125. Turning a Zomiemat Into a Gold Mine with Emil Schaffroth

Speaker A [00:00:00]:

Hey, what’s up, guys? It’s Jordan with the Laundromat Resource podcast. It’s show 125. And I’m pumped you’re here today because today we have on the show Amel Shafroth, who turned his zombie mat into a gold mine and tells you all about how he did that. And it’s one of the big questions I get asked all the time is what do I do with the zombie mat? How do I know if it’s going to make money and what do I do to make it make money if I take it over? Well, Amel is here to show us the way. It is an awesome episode. We have a lot of fun chatting. I know you’re going to love it and want to get into it in 1 second, but real quick, I want to do today’s fast lane tip to help you achieve your goals faster through Laundromat Resource. And today’s fast lane tip is this. Did you know that when you join the Laundromat Resource pro community, you get access to a whole bunch of stuff? So go check it out. Slash Pro. But one of the things that you get access to is you get access to a bunch of discounts in a lot of different things in the industry, anywhere from marketing to software to even buying your own house. You get access to a whole lot of different discounts that we’ve been able to put together, and we’re continually putting more and more together. And I think we have a couple more coming up here pretty soon. But right now, there’s well over $3,000 worth of discounts and free things from industry partners when you join the pro community. And each and every single one of them is valued at more than the investment to join the pro community. So not only do you get everything that you get with the pro community, but you can also recoup your money pretty much immediately. If you’re planning on using any of these services, go check it [email protected] pro and see all the different discounts that you get access to. And you know what? That’s not even the best part of the community. The best part of the community is the community itself. It’s so awesome to just be in there and everybody helping each other out, everybody helping each other get to the next level, wherever that is for you. So come join us slash Pro. Love to see you in there. And without further ado, let’s talk about how to turn your zombie mat into a gold mine with Amel Shavroth. Amel, thank you for coming on the show. Super excited to have you on. How you doing?

Speaker B [00:02:33]:

Good, how are you doing?

Speaker A [00:02:34]:

I am doing awesome. Listen, man, we’ve chatted a little bit, getting ready for this thing, and I’m super excited. So why don’t you start off by telling us a little bit about who you are and then let’s get into how you got into this business.

Speaker B [00:02:51]:

Okay? Yeah, I’m originally from Oregon. I was, like, military guy out of college, and I think I got out of 2010 and was just kind of doing a few different businesses. I was a pilot when I was in the military, so I continued flying while I was trying a couple of other businesses. And, yeah, finally got out of flying when I bought my first Laundromat. But I’d been looking for Laundromats since, like, the early 2000s. Well, I shouldn’t say I’ve been looking for them, but I was curious about them because of the famous book, Rich Dad, Poor Dad, Poor dad.

Speaker A [00:03:30]:

Come on.

Speaker B [00:03:30]:

Yes, he was talking about that. And I read that when I was, like, 20, and I was like, oh, this is I mean, it was such a great book for the concept of money and everything. So, yeah, that was one of the things that kind of stuck in my head was Laundromat did a bunch of flying stuff and then COVID hit, and I was furloughed, so I was out of work. I hated that feeling of, like, somebody called me to tell me, hey, you’re not going to work for us anymore. And so I didn’t know I was going back to work, and I was like, hey, this is the time to really get serious, find one and buy one and get in the business. So I did, and it’s been great so far.

Speaker A [00:04:10]:

Awesome. Well, first of all, thanks for your service. Appreciate that. We’ve got a long history of pilots in my family. What branch were you in?

Speaker B [00:04:18]:

I started in the Marines and finished in the army.

Speaker A [00:04:20]:

Okay, awesome. We got a lot of Air Force pilots on our side over here.

Speaker B [00:04:24]:

Okay, cool.

Speaker A [00:04:25]:

A lot of respect for the pilots. So appreciate you and everything you’ve done for our country. Out of curiosity, you said you’ve kind of well, first of all, I just need to speak to everybody else for a second. If you have not read Rich Dad, Poor dad, shame on You, I’m going to have a link. Go buy it and read it.

Speaker B [00:04:42]:

That’s like the epitome of this business is, like, based on that.

Speaker A [00:04:47]:

Exactly. And it’s like just any podcast you listen to, any interview, almost inevitably this book is going to come up. Right. Anybody who’s found success, you’re going to be like Richard Hordet, right? And there’s some people who like to hate on the book and stuff. Who cares? Forget them and take the lessons out of the book that are meant to be taken. So shame on you. Click the link down below if you haven’t read it and just buy the book. Okay. All right. So going back, so you said, hey, you kind of been eyeballing Laundromatch for a long time. What was holding you up? How come you never pulled the trigger.

Speaker B [00:05:22]:

Until yeah, that’s kind of forced that’s a great question. I can remember specifically. One that I talked to the owner went through all the stuff came up with the, you know, had the financing, and I just couldn’t just couldn’t pull the trigger. And I was busy, you know, with with my career, and I didn’t know how I was going to take it on doing the two of them, and I was just scared. I just didn’t want to do it. It was scary.

Speaker A [00:05:56]:

Taking that step and jumping off the ledge or whatever. That is the big hurdle. Right? It’s so hard to do that because there’s a lot of unknowns, a lot of things you don’t know. Like you said, you’ve got other things going on, too. Things are busy. It takes capital. It takes money.

Speaker B [00:06:15]:

Yeah. Then I think it was, like the point. When I made the offer, they accepted it. We went into escrow. That was, like, the same week that I got called back to work to fly, and I was like, oh, my gosh, how am I going to do this? And crazy enough, my mom, she’s retired, and she was like, I’ll come down and help you. And so she flew down from Portland to La. And lived with me for, like, four months while I tried flying and know. It was a zombie mask. It was like I was doing all nighters, like, trying to renovate it. And then I would get called to go on a know, and then I would be gone for four days, and she’d be working the Laundromat. And it was just crazy. Finally, I told my boss, I was like, I can’t do this anymore. And it’s so funny. My boss, when he owns this big charter company, and he was so interested in the Laundromat thing, he just kept asking me all these questions about it all the time, and I was like, man, you got this awesome business here. Why so interested in the laundry stuff?

Speaker A [00:07:20]:

Well, I found that to be true. Like, a lot of business owners are very intrigued by the Laundromat. And I think I’m not going to speak for your boss, but I think I’ve seen a lot of people who have great businesses, but they’re earning that money, right? They’re working hard. They’re working long hours. They’re dealing with lots of issues, lots of problems, because they’ve got a lot of people and big airplanes and stuff that they’re trying to figure out. And the concept of the Laundromat, where you’re getting cash flow, it’s not taking up all your time. You got a lot more freedom. I think it’s really intriguing to a lot of business owners.

Speaker B [00:07:56]:

Yeah, it is. It’s a great business, for sure.

Speaker A [00:07:59]:

Yeah, it’s not that surprising. Okay, well, yeah, that’s a crazy four months. That sounds like not only are you working a job and trying to turn around a zombie bat, but your mom’s also living with you. That’s a whole nother.

