I now pronounce you… Carwash and Laundry
October 11, 2010
What was it that sparked long-time carwash operator Gary Baright and his partners to make a coin laundry part of their family business in Wappingers Falls, NY? “We had three acres and I was thinking, what am I going to do with this extra property?” Baright explained.
Around the same time, a friend from New Hampshire joked about a unique upside to his vended laundry business. Unlike a carwash, he said, the coins emptied in the pleasant indoor conditions of a coin laundry are always warm.
After doing some investigation and research, Baright liked the idea of pairing up his family’s successful Foam & Wash Car Wash business with a second venture on the site. The merge of carwashes and laundries, however, isn’t a unique blend.
Working well together
According to Coin Laundry Association statistics, six percent of coin laundry owners surveyed in 2006 also feature carwashes with their operations.
Angel Caballero is owner of Fabricare Industries, a Wappingers Falls laundry equipment distributor, and assisted on the Foam & Wash project 20 years ago. Along the way, he has handled many upgrades.
“I think this is a perfect marriage,” said Caballero, adding, “people get a one-stop cleaning area.”
Likewise, Baright saw efficiencies in pairing the businesses at the same site. Because laundries and carwashes utilize the same basic systems such as water, bill changers and other items, efficiencies such as a lower insurance rate and one dumpster versus two add to the bottom line.
Why add a laundry?
Besides economies of scale, Dan Bowe, national sales manager for IPSO brand laundry equipment, points to the track record of laundries as an attractive selling point, including a success rate of almost 100 percent after five years. A high ROI (return on investment) figure also makes it easy for current carwash owners to get excited about such an investment.
Bowe said a coin laundry helps carwashes off-set losses on foul weather days. Not only that, but current carwash owners already have a head start in knowing what it takes to be successful.
For Baright, getting started consisted of an initial homework phase. He traveled all around looking at coin laundries and listening to operators who had years of experience. “The guy who’s done it for 10 years has been through the school of hard knocks,” Baright said. And he was able to apply lessons they had learned without having to make the mistakes.
From there, he reviewed equipment distributors in his area, careful to note experience and overall quality and range of services available. “A lot of guys just want to buy on price,” he said. “In the long run, it’s going to save you money [to pick the best distributor, even if they are not the lowest price].”
Caballero was extremely helpful in explaining things along the way and the relationship has continued two decades later. If there’s a problem with equipment, Baright knows he can count on fast service from Caballero.
Caballero concurs with Baright that those entering the coin laundry business should work with a distributor who has solid experience helping investors develop the business — just as successful carwash owners choose the same experienced distributors for that equipment.
Your distributor should assist with navigating the codes and permits process, installation, training, service and financing.
The finished product
Baright’s three-acre parcel was developed into a six-bay self-service carwash with one full conveyor tunnel along with a more than 6,000-square-foot laundry. The laundry includes a lounge, complete with big screen TV, vending machines and a pool table.
“Build 10 percent better than anybody,” Baright said of his philosophy on not skimping on store design elements such as seating and amenities. He believes owners who put the customer first always will rank ahead of their competition at the bottom line.
Baright believes every one of his customers is worth about $500 a year, so he wants to give every customer a reason to return. Losing only a handful of customers could severely impact his monthly bottom line revenues.
He’s been happy with how having the laundry on-site has benefited the service his carwash customers receive. At night, when a vacuum jams, customers can walk in the laundry, notify the attendant and receive their money back.
“You’re really helping the customer out because they are getting immediate satisfaction,” Baright said, adding that the additional benefit comes in the attendant placing a sign on the unit to ensure no other customers are inconvenienced.
Baright’s focus on customer convenience extended to the laundry as well, where he installed an ESD card payment system. The system enables customers to add value to a smart card. The card then is used to activate washers and dryers — eliminating the need for customers to carry quarters.
In time savings alone, Baright said the system is worth it. He only has to collect cash from a central terminal versus each individual machine. While he initially was worried how his older clientele (35 percent of his customer base is seniors) would react to the new system when he installed it several years ago, he was pleasantly surprised in the end.
“Older people loved it … they took to it right away,” Baright said.
Though he utilizes a separate system for the carwash, he does incorporate cross-marketing initiatives such as rewarding loyal laundry customers with a free top-level carwash during the holidays.
Advice to newcomers
A number of factors will determine the success of a combination carwash/laundry, but Baright insists site selection is paramount. With a growing portfolio of 14 carwashes including full-service washes, convenience stores and gas stations in and around Poughkeepsie, NY, the Wappingers Falls site has been the only one to host a laundry.
“We’re carwashers first,” Baright said, adding, however, they do consider adding vended laundries to new developments, but haven’t found a suitable location. “It is hard to get both to work on the same site.”
Bowe agrees that the success of a vended laundry is established before it even opens its doors by the selection of a site with the right demographics. This is where he advises operators to work with a distributor that can provide a demographics analysis and help identify sites or give the operator the option of a turn-key store that may already be developed.
Baright also points out the need to have adequate space of about 1.5 acres to make the two businesses work at the same site. He advises operators not to try to do too much at one location, or clutter up their carwash site with a laundry facility that really needs more acreage.
Caballero stresses the same point in developing a vended laundry.
“I discourage the guy looking to go small… you’ve got to give yourself the best opportunity [to be successful],” Caballero said. Customers who end up waiting for washers and dryers during peak business periods rarely return.
Patience is equally important, Baright said, adding that entrepreneurs should take their time during startup. According to Bowe, ramp-up with a vended laundry is about 18 months. After the first year and a half, an operator should be going full steam.