American Coin-Op - August 2012

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I N S I D E : A U G U SI NT S 2I D 0 1E :2 J U L Y 2 0 0 5 TEN SECRETS TO PROMOTING YOUR LAUNDRY NOW!

COIN-OP INSURANCE Q&A WITH THE EXPERTS

INCREASING PROFITS BY INCREASING CAPACITY

W W W . A M E R I C A N C O I N O P. C O M

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CONTENTS AUGUST 2012 VOLUME 53 ISSUE 8 EXTRA PROFIT CENTERS BIG AND SMALL Megamat Super Laundromat, Mount Vernon, N.Y., and The Service Station, Thompsonville, Ill., couldn’t be more different in geography or demographics. But what about their approaches to extra profit centers?

COVER STORY

FEATURES 10 TEN SECRETS TO PROMOTING

YOUR LAUNDRY NOW!

Brian Wallace, president of the Coin Laundry Association, offers 10 no-cost or low-cost ways that you can promote your store(s) today.

18 COIN-OP INSURANCE Q&A Representatives from the industry’s major insurance providers answer some questions that the average self-service laundry owner might have about protecting their investment.

28 PRODUCT SHOWCASE: BIG BOYS

14 COLUMNS 16 LAUNDRY FINANCING CAN BE HAD FOR...

Columnist Howard Scott disagrees with the notion that obtaining money is hard these days. Yes, even in these cautious, recessionary times, Scott says, money can always be had for a good investment. He offers up some options for those who are serious and determined.

DEPARTMENTS 4 VIEWPOINT 6 INDUSTRY SURVEY 24 CALENDAR 24 WEB UPDATE

37 AD INDEX 38 CLASSIFIEDS 40 NEWSMAKERS

(LARGE-CAPACITY WASHERS & DRYERS)

36 COIN-OP 101: INCREASING PROFITS

BY INCREASING CAPACITY

Distributor Eric Greenberg says the steady growth in popularity of machines with capacities of 60 to 80 pounds has allowed manufacturers to construct reliable and durable products that have increased in longevity, have better utility consumption, and allow owners to be competitive.

18 A CLOSER LOOK Fire, liability or worker injury are just some of the risks that your laundry faces every day.

Do you have the right insurance coverage?

Photo: ©iStockphoto/KEMAL BAS

Cover Image: © iStockphoto/Ivan Bajic 2

AMERICAN COIN-OP AUGUST 2012

www.americancoinop.com

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VIEWPOINT

EDITORIAL Charles Thompson, Publisher E-mail: cthompson@ americantrademagazines.com Phone: 312-361-1680 Bruce Beggs, Editorial Director E-mail: bbeggs@ americantrademagazines.com Phone: 312-361-1683

IT’S FREE (OR CLOSE TO FREE)

Roger Napiwocki, Production Manager Jean Teller, Contributing Editor Nathan Frerichs, Digital Media Director E-mail: nfrerichs@ americantrademagazines.com Phone: 312-361-1681

ADVERTISING ‘SECRETS’ FOR PROMOTING YOUR STORE It was my pleasure to attend Fabricare 2012, the every-otheryear conference sponsored by the California Cleaners Association.

And I’m not just saying that because it was in beautiful Long Beach last month.

I stayed until the final speaker on the last day because the title of his presentation convinced me that covering it would make a good story for the magazine.

It was 10 Secrets to Promoting Your Laundry Now! What coin Bruce Beggs laundry owner could pass that up?

Brian Wallace, president/CEO of the Coin Laundry Association, shared some cost-effective ways that a laundry owner can boost their market profile; many of them are free. Most involved using online and social media resources like Facebook, Google Places, Twitter and more.

If you can get past all the clutter, as Wallace put it, that is where people are learning about businesses and getting referrals today. And you really can’t afford to not be part of it. Take a look at my story beginning on page 10.

EXTRA PROFIT CENTERS BIG AND SMALL Last month, distributor Todd Santoro shared some thoughts about providing extra services and how certain additional revenue streams require little extra work (Coin-Op 101: Extra Creativity Can Lead to Extra Profit).

This month, I take a look at two laundries that couldn’t be more different as far as geography and demographics are concerned, and how their owners approach the offering and management of extra profit centers. Peek inside the Megamat Super Laundromat and The Service Station beginning on page 14.

INSURANCE UPDATE You might not consider insurance to be the most exciting of topics, but make a mistake by failing to have the proper coverage and it could cost you your business.

Did that get your attention? I posed a series of questions to our industry’s major insurance providers, and their experts provided sound advice you might rely on the next time your policy is up for renewal. Check it out starting on page 18.

Bruce Beggs Editorial Director

4

AMERICAN COIN-OP AUGUST 2012

Donald Feinstein, Natl. Sales Director E-mail: dfeinstein@ americantrademagazines.com Phone: 312-361-1682

OFFICE INFORMATION Main: 312-361-1700 Fax: 312-361-1685

SUBSCRIPTIONS 630-739-0600 www.AmericanCoinOp.com

American Coin-Op (ISSN 0092-2811) is published monthly except Nov/Dec combined. Subscription prices, payment in advance: U.S. and Possessions, 1 year $39.00; 2 years $73.00. Foreign, 1 year $89.00; 2 years $166.00. Single copies $7.00 for U.S. and Possessions, $14.00 for all other countries. Published by American Trade Magazines LLC, 566 West Lake Street, Suite 420, Chicago, IL 60661. Periodicals postage paid at Chicago, IL and at additional mailing offices.

POSTMASTER, Send changes of address and form 3579 to American Coin-Op, Subscription Dept., 440 Quadrangle Drive, Suite E, Bolingbrook, IL 60440. Volume 53, number 8. Editorial, executive and advertising offices are at 566 West Lake Street, Suite 420, Chicago, IL 60661. Charles Thompson, President and Publisher.

American Coin-Op is distributed selectively to owners, operators and managers of chain and individually owned coin-operated laundry establishments in the United States. No material appearing in American Coin-Op may be reprinted without written permission. The publisher reserves the right to reject any advertising for any reason. © Copyright AMERICAN TRADE MAGAZINES LLC, 2012. Printed in U.S.A.

www.americancoinop.com

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INDUSTRY SURVEY

COIN LAUNDRY BIZ IS NO FUN DURING SUMMER, MANY OWNERS SAY Is it fun in the sun or the dog days of summer in your store this time of year? Nearly half of the store owners who took July’s AmericanCoinOp.com Wire survey say that summer is worse than most seasons (36.8%) or is the worst season (10.5%) in terms of business.

Approximately 16% say that summer business is the same as other seasons, while 26.3% think it’s the best season and 10.5% think it’s better than most seasons.

Fewer than 22% of respondents run specials or promotions specifically during summer. They offer things like cash raffles, gift-card drawings, and fluff-and-fold or dry cleaning specials.

“I do a two-for-one comforter special because they are easy to do,” says one owner, “and it helps a lot of people get a job done that they normally would wait until busy winter months to do.”

More than half of respondents (52.6%) say that customer habits, such as when they do their laundry and how often, tend to change during the summer and this affects their store’s hours, attendant scheduling, etc.

With most children on summer break, that means more opportunities to tag along with Mom or Dad to the Laundromat.

But 52.6% of respondents don’t think there are more childrelated issues—screaming, running throughout the store, etc.— during summer than other times of the year. Roughly 42% think there are more issues in the summer, and 5.3% aren’t sure.

What’s the worst thing about running a self-service laundry during the summer? Paying higher utility bills, trying to keep their store comfortable, fielding more customer complaints, and having fewer customers were some of the more common responses to the survey question.

While the Wire survey presents a snapshot of readers’ viewpoints, it should not be considered scientific.

Subscribers to Wire e-mails—distributed twice weekly—are invited to take the industry survey anonymously online each month. All self-service laundry owners and operators are encouraged to participate, as a greater number of responses will help to better define operator opinions and industry trends.

To sign up for the Wire, visit AmericanCoinOp.com, click the “Subscriptions” button at the top right-hand corner of the home page and follow the instructions.

■

To read other Wire survey stories, visit AmericanCoinOp.com 6

AMERICAN COIN-OP AUGUST 2012

www.americancoinop.com

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to Promoting Secrets Your Laundry

By Bruce Beggs, Editorial Director

B

rian Wallace, president/CEO of the Coin Laundry Association, had a daunting task: to capture the audience’s attention during the final hour of a regional dry cleaning and laundry trade show in sunny Southern California.