Speaker B [00:08:14]:

There was a couple of other things that added to that that was like, I had to have been like one of the lowest points of my life. Just turned 40 and I was like, this is my midlife crisis for sure.

Speaker A [00:08:24]:

Yeah. You’re like? Man, I should have bought a Lamborghini.

Speaker B [00:08:27]:

Yeah, exactly.

Speaker A [00:08:29]:

Okay, well, all right, you bought a Zombie Mat. So can you take me through the process a little bit? Like, how did you go about finding this place? And what was that experience?

Speaker B [00:08:43]:

Just kind of went on the classic biz buy sell website and Craigslist. And this one I found on Craigslist randomly because there’s not really a lot, especially now. That was three years ago and it’s changed so much since then. But yeah, this one was on Craigslist. I reached out to the broker. He started kind of walking me through things and started pre qualifying me and a little bit more backstory. I owned vending machines before this, and so I kind of did a business, similar cash business that had a lot of coin turnover and stuff like that. That was another reason I actually wanted to get into the Laundromat industry, was just kind of like segue into like, I could have the both of them. I never would have a coin shortage. Like, we were going COVID.

Speaker A [00:09:34]:

That was another wrench into things.

Speaker B [00:09:38]:

Yeah, but anyway, we started kind of talking things out and I can remember the broker was telling me, hey, he’s like, this is what they want. Let’s go ahead. And if you’re really serious, you need to write a purchase agreement and 30,000 down. Whatever was what I needed to put down according to him and the seller. And I was like, dude, I’m not signing a purchase agreement. I haven’t done any due diligence. I don’t know anything about this Laundromat yet. And he was like, well, that’s not really the way it works. And I was so frustrated with him, I think I eventually hung up on him. And I was like, this guy’s got to scam this guy’s on Craigslist, all this stuff. So he reached back out to me and so I hired another broker to consult and I found him. He was an La business broker. And I said, hey, I’m not looking to split the commission or anything or whatever, but can I pay you like, $500 and just go through the paperwork and tell me if this is the way it’s done? And he did, and it helped tremendously because he was able to say, yeah, this is normal. Okay, yeah, this is the due diligence that you’re going to do. This is escrow. These are the contingencies during escrow that you’ll sign off of and all that stuff. This is the process. And that was amazing. And then come to find out the broker was perfect. He wasn’t trying to scam anything. He was completely honest. The sellers were amazing. They were like a Korean couple who had owned their Laundromat for 30 years, and they were just wanting to retire during COVID And they were scared and not scared, but they were just like they saw a decline in their business and they’re like, our health deteriorated, we want to retire.

Speaker A [00:11:19]:

Good transition point for them.

Speaker B [00:11:21]:

Yeah, and they were amazing. They even check in on me currently to see how things are going. They always wanted to make sure I was still making money and all that stuff. So the process for me was actually really nice.

Speaker A [00:11:36]:

I love to hear that because especially in our market, there’s just stories of this going south. Honestly, there’s maybe like a handful of brokers that I would trust to do deals. So it’s likely you’re going to find somebody who’s not who is telling you weird stuff like that. But I’m super glad to hear that you paid somebody to just verify everything. Like, hey, is this right? Because it doesn’t the process is so on the one hand, it backwards. Like it doesn’t make sense. You’re not getting a lot of details before you make your offer. You’re not verifying anything before. And so you’re kind of just saying you got these owners saying, okay, here’s how much money it’s making. And you’re like, Based on what? How do I know that that’s true? And they’re like, well, make me an offer of tens or hundreds of thousands of dollars based on just me saying that. And it feels wrong, especially if you’ve never done it before. So glad to hear that you did that. Okay, so you found this thing on Craigslist. You reached out to the broker. You brought on a consultant. They said, yeah, it’s legit. What was the process of the due diligence like? Did you do a whole lot? I mean, you said this was a zombie mat, so what was that like?

Speaker B [00:12:56]:

Yeah, when I went and looked at it, I think one of the first things I did before I’d even met the owners was I went and I sat inside there and just kind of watched. I think I did a load of laundry and I just kind of watched how things were. And I can remember just looking around going, I feel like this place could use a ton of improvement. I think you could just do a lot in here. And the only question is now, is it making money? So I’m a spreadsheets nerd and love doing pro formas and all that kind of stuff. And so I kind of put together what I could based off of what I knew about the industry, which was nothing. Just tried to ask a lot of people as many questions as I could. Hey, what is insurance expense going to be? I was able to get the utility bills from them and then just go off of what their collections were. And I can remember the guy was so funny because he was very private about everything and he was like, yeah, we’ll do the collections. But I was like, okay, well, that’s cool. And all. But do you have, like, a history of collections? I want to see your history of income. And he kind of didn’t want to, and then one day, he brought in, like, a sack of these little books that were like, 30 years worth of his collections. And I was like, wow. And I put it all together, and I ran the numbers, and I was like, okay, this is legit. This is like making a little bit of money. Decent price for what? I thought, again, I didn’t know, but I could kind of guess based off of the numbers. I was like, oh, yeah, I can make this work. I could make a little bit of profit, pay my loan on the business, and it’ll work out. I didn’t know it would turn into what it is, but I was like, yes, this is a definite yes. Which I think is important. Really? I mean, they say if it’s not a hell yes, then it’s a no type of thing. But it’s scary though, man. Like, when you don’t know anything about the business and you’re get in, there’s so many things that are going to tell you to back out. It’s hard.

Speaker A [00:15:03]:

Yeah, no, that is 100% legit. And I can’t tell you how many people I talk to on consulting calls and stuff or just having conversations with the people that are similar to you, like, oh, I’ve been thinking about buying a Laundromat forever. And I’m always like, well, how come you haven’t? And it’s scary, man. It is. And at some point, either you got to take the leap, or it’s just one of those things you’ve been thinking about for decades. Right?

Speaker B [00:15:31]:

Yeah. Now I’m looking at another one, and this one involves the property, and it’s like, it’s just so scary. There’s just a million things that just make you I’m back in the same shoes, and I know the business now somewhat.

Speaker A [00:15:47]:

Yeah, no, and it is that’s how this industry is, because most Laundromats still are cash based. There’s just a lot of unknowns, and it’s not like you can download a report off of software for a lot of these businesses and just, okay, here’s how much money is coming in. It’s clean, clear cut. It’s just not it’s a lot of murkiness there.

Speaker B [00:16:09]:

Oh, yeah, a lot. And there’s so many variations in the Laundromat business. As you know, you’ve got all different types of types of Laundromat businesses and add on to that and Wash and Fold. Like, I was running numbers saying, okay, if I add the wash and fold, it’ll make this much more. If I add a little store, it’ll make this much more. That was kind of what I was guessing. Well, come to find out, my sales did great, but the Wash and Fold did nothing. I think I get, like, three customers a month on my Wash and Fold because it’s just not that demographic. And I had no idea but in other areas, that’s going to be your main income.

