Tracking your laundromat metrics could be the difference between success and failure for a small business owner. Without metrics, laundromat owners must operate on instinct and feeling rather than facts and data. And no matter how experienced you may be, operating without data makes you reactive, responding to events that have already taken place. The most successful businesses are proactive, anticipating changes and using them to their advantage to improve results.
After opening a laundromat, you should begin tracking your metrics immediately to set a benchmark for your store that you can track against future performance. This can help you decide when to make changes to your business and stay ahead of the curve. Understanding and monitoring your key performance metrics (KPIs) can help you to:
- Identify opportunities for new services or to expand your business to a new location
- Fine-tune your current mix of commercial laundry equipment and services by identifying what your customers are using and what they are not
- Ensure that your business is maximizing opportunities and being proactive instead of reactive
- Evaluate the success of your business by comparing its current performance to your benchmark data
Commercial Laundry Metrics Laundromat Owners Should Know
1. Number of Turns Per Day Per Machine
This critical metric tells laundromat owners how much laundry is being processed per day by each machine. Some machines may be more popular than others, and if they are getting significantly more usage they may need additional service or maintenance. Monitoring this metric over time will also help you pinpoint slow periods, where you have the opportunity to boost traffic with targeted promotions.
2. Revenue by Machine and Cycle Type
Different machines – and cycles – will bring in different amounts of revenue. Consider getting more of the machines that bring in the greatest amount of revenue, and remove those that bring in the least. If charging for additional cycles is profitable, like a sanitization cycle, make sure your customers are informed about the availability and benefits of these specialty cycles to drive additional revenue.
Related reading: How Laundromat Owners Can Maximize Profit Margins
3. Error Codes and Service Requests
A washing machine error code may be the result of something simple and easily corrected – like an unbalanced load – or it may be caused by a more complicated problem and require professional service. Monitoring these metrics allows you to spot patterns in error codes and service requests and get to the root cause, to take preventative action and control costs.
4. Utility Costs
Utilities make up a significant part of recurring costs for laundromat owners, so managing energy costs is a good way to control overall expenses. Monitor your utilities over time to spot patterns. Perhaps utilities have seasonal or yearly spikes? This knowledge can help you plan for fluctuations.
What Can Commercial Laundry Metrics Tell You?
Laundromat owners should use the data that they collect to make informed decisions about their business. Here’s how you can apply the data you collect:
1. Identify Opportunities
Analyzing your data can help you identify opportunities to use promotions and marketing to balance traffic and drive growth, as well as opportunities to upgrade, expand, or add a new product or service to your facility. Perhaps it would be beneficial to upgrade lower-use machines to the most popular models to drive sales. If your location mostly serves families, you may see an additional profit from larger machines, or be able to obtain additional streams of revenue through vending machines, arcade machines, and other family-centered entertainment.
2. Benchmark Revenue
Plan for cyclical changes to revenue by understanding revenue changes over time, both short and long-term. If you identify a recurring slow period, it might be a good time to implement a new promotion to drive traffic for that time. A busy period is a good time to think about adding services – for instance, a wash and fold service or delivery may be more appealing during a time when self-service machines are busy, bringing in additional revenue.
3. Allocate Resources Efficiently
Metrics can help you realize efficiencies that can add money directly to your bottom line. This includes controlling the cost of utilities, planning service and maintenance to minimize emergency service costs, and planning labor so that you have help when you need it (and not when you don’t). Savings from one area can then be channeled into other parts of your business where they will make the most impact – upgrading equipment, marketing, or loyalty bonuses to drive repeat business and customer retention.
Operating a successful laundromat isn’t easy, but tracking the key metrics above can help you to be proactive and fine-tune your business as it grows. As a business owner, it’s also critical to remember that you should track and analyze these metrics on a regular basis to help you spot trends and opportunities; not only when business is slow or struggling.
Laundrylux is a full-service laundry partner and laundromat supplier, with over six decades of experience helping entrepreneurs launch, manage, and succeed in the laundry industry. LandryPulse is Laundrylux’s digital laundromat management system that lets store owners access real-time data, as well as implement dynamic pricing and promotion strategies.
Contact Laundrylux today to learn more about how to achieve success as a commercial laundromat owner.