased costs. Pick-up is particularly important for growing your commercial laundry revenue to include clients such as spas, catering companies and salons.

Ancillary profit centers allow Laundromat owners to be creative with their offerings. An example is offering U-Haul trucks for rent. Store owners receive commission from the rentals, and attendants also set up reservations for other locations, which also nets owners a percentage of the rental.

There are many other services that a laundry can offer, but remember, consider your target demographic. Services that are quick and helpful will best serve them and you.

To read the original stories in their entirety, click the following:

Store Creation: Build New or Rehab? (Part 1)

Store Creation: Build New or Rehab? (Part 2)

Trends in Laundry Furnishings

Coin Laundry Pricing Strategies (Part 1)

Coin Laundry Pricing Strategies (Part 2)

Coin Laundry Pricing Strategies (Part 3)

Expanding Your Business: How to Become a Multi-Store Owner

Grow Your Laundry One Little Idea at a Time

Energy Efficiency: Battle Against Rising Costs Often Starts with Equipment (Part 1)

Energy Efficiency: Battle Against Rising Costs Often Starts with Equipment (Part 2)

Extra Creativity Can Lead to Extra Profit (Part 1)

Extra Creativity Can Lead to Extra Profit (Part 2)

PLAINVIEW, N.Y. — Coinmach, a supplier of outsourced laundry services, has acquired SDI Laundry Solutions, a laundry room design and management company. SDI President Ron Garfunkel will remain in his position, as will his leadership team and service personnel, and SDI will continue to operate from its Yonkers, N.Y., headquarters.

Terms of the acquisition were not announced.

“I am excited by this acquisition, as SDI is a highly respected company in our industry, with great leadership, smart technology, and a stellar reputation in the New York metropolitan area,” says Robert M. Doyle, Coinmach's CEO. “This is especially true in the supportive and affordable housing sectors.”

“This is a great development for SDI and for its valued customers,” Garfunkel says. “Joining Coinmach will enable us to benefit from the resources of a nationwide organization, as we continue to deliver the high-touch personal service SDI is known for.” Within the New York area, Coinmach brings substantial regional coverage and resources to the relationship. SDI deploys non-coin payment systems, operating an almost purely coinless business in an industry still dominated by coin-fed laundry machines.

Coinmach will benefit from access to SDI’s proven technology and established reputation, Doyle says, while SDI benefits from Coinmach’s customer depth and geographic reach.  

CHICAGO — Fire, liability or a worker injury is a risk that a coin laundry faces every day. If the business doesn’t have the proper insurance protection in place, an incident could be difficult to recover from. In a worst-case scenario, it could even put it out of business.

American Coin-Op invited representatives from the industry’s major insurance providers to answer some questions that the average self-service laundry owner might have about protecting their business investment.

ACO: How often should a laundry owner evaluate his/her insurance coverage?

Steve Brodie, senior vice president, Wells Fargo Insurance Services USA: Things change all the time. I would review the liability when the lease is coming up for renewal and just keep in touch with your distributor annually on any major equipment price increases so you can raise your personal property value accordingly.

Adam Weber, president, Irving Weber Associates: All insurance policies should be evaluated yearly at the time of renewal at a minimum. If, over the course of the given term, changes are made to the building, machinery, autos, etc., the insurance should be re-evaluated at that time as well.

Anne Hawkins, senior underwriter, NIE: A good agent will contact his insured at least two months before renewal to review current coverage and make possible upgrades or changes. If an agent does not contact the owner in this manner, it may be time to look for a new agent. Don’t let a renewal go by without reviewing your coverage with the agent or carrier. There may be changes that are occurring to the insurance or you may have some new operation that needs to be covered.

I find that many Laundromat owners actually have other jobs and businesses and are extremely busy people. But always take those 15 minutes to remember what’s covered/not covered at the Laundromat. If you can’t be reached by phone, let your agent know that he can reach you by e-mail. I find it a convenient way to communicate, but it’s always nice to speak to the owner so responses are immediate and carry a more personal touch.