Speaker A [00:16:49]:

Yeah, a lot of different business models for this model, that’s for sure. Okay, we’ll get there for how you set your business model up here in a second. Okay, so you went through this due diligence process. You did coin collections. You got a bag full of 30 years of collections, and eventually you’re like, okay, I think I can make this work. Take us back to day one. When you took over, they handed you the keys. What was, like, going through your mind and how did it turn out?

Speaker B [00:17:21]:

It was just one of those things where you’re like, here we go. What have I got myself into? It was overwhelming. I didn’t know it’s so scary.

Speaker A [00:17:31]:

Yeah.

Speaker B [00:17:31]:

The owners, they were like, cleaning out their office and walking out the door, and here are your keys. And I was like, we’ll see how this goes. They left me two employees that were helpful, that helped me kind of that’s good. A little bit, as much as they could because they don’t have access to a lot of stuff. That was and I think that was the day my mom got down to La. From Oregon and she was trying to spin her up on what keys are. What we’re trying to find out what keys are. What you remember, you got the bag of keys and you’re like, I got a bucket.

Speaker A [00:18:06]:

I think I got one of those old butter buckets with the little plastic lid that goes the toes. And it was just full of random keys. And I was like, yeah, what do I do with this stuff?

Speaker B [00:18:17]:

The storage units were just, like, piled high with just garbage. Back behind the dryers was all the equipment from 20 years that had never been hauled out or anything, just parts and stuff. I just remember that completely overwhelming feeling that first day.

Speaker A [00:18:33]:

Oh, yeah. Well, I’ve shared this on here before, but I walked in first day, and a lady was completely naked, washing all of her clothes. And I was like, what did I do? Help me gosh. What did I do? So that was an omen of things to come. Okay, so super overwhelming. And you got a bucket full of keys or a bag full of keys, and you’ve got storage that’s piled high. What were your first steps? What did you do from when you took over? You knew going into this, you were coming in trying to basically turn this thing around or increase business. So what steps did you take? What did you do? And did they work?

Speaker B [00:19:19]:

Yeah, I think the first steps that I took were, like, just try to keep your head above water. I mean, it was sink or swim type of thing. So I was just trying to figure out the day to day, like, hey, are the doors going to lock when I close them? Are they going to open in the morning when they’re supposed to, and we got to keep this place clean. It needed a lot of renovation type of stuff, and that was maybe one of my specialties because I have that background to be able to do that. But I didn’t have the resources. I didn’t have any money. I think all my money was tied up in like the utility company wanted two months of deposit, the rental company wanted two months of deposit, and it was like handing out cash left and right, get this thing going. And I was like, well, where am I going to come up with money to redo the floors or repaint the walls and stuff? So that’s where it became difficult. But I think the first two weeks was literally just figuring out the operations, day to day operations and just going with the flow, dealing with the customers, learning how they work, trying to please them, make sure they’re coming back. That’s the biggest thing when you have any type of store is are people coming in the door and are they coming back?

Speaker A [00:20:33]:

Yeah, that’s super succinct. But that is like the key, right? You have to distill it down. It’s like, are people coming in and are they coming back and how do I get people in and how do I get them to come back? That is the key to business right there. Okay, that’s it, right? You got to learn the business when you first take over. You got to learn the operations. You got to learn the ins and outs. The good news is that the basics of it, at least, they don’t take a whole lot of time learning, like you said, a couple of weeks or whatever. So once you kind of got that rolling, did you do anything specifically to start growing the business or just kind of happened because you’re taking care of stuff?

Speaker B [00:21:19]:

Yeah, no, like I said, my goal was to fix it up, and I didn’t have the money or the knowledge or anything to invest in new machines, which I knew needed. But I had like a handful of machines that were good. When I say good, about ten years old, so they would say work fine. But I guess in the world of laundromats, if you value the laundromat based off of ten year old equipment, it’s probably passive cycle and not worth anything. But hey, they worked great and they were making money, so that was fine. But then I had another set of machines that were like 30 years old, and they worked, but there was a lot of maintenance involved, and I didn’t know the maintenance on those. I’m handy, I can work on a car, but this is a completely different animal. So I had a mechanic who come to find out was kind of taking me for a run a little bit, and then I was able to find my new mechanic. I think it’s same as your mechanic. But anyway, he is amazing and he teaches me things and shows me things and most honest guy. But the first guy, I had to let him go because it was like, wait, what are you doing? And you’re not fixing the machine, you’re spending all this money. Yeah, he just didn’t know what he was doing, especially on the older stuff. So I came in and I said, okay, first thing I can do is maybe the floors. Let’s tear up the floor and grind it and polish it, make it look nice, maybe. I think people, when they walk into a store, they either look up or down, and a lot of times they look down because they’re walking. And I said, okay, if I make a floor look nice, that’s step one. So I pulled like a couple of all nighters tearing up the floor and having it sanded and polished, and I think I was able to scrape together a couple of $1,000, have a guy come in and polish them for me. And that was like a huge step for me. That was the biggest thing I could do. And that kind of got the wheels rolling. That kind of got me motivated and got things going in the right direction.

Speaker A [00:23:11]:

Yeah. And I think the floors, like you said, people are looking up or down. I think the floors can be a huge investment, like return, because it’s so easy for floors to look dirty and dingy. And if your floors look dingy and old, your stores, even if you have brand new machines in there and paint on the walls, if your floors are dingy, your store is just going to look shabby. It almost doesn’t matter anything else, but vice versa, you can greatly improve the look and feel of your store just by even if you have older machines and stuff, right, just by improving the floors. Yeah.

Speaker B [00:23:46]:

One of the best comments I got after I did the floors was somebody said, you changed the lights in here, didn’t you, because it’s a lot brighter. And I said, no, we didn’t actually do anything to the lights, but it was just the reflection or just the different color of the new floor was a lot brighter in there, which helped a lot. I liked.

Speaker A [00:24:02]:

Yeah, this is awesome. Real quick, I don’t want to gloss over because you mentioned something I think gets overlooked a lot when you first got in, which was there’s a lot of expenses that people don’t really realize when you take over a Laundromat and you mentioned the rent deposit. You mentioned one that a lot of people are kind of used to rent deposit. If they’ve ever rented an apartment or something, they require a deposit. So you can kind of get that and anticipate that. I think a lot of people don’t realize you got to put in deposits for utilities a lot of times, and you got to buy quarters a lot of times come with the business, right? And so there are these other kind of expenses to be aware of. So you mentioned that, and I wanted to kind of highlight that because you can get blindsided, especially a lot of people are looking for the free laundromat or whatever, which is fine, but there’s nothing free. Right. You still got to have these deposits there. So if you come in with zero cash or you come in right at the edge of what you can afford, you might get a rude awakening when you find out you’ve got to put down money or buy quarters or stuff like that. So just something I wanted to highlight because I thought that was a great point.