But his task was no more challenging than one faced by every self-service laundry operator: to successfully market his/her store(s) in an environment where potential customers have near-instantaneous access to information from a variety of sources.

On top of all the other “hats” that a laundry owner “wears”—customer service, maintenance, production, human resources, accounting—he or she can add one more hat to that mix: director of marketing, Wallace told attendees of Fabricare 2012 in Long Beach, Calif.

“We’re all trying to reinvent ourselves on the fly, trying to deal with the new market-

Photo: © iStockphoto/Rouzes 10

AMERICAN COIN-OP AUGUST 2012

Now!

place,” Wallace says. “I think that trying to come to grips with some of the new marketing techniques is really an important part of that overall process.”

Worried about not having the time and money to boost your laundry’s marketing profile? Don’t be, says Wallace.

“What I’ve found exciting about social media, digital media, web, all these different things that have come along the last couple of years, these are almost all lowcost or no-cost opportunities.”

Where do consumers look first for local business information? According to Wallace, they look to search engines (33%), printed Yellow Pages (23%), online Yellow Pages (22%), local search sites (13%), and mobile apps/social media outreach (9%).

And 77% of all users will research online before they’ll walk through a laundry’s door, he says.

“If we want our businesses to be successful, we need to make sure that our message is where the people are.”

Thus, Wallace ran down a list of 10 ways in which a laundry operator could promote his or her business today: CLAIM YOUR BUSINESS LISTING ON GOOGLE Google Places is a free business directory offered by Google, the largest search engine in the world and the second busiest website overall.

Google Places allows a business to Wallace create an informative page about its location, services, hours of operation, and more, using text, images and even video.

“By claiming your business, you’re essentially saying, ‘Google, that is my (laundry).

I am the owner,’” Wallace says. “And once they confirm that with you, it’s a pretty easy process.”

Once a listing is established, the business has the ability to edit the presentation so that it is always accurate and up to date.

“The search engine’s job is to deliver the best possible results for the customer,” he says. “So, they’re going to put a lot more weight on a listing that’s been claimed by the business owner, that’s been fleshed out with all the pertinent information. It’s going to deliver better results.”

Once you’re created a profile for Google Places, it’s simple to “copy and paste” the data into other services such as Yahoo!

Local, Bing Local, Yelp and Merchant Circle. www.americancoinop.com

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“Do your prospective customers a favor—the ones that want to spend money with you—help them find you.”

GET A WEBSITE If your laundry maintains a business website, great. If your laundry is among the 46% of small businesses that still don’t have a website, get one.

If you don’t think it’s something that you or someone affiliated with your business can do, there are any number of companies that offer website design services with small businesses in mind.

Wallace’s association builds websites for its members for free. “We believe the best way to grow the coin laundry business is to make sure that every single laundry owner is available on the web to be found by consumers.”

CREATE A FACEBOOK PAGE Facebook boasts more than 600 million active users, 50% of whom use the site on a daily basis. Why should you market your laundry on Facebook?

• Your customers are there • Competitors might be there already

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• It’s easy to create and update your page • You can share all types of information in almost any format for free • It aids in search engine placement “If you cut through the clutter, this is where people are finding businesses,” Wallace says. “This is where they’re getting referrals, this is where they’re finding out where their friends and family are doing their dry cleaning, and who they like and who they don’t.”

So how do you get started? Create a Facebook page, but do not create a personal profile (one with an e-mail address). And before you create a page, search the site for an existing “Facebook Places” page for your business and claim it instead.

MONITOR AND RESPOND TO REVIEWS In the past, when someone had a certain experience—good or bad—at your business, they told their friends and family.

Today’s web-savvy customers are also likely to post a review on sites such as Yelp, Merchant Circle and others that millions can read 24/7.

Wallace often hears from laundry owners who avoid sites like this because of negative

reviews. But sticking your head in the sand is not the answer.

“The genie is out of the bottle. The toothpaste is out of the tube. It’s out there.

It’s happened. You don’t have a choice in the matter. Your business is already being discussed in this manner.”

He sees a negative online review as an opportunity for you to respond to a customer’s complaint, just as you would have had you received it at your business, and to promote your laundry’s benefits.

“Part of this is not only responding … but encouraging people to review you, because you run a great shop. That bad review is one rotten apple in the barrel.

Most of your customers love you. They see you every week. You need to get that volume going, too.”

OFFER CONTESTS, BUILD CUSTOMER DATABASE Contests can increase community awareness of your business, plus enable you to network with customers. You can create repeat customers while building a database for use in direct or e-mail marketing.

Every laundry should develop a customer mailing list, preferably one that includes

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www.americancoinop.com

AUGUST 2012

AMERICAN COIN-OP 11

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Smartphone users that “check in” at businesses by using foursquare in hopes of garnering special offers can attract new customers.

Photo: foursquare

e-mail addresses, Wallace says. Stay in touch with your customers through offers and information in order to retain their business; plot their locations on a map to help plan for future advertising.

SEND AN E-MAIL NEWSLETTER Use the e-mail addresses that you gathered from your contests to update those customers with a newsletter about your business.

What should your newsletter include?

Share print-to-click coupons, store news, and announcements of upcoming special events. Position yourself as a garment care expert by sharing laundry tips.

“What do people do today when they get a great coupon via e-mail?” Wallace asks.

“Forward it to their friends and family. You used to mail a coupon. They had one coupon and one person redeemed it. What happens now? Maybe that coupon goes out to everybody on my e-mail list, all my friends on Facebook, anyone who follows me on Twitter. All of a sudden, this coupon that you sent to one regular customer just went out to maybe another couple hundred people.”

He recommends keeping an e-newsletter short and easy to scan, designing it for the “preview pane,” creating a strong subject line, and selecting a reputable e-mail marketing service to maintain and deliver your newsletter.

ADVERTISE WITH GOOGLE ADWORDS Use “search advertising” to find customers when they’re in need of laundry services, says Wallace, and a high-profile method is using Google AdWords. “We want to do everything we can to let people find us organically, but this is where we 12

AMERICAN COIN-OP AUGUST 2012

cover our bet. This is where we pay for placement.”

You create ads and choose keywords, which are words or phrases related to your laundry. When people search on Google using one of your keywords, your ad may appear next to the search results. Plus, you can set local parameters such as ZIP code and a radius search.

Google AdWords can be cost-effective, Wallace says, because you establish a budget for the campaign and control your ad spending. “The impressions are free; they can see that your results are there. You’re only paying if they click. There’s a process here ... whereby you bid on certain search terms, and you’re paying per click.”

The amount you spend is entirely up to you, and there’s no minimum. When your ad has drawn the number of clicks that exhausts that budget, you have the option to end the campaign or to add funds to keep it going.

“What’s a regular customer going to spend with you in a year?” Wallace asks.

“The average Laundromat customer is going to spend 500 bucks a year, probably closer to a thousand. … You can go the extra mile. There’s a cost associated with it, but it’s a low cost.”

INCENTIVIZE WITH FOURSQUARE, GROUPON The service called foursquare allows users to “check in” via a smart phone app or SMS. Users share their location with the public while collecting points and virtual badges.

A business benefits from foursquare because the activity attracts new customers, rewards loyal customers, and provides another outlet for offering specials, mobile coupons, and prizes or discounts.

“It’s works well where people are going on a regular basis. … It’s the frequent flyer model. It’s the punch card from the sandwich shop. As the business owner, you give them different perks, different discounts, different things to attract, mobile coupons, and you’re rewarding them for being a regular customer. It’s the oldest idea in retail.”

Groupon is a “deal of the day” website that features discounted gift certificates offered for a limited time that a customer purchases online and then presents at the business. Groupon offers small businesses big exposure and measurable marketing,

Wallace says; 91% of businesses report seeing new customers from their promotions.

But critics say the new business generated by a Groupon campaign is short-lived and doesn’t result in repeat customers.

“Among a lot of the small-business people I talk to, the jury is still out,” Wallace says. “It definitely generates leads. You get people that use the service. You’re basically asked to give about a 50% discount, splitting the other 50% with Groupon. But you’re getting people in the door.”

GET SOCIAL ON TWITTER Twitter is the fastest-growing social network, with 300,000 people joining every day. The microblogging site enables users to send and read posts of up to 140 characters called “tweets.”