Larry Trapani, president, Brooks Waterburn Corp.: The insurance landscape is constantly shifting. In terms of price shopping, I recommend you review your policy about every two years. I do strongly suggest an annual conversation with your agent to review coverages. You may have bought new equipment during the year and the values need to be adjusted. The agent can also review new discounts that become available during the year.

ACO: How does the presence of a surveillance/security system affect a store’s insurance coverage and cost?

Weber: Surveillance/security system would lower the costs of most property coverage as this is a definite deterrent to theft, vandalism and similar situations causing a claim. Surveillance systems can also assist in determining if there was an actual fault on the business owner’s part in a liability claim, such as to whether a water spill caused a slip-and-fall.

Hawkins: That determination would be made on a company by company basis. I find that unless surveillance tapes/discs are kept for at least 2 years, they may not be of help for liability purposes. Why? Someone may fall on your premises and you may not hear a word about it until the statute of limitations is about to run out (two years in most states). In the meantime, the claimant has seen an attorney and been treated by a chiropractor for two years, running up many expenses. Then, out of the blue, you receive a lawsuit. If you haven’t kept the surveillance footage, it’s hard to contest the claim.

Security systems are great, but in many cases someone forgets to turn them on, they aren’t working for some reason, or they are working but the burglar is able to get in and out before the police arrive. They may be a customer during the day, trying to figure out exactly how they are going to pull it off quickly without getting caught. On the other hand, the fire portion of the security system is important. It can keep a small fire from becoming a potential total loss.

Trapani: Every insurance company has different credits for security systems. While most give a credit for alarms, cameras, etc., the discount is relatively small. The real savings occurs when cameras protect you from bogus liability or employee dishonesty claims. I’ve gotten many slip-and-fall and workers’ comp claims denied because the store owner had cameras on the premises and the claim proved to be false.

Brodie: It helps greatly in the defense of a liability case, so many carriers give a small credit for the installation of live, taped security systems (both fire and burglary).

ACO: What new developments in insuring coin laundries have there been in the last two years?

Hawkins: Coin laundries can now be insured on a business owners policy, which was not available to most carriers (for this exposure) two years ago through the rating service that most insurance companies use (ISO). This policy is quick to rate, quick to quote, and pretty much boilerplate. The cost and the use of this policy varies by insurance company.

Trapani: Insurance is a cyclical business. There are long periods of time (often five years or more) of insurance premiums going down and shorter periods of prices going up. Unfortunately, we are in one of the periods of higher prices. It started last year with some modest increase and looks to continue through the end of this year.

Some insurance companies have stopped writing the class of the Laundromat business altogether, while most are just raising their prices. The good news is that these cycles usually don’t last long. I think we’ll start seeing a downward shift in pricing in late 2013.

Brodie: Consider adding employment practice liability if you have employees, as well as pollution coverage. Sometimes pollution covers more than you think; for example, mold is a pollutant that’s excluded from all standard policies, but is covered under a pollution policy. Consider this if you have an apartment above the laundry. The heat and moisture in some stores creates mold, and the tenant then sues the laundry owner. Without a pollution policy, your standard insurance normally will not respond.

Weber: Insurance policies should be reviewed for the business property limits, as these have often changed in recent years. The policy was probably originally taken out to cover a loan taken on the equipment. Since that time, the equipment found in Laundromats has changed greatly with the times, particularly in terms of electronics.

Laundromats now usually contain flat-screen TVs, Wi-Fi equipment, computer connection equipment, key fob and/or card readers, and other electronics, which will add considerably to the property value at the location. Review and update this information often to be sure there is adequate coverage.

Q: What general advice about insurance can you offer a coin laundry owner?

Trapani: The best advice I can give a coin laundry owner about insurance is to be proactive. Read your policy, talk to your agent, and make sure your investment is well protected. You have insurance so you sleep well at night.

Also, make sure your agent has experience in writing Laundromats. While the class of business can be written by virtually any agent, if they don’t know the industry and ask the right questions, they may be missing coverages and leave some serious gaps in your protection.