Speaker B [00:25:18]:

Yeah, I think it was like 26,000 in deposits I had to pay. You can’t borrow that money. You’re not going to put your credit card or something. I mean, you could, but that’s just one of those things where you just start figuring out how to do it because challenge.

Speaker A [00:25:35]:

Yeah, that can be a challenge. Okay. All right. So you did the floors. That’s awesome. Did you see impact? Obviously, the customer experience was better. Did you see impact on the business?

Speaker B [00:25:47]:

I don’t think there was a lot of change in volume at that moment, but part of it was the floors, I think. And then also my mom was just amazing customer service lady. People three years later still ask about her, how’s your mom doing? And she was just so nice to these people who live in a rough part of town, and they are probably on guard a little bit, so they might not be as friendly all the time, but extending that friendliness to them helped so much. I think we got a lot of positive reviews. I guess the few Google reviews that we got at that time were positive on the new ownership is good. And that helped a lot, I think. I think it wasn’t until January, so I bought in October. It wasn’t until after Christmas, January, when we really started seeing sales start to increase, when I kind of started implementing a couple of things that a lot of people and the old owner was like this, too, were like, hey, if I can’t see an immediate return on it, I’m not going to do it. Well, I just didn’t really believe in that philosophy. I believed that anything that I can do to make the customer experience better was going to help me, even if it cost me money and didn’t show a direct link to a return on investment. And I bought like a nice coin changer. I bought a couple more coin changers. I think we had two. I put in two more, and this one was able to break bills. Instead of having to walk around with a lot of cash and give people change all day long, the machine could do it. And customers just loved. It, and that helped kind of the customer experience, and that was another big thing.

Speaker A [00:27:43]:

Yeah, that’s huge. I forgot to ask you, but when you took over, was your assessment of how this business was performing, was it accurate? Did it turn out to be ballpark, inaccurate assessment or, like, what the owner was saying, or was it making less? Was it making more?

Speaker B [00:28:04]:

All the numbers he had were spot on. He wasn’t trying to hide anything. He was very honest, and that was great. And that’s why he came back the next month and said, hey, I want to know how you did. I want to make sure we didn’t sell you something that you’re not happy with, which I thought was amazing, but how lucky is that? So everything was on point to what he had, but even the trash cans were, like, just these big open Oscar, the Grouch type of metal tin cans that were open, and they were beat up and old, and I just didn’t like that they had trash that you could just see. So we upgraded those. And trash cans aren’t cheap. I think they’re like, $500 apiece or something like that. And we just made nicer ones and started to go down that road of making every little improvement that I could.

Speaker A [00:28:56]:

Those incremental changes really do add up. And like you said, sometimes you can’t see that return right away, but as they accumulate, it really shifts the perception of the business, and it shifts the experience that the customers have there.

Speaker B [00:29:15]:

Right. And a lot of people ask me, like, well, what do you think it was that caused all your growth? And it’s really hard to say one particular thing, but I was always trying to do multiple things, and I was always watching my numbers. Like I said, I’m a huge numbers guy, and I think Warren Buffett said, if you can’t measure it, you can’t manage it. So it was like, okay, let’s see how it’s doing. I couldn’t, unfortunately, pin one specific thing to the numbers increasing or anything like that, but I just know it was a collective, and there was some luck involved, to be honest with you. I think one of my biggest competitions closed down nine months after I bought it, and we just had a huge influx of customers, which is just pure luck, and it was awesome. But we really had to step up our game at that point, because now we got to service all these people and get them in and out and keep them, like I said, happy and keep them coming back. And I was like, do I raise my prices? What do I do? This is supply and demand issue. I didn’t really know how to handle that, but we worked through it.

Speaker A [00:30:15]:

Well, what did you do? I mean, did you raise prices when that happened?

Speaker B [00:30:19]:

Yeah, my thought was, okay, I got all these customers coming in. I almost can’t get any more in the door, especially on a weekend, I need to raise my prices. And so I kind of did a little bit, just a small, little incremental price increase. But that didn’t seem to make that much difference. We still had a lot of people coming in, so I just kind of ran with it again. I was thinking, okay, if I raise the price just like the supply and demand curve, it’ll show. I’ll have customers kind of dwindle down, and I’ll keep the ones that want to pay the price. But I knew that I couldn’t raise prices without adding value. So the customer can’t say, oh, I got this price increase, but I don’t see any benefit to what I’m getting for this added increase. So that was where I had to make sure that I got the things done I wanted to do, like, the renovations and upgrading the store before I could really throw in a decent price increase. So I kind of left it the way it was because I knew it wasn’t ready for that. But eventually, we did do some price increases when we got things done, and it worked out well.

Speaker A [00:31:26]:

Yeah. That’s awesome. Yeah. And, I mean, that whole supply demand curve is awesome. And like you said, there was some luck involved there, but you had already been doing some incremental things to be ready to capitalize on that luck, which is also fortuitous for you. But that’s on you for doing that, right? You get credit for that. I’m giving you credit.

Speaker B [00:31:47]:

Thanks.

Speaker A [00:31:49]:

Did you end up replacing machines at all, like, ever?

Speaker B [00:31:53]:

Yeah, I think I went to a function. I’ve met a lot of people in the industry now that have been in it, which is awesome because you can really bounce ideas off people, like, hey, what do you think about this machine? What do you think about that machine? And what size machine do you think I need? And then I met this one guy down in San Diego who owns several stores down there, and he’s been in the business for 40 years, and he’s kind of like a ninja. He’s not like, a huge, huge, laundromat guy, but he knows the business inside and out. He even refurbishes his own machines. And he has this whole production, like a warehouse off site where he just refurbishes machines, and he can build out a store for amazingly cheap. And the machines look brand new, but they’re 30 year old Dexters that just run top. Anyway, he kind of started walking me through, hey, okay, I think you need more 80 pounders. I think you need more 40 pounders, this and that. And he was like, oh, yeah, get rid of those machines. I had some 30 year old Mill Nerds, which are great machines. The customers love them, but they’re not great for the owner because they use a ton of water, a ton of maintenance tanks. We had to get those out and just replace them with easier said than.

Speaker A [00:33:05]:

Done because those suckers are tanks in their weight. Also. They’re heavy.

Speaker B [00:33:10]:

Yeah, it’s a cool machine, but it didn’t add to the look of the store. It didn’t add to my efficiency with water, electricity, even those things, you can hear them humming all night long, even when the store is closed. It’s a crazy machine, but yeah, we got those out. I spent about 100,000 in new equipment, which wasn’t really a lot of equipment, but it was just to replace about 13 machines. And then I think I had 16 top loaders at the time, and I was like, this is just way too much water. So I replaced five milliners, eight old Continentals, and then took out eight top loaders. And just that right there decreased my water bill by $2,000, which paid for the equipment that’s an equipment payment and more. So that was like a huge thing that I kind of stumbled across. Incidentally. I was like, wow, I didn’t realize how much savings we would have just by upgrading the efficiency of the equipment.