From a business perspective, Twitter is used for customer service, sharing immediate information, gathering real-time market feedback, generating leads, building customer relationships, marketing, and sharing coupons and discounts.

“It’s a great way to stay in communication, but it’s the same principle. It’s word of mouth. It’s peppering out information about your business and asking people to follow through on it.”

Wallace described an Ohio Laundromat owner who tweets that his machines are open or that he’s offering a free soda or box of soap to the first 10 customers to show up. “He said that every time he tweets during slow times, he gets customers.”

GET FOUND BY GPS Increasingly, people are using the search functions of GPS units commonly found in today’s vehicles and smart phones to find local businesses. There are two main information providers—Navteq and Teleatlas— and businesses can register their sites for free with those companies, Wallace says.

“Is it going to revolutionize your business? No, but it may find you a few new customers.”

Whether you try out only one or two of these tips or all 10, it’s absolutely vital that you become more proactive in promoting your business, Wallace advises.

“A lot of this talk is about ‘grabbing the wheel,’” he says. “A lot of this is happening either with you or without you. As a smallbusiness owner, I’m saying, ‘Grab the wheel.’

Have an impact on what’s happening with the way your business is being viewed online and through social media.”

■ www.americancoinop.com

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Photo: © iStockphoto/Agnieszka Gaul

By Bruce Beggs, Editorial Director

L

ast month, distributor Todd Santoro shared some thoughts about providing extra services for your laundry customers and how certain additional revenue streams require little extra work to put into place (Coin-Op 101: Extra Creativity Can Lead to Extra Profit).

This month, American Coin-Op takes a look at two laundries that couldn’t be more different as far as geography and demographics are concerned, and how their owners approach the offering and management of extra profit centers.

MEGAMAT SUPER LAUNDROMAT MOUNT VERNON, N.Y. When Conrad Cutler responded to American Coin-Op’s recent poll about extra profit centers, his list for the Megamat Super Laundromat was a lengthy one: vending machines, laundry bags, wash-dry-fold services, drop-off/commercial accounts, video games/pinball machines, moving truck rental, rug cleaner rental, ATM, and car care equipment (vacuum, air machine, and fragrance machine).

The 5,000-square-foot store located in a low-income, predominantly AfricanAmerican neighborhood just north of New York City is open 24 hours a day, seven 14

AMERICAN COIN-OP AUGUST 2012

days a week, and is advertised as the “home of America’s largest washing machines.”

Cutler, 22, only recently graduated from Syracuse University with a degree in supply chain management and entrepreneurship and emerging enterprises, but he’s been running Megamat since August 2009.

His family leased the former warehouse to a tenant who installed the mega-laundry.

When the tenant went bankrupt, the young Cutler was called on to take over the operation so the family could avoid accruing real estate tax on a vacant property.

Cutler successfully renegotiated the tenant’s sizable outstanding note with the finance company and instituted a renovation plan that would take four months to complete and cost $30,000.

Expanding the breadth of services offered by the laundry was always part of his business plan. “My objective in having so many different auxiliary revenue streams was not only to generate money but also to bring people into the Laundromat who might not come in there regularly otherwise.”

And that’s mighty important when you consider there are 46 coin laundries within four square miles serving 65,000 people.

All of the non-laundry equipment is serviced by outside contractors (eight, by

Cutler’s count) that pay Megamat a portion of the revenue. “The most important thing to me is that we have 100% uptime on all of our equipment,” he says.

Cutler depends heavily on a staff of six attendants to manage the around-the-clock operation when he’s not there. The store wouldn’t be able to offer the scope of added services without them, he says.

Among Megamat’s most popular auxiliary services are U-Haul truck rental (it’s one of the few Northeast businesses to offer it around the clock, according to Cutler) and pay-as-you-go Internet service (at the rate of $1 per 10 minutes; most people living in and around the neighborhood don’t own a computer or have Internet access, he adds).

Cutler called extra profit centers a “dualedged sword” that could hurt an operation if they’re not treated with the same level of care and concern as the laundry.

“You really have to make sure that you’re giving excellent customer service in all aspects to whoever walks in the door, regardless of whether they’re washing clothes or just putting 25 cents in a gumball machine,” he says. “That’s really what’s going to keep the business going is maintaining the same level of customer service for every customer.” www.americancoinop.com

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THE SERVICE STATION THOMPSONVILLE, ILL. The Service Station is divided into two parts: it’s half coin laundry and half tanning salon and office center offering copy/fax/ scan service and a pair of Internet kiosks.

Owner Nova Randolph grew up in the Southern Illinois village of 600 people.

When she returned to Thompsonville several years ago to raise her family, she found that few local businesses remained. Among the shuttered was a coin laundry.

Randolph works full time as an accounting and computer sciences instructor at a community college located a little more than an hour away. During the course of conversation with other Thompsonville residents, she often heard how they had to drive to larger communities 10 to 12 miles away for shopping and other retail services.

“I came up with the idea to put a bunch of different services together for the community and do them all out of one business.

I don’t think any one of those businesses could ever stand on their own.”

Randolph found a centrally located building near two highways that carry lots of traffic by her door every day. It was ren-

Page 15

ovated so each half of the store can be accessed independently, yet a doorway inside connects the two halves.

She opened the Laundromat last December and the tanning salon in May. The copy/fax services and Internet kiosks were just added within the last month or so.

“My original plan was to open it all at once,” Randolph says. “We did most of the work ourselves, other than what was required by law. So it took us from last August until the middle of December to remodel the Laundromat side.”

Midway through the remodeling, Randolph decided that one portion of the multi-service business needed to be completed so it could start generating revenue.

Equipment and remodeling for the “Internet/tanning/fax/copy” area cost approximately $10,000, according to Randolph.

The 1,000-square-foot laundry is equipped with five top loaders, two 20pound front loaders, five dryers and a stack dryer. She plans to add a triple loader later this year. There are soda and candy venders, plus she plans to add a soap vender soon.

The laundry is attended only when the two-bed tanning salon is open, and a couple of family members step in to manage the business if Randolph has a scheduling conflict.

The laundry is open 6:30 a.m. to 10 p.m.

Monday through Friday, and 9 a.m. to 10 p.m. Saturday and Sunday. The tanning salon is open 3 to 10 p.m. Monday through Thursday and noon to 6 p.m. Friday and Saturday.

The tanning beds are generating about as much revenue as the coin laundry, Randolph says. And she’s looking to add a spray tan booth in the future.

At the time of Randolph’s interview, The Service Station was set to begin offering drop-off laundry service. And she’s not done thinking about adding other extra profit centers. Randolph is now considering adding either a hairdressing station or a nails station to complement the tanning salon.

“I can’t tell you how many people that see me in the Laundromat and thank me for putting this in here,” she says. “That I have just helped them out so much and made their life so much easier.”

■

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AUGUST 2012

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AN OUTSIDER’S VIEW

LAUNDRY FINANCING CAN BE HAD FOR GOOD INVESTMENT

Howard Scott

“Laundromateurs” tell me if they only could get their hands on $100,000, they could build a great business. And I occasionally meet individuals who say, “I would love to open a Laundromat, but I just don’t have the money.” Both types are missing the boat.

As a starting point, I’m not sure existing operators would use that $100,000 effectively. That is, after using the money, their business might be more or less in the same position as before the money was spent.

Second—and this is the point of this column—I disagree with the notion that obtaining money is hard these days. Yes, even in these cautious, recessionary times, money can always be had for a good investment.

Let me tell you a story. In 1968, I was a callow young man, fresh out of college and a year in the working world, wanting to start a business. I computed that I would need $25,000. Since I only had $2,000 to my name, how was I going to raise the rest?

First, I did my research. I obtained a warehouse job at a company in the field I wanted to enter. Down in the basement, I learned about product, processing, delivery, and staffer work patterns. I learned about the guts of the business. I would submit to you that my two months of being a warehouse worker was far better experience than being an executive.

16 AMERICAN COIN-OP AUGUST 2012

Secondly, I went to several business owners and interviewed them. I told them that I was doing a graduate thesis about the industry. These businessmen opened up, providing in some cases more than I wanted to know. I took copious notes. In the process, I learned some strategies about winning and maintaining customers. For example, I learned one businessman’s theory about giving price breaks.

Thirdly, I spoke to customers and asked what they liked about their service and what they didn’t like.

