PlanetLaundry and Supplements West Regional Supp to April 2011 JRNL : Page 1

Spring 2011 | planetlaundry.com | coinlaundry.org West BUSINESS P R O FI L E DAVE MCMAHON Less is Not Always More For Washington Laundry Owner, More Stores was ‘The Right Thing to Do’ When Rob and Aileen Carrell decided to expand their portfolio, they first considered restaurant franchises. Their search was continuing when Rob attended a laundry distributor’s open house in the Seattle area. Thanks to one owner’s less-than-accurate portrayal of the coin laundry business, the Carrells now own five Spin City Laundry locations in and around Tacoma and Olympia, Wash. Spin City – with operations in Tacoma, Spanaway, Lakewood, Lacey and Olympia – has provided Rob, 41, with an ideal match for his service-related background. He worked as a bartender and in sales (home furniture and restaurant equipment and supplies) prior to taking ownership of their first store. Rob and Aileen, a 20-year employee of Starbucks Coffee Co., met while Rob was bartending. “I was a bartender at private country clubs,” he said. “I eventually got tired of that, but fortunately I met my wife there. She was the daughter of the president of one of the clubs.” Now, as the head honchos of their own businesses, Rob has developed Spin City stores into successful operations that don’t look much like the picture that was painted for him about the industry. continued on page 6 ADVERTISERS Absolute Laundry Systems Co | 5 Central Coast Commercial Laundries | 2 CLA Insurance | 11 Continental Girbau West | 7 Peterson Equipment Co | 12 Pride Laundry Systems Inc | 9 Sunshine Sales | 10

Less Is Not Always More

For Washington Laundry Owner, More Stores was ‘The Right Thing to Do’

When Rob and Aileen Carrell decided to expand their portfolio, they first considered restaurant franchises. Their search was continuing when Rob attended a laundry distributor’s open house in the Seattle area. Thanks to one owner’s less-than-accurate portrayal of the coin laundry business, the Carrells now own five Spin City Laundry locations in and around Tacoma and Olympia,Wash.

Spin City – with operations in Tacoma, Span away, Lakewood, Lacey and Olympia – has provided Rob, 41, with an ideal match for his service-related background. He worked as a bartender and in sales (home furniture and restaurant equipment and supplies) prior to taking ownership of their first store.

Rob and Aileen, a 20-year employee of Star bucks Coffee Co., met while Rob was bartending.

“I was a bartender at private country clubs,” he said. “I eventually got tired of that, but fortunately I met my wife there. She was the daughter of the president of one of the clubs.”

Now, as the head honchos of their own businesses, Rob has developed Spin City stores into successful operations that don’t look much like the picture that was painted for him about the industry.

“I hadn’t owned any other businesses prior to the laundromats, and that’s sort of why we did this,” he said.

“We looked at different things for a few years – Papa Murphy’s franchises, Subway. One day, I noticed that a laundry equipment distributor was having an open house in Seattle. So we sat through the hour-and-a-half meeting. One guy told a story about how he had retooled a store and made it like brand new and just goes in every couple of days to collect quarters.”

Rob’s ah-ha moment during the eye-opening seminar eventually led to a conversation with the owner.

I bugged the guy for three weeks to sell it,” he said. “I cashed out my 401(k) and finally told him, ‘Look, man… I want it.’ Of course, then I found out there’s way more to it than that guy at the seminar was telling us.” Carrell didn’t need much time after opening his first store to learn that there’s more involved than mere trips to the bank to deposit quarters.

However, running a laundry fit perfectly with the Carrells’ lifestyle.

“It allows for a pretty flexible schedule,” he said. “We have two little kids, and it allows me to go to school to volunteer, go on field trips with them. I go in on weekends.

Plus, there’s no inventory, no accounts receivable. Once I saw the potential of the first store, opening a second store was a no-brainer. Here I am just having opened a fifth store because it seemed like the right thing to do.”

Carrell’s burgeoning coin laundry chain had expanded to three stores within two years of his first store opening.

I had a competitor down the street from one of my other stores, and I went in there one day and joked that he should sell it to me – and he did!” Carrell laughed.

The newest Spin City in Tacoma is 5,000 square feet and includes a pool table and an arcade. The old coffee shop That was part of the previous ownership’s store was demolished to accommodate more washers.

“My philosophy is that, if it’s going to sit there, it’s going to make money,” Carrell explained.

“Nothing sits without working very long in my stores. I’m paying $31 dollars a square foot for rent. I need everything working 100 percent.” All Spin City stores include coin-operated equipment, although plans are underway to implement a credit or debit card option at the new store in Tacoma.

We plan to use that on our 16 largest washers and 14 largest dryers,” he said. “We have new washers that offer some pretty cool technology. It sends a text to you when you check to see how much equipment is being used and how much is available. It audits the machines. The customers can ask for a text that says ‘Please return in 10 minutes for you finished laundry.’ On a recent Saturday, I texted in a status report and, out of 30 washers, only five of them were available. The customer can use that feature also. It’s an expensive feature, but so far it’s been great.” The technology also allows Carrell to work remotely while keeping customer satisfaction high.