Speaker A [00:34:13]:

Yeah, that’s awesome. It’s easy. Again, it kind of goes back to your investing in things that may not have an immediate return, even though this did for you. But it can seem like, oh, my gosh, I have to buy all this equipment. It’s going to cost me X amount of money. But what we forget to factor in is that there’s also monetary benefit to that. Right. I don’t know if you raised your prices, but you can raise prices. You’re going to see some utility savings that’s going to help you out, offsetting the cost of the loans there. Customers do, like, shiny new things, so you might get new customers coming in. You’re going to keep them there longer because they know the machines are going to work, because they’re reliable, because they’re new. Right. Like, there’s so many benefits, too, of adding new machines that don’t be short sighted on, oh, it’s going to cost me $100,000 or 200 or $400,000, whatever it costs, because there are benefits that are coming your way, too.

Speaker B [00:35:12]:

Yeah, it’s kind of cool when you don’t. It’s just like it was in the back of my head that I just knew I needed to do it because it was just kind of on that customer experience spectrum. And like you said, yeah, you can raise the prices, and when you do it, the aftermath is like, oh, my gosh, why didn’t I do this before? How does everybody not do this? That type of thing.

Speaker A [00:35:34]:

Yeah, absolutely. And going back to your point is this is why it’s so important to be connected in the industry, right? Like, you probably would have made different decisions if you didn’t have a dude who was 40 years deep into the industry who just knew what you needed to do to help you improve your business. Right. And was giving you specific advice.

Speaker B [00:35:57]:

Well, the funny thing is, there was a couple of things he said that I kind of went against, and now I’m wishing I had done, but it is what it is. But we’re still learning.

Speaker A [00:36:08]:

It’s all part of the process, right? And it’s also not to say just because somebody’s been in the industry 40 years doesn’t mean they know the best way to do it either, right. You still got to use your head, and it’s going to behoove you to be connected to multiple people, getting some different perspectives and contextualizing it to your specific business.

Speaker B [00:36:27]:

A lot of times it comes down to going with your gut, too, because I’ve experienced this and I heard somebody else talk about this one time. He’s an investor, a very prominent investor, and he was saying in an interview, he said, I go to these meetings and he goes, I have my idea of how I think I should invest or whatever. And everybody has all these opinions. Everybody starts talking about stuff and collaborating. He goes and I walk out and I feel like I know less than what I knew walking into it, because now I’ve got all these people’s opinions, and I think that’s true with my experience, too, which was like, all right, all these people said to do all this stuff. Now I’m just completely lost. I don’t know. But, yeah, if you go with your gut, I’m big on educating myself in every way I can. So I guess over the years, I’ve learned enough stuff and I’m still learning a lot, trust me. But you just kind of go with what you think is going to make the best business decision, and then you learn from it. And there’s nothing wrong with making the wrong decision. It might cost you a little bit of money, but you got nothing but the future. Eddie I think, yeah.

Speaker A [00:37:40]:

That’s awesome. All right, so when you buy this thing and you’re growing this thing, you said for four months, you’re working your job, I think you said four months, right? You’re working your job and you’re trying to run this business, and you got your mom helping you, and eventually you’re like, hey, look, I can’t do both. I’m going to bow out of this job. How do you make that decision? Was the laundromat doing well enough to support you at that point, or did you take a leap? What was that situation?

Speaker B [00:38:12]:

Yeah, I think I was lucky enough to buy a store that had enough revenue to start with to know that I could pay my bills once I walked away from this other job. And I lived very frugal at that time, still probably pretty frugal, but at that time, I knew that my expenses were minimal and I could make it happen. It was nice to have the income of the job, for sure, but yeah, I was able to do that. That was nice because a lot of people. Their first store is like 1000 sqft or something. Mine was 2800 and it had enough revenue that it could pay bills. But some of these really small stores, I’ve met a couple of people that they were like, oh, you were able to walk away from your job. That’s nice. I can’t do that yet, but I was lucky on that part.

Speaker A [00:39:04]:

Yeah, that’s awesome. Honestly, I think that’s one of the powers of Laundromat, right? What makes them such good businesses and such good investments, potentially, is that one to maybe three Laundromats is your ticket to freedom, if that’s what you’re going for. Right. One to three Laundromats is your ticket to freedom. And if you can get there, then you have the option, right. You can keep working. If you love flying and you want to keep doing it, you can set up that business to where you can keep flying. But if your goal is to kind of leave that, leave your nine to five, have more freedom in your life or whatever, one to three Laundromats is the ticket. And to your point, if your goal is to get out of that nine to five as quickly as possible, you want to try to get a little bit bigger business so that that volume is there to be able to buy that ticket out, right. Was it scary for you not going back, or do you feel pretty confident? What was that like?

Speaker B [00:40:09]:

Yeah, it was actually scary. The day my mom left too, I was kind of like, oh man, I’m here on my own. She was such a great help. I can’t imagine. It was just such a blessing to have her come and do that. And when she left, it was like, oh man, I’m here on my own. And then that’s when I think the all nighters started kicking in, which is miserable. And I dreaded it every time I had to do it. I still do. And once in a while you just have to do it because I’m handy, so I want to save money and do it myself. Now I’m to the point where I’m starting to hire contractors. I’m starting to find contractors that could do before, I didn’t even know where to find somebody that could do totally stuff for a Laundromat. But you hire a plumber and it’s like, Whoa, $2,000. And all they did was solder a pipe together. All right, that’s not going to work. YouTube and putting time in was where I had to earn it in the beginning, that’s for sure. Now I have a really flexible schedule. I still put a lot of time into the Laundromat because I’m having fun with it. And I think that’s the leadership side of it. If I just kind of walked away from it, my employees would kind of go, what’s he doing? But I stay very active in it because it’s just fun. It’s fun to watch it grow, and it’s fun to see the rewards, and it’s just a great time for me right now.

Speaker A [00:41:33]:

Yeah, well, what are you doing? What’s a typical week for you with this laundromat?

Speaker B [00:41:38]:

Typical week is I’ll go up there about five days a week. One of the nice things about quitting the pilot job was now I’ve got weekends, now I’ve got evenings at home. And so I can put in a typical 40 hours week if I want, or I can work longer. And it’s still fixing things. It’s still repairing swamp coolers or adding a new sink or putting a new toilet or there’s a lot of work to be done, for sure, especially when you’re trying to do it yourself. So that’s where I go. I do like the kind of the dailies I could get away with probably spending 5 hours a week there. Just do the collections and check in with the employees, do the payroll, and they handle it. I even have employees that do collections for me, which is against what a lot of people would say is advisable, but I trust them, and I definitely had to make some changes in the staff at times, which is not fun, but I always tried to make sure I make better hiring decisions. I think it was the Facebook said, one of the most important things to grow in a business is hire quick and fire. I never I don’t understand that concept because I don’t like firing people, but sometimes you have to. And I gave a lot of guys a lot of leeway until they would kind of hang themselves with their own robe, because in that business, it was like, I felt so bad for him. I was like, man, this is a tough job. They’re working late nights. This is a dangerous neighborhood. They got to close on their own. At least the guy shows up every day. He’s friendly. The customers love him, that type of thing. But then at a certain point and then I’ve noticed that every time I made that decision, I got a little bit more empowered, and it came out to be, like, a little bit better aura and a little bit better energy at the laundromat, and things just work out better that way.