Using that research, I wrote up a seven-page business plan. Nothing fancy, but it basically explained what I needed in capital and how I was going to use it to get my business started. Then I sent my business plan to 10 individuals. These people included successful business owners from the town where I grew up, moderately rich relatives, and one college buddy who had money. I also sent the business plan to my local banker, who I had dealt with when I was a young boy minding my miniscule savings account.

Basically, I asked for a debt and equity investment of equal increments. In other words, whether they invested $1,000 or $5,000, it had to be 50% debt and 50% equity. The equity was the individual’s ownership stake. If the business prospered, the investor’s value would be increased by the success of the business. The debt portion was a three-year loan, which would be paid back at 4% interest each year, until the balance was paid off in full.

Why this necessity of equal debt and equity? Because I would contribute my $2,000 (my life savings), and if every investor contributed equal debt and equity, then I would, by arithmetic, own more than 51% of the business and therefore have effective control. I could do what I wanted and wouldn’t have to answer to anybody.

To illustrate, say there were five investors, and each contribution went like this: • Ricky — Total contribution of $1,000: $500 in debt, $500 in equity • John — Total contribution of $3,000: $1,500 in debt, $1,500 in equity • Susan — Total contribution of $4,000: $2,000 in debt, $2,000 in equity • Mike — Total contribution of $5,000: $2,500 in debt, $2,500 in equity www.americancoinop.com

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• Jose — Total contribution of $10,000: $5,000 in debt, $5,000 in equity I add my $2,000—all equity—to reach the $25,000 required capital investment. So, my ownership stake is the $11,500 debt and the $2,000 personal contribution, for a total equity stake of $13,500. That’s 54% ownership ($13,500/$25,000).

For many years, the Ford family owned exactly 51% of Ford Motor Co., so therefore it had full control. Sure, the Fords had to share profits with the minority 49% stakeholders, but they could manage the business any way they wanted. That’s the importance of obtaining equal debt-equity contributions.

One by one, I visited these potential investors, presented my case, answered questions, and showed them how serious and determined I was. Several days went by, and nobody budged. Then one prospect called, saying he would put in $2,000 according to my stipulations. I called two others, and both agreed to put in money.

In one week, I had the necessary commitments.

Altogether, nine prospects agreed to invest in my business. Even the bank came through with funding, which I had to refuse because its interest requirements were higher than my debtors’ arrangements. In short order, I gathered my $25,000, and started to set up my business. I was 24 years old.

The point of this story is not to boast. Rather, it’s to show that there are unlimited ways to obtain funds. In my state, Massachusetts, 6% of families have more than a million dollars in capital. Many of these individuals are earning precious little on their money. A number of them could be persuaded to invest

in a business enterprise.

Consider the following options: • Attend a Rotary meeting and present your business investment idea. Describe how investors can make money from your proposition.

• Approach members of your family, asking them to invest a sum of money, which will be rewarded with 10% interest a year. If you believe you can take that money and put it to good use, you can certainly pay high interest. I know a woman who built a giant bus company by giving investors 20% annual interest for their $10,000 investment.

• Visit your two wealthy retired relatives with your idea and pitch them on the debt equity deal that will make them partowners again. Play one against the other to encourage them to invest. Or do the same with neighbors, friends, or members of the same organization you belong to.

• Post an ad on Craigslist for a partner. Set up some sort of partnership role, without you giving up control. Who knows, perhaps some wealthy individual will become intrigued by your proposal.

If you need money to take your business to the next stage, it’s out there. Saying “I can’t find investors” is no longer acceptable.

■ Howard Scott is a long-time business writer and small-business consultant. He has published four books.

To read more Howard Scott columns, visit AmericanCoinOp.com

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AUGUST 2012

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F

ire, liability or a worker injury are just some of the risks that your coin laundry faces every day. If your 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 you out of business.

This month, 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: What specific coverages do you believe are absolute requirements for any coin laundry, and why?

Adam Weber, president, Irving Weber Associates: There are many coverages that are industry-specific, such as bailee coverage for operations that offer attendant service (as well as those that don’t) such as wash and fold, but may experience an equipment malfunction that damages a customer’s clothing while being processed.

Other important coverages are water damage caused by sewer system backups, signs, general liability, parking lots, and equipment breakdown (including equipment and/or boilers and machinery if present). Also, business property coverage should be considered not just for machinery but also folding tables, TVs, chairs, vending machines, computer systems, card readers, etc.

Anne Hawkins, vice president, NIE:

Coin-Op Insurance Q A

&

Insurers outline industry-specific coverages, offer advice on recommended scope of protection

At a minimum, every Laundromat should carry these coverages: • Building (when owned by the business owner) — If it’s an older building and you wouldn’t rebuild, insure for actual cash value. If you would rebuild, insure for replacement cost.

• Improvements and Betterments (when the business owner is a tenant) — You will need to replace the building owner’s property that is part of the building if you have a loss due to your negligence. This would include flooring, lighting, paint, wallpaper, etc.

• Business Personal Property (at replacement cost) — When you determine the replacement cost, be sure to include delivery, installation and taxes because these are included in the loss amount.

• Loss of Income (for minimum of three months) — This pays your profit and continuing expenses while you are out of business due to a covered cause of loss that occurs at your location.

• Utility Services - Time Element — This pays your profit and continuing expenses while you are out of business due to a covered cause of loss that occurs away from your premises, i.e. downed power lines due to windstorm.

• Utility Services - Direct Damage — This pays for damage done to your equipment due to a covered cause of loss that occurs away from your premises, i.e. when the power comes back on, some or all of your equipment is not working.

• Equipment Breakdown — Even if you do not have a boiler at your location, there are many other pieces of equipment that can fail due to an accident such as a power surge that is not caused by a covered cause of loss, i.e. power company equipment failure.

• Bailee — If you are doing drop-off dry cleaning and/or wash/dry/fold, you need to have coverage for your customers’ items that may be in your store overnight or for any length of time.

• Liability — Coin laundries have high liability exposure due to the volume of customers who enter their store and stay on the premises while doing laundry.

Photo: ©iStockphoto/KEMAL BAS 18

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Larry Trapani, president, Brooks Waterburn Corp.: While a Laundromat owner needs many types of coverage, here are what I feel are the most important: • Business Personal Property (aka Contents) — This coverage protects your washers/dryers, vending machines, coin changers, basically all your stuff inside the building. Make sure the coverage is valued at “Replacement Cost” rather than “Actual Cash Value,” because if there is a claim, you want what it cost to get new machines, not the value of a 10- or 15-year-old machine.

• Tenant Improvements (aka Build-out) — This is the cost that you put into the space you are renting. It includes electrical, plumbing, lighting, flooring, etc. Sometimes, these values can be $75,000 to $100,000. It is by far the most overlooked coverage when I review competitors’ policies.

• Liability — This covers slip-and-falls, children running into tables, or any other type of incident that might get you sued.

Standard coverage is $1 million but some landlords require $2 million or more.

• Workers’ Compensation — The truth is, the Laundromat industry is a cash business. Many store owners pay workers “off the books.” The IRS is cracking down on small business.

In most states, employers are required by law to carry workers’ comp insurance. And classifying employees as “independent contractors” will not fly. More than one of my customers has been caught doing that and paid significant fines.

certain on the property side that you have full replacement cost for both equipment and tenant improvements, along with business income protection. Get your distributor involved by asking, “What would it cost to rebuild my store today?” Once you have that answer, discuss it with your insurance broker. Many times, fees (sewer hook-ups are a good example) do not have to be paid again.

On the liability side, review your lease as a minimum requirement, then discuss your own personal net worth, or that of the LLC, corporation or partnership that owns the store.

Last item of importance, but by no means should it be forgotten, is workers’ compensation. Laws differ in each state based on labor codes. Do not have a person in the store, even if advised by your CPA, that you call an “independent contractor” who is not covered by workers’ comp. If you have that exposure, take out a minimum premium compensation policy, even if your CPA gives them a (Form) 1099 and classes them as independent. The only time this is questionable is if you hire another company (janitorial, for example). Make sure they supply proof of insurance and a “waiver of subrogation” from their workers’ comp carrier.

ACO: What are the biggest insurance risks in a coin laundry setting, and why?

Steve Brodie, senior vice president, Wells Fargo Insurance Services USA:

Hawkins: The biggest risk is the liability exposure due to wet floors and/or damaged floor tiles from water leakage, plastic furniture that can collapse, lack of supervision of children, stools used to reach equipment controls, and improper maintenance of equipment.