“I’ll get a text that says, ‘Washer 17 door lock error,’ and it automatically puts the machine out of order,” Carrell said. “Since I can start them remotely, I tell the attendant to move to Washer 18 and I’ll start it for them.”

Carrell leases at each of his locations but has hopes of someday becoming a property owner.

“I don’t own any property because I keep buying laundromats,” he laughed. “I’d like to stop buying laundromats, but something always comes up that I can’t refuse.”

Carrell isn’t afraid to have some unique flavor to his stores, especially if it means saving money.

“We built the new store from the ground up inside the building space,” he said. “Before we took over, it had been a karate shop and before that a restaurant. I’m the only laundromat with awall of mirrors behind my dryers. They’re huge chunks – 5 by 10 feet. The whole wall was covered for their karate instruction. They weigh a ton, so I decided I might as well leave them there.”

Carrell was grateful that he didn’t have to pay any fees To set up his latest store. He has spied some potential locations for future stores, but has shied away after learning of the city’s steep impact fee per washer.

Carrell’s stores all target a similar demographic and estimates that about 50 percent of the area’s population are renters.

“It’s a mix of low- to medium-income families,” he said.

“It’s always interesting to see a Mercedes or a Lexus pull into the lot. That usually means it’s time for them to wash a comforter. Right behind them is someone getting off the bus with their laundry cart behind them.”

Carrell drives traffic to his stores with a variety of marketing methods, but mostly through media that allow him to keep his balance sheet in mind.

“We’ve done a bit of all kinds of marketing,” he said. “We used to do billboards. They were $450 to $600 at the time, but now Clear Channel has a monopoly on them out here, and they’re $1,100.”

Instead, Carrell has found success by advertising in the Fort Lewis Ranger, a newspaper that serves the local military community.

“We have a triangle of stores around the base, and if I were to do another store, I’d make a square around the base,” Carrell said.

A ticket giveaway done in conjunction with a live remote by a radio station brought plenty of Kenny Chesney fans to his store. But country music lovers packed their way so tightly into the store that potential customers could not have done their laundry even if they had wanted to.

“As soon as they gave the tickets away – Boom! Everyone left,” Carrell said. “They did a live broadcast from the store, which gave us a lot of recognition, and it was cool. But I wouldn’t do it again.”

Carrell is also considering advertising on a Spanish language radio station.

The new store sits in a shopping center that includes a grocery store, a Subway, a McDonald’s, a Michael’s craft store, a clothing retailer and a sewing shop.

“Our stores have a good mix of tenants around them,” he said. “I looked at some spots, and there was nothing else in the complex that would drive traffic.”

Carrell isn’t the only show in town by any stretch, but he takes steps to make sure that a potential customer becomes a returning customer after one visit to his store.

“Within a five-mile radius of our new store, there are seven laundromats,” he said. “We stand out by being really clean. That was one thing my wife kept bringing up when we first started looking at stores. I had to tell her that ours wasn’t going to be an eyesore. Ours will be clean, the walls won’t have any holes in them and they will be painted.”

In an effort to keep as many of his machines turning as possible, all Spin City locations offer wash-dry-fold services, ranging in price from 99 cents to $1.20 per pound. And Carrell has experienced a range of success with the service.

“One store does very well, and one store does hardly anything at all,” he said. “The others are hit and miss.We’re going to introduce a coupon for $5 off a bill of $20 or more, so hopefully that will get some interest in our drop-off service.”

Carrell has not sought out commercial accounts, but several businesses bring their laundry to his stores. An MRI company brings its aprons, smocks and patient gowns. And the owner of a hair salon, despite having a washer and dryer, often does laundry at Spin City due to faulty equipment.

“I’ve never aggressively gone after commercial accounts,” he said. “I didn’t want that to be the biggest aspect of my business. If I decide not to do anything, then the laundromat should take care of itself. It gets into things like buying a vehicle that I don’t want to be stuck driving – plus, then you have billing and collecting. It seems like more work.”

Originally, Spin City stores were unattended, but Carrell slowly started adding part-time employees. The stores are open from 8 a.m. to 9 p.m. daily.

“Now we have 16 employees, and the stores are all fully attended,” he said. “Having someone there has cut back massively on the ‘how’ and ‘why’ questions that we, as owners,would have about things before we had attendants.”

Carrell has steadily grown the business from nothing to five laundries and 16 employees. Could those numbers continue to rise?

“I would do more laundromats,” he said. “I originally thought two or three would be good. Now I think between six and eight, strategically located, would be good.”

Read the full article at http://digitaleditions.walsworthprintgroup.com/article/Less+Is+Not+Always+More/673995/64699/article.html.

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