Speaker A [00:43:39]:

Yeah, totally. And I’ve for sure seen that, too. I mean, it’s hard letting people go. It’s hard firing people, unless sometimes they just make it easy, right? Like, you just got to get rid of them. I had a lady who was working for me, and she literally got in a yelling match with a customer over nothing, and the entire shopping center is coming out. And I was just like, look, that’s not how we want to be portrayed here. That decision was easy, but a lot of times it’s not that easy. And like you said, especially if you’re in a rougher neighborhood and there’s a lot of things that you’re looking at the amount of work it’s going to take to replace them or if you’re going to have to fill the shift until you can replace. There’s a lot of things to think about. Right. But like you said, and you think about Good to Great, the book, which is an awesome book, too, and it’s having the right people in the right seats, right, doing the job. And it really does, like you said, it kind of brightens up the aura of the business, the atmosphere. And a lot of times what happens if you have multiple employees and one is slacking off or doing things they shouldn’t be doing or stuff, resentment starts to build up in the other employees. And talking about leadership, sometimes you just got to make that hard decision and have that hard conversation for the sake of the other employees who are doing the right things.

Speaker B [00:45:12]:

Yeah, that’s spot on, because I didn’t realize how much it affected the other employees. When I let this one person go, it just changed the attitude of the other employees, like, hey, everybody’s pulling their weight now. And, yeah, that was a lesson that was interesting to learn.

Speaker A [00:45:30]:

Yeah, absolutely. Okay, so you’re growing this business. You’ve been doing some incremental changes, doing the floors, you’re pairing stuff around, you’re adding some machines. Have you seen pretty good growth? That’s been a couple few years since you’ve owned this business. Have you seen some pretty good growth? What’s that been like?

Speaker B [00:45:57]:

The growth has been insane. What my goals were for this laundromat when I first bought it. Three years later, it’s three times that goal, and I had never thought that it would do as well as it’s doing. But a couple of lucky things, like I said, improving the customer experience. We’ve just had a lot of return customers, and then that with the ability to raise prices in the store. I’m not a huge fan of raising prices. I’m not trying to gouge anybody. I have a lot of empathy for my customers, but I want them to get the value. But at the same time, I’ve got to make sure all my bases are covered, and we’re doing the right thing for everybody. So having employees is a lot of payroll. That’s a tough expense. So we got to make sure that everything’s working out right. And then, shoot, there could be a downturn at any time. You could have a competitor move in at any time. And are you prepared for that? Yeah, the growth has just been huge. It’s been awesome.

Speaker A [00:47:04]:

Yeah, that’s awesome. And I love hearing that and that combination of lucky breaks, but also, like I said, being ready for those lucky breaks, preparing for it, having that going is awesome. And I’m sure the majority of your success is attributed to your detail in improving the customer experience and ensuring they’re having a good experience. And I think I’ve mentioned on this before, but you said, like, a magic word for me, which is empathy. And I think empathy gets a bad rap. It’s almost perceived as like a weak trait in a lot of ways. And I honestly think that empathy is a superpower. I think if you can develop empathy for your just in general, just in life in general, but especially in your business, for your community and for your customers, and you can kind of put yourself in their shoes and feel what they’re feeling, actually is going to be a superpower for you. And I think that that’s a big part of why you’re seeing the growth that you’re seeing, like three Xing. Your goal for your business is insanity. That’s insanity. So congrats for that, for sure.

Speaker B [00:48:23]:

Thank you. I actually have a funny story about that type of thing. I went through this whole process of making signs, right? So I sat down, YouTubed a ton of videos on how to use this program. It’s similar to me, and put all this effort into making these signs, right, what size machines they are, like rules of the Laundromat. And I had this one sign that I was so proud of because we have a lot of issues with customers over soaping the machines, and I’m sure you do too. It’s very common. So I wanted to put this on there because we got a lot of the same repeat customers over soaping the machines. And I said I made a little stop sign and I never made it, actually, but I created it and it said, please do not over soap, there will be no refunds. And it had a couple pictures on it of the X through too much soap and the picture of the right amount of soap. Anyway, I thought I would post it on the Facebook forum to get some feedback. Oh, man, did I get ripped mean and by a lot of people who are really expected. I know they’ve all been I think Luke Williford was just like, yeah, that basically says to me, let anybody know where’s the nearest wash house Ross was on there. He was super nice about it, but they just were like, that just says no customer service at all. And I was like, oh, but I was so proud of this know, I thought it was going to be such a great tool in the laundromat to help people, but it really wasn’t. It was basically saying, hey, you’re screwing up. And that was a huge lesson for me on how to approach customers.

Speaker A [00:50:05]:

Yeah, well, that is funny because that’s a common sign that you might see in any Laundromat, right? Like, don’t over soap, no refunds. Because I’m sure for you and for a lot of people, that came out of a frustration as an owner, right? Because when people over soap, it creates a mess. They get upset because their stuff is still soapy when it comes out and they blame it on the machines and yada yada, yada. And it’s coming out of that frustration of having to deal with that. But like you said, having that customer empathy there and seeing and for those of you guys who don’t know, when he said Luke says that, just says, Go to the next wash house. That’s the name of Luke’s chain. He’s got, like, 40 laundromat, right? And, like, hey, go. Yeah, he’s got insane. But yeah. That is a hilarious story, though. But again, the power of the community, right?

Speaker B [00:51:06]:

Working together, that even led me to retraining my staff. But I was like, yeah, it was just a whole new perspective for me. That was like, hey, let them over soap. It that’s like a cultural thing. They love to use soap. You’re not going to change that in their mind. So let them do it and then try to convince them that we’re really sorry that that happened and we’ll take care of it for you. And to restart a machine for somebody once a day, twice a day, whatever, is nothing, so why not? And it was a change for my employees, too. They were kind of like, Wait, what? We’re trying to stop this from happening. I was like, Just let it go.

Speaker A [00:51:43]:

Yeah. If it happens, it happens. Yeah, right? Yeah, I love that. And I mean, I love the it’s funny because it’s like a small thing, right? This one sign that you’re going to post, you happen to post it on the Facebook thing, and people were some you’re dropping some heavyweight luke, Williford, Ross, Dodds. Like, those are some heavyweight names in this.

Speaker B [00:52:08]:

Yeah, I think Dave mens even commented on it. Know all super nice people, but it was like, whoa, these guys are saying that. All right, let’s take a step back. Let’s look at yeah.

Speaker A [00:52:18]:

And and it just caused a whole perspective shift, which I think is I mean, I think that’s awesome. I love that. Okay. All right, so your business has been booming. You mentioned that you’re thinking about maybe buying another one with some property. Do you have any goals, aspirations? Are you trying to get a bunch? You just try and take it one step at a time. What’s that looking like for you?