Burglary is another big risk. When someone burglarizes a coin

Key insurance issues are property coverage and adequate liability protection. Within these two broad segments, you want to make

(Story continues on page 22)

www.americancoinop.com

AUGUST 2012

AMERICAN COIN-OP 19

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

laundry, they usually destroy the coin boxes on each machine and vandalize coin changers. This gets expensive and happens frequently.

Trapani: The biggest risks in a coin laundry setting

Coin-Op Insurance

can be broken down into two areas: • Property Losses — The largest and most frequent claims are dryer fires. It usually has to do with not cleaning lint traps or ducts. As you can imagine, most fires cause significant damage because the dryers and washers are closely grouped together and the fire easily spreads. A good housekeeping procedure can help reduce these types of claims.

• Liability Losses — While trip-and-falls are common, lately, I see more children getting hurt in stores. Parents don’t always pay close attention to their kids, who run into things, pull down tables on top of themselves or fall from carts. I always suggest that a store owner bolt down tables to minimize some of the risk.

&

QA

Brodie: Fire and liability claims are your biggest exposures to loss and cost the most when they happen.

Weber: Fire is probably the most common and easiest to avoid.

Fires can easily begin in these businesses due to build-up of lint in dryers/exhaust vents, poor maintenance of heat-limiting safety devices (switches on dryers), combustible material stored near dryers or water heaters, washing materials soaked in flammable liquids such as gasoline, and build-up of oxygen agents (bleach, for example) through overuse.

Additionally, liability claims for alleged slip-and-falls are prevalent with this industry group.

ACO: How does the status of a store—unattended or attended— affect its insurability?

Trapani: The status of a store has a significant impact on insurance premiums. Unattended stores obviously are not as closely watched as attended stores. If something goes wrong, nobody is there to minimize the damage. Insurance companies know this as well and charge accordingly. The premium can be up to 40% more for an unattended store.

A note of caution here: If your store is unattended, make sure your insurance company knows it. If there is a loss, you may have trouble collecting because the insurance company can state that if it had known the store was unattended in the first place, it would not have written the account and thus deny the claim.

Brodie: They are both insurable; the attended store might get a little bit less premium based on someone attending the store during operational hours. Around-the-clock operations, as sometimes can be found in cities like New York and Las Vegas, pose different risks and must be 100% attended, usually with two people on duty at a time.

Weber: Unattended stores are at a higher risk of theft, vandalism and claims in general. Any time a business is left unattended, it is at a much greater risk of incidences that would require the use of your business insurance policy and generally are not as desirable to insurers.

Hawkins: It may depend on the individual insurance carrier. It’s been my experience that the unattended Laundromat pays more premium than the attended Laundromat due to the vandalism issue and the lack of a witness when someone reports an injury.

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AMERICAN COIN-OP AUGUST 2012

Brodie: 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.

Weber: 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.

Hawkins: 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.

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

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.

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 www.americancoinop.com

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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.

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

your insurance, your premium, or loss control. It’s their job to service your insurance needs.

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.

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

www.americancoinop.com

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.

Also, review and update your coverage limits annually and whenever changes are made. And be sure that you are up front and honest 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.

■

AUGUST 2012

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CALENDAR

DON’T MISS THESE UPCOMING EVENTS coinlaundry.org

AUGUST

SEPTEMBER

11

12-13 BDS Laundry Systems Open House/Product Show St. Paul, Minn.

Info: 651-688-8000 bdslaundry.com

PWS Los Angeles Service School Info: 888-979-7462 San Francisco Service School Info: 650-871-0300 pwslaundry.com

24-25 KeeWes Equipment Co. 21st Annual Trade Show Branson, Mo. Info: 800-383-9274

OCTOBER 11-13 Coin Laundry Association Excellence in Laundry Conference Rancho Mirage, Calif.

Info: 630-953-7920

28-30 Multi-Housing Laundry Association Fall Educational Conference Marana, Ariz.

Info: 919-861-5579

NOVEMBER 15

SoCal Coin Laundry Assn.

Fall Meeting Cerritos, Calif.

Info: socalcla.com

Most popular stories from AmericanCoinOp.com for the 30 days ending July 15 — (WE) Denotes Web Exclusive

TOP FIVE STORIES

COLUMNISTS/FEATURES

OUR SISTER WEBSITES

• Insurance Firm Introduces Services for Coin-Op Owners

• Changes in Repair/Replace Tax Rules

From AmericanLaundryNews.com:

• Laugh, and the World Will Launder at Your Store

• Preventive Maintenance in the Laundry

• Long Beach Preps for Fabricare 2012 • Exhibit Space Sales Open for Clean 2013 in New Orleans

• Survey: Coin Laundry Biz is No Fun During Summer, Many Owners Say

• Insurer Says Failure to Plan Puts Businesses at Risk

• Extra Creativity Can Lead to Extra Profit

• StatShot: Three of Four Regions See Higher Sales in May (WE)

• You Have to Be Hungry for Success (WE)

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AMERICAN COIN-OP AUGUST 2012

• Emerald Textiles CEO Gildred Named Entrepreneur of the Year

From AmericanDrycleaner.com: • StatShot: Across-the-Board Sales Gains Tempered by Dire Individual Reports (WE) • The Dream Dry Cleaning Plant

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PRODUCT SHOWCASE

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uebsch recently announced the introduction of its vended reversing 75-pound tumble dryer.

The new addition to Huebsch’s product line will allow Laundromat owners to charge more for use of a specialty tumbler, while offering a solution for those who also manage commercial accounts, as well as pickup and drop-off services.

The new tumbler is equipped with reversing technology, which allows the machine to stop, pause and then switch direction. This helps reduce balling or roping of large articles, such as sheets, comforters and tablecloths.

The reversing feature provides a consistent and even dry of the laundry.

The machine is available with the Galaxy 600 control for tumblers, a complementary control to the Galaxy 600 washer-extractor control, Huebsch says. The dryer control features advanced programming options to modify the machine’s cycles and up charge for certain features, such as temperature or time, and time-of-day pricing. huebsch.com 800-553-5120

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AMERICAN COIN-OP AUGUST 2012

M

aytag® Commercial Laundry provides sizing flexibility and energy savings to coin store operators with Energy Advantage™ Rigid Mount Front-Load Washers with the TurboWash™ System, the company says.

Operators can develop a unique machine configuration mix to fit each store’s customer capacity needs. This comprehensive line features seven models, including the 80-pound machine.

The complete line of rigid-mount front-load washers features advanced controls with cycle and pricing options, full opening door design, extraction speed increases and water temperature control options. With upgraded cycle options such as Super, Deluxe and Ultimate, coin store owners can easily adjust water levels and temperatures to control energy costs, Maytag says.

All Maytag® Commercial Laundry Energy Advantage™ Rigid Mount Front-Load Washers come standard with the TurboWash™ System, which offers savings on energy costs, says the company. The baffles deliver water directly where needed for complete saturation with less water, while the computer-controlled TurboWash™ System tumble patterns continuously turn laundry through the wash cycle. maytagcommerciallaundry.com 800-662-3587

www.americancoinop.com

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PRODUCT SHOWCASE

WASCOMAT

E

PELLERIN MILNOR

stablished in 1955, Wascomat has a full range of energy- and water-saving equipment, distributed exclusively by Laundrylux in North America.

Models include: • The 80-pound EXSM model 220-G-force washer offers heavy-duty, maintenance-free construction; high spin for fast drying and low energy costs; and Compass Control to customize wash programs.

• The 77-pound W-model 100-G-force washer combines reliability and programmability with a single-phase electrical system for low installation costs, Wascomat says. Compass Control allows an operator to create programs to meet specific market needs, and it will display two languages at one time.

• The 83-pound TD dryer offers Compass Pro Control, reversing cylinder option, and axial airflow for low energy consumption. laundrylux.com 800-645-2205

P

ellerin Milnor’s 36021 C4E is an industrial washer with oversized loads and higher vend prices. With a traditional design based on Milnor’s larger washers, the 36021 C4E has a capacity of 80 pounds.

These washers also have the GreenTurn™ formula set. GreenTurn formulas help to deliver faster turns, lower energy costs and decrease total water consumption, Milnor says.

In addition to the formula set, the Milnor 36021 C4E washers now have an increased extraction speed of 150 Gs, and customers may choose a singlephase electrical option.

