From Coin to Contactless
The worldwide coin-operated laundry market was valued at USD 14.6 billion in 2019 and is expected to grow at a yearly rate of 9-10%. The growth is mainly driven by the increasing number of working women worldwide, millennial lifestyles, improved standard of living and a rise in disposable income.
North America has a dominant 45% share of the laundromat market. The Asia Pacific region has high potential for coin-operated laundries in the near future due to a growing middle-class, millennial demographics and dense population.
Key patrons of laundromats include millennials, college students, and working professionals. In addition, commercial customers tend to be boarding schools, colleges, and hostels.
Changing Business Landscape
Although coin-operated laundries operate across the globe, the real opportunity is breaking out of the old models. Millennials as well as working-class people are attracted to coin-operated laundries that provide a high degree of additional conveniences, such as round-the-clock-service, doorstep pickup and delivery, and complete service within 24 hrs. Additionally, promotions and discounts are increasing the adoption of coin-operated laundries.
When it comes to modes of payment, the Covid-19 pandemic has had a tremendous impact on consumer preferences. More and more people are looking for contactless payment options not only for the hygiene, but for the convenience as well.
Will Coin-op Survive?
Coin-op machines used to be the only option at laundromats. But that has changed rapidly spurred by the COVID-19 pandemic. People are looking for cashless payment options more and more. Moreover, today’s multiload washers sometimes require 28, 32 or even 40 or quarters to activate! If you choose coin payment, you Likely to need a lot of change to get your clothes cleaned.
From a management point of view relying on coins and cash have the added disadvantages of security, vandalism and maintenance issues. But the new contact list forms of payment do not suffer from those tribulations.
Card payments can come in two primary forms: card readers that enable customers to pay with their credit or debit cards and prepaid laundry cards. From a business perspective, three main advantages are security, manpower savings and customized pricing since coins are no longer a concern. Since many consumers typically use credit or debit cards as their main payment method, equipping your machines with a credit card system, may draw new customers while retaining the existing ones.
Another option is using mobile apps with Bluetooth connectivity. With this method, customers can swipe to pay for laundry services from their phones – no quarters or cards needed. They simply download the app, add funds, see which washers and dryers are available, and select.
The Best of Both Worlds
Some of your customers might prefer to use cash or coins depending on the circumstance. In that case, Hybrid payment solutions are your best bet. Hybrid systems offer the convenience of card/mobile payments without losing customers who would prefer coins. Recent research has shown that contactless means of payment can not only spur loyalty but actually increase customer spend. Consumers actually enjoy the whole contactless experience. At the end of the day, it’s all about your customers’ convenience. If they are happy, then you can be happy, and more profitable.
Another advantage of cloud based contactless payment technology is that it can capture data to track usage and offer insights and alerts that will keep maintenance up and lower downtime and costs. Clearly, laundromat owners have better choices that bring many advantages to the business.
All this explains why OTI retrofit solutions are in great demand since they enable you to continue utilizing existing machines by upgrading them to continue accepting coins as well as contactless payments. The retrofitting is easy to accomplish and the integration is very easy.
OTI’s advanced pulse interface opens the way to a cost-effective advantage over competition who can’t accept cashless payments and means that you have less trouble dealing with coin collection and theft.
Locations That Bring In Payments
Although calling laundries can be found and almost any neighborhood, they seem to succeed in areas with a high percentage of renters as opposed to homeowners.
The first thing you want to look for in a potential location for setting up a laundromat business is the total number of households in the vicinity. The higher the population density in the area, the more people there are per square mile who potentially would need the service. The flip side of the equation is that an area that is too dense might already have established competition.
Another thing to look for is whether the area has a lot of rental properties or homeowners. Most, (but not all) statistics show that a higher percentage of laundromat customers tend to be renters rather than homeowners. Since renters tend to be more transient than homeowners, it makes sense that they would not be invested in having their own washer and dryer.
From a demographic point of view, laundromat customers generally tend to be low to middle class. Although not exclusively younger, a higher percentage of laundromat customers are usually in the younger age brackets. One thing that can influence this is of course the type of neighborhood that it is located in. If it is close to a university or college, the type of patronage you can expect is likely to be predominantly students and young people. If the neighborhood tends to be an area with older people, the typical clientele will obviously be older as well.
Another important aspect to take into consideration is the ethnicity of neighborhood. If the area has a predominantly singular culture, your décor can make it more appealing to your potential clientele. If the neighborhood tends to be predominantly more upper class with white collar workers, then they suitable décor and additional services might help attract more people to your business.
One basic thing that you should never overlook is the importance of location. If the business is located in a popular commercial area where is it far out of the way, is there convenient parking or would it be a hassle for customers to come into the shop and pick up their laundry. Small or mini shopping centers are sometimes conducive to customer traffic as people stop to pick up groceries or take care of other chores making it easy to step in and become a client of your business as well.