Brodie: The best advice is to insure with a broker that has experience insuring coin laundries. Many local agents insure small businesses, and in this current economy are more than willing to insure a coin laundry, but they know nothing about the business. Go with a knowledgeable broker that has many stores insured, is recognized throughout the industry, and will be there to help with the claims process.

Weber: Be sure to have the correct insurance for your type of business. Standard business insurance doesn’t take into account the industry-specific needs with regards to water damage, bailee coverage, boiler coverage, etc. It is important that your insurance carrier offers coverages specifically designed for the Laundromat industry.

Also, review and update your coverage limits annually and whenever changes such as new equipment and building updates are made. And be sure that you are up front and honest with your insurer about hours of operation, if your operation is attended or not, and if you have certain systems in place (fire/burglar alarms, cameras, etc.) and that they are in working order; insurers will review this against the application at the time of a claim.

Hawkins:

• Insure your property to the proper value because if you do not, there may be penalties involved at the time of a loss.
• Maintain your premises and equipment to keep losses down, which in turn keeps premiums down.
• Be sure you have the proper venting installation. If you are not using class B vents, your premium may be higher. Also, make sure vents do not come into contact with combustible building materials.
• Clean dryer vents daily; lint sparks a fire easily.
• Call your agent or carrier if you have any questions regarding your insurance, your premium or loss-control questions. It’s their job to service your insurance needs.

Click here to read Part 1!

RANCHO MIRAGE, Calif. — Alan Beaulieu, president of ITR Economics, one of the oldest and most respected consulting firms in America, will be providing “accurate, understandable and actionable” economic forecasts to the laundry industry at the Coin Laundry Association’s Excellence in Laundry Conference in October.

Attendees will learn how to enhance their profitability and gain an advantage over their competition by knowing what’s going to happen in the world around them.

Beaulieu will talk about strategies and tactics that should be undertaken now if businesses are to maximize their profit potential for the future.

“You can make decisions with great confidence by knowing which leading indicators to look at,” he says. “Those leading indicators are like road signs. By knowing which road signs to watch, you can gauge the impact of major events and small events on your business with plenty of time to act, to make decisions, to protect your company and to move forward.”

The Excellence in Laundry Conference is scheduled for Oct. 11-13 at the Rancho Las Palmas Resort and Spa. More information about the event is available at coinlaundry.org/conference2012. To learn more about Beaulieu, visit itreconomics.com.

RONKONKOMA, N.Y. — Irving Weber Associates (IWA), which has provided business insurance protection to the fabricare/dry cleaning industry for many years, says it is expanding its services to owners of coin-operated and self-service laundries.

“We have been working on this request from brokers and the Laundromat owners for some time now,” says IWA President Adam Weber. “The extra time it has taken us was to ensure the Coin-Op Advantage Program™ was as exceptionally suited for the diverse and advancing Laundromat industry as our Fabricare Advantage Program™ has been for dry cleaners.”

IWA will continue to work with local insurance brokers to offer the coin-op program. “The design and benefit of this program will only be seen by the above-average Laundromat operations,” says Weber. “We will be offering the Coin-Op Advantage Program to owners that are involved with up-to-date, technologically advanced, clean facilities in emerging communities.”

He says this is being done to keep insurance costs down, while providing comprehensive coverage to Laundromat owners “who have invested in the long-term success of their business.”

CHICAGO — Credit is the oil that lubricates the machinery of business. Whether it’s a loan to buy supplies, to support expansion, a capital purchase, or just the need for a short-term loan to meet payroll or other operating expenses, most coin-op laundry owners need to depend on credit at some point. Unfortunately, the upheaval in today’s economy has resulted in a credit crunch that seems to have made it tougher than ever for business owners to swing a loan.

Still, for those in the know, there are enough options available to make the task a little easier. Money may be tight, but business loans are being made every day to those who know how to ask.

“In today’s banking climate, good deals still get done, but with more equity, more collateral and much higher credit scores required of the borrower than in the past,” says Linda Feltman, Pennsylvania State University, Small Business Development Center.