The seven different wash formulas each come with programmable vend prices, and the larger cylinder volumes and solid construction set the coin-operated washerextractors apart, Milnor says. milnorcoin.com 800-469-8780

IPSO

I

PSO now offers a 90-pound washer-extractor, part of the IWF line. Large-capacity washers help customers get in and out of a Laundromat faster, providing an owner a higher rate of turnaround, the company says.

IPSO’s Micro-20 control helps generate 40-50% in water savings, says the company. The Micro-20’s multi-level vend pricing enables owners to offer customers additional wash options for premium vend prices. Audit and diagnostic functions help streamline management of the business.

All IWF washer-extractors are equipped

30

AMERICAN COIN-OP AUGUST 2012

with inverter drives, eliminating large electrical current draws when the motor powers up. The inverter’s gradual rampup in speeds is much more efficient, helping to lower utility costs, IPSO says.

The washer-extractor’s welded channel iron construction is strong enough to withstand years of service.

Customers will appreciate the time savings of a 90-pound washer-extractor and the cleaning it produces, according to the company. ipso.com 800-872-4776

www.americancoinop.com

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PRODUCT SHOWCASE

DEXTER LAUNDRY

D

exter Laundry offers several largecapacity options for Laundromat owners looking to meet customer demands for more capacity.

The 80-pound T1200 is available for owners with limited space. Designed to fit through a standard 36-inch doorway, the 100-G-force model is an easy replacement for older, smallercapacity washers.

The new 90-pound T1450 EXPRESS washer also is available. The 200-G-force model features double the extract force to improve customer throughput.

Both models feature four fill valves for a fast fill and shorter cycle times, plus extra-large loading doors and front-mount supply dispensers for maximum customer convenience. Models are available in Jet Black or Dexter Blue color schemes. Both are designed to run on either single- or three-phase electricity.

Dexter washers deliver a 60% reduction in electrical power consumption, says the company, and the highspeed extraction further reduces energy costs, shortening drying time and allowing for quicker customer turnover.

Dexter also offers 80-pound dryers, delivering energy

efficiency and top drying speeds by balancing heat input, tumble speed, air recirculation, and airflow through fully perforated, large-diameter cylinders.

Engineered to handle any type of commercial load, Dexter dryers feature a fully welded solid steel cabinet structure, heavy-duty bearing housings, oversize bearings, as well as hardened steel trunion-shaft assemblies. This “over-built” design results in years of reliable service.

Extra-large loading doors offer nearly 100 square inches of additional loading area. dexterlaundry.com 800-524-2954

CONTINENTAL GIRBAU

I

n response to the vended laundry market’s demand for a large-capacity, high-speed washer, Continental Girbau introduced the 90-pound freestanding ExpressWash.

The washer is designed to reduce water, natural gas and electricity costs. By providing a significant reduction in utility, it allows laundries to embrace energy-efficient “green” benefits, lower utilities, and improve profits.

ExpressWash 90 provides a highspeed, efficient alternative to hardmount machines by consuming less water than traditional front-load washers and offering high-speed extraction up to 381 G-force,

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AMERICAN COIN-OP AUGUST 2012

according to the company. ExpressWash removes more water from each load, reducing the time it takes to dry a load of laundry by as much as 50%. The washers also can cut the time required to wash, dry and fold a load of laundry to 60 minutes or less, Continental Girbau says.

The user- and laundry-friendly control on the ExpressWash 90 helps store owners curb utility costs. It offers four individually modifiable programs and multi-level vend pricing, and can interface with multiple payment systems, including world drop, token, credit and debit card technology. continentalgirbau.com 800-256-1073

www.americancoinop.com

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PRODUCT SHOWCASE

SPEED QUEEN

ELECTROLUX

E

lectrolux offers a full range of large-capacity equipment with the latest technology and unique money-, water-, and energy-saving features to increase store profits. Laundrylux is the exclusive North American distributor of Electrolux equipment.

Electrolux’s new 135-pound 220-G-force coin-op washer with Compass Control will be available soon.

Super-sized for large family loads, sleeping bags, work clothes and more, the new machine offers low energy use and extra-heavy-duty construction for demanding environments.

The Electrolux 77-pound S-Model 200-G-force washer features single-phase electrical power, which means lower installation costs. Compass Control allows owners to customize programs to lower costs.

Electrolux’s 75-pound H-Model 350-G-force soft-mount washer shortens dry time and provides gas savings, and can be installed over basements and upper levels.

The new 83-pound Electrolux dryer dries 12% faster using up to 20% less gas, Laundrylux says. It includes EcoPower, Compass Pro Control, reversing cylinders, and axial airflow for low energy consumption. laundrylux.com 800-381-7222

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AMERICAN COIN-OP AUGUST 2012

S

peed Queen’s SC80 hardmount washerextractor is perfect for large-capacity loads and offers numerous possibilities to reduce energy costs and maximize profitability, the manufacturer says.

It uses 33% less electrical energy and 11% less water on average, according to the company.

Advanced technology allows for extraction options up to 200 G-force, which leads to shorter dry times and lower dryer energy costs. To further increase efficiency, the product offers a cylinder design that helps minimize water consumption with smaller sumps.

The hardmount washer-extractor also comes equipped with the patented Water Guardian technology, which detects slow or leaking fill valves and drains.

Easy-to-use Speed Queen Quantum™ controls come standard on the washer-extractors, along with options including maintenance reminders, cycle modifiers and time-of-day pricing. Quantum also allows laundry owners to manage their laundry from anywhere in the world through PDA or PC access.

The machines also contain features such as a four-compartment dispenser; automatic door lock; secure high-capacity coin vault; protected bearings, shaft and seal; ergonomic door handle; and front service access.

Every machine integrates with most aftermarket smart card and credit card payment systems, Speed Queen says. speedqueen.com 800-590-8872

www.americancoinop.com

DON’T

MISS

OUT

HERE’S WHAT’S COMING UP IN AMERICAN COIN-OP...

SEPTEMBER Feature: Buying or Selling a Store: Evaluating a Property/ Location Determining fair market value involves many factors; Succession Planning Product Showcase: Water-Heating Equipment Editorial Submission Deadline — July 15

OCTOBER Feature: Distributors Directory & Survey Another “keeper” issue features listings for laundry equipment and supply distributors nationwide, plus the results of a distributor business survey.

IN EVERY ISSUE:

Editorial Submission Deadline — August 15

• Product Showcase

NOVEMBER/DECEMBER

• Wire Survey Results

Feature: Year in Review

• Product News

A look back at 2012’s best ideas with an eye toward the future;

• Web Update • An Outsider’s View

Store Security/Surveillance Product Showcase: Money-Handling Equipment Editorial Submission Deadline — September 15

• Newsmakers • Ad Index • Classifieds Want to send a press release or submit a story?

Contact Bruce Beggs, editorial director, today!

THE TRADE SHOW YOU CAN PUT IN YOUR POCKET

Phone: 312-361-1683 I N S I D E : J U L Y I2N0 S1 I2D E : J U L Y 2 0 0 5

E-mail: bbeggs@americantrademagazines.com

...and much more!

DISTRIBUTOR SATISFACTION: WOULD YOU MAKE A SWITCH?

LAUGH, AND THE WORLD WILL LAUNDER WITH YOU

COIN-OP 101: EXTRA CREATIVITY CAN LEAD TO EXTRA PROFIT

W W W . A M E R I C A N C O I N O P. C O M

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COIN-OP 101

INCREASING PROFITS BY INCREASING CAPACITY

Eric Greenberg

We’ve all heard the phrase “bigger is better.” That statement can hold true when deciding to install large-capacity machines in your store. Manufacturers continue to build larger machines, and for good reason—larger-capacity machines can improve profitability.

The steady growth in popularity of machines with capacities of 60 to 80 pounds has allowed manufacturers to construct reliable and durable products that have increased in longevity, have better utility consumption, and allow owners to be competitive.

MORE PROFITABLE Store owners need to consider how much profit is possible per square foot. See how much space your machines are taking up and their capacities. If you can decrease the number while maintaining or increasing combined capacity, you can boost your profitability.

As an example, consider replacing five small machines with four larger machines that take up the same amount of square footage. The rent doesn’t change for this space, but the vend price of the larger machines increases. If each machine is being used up to three turns per day, gross income rises by approximately 20% per day.

Older machines are less efficient and wind up costing owners more. Newer machines are engineered to use up to 30% less water and energy than previous models. The water/sewer costs can decrease by up to 44% when four larger machines replace five smaller ones, for example.