Speaker B [00:52:41]:

Yeah, I’m trying to take it one step at a time, I think. I don’t have this idea of, like, hey, I want to own ten, I want to own 100. It’s just kind of a matter of what I can manage, and that’s one step at a time, one laundromat at a time. I think I’m ready to expand into another one because I do want to have some diversity for future. If something happens, I lose my lease or something on this current one. Hey, there goes just about everything. I think it’s important to diversify somehow, some way, whether that’s other services you’re offering in your Laundromat or whatever, or having multiple laundromats, I think that’s important. So that’s where I’m trying to go with it.

Speaker A [00:53:27]:

Yeah. Awesome. Have you thought about doing, like, pickup and delivery? I know you said you get like a couple maybe customers on drop off, but have you thought about trying to grow that a little more or are you looking for another?

Speaker B [00:53:38]:

I did to do that? Yeah, I did. I would need a different location for sure. We don’t have enough space. It’d be nice to have a back door for that type of stuff, some closets or even an extra unit off the side to be able to store and house a lot of that stuff. But that’s a goal I had at one point, but now I just want to optimize the way this store works right now, and then I think in the future, because when you add wash, dry fold, it’s a whole nother business and it’s a whole nother animal, a whole nother set of employees problems. So I would like to get this one efficient and then maybe decide at that point if it’s necessary or something. I’ve had a couple of people say, yeah, we tried implementing it, but we found it was just easier just to grow laundromat.

Speaker A [00:54:30]:

Yeah, well, that’s the Luke and Lee Williford philosophy is just easy for us to add more locations. Right.

Speaker B [00:54:37]:

Makes sense.

Speaker A [00:54:38]:

Model to.

Speaker B [00:54:41]:

But I love the wash drive hold thing because you’re almost unlimited in your reach. You can reach a different set of customers. Now it comes down to a lot more marketing, and you’re adding new business skills, which is fun, too, but we’ll see how that goes.

Speaker A [00:54:57]:

Yeah, that’s cool. I mean, I love the just take it one step at a time and we’ll see where we end up because we’ve already talked about the business models. There’s a plethora of different ways you can kind of go there. So, yeah, it’s kind of exciting to kind of build that out and see where you end up.

Speaker B [00:55:18]:

Yeah.

Speaker A [00:55:19]:

Awesome. Okay, anything else about your business that we should be talking about before we get into some of the segments of of the podcast here? I don’t know.

Speaker B [00:55:29]:

I think it’s pretty basic. It’s really basic. It’s just a laundromat and it’s just doing turns.

Speaker A [00:55:39]:

That’s the whole goal for a lot of us who love this business. Right. Just have a basic, simple business that serves the community well and is profitable doing it. And that’s what we’re right.

Speaker B [00:55:50]:

Right. You’d be amazed at how difficult it is to get everything dialed in, everything from Ada compliances to distances on machines and dryers to get customer flow and how know I think there’s a formula even Andrew Cunningham, one of your guests, has on dryers to washers capacity ratio and things. Like know there’s a lot to this business that you can spend a lot of time just perfecting the efficiency of and compliance and regulatory taxes, you name it. It can keep you busy.

Speaker A [00:56:29]:

Yeah. Don’t get Andrew started on your.

Speaker B [00:56:34]:

Makeup air.

Speaker A [00:56:35]:

The makeup air. Yeah. Thank you. The makeup air, because he’ll go for days on the makeup air. Yeah, that’s funny. I got to call Andrew today, actually, so maybe I’ll bring it up and bait him a little bit.

Speaker B [00:56:44]:

Yeah, he’s a good guy. I hired him to consult a little bit after I watched it because I knew he knew my neighborhood too.

Speaker A [00:56:50]:

He was yeah. Actually, anybody interested, you can actually book a call with Andrew Cunningham on he’s he’s one of the consultants over so Lawnmowersource.com Slash Coaching. You can actually book a call with him anytime to talk anything, whether you’re getting into the business or you already own Laundromat and you’re going to the next level. So he’s awesome. He knows the business like the back of his hand, for sure.

Speaker B [00:57:13]:

Yeah.

Speaker A [00:57:14]:

All right, we got a segment called down to Business. And in down to Business, we just talk just a little bit more specifics about your business. So you are in, right?

Speaker B [00:57:26]:

Yes, yes.

Speaker A [00:57:27]:

Awesome. Love it. And you’ve got one right now looking at maybe getting another one, potentially. And you’ve been in for a couple years now. Talk to me. What does it cost to do laundry in Koreatown?

Speaker B [00:57:43]:

Well, there’s a funny story behind that, too, but we were able to raise prices significantly due to upgrading the facility and adding new equipment. And then, as you know, I don’t know how many of your listeners know about this, but Southern California or California in general got hit with a gas crunch in January that was just know my gas bill more than doubled. As most people you know, that just wipes out all your profit, really, because the gas bill is one of your biggest expenses. And for that to more than double was like crazy. So everybody in the industry was like, all right, well, we got to change our dryer times and dryer drop them from, like, eight minutes for a quarter to five minutes for a quarter. And I had done a change, like, the month before from ten minutes to eight minutes, and I got a ton of backlash, and one of my employees was like, hey, they don’t really say much when you change the washing machines, but we sure get a lot of complaints when you change the dryers. And I was like, because that was around the time we had just got the new equipment installed, so we were doing a little bit of price changes and kind of experimenting. I was scared to do it, didn’t want to do it. When that gas bill hit, I was like, Got to do it. And so we jumped the washer prices 25%, which is that’s huge. I felt terrible having to do it, but we had to regain that. Now, as things have calmed down, we were able to find a nice even number that still worked. We didn’t lose hardly any customers. When I say customers, I measure it through capacity. Just a simple formula on turns per day times the capacity of that machine. So I’m doing X amount of pounds per week in my laundromat. We didn’t lose that many pounds per week, but we increased our revenue by 25%, which was great. And then once the prices on the gas came down, we were able to refine and adjust and make some fine tuned adjustments. And now we’re cruising right around. I think my 80 pounders are about 950 and my 20 pounders are at 350. 40 pounders are about, I think, 575.

Speaker A [01:00:11]:

That’s awesome. And I think that’s interesting feedback because I found that to be true also about the dryers and washers, where customers, for whatever reason, they complain about the dryers and the washers. You can raise the prices and it just doesn’t seem to bother them as much for whatever reason. But I’m wondering if it’s because of the time thing. Right. And there’s a lot of laundromat in La. Even, that are like three minutes for a quarter and are charging like that, which is just kind of interesting. I know a lot of people went to full cycle dry, which is a scary transition to make, too.

Speaker B [01:00:51]:

Yeah, I got some feedback on that. And a lot of people, even my mechanic was like, hey, we suggest you don’t do that. This is not the area for that. We had a guy we did that for, and then within 24 hours, he was calling us to come back and change the prices back to not do full cycle dry.