If you’re looking for financing for your coin-op business, now or in the future, here are some choices along with hints on how to greatly improve your chances of coming away with the money you need:

Banks

The first place most coin-op laundry owners turn to when they need a business loan is their local bank. That’s why it’s essential to build a solid business relationship with your bank well before you need to ask them for money. Allowing your bank to become familiar with your business sets the stage for the time when you need to ask for a loan.

“The news media tends to lump all banks together when it come to tight money,” says Bob White, president of Abington Bank, Jenkintown, Pa., “but there are big differences among banks. Like many other small community banks, we have always followed conservative lending practices. As a result, our default rates haven’t suffered and we’re in the same healthy position for making loans now that we were four years ago.”

Even after establishing a relationship, some business owners meet with frustration when the bank turns down their loan application. Most bankers agree that this is often because the owner has failed to come prepared with the information a lender needs to make a positive decision.

“How to find the money to finance a renovation, expansion, or other need is the last thing that many business owners think about when they plan a project,” says James G. Marshall, vice president, Fulton Bank, Lancaster, Pa. “It’s best to have a team lined up behind you when you plan a major financial move — and your bank should be a member of that team.”

How should you prepare for a meeting with a bank loan officer? Marshall suggests that you come armed with:

• Financial statements for your existing business
• Accountant-prepared financial projections and cash-flow analysis
• Marketing feasibility study for the project
• Owner’s personal financial statements and tax returns
• Information on the background and experience of owner(s)

“With this information,” says Marshall, “the bank can give proper consideration to your loan application.”

Be careful to avoid the red flags that may raise concerns in the mind of a loan officer. “One of the things that would turn me off,” says White, “is an applicant who has over-leveraged himself or recently financed the purchase of an expensive asset. And, of course, it’s absolutely essential that the applicant be honest and up-front with all pertinent information.”

Check back tomorrow for Part 2: What happens when the bank says no?

SANTA FE SPRINGS, Calif. — Continental Girbau West (CG West) has hired Andrew “Bud” Bakker as vice president of sales. In his new role, Bakker manages and works to grow the regional distributor’s vended, on-premise and industrial laundry sales efforts.

“Bud is an incredibly experienced sales professional with undeniable character,” says Continental Girbau President Mike Floyd. “He understands field sales and comes to CG West with more than 28 years of experience.”

Bakker launched his career in 1984 as an owner/operator of Simon and Son Fine Dry Cleaning, in Woodinville, Wash., where he stayed for 11 years. He went on to serve Westport Supply, Tukwila, Wash., where he handled drycleaning, industrial laundry, hotel laundry and janitorial supply sales. Most recently, he served as the Northwest sales account manager at Dynamic Sales and Service, Kirkland, Wash., where he managed a territory including Washington, Oregon, Idaho and Montana.

A subsidiary of Wisconsin-based Continental Girbau Inc., CG West serves the California vended, on-premise and industrial laundry markets by providing equipment, parts, financing, service, warranty and training.

INWOOD, N.Y. — Laundrylux, distributor of Electrolux and Wascomat laundry equipment, has promoted Robert Hinojosa to regional business manager, coin, for its Northeast Territory.

“Robert is a great asset to our company,” says Laundrylux President Howard Herman. “He started out in Inside Sales about four years ago and has steadily taken on additional work and responsibilities. Robert served as an interim RBM for the West Coast over the past year and did a super job.”

Hinojosa was born and raised in San Antonio, Texas, where his father and grandfather were partners in multiple coin stores. “Needless to say, I spent many weekends with my father keeping the stores clean and maintaining machines,” he says.

After college, Hinojosa’s grandfather, a long-time Wascomat distributor, asked him if he would like to work for his company selling Wascomat equipment. Hinojosa says the first-hand experience gave him great insight into the distribution business.

“Robert joined Laundrylux with the goal of becoming a regional (business manager), and he worked very hard to achieve that goal,” says Laundrylux COO John Sabino. “When this new opportunity arose, we knew the timing was right and (that) Robert was the man for the job. His knowledge of financing, new store development, and products has continued to grow, and we are confident he will be a great asset to the Wascomat and Electrolux coin distributors in the Northeast region.”