ADDED BENEFITS Although profitability and utility savings are major considerations in selecting large-capacity machines, the equipment can also help move customers through your store more rapidly.

By offering larger machines, customers can clean larger loads, helping to reduce the amount of time they spend completing the laundry chore. Additionally, larger machines can improve the traffic flow in your store.

During busy times—like the weekend—an efficient traffic flow helps increase revenue.

The machines can also make your store the preferred stop in the area. If you offer larger-capacity machines and the store down the street does not, you are more likely to win the business.

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AMERICAN COIN-OP AUGUST 2012

GOOD EQUIPMENT MIX Of course, a store cannot have only 60- and 80-pound machines; a good equipment mix is still essential when considering the addition of larger-capacity machines.

Although a large-capacity machine can be profitable at various locations, they have become especially popular in inner-city locations. Generally speaking, there are larger families in cities. More people mean more clothes, and the larger machines help these families get in and out of a laundry quickly.

IMPORTANT CONSIDERATIONS As with any major business decision, owners should be aware of certain factors when considering the addition of larger equipment to their store. This is when the help of an experienced distributor comes into play.

The first question an owner should ask is, “How am I going to pay for this equipment?” Your distributor should be able to provide a quantitative analysis of the projected utility savings and profits with the addition of these machines. And because large machines are not the best fit in all circumstances, this report is essential.

Structural changes also need to be taken into consideration when deciding on larger machines. For example, an 80-pound washer-extractor requires a concrete pad to be added to the floor. Plumbing and electrical systems may also need to be redone to handle the larger machines. Additionally, the hot water heater may need to be adjusted to handle the increase. Again, these are all costs to consider when pulling the initial quantitative report with your distributor.

FUTURE SAVINGS As the trend continues toward the addition of larger machines, it’s important to be aware of the benefits these machines can bring, including profitability, utility savings and customer loyalty. As with any major project, it’s important to consult with your distributor to ensure you choose the most profitable option for your store.

■ Eric Greenberg is vice president of sales for American Equipment Sales Corp., a Huebsch distributor based in Waltham, Mass. He has more than 30 years of experience in the commercial laundry industry, and can be reached at egreenberg@aclslaundry.com, 800-747-7837. www.americancoinop.com

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ADVERTISERS’ INDEX Advertiser

Page

Advertiser

Page

AC Power ...................................................................... 23

NATCO............................................................................37

American Dryer Corp. (ADC) ........................................ 13

New York Laundry Equipment ...................................... 25

American Switch.............................................................. 39

NIE Insurance .................................................................. 7

Brooks Waterburn Corp. ................................................ 15 Dexter ............................................................................IBC

R&B Wire Products ........................................................ 1 Royal Basket Trucks ........................................................19

ESD Inc. ............................................................ 20, 21, BC Setomatic Systems.......................................................... IFC Gold Coin Laundry Equipment ................................ 26, 27 Speed Queen ............................................................8, 9, 11 Great Lakes Commercial Sales ...................................... 38 HHC Electronic Service .................................................. 39 Huebsch ..........................................................................FC

SQS Laundry .................................................................. 29 Super Computer Boards .................................................. 38

Laundry Concepts .......................................................... 31

Vend-Rite .................................................................... 5, 39

LG .................................................................................... 3

Wells Fargo Insurance Services ...................................... 17

Mountain Electronics ...................................................... 38

Western State Design ...................................................... 33

www.americancoinop.com

AUGUST 2012

AMERICAN COIN-OP 37

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CLASSIFIEDS

EQUIPMENT FOR SALE

ELECTRONIC REPAIRS

BEARINGS DIRECT LAUNDRY SYSTEM Queens NY 718-468-1119 / 917-678-2095

DIRECT LAUNDRY SYSTEM 98-47-212 St, Queens NY 718-468-1119 / 917-678-2095

Commercial & Industrial Bearing Job & Repairs NY NJ CT PA Area.

Laundry Equipment Parts Repairs Bearing Job Over 20 Years’ Experience.

W 184 W 125 W 74 HC 20 HC 30 HC 50

W 185 W 125 W 75 W 184 W 124 W 74 JT0300 JT32DG

$500.00 $375.00 $250.00 $275.00 $325.00 $500.00

No one done more Bearing Jobs than us, Count on Experience.

Lots of Washers, Dryers, Motors, Baskets, Gas Value, Computers, Doors, Front & Side Panels etc.

20 Years’ Experience Florida & Georgia area VICTOR @ 321-946-9890

Washers comes with 2 Years Bearing, 1 Year Limited Parts & 90 Days Service in the NYC and Tri-State Area.

COIN-OP FOR SALE WELL ESTABLISHED coin laundry with drop off and cleaning business, fully staffed, turn key operation in the most livable city in the U.S. TALLAHASSEE FL. Call 850-402-7683 for more information.

Coin Laundry, Building, Equipment, Upstairs Apartment. Northwestern Wisconsin Island City.

Retiring. $115,000. Willing to sell equipment separately, call for list. 715-822-2760 DEXTER EXPRESS LAUNDROMAT BUSINESS FOR SALE IN EASTERN NORTH CAROLINA. PHONE 910-549-4693

Florida & Georgia area VICTOR @ 321-946-9890

EQUIPMENT WANTED EQUIPMENT FOR SALE

WASCOMAT WASHERS. 704-592-2022.

NEED SAVE $ PARTS? $$$ Call US First!

Check us out online for Specials

• Bock • R&B Carts • ESD • Vend-Rite • Soap

WILL BUY ANY EQUIPMENT (WASHERS AND DRYERS) ON WEST COAST. 888-205-0884.

REPAIRS Repair Front Load WASHER Bearings.

Call Tony P. 516-805-4193

>>>>>>>

COMPUTER BOARDS SOLD & REPAIRED

Many Brand Names not listed.

• Maytag • Caco • Dexter • Hamilton Heaters • American Dryer • Rowe • Greenwald • Standard • Continental-Girbau & MORE

COMPUTER BOARDS

>>>>>>>

$3000.00 $1700.00 $900.00 $2800.00 $1600.00 $800.00 $1800.00 $1500.00

(Lowest Prices in the U.S.) Hundreds of Computer Boards for Sale!!!

Dexter, ADC, Speed Queen, IPSO, Wascomat, UniMac, Primus & more Timers and Ignitors Repaired!!!

New Touch Pads for S/Q Dryers, S.C. Washers, Dexter Stack

Brookfield, WI Troy, MI Wyoming, MI Dayton, OH Indianapolis, IN

1-800-236-5599 1-888-492-0181 1-800-821-8846 1-888-877-4382 1-800-577-7103

Contact classified sales to place your ad! dfeinstein@ americantrademagazines.com

www.greatlakeslaundry.com

SUPER COMPUTER BOARDS 17812 Wrightwood Ln., Huntington Beach, CA 92649

(877) 870-5553 • (714) 377-9753

www.AmericanCoinOp.com 38 AMERICAN COIN-OP AUGUST 2012

www.americancoinop.com

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SERVICES AND SUPPLIES

SERVICES AND SUPPLIES

SERVICES AND SUPPLIES

COMPUTER BOARDS FIXED

WASCO GEN 5 DOOR LOCKS

WASHERS and DRYERS COMPUTER BOARD REPAIR

Repaired & Rebuilt to Manufacture Specs.

Door Lock $68 • Gen 5 & 6 Timer $85

& TIMERS REBUILT

Summer Discounts!

Gen 4 Timer $75 • Continental Timer $85

Shipped Anywhere.

DRYER COMPUTER BOARDS

• American • Dexter • • Easy Card, ESD • • Huebsch • Speed Queen •

HHC

ELECTRONIC SERVICE

14844 Las Tunas Drive, Hacienda Hts., CA 91745

626-961-8678 • 800-820-9888 E-mail: hhc168@hotmail.com

ADC Stack $60 • Single $45 Huebsch SQ Board $45 Huebsch Old Style Board $55 Stack Dexter/Continental $60 Washer Coin Boards $55 Some prices may vary!!!!

JECON INC. SUITE 272, 11064 QUEENS BLVD. FOREST HILLS, NY 11375

ADC 137213 / 137234 . . . . . . . . . . . . . . . .$65.00 Igniters . . . . . . . . . . . . . . . . . . . . . . . . . . .call Dexter VFD Inverter (Delta Motor Control) All Models (9375-xxx-xxx) . . . . . . . . . . . . .call Stack Dryer . . . . . . . . . . . . . . . . . . . . .$65.00 Coin Accumulator . . . . . . . . . . . . . . . .$55.00 Maytag Computers . . . . . . . . . . . . . . . . . . . . .$65.00 23004118 . . . . . . . . . . . . . . . . . . . . . . . . .call W10343020 . . . . . . . . . . . . . . . . . . . . . . .call 33001129 . . . . . . . . . . . . . . . . . . . . . .$85.00 Motor Control . . . . . . . . . . . . . . . . . . .$55.00

One-Year Warranty on All Parts Send Core Unit with S&H Fees Call Toll Free: 1-888-532-6677 (888-JECON77) Local: 718-525-3733

DRYER COMPUTERS REBUILT

• Fax: 212-656-1913

718-525-2266

Visit: JECONINC.COM We Now Accept All Major Credit Cards

Highest quality rebuilding for over 16 years

Gold Medal Soap Vender Parts Going, going, gone…

Speed Queen and Huebsch

ONLY $39!

Call for other brands

Dominic’s New TOUCHPADS TM

The Best!

For Huebsch and Speed Queen Dryers Super-TuffTM overlay - $9.95 - $14.95 Dura-FlexTM touchpad - $19.95 QuickFixTM Overlay Repair - $3.95 American Switch 43 Pleasant Ave., Suite 3 Johnson City, NY 13790 607-759-1995 M/C & Visa Accepted www.domstouchpads.com

www.americancoinop.com

Volume Discounts.

One-Year Warranty.

Free Return Shipping.

El -Tech, Inc. 26 West St. Colonia, NJ 07067 For Complete Price List Please Call: 732-381-7620 or 908-510-6520 or visit us at www.eltechlab.com

TIMERS REBUILT — IPSO main & reverse, Milnor, Dexter, Primus, Whirlpool, Speed Queen, Maytag & Continental Girbau, Wascomat Generation 4 and 5.

Call for price sheet.

Reeco Timer Co., 2860 Kirby Circle, N.E., Suite 14, Palm Bay, FL 32905, 888-952-1889.

(+$9 shipping ea.)

One-Year Warranty!

Any questions call Ernie at (607) 798-7704 Mastercard and Visa accepted Send your computer to: D&E Dept. 1 1724 Hawleyton Rd. Binghamton, NY 13903 www.dryercomputers.com

Speed Queen / Huebsch Computers . . . . . . . . . . . . . . . . . . . . .$65.00 Motor Control . . . . . . . . . . . . . . . . . . .$55.00

All Gold Medal parts are 50% off while supplies last.

Order your today, when they are gone, there gone.

Call 1-800-777-1802 ask for Jenny

Place your ad

ONLINE www.AmericanCoinOp.com

WASHER AND DRYER COMPUTER BOARDS REBUILT Igniters repaired Washers: $60 - & up Dryers: $35 - & up Igniters: $20 - & up Rebuilt Timers - Wascomat, Huebsch, Speed Queen, IPSO, Laundry Center, Maytag Call for exact price which includes free return shipping METRO LAUNDRY TECH CORP. 253 East 204th Street, Bronx, NY 10458 ONE-YEAR WARRANTY ON ALL REPAIRS Please call 718-742-4137 Or 718-733-4313 Or Visit our website at www.metrolc.com email us at metrolc@hotmail.com AUGUST 2012

AMERICAN COIN-OP 39

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NEWSMAKERS

ADC NAMES QUALCLEAN EQUIPMENT ITS ‘PREMIER PARTNER’ American Dryer Corp. (ADC) awarded Qualclean Equipment its prestigious Premier Partner award in July at the distributor’s Blue Bell, Pa., headquarters.

Qualclean is a distributor of coin-operated and on-premise laundry equipment serving Pennsylvania, New Jersey and Delaware.

The company has exhibited exceptional service and support in its market, ADC says.

The Premier Partner award was instituted in 2007 to celebrate the achievements of a highly select group of ADC distributors. A Premier Partner is one whose integrity, service and loyalty exceed their customers’ expectations every day, ADC says.

John Olsen (left), vice president of sales for American Dryer Corp. (ADC), presents his company’s Premier Partner award to Bob Eisenberg, president of Qualclean Equipment.

CLA DESIGNS UNIQUE CONFERENCE FOR ‘TOP 100’ LAUNDRY OWNERS The Coin Laundry Association (CLA) has put together an event Oct. 11-13 in Rancho Mirage, Calif., that it hopes will bring together the self-service laundry industry’s most successful people for unmatched educational sessions, networking, exhibits and a unique opportunity to share best practices with their peers.

The Excellence in Laundry Conference is designed specifically for those laundry industry entrepreneurs who want to grow their business and succeed, CLA says. Attendees will rub elbows with some of the most successful laundry industry professionals and learn some of their most coveted secrets to success.

The agenda includes: • Robert Spector, author of The Nordstrom Way, will walk attendees through the principles of world-class customer service cultures, such as Amazon.com, Starbucks and Nordstrom.

“Everything I do is based on the concept that all business practices should be driven by customer service,” he says. “You have to understand that customer service is provided by all employees. You 40

AMERICAN COIN-OP AUGUST 2012

need to offer consistent, multi-channel customer service and learn to retain your customers by establishing long-term relationships with them.”

• Alan Beaulieu, president of economic consulting firm ITR Economics, will provide accurate, understandable and actionable economic forecasts to the laundry industry. He will talk about strategies and tactics that should be undertaken now if businesses are to maximize their profit potential for the future.

• Industry professional Jeffrey Barman will host a roundtable discussion featuring some of the country’s most successful multistore owners. They’ll share insider secrets to successfully adding multiple laundries, growing from being an owner with two or three stores to owning five, 10, 30 or more stores. Attendees will glean insights into real estate, acquisitions, finance, operations, staffing, accounting and other challenges that are faced by those looking to grow big.

The Rancho Las Palmas Resort and Spa will play host to the fall event. More information is available at coinlaundry.org/ conference2012.

INSURANCE FIRM INTRODUCES SERVICES FOR COIN-OP OWNERS 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 coinoperated 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.”

EIA LOWERS REGULAR GAS RETAIL PRICE FORECAST FOR THIRD QUARTER With crude oil prices falling, the Energy Information Administration (EIA) lowered the average regular gasoline retail price forecast for the third quarter of 2012 to $3.39 per gallon, according to the agency’s latest Short-Term Energy Outlook.

EIA expects these prices, which averaged $3.53 per gallon in 2011, to average $3.49 per gallon in 2012 and $3.28 per gallon in 2013.

Natural gas prices continue to remain low, thanks to record-high working inventories. EIA expects the Henry Hub natural gas spot price, which averaged $4 per million British thermal units (MMBtu) in 2011, to average $2.58 per MMBtu in 2012 and $3.22 per MMBtu in 2013.

■ www.americancoinop.com

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TM

Credit and Debit Card Laundry Payment Center Convenience is the name of the game LQ WRGD\¶V PRGHUQ HI¿FLHQW 0XOWL )DPLO\ ODXQGU\ URRP &HQWUDO3D\ IURP (6' DGGV FRQYHQLHQW &UHGLW DQG 'HELW &DUG DFFHSWDQFH LQ DGGLWLRQ WR QRUPDO FRLQ RSHUDWLRQ :LUHOHVV FRQQHFWLYLW\ WR HDFK PDFKLQH SURYLGHV IRU VLPSOH LQVWDOODWLRQ DORQJ ZLWK PDFKLQH PRQLWRULQJ IRU WRWDO DFFRXQWDELOLW\ IRU DOO WUDQVDFWLRQV LQFOXGLQJ FRLQ DQG RQ OLQH UHSRUWLQJ &XVWRPHUV ZLOO ZHOFRPH WKH FRQYHQLHQW FDUG SD\PHQW RSWLRQV DV ZHOO DV WKH DELOLW\ WR UHTXHVW VHUYLFH DQG RU D UHIXQG IRU D PDOIXQFWLRQLQJ PDFKLQH

Easy to use touch screen interface ESD Laundry Aware monitoring to your SmartPhone for text and email alerts

(6' 6PDUW/LQN /0, UHTXLUHG IRU HDFK PDFKLQH

ESD, Inc. 270 Commerce Drive Fort Washington, PA 19034

www.esdcard.com