Speaker A [01:01:09]:

Yeah, there’s some kind of psychology there that I don’t really understand, but it is kind of interesting. And I know, too, a lot of you Midwesterners are out there being like, what, you charge 950 for 80 pounders or whatever? We’re at like $14.

Speaker B [01:01:29]:

Yeah, I’ve read some of those Facebook things and I think a lot of people forget where people are. A lot of people just call people out on, oh, my gosh, that price is just crazy, or whatever. Whether it’s on the high side or whether it’s on the low side, but everybody forgets where they’re dealing with. And the East Coast, if you can double that for a vendor price, it’s just really interesting. But not here.

Speaker A [01:01:49]:

Yeah, well, it is interesting, and it’s a little counterintuitive because when you think of La versus Kansas or something, you’re like, well, yeah, La. Is going to be more expensive. But it’s actually not true. And I think a big part of it is there’s a lot more competition here. Like a lot. It does have downward pressure on the pricing here, but interesting. But you seem to be pretty much in line with what I’m seeing around. So everybody back off. All right, you mentioned capacity. I love your formula for capacity with turns times pounds of the washers. Can you talk a little bit about what kind of turns are you doing or capacity or how are you thinking about that?

Speaker B [01:02:41]:

Yeah, so I keep a really good spreadsheet. That’s a weekly spreadsheet of basically broken down per size of machine. And then I also have broken it down a couple of times into even if it’s the same size machine, like, what’s the age of the machine? Like, if this one’s 30 years old and this one’s new, am I doing a lot of difference in business? And it’s great feedback to know. I remember Andrew Cunningham was like, why would you ever do that? And I was like, well, I just want to get microscopic about it so that I can see what adjustments to make. My spreadsheet just shows all the different size machines, how much money I collected out of each one of those or out of each type of machine. And then the formula is pretty simple. It’s just divided by the venn price, then divided by the amount of days in the week. And that comes up with my turns per day so I can see all the different turns per day. And then I average that all the way on a far right column to my average turns per day. I’ll tell you, I know that I’m not up to optimum efficiency because you probably want to have all your machines right around the same turns per day, but I have like a huge variation of turns per day and it’s kind of true to my 80 pounders are very popular. I should have more of those. We do a high amount of turns per day on those. I have 20 pounders and I only have four of them because I didn’t really think anybody would ever want them. So I only bought four when I took out the top loaders. And you wouldn’t believe how many turns per day those are getting. I mean, it’s just like unreal and it’s way above what the other ones are getting. Again, it’s kind of that psychology thing. I don’t know if people just see the cheaper price so they want to do it. And I don’t mind that. I think a lot of people are like, oh, you got to get bigger machines in there. You can want to force people to bigger machines because you’re going to make more money on bigger machines. But really, my lower machines, I make more money per pound. So there’s a little bit more profit in the smaller size machines than the bulk machines. They’re getting a bit better deal. The customer is on the bulk machine, which should be designed that way. But for me, the owner, I don’t mind them using the 20 pounders all day long. If they want to split up their load and not do a 60 pounder and do 320 pounders, guess what? I just made a little bit more money.

Speaker A [01:05:06]:

Yeah, no, I think that’s great. And especially, I think in our market where that upper limit number is really that’s a tough one to raise up to the same sort of ratio per pound as the lower ones. Like you said, you can get away with raising those lower ones up to 350 or whatever it was for a 20 pounder. But you’re just creeping over one dollars a pound at like the 950 for 80 pounds, you know what I mean? And so that ratio is harder to get in line in our market for whatever reason.

Speaker B [01:05:39]:

Those upper yeah, what it comes out to be is about fifteen cents per pound, my average. But my 20 pounders are nineteen cents per pound and my 80 pounders are twelve cents a pound. So it works out. The is still on the low side, I think, even for our area, but it works for us, so I have no desire to change it.

Speaker A [01:06:01]:

Are you seeing the biggest turns per day on your bookends? Like your eighty s and your twenty s and then not as much in the middle? Is that how it’s working?

Speaker B [01:06:09]:

Yeah. So on the ends is always the highest amount of and you just notice that when you pull the quarters out, like, I’ll have 630 pounders in a row and the two end 30 pounders will be the highest volume. And then again, I have the front right when you walk in the door. And I have 60s on the back wall, which are actually a better value. They get a better price per pound out of the 60 pounders, but they just don’t use them because they don’t go to the back of the store as much. And I’ve tried to do everything to highlight, hey, go to and have the attendants know that when people are looking for machine, hey, we got these 60s in the back. But I think the 60s are just somebody told me, that guy down in San Diego, he told me when you get to above around six turns per day, you should add a new machine. And in Koreatown we’re high for that. So we’re a little bit more than that. But my 60 pounders do less. And I just don’t think that the customers it’s just that in between machine. And it’s the same with the think the are kind of an in between machine. Everybody wants the 20, the 40 and the 80. So it’s a challenge. But that’s just part of the business.

Speaker A [01:07:24]:

Yeah, that’s interesting. I had Brandon understall. This was like way back, early on, and he was like, don’t do 40s because people will overstep the not use the think it’s interesting. But that was kind of before 80s were so popular, too, and 60s were the big machines and now 80s are more commonly the big machines. So it’s kind of interesting how it all works. And I don’t know, there is some kind of psychology about that. But there’s also the spatial thing, right. The convenience factor and the in your face factor, where if the 60s are sort of not in your face. You just don’t think, yeah.

Speaker B [01:08:01]:

I’m like, hey, I got these beautiful brand new machines in the back, but people just want to use the old eighty S up front.

Speaker A [01:08:08]:

All right, get it going. Well, maybe you need to raise your 80 prices and say, hey, the 60s are a better value.

Speaker B [01:08:13]:

Yeah, exactly.

Speaker A [01:08:15]:

I don’t know. Maybe not, though. Maybe just let it happen. Awesome. Are you running fully attended?

Speaker B [01:08:22]:

Yeah, I would call it absentee. I don’t have to be there. I have an employee there all day during the week and the weekend. The hours are a little bit more extended on the weekends. They start earlier and probably finish about the same time, like around midnight. They probably finish that’s when the store closes midnight, but we’re able to start the attendant a little bit later on the weekdays, even though we’re still kind of busy. I think it’s fine. It works out really well.

Speaker A [01:08:59]:

Yeah. Awesome. Are you coin only or card too? Coin only.

Speaker B [01:09:05]:

No. Coin only. I’ve gone down this road with so many people about, hey, do you do the hybrid? Do you do the pay range? Do you do this, do that? And I just have decided that right now we’re okay. Eventually, if I bought a new store, did something, I had to buy a bunch of new equipment, I would definitely include so that it’s more of a hybrid. Just to see, to be honest with you, because everything I’ve really tried, I’ve always been shocked with results, whether in a good way or a bad way. So I kind of just want to see how it works.

Speaker A [01:09:35]:

Yeah, well, hey, there’s always time for that, too. I did want to ask I meant to ask you this earlier, because you kind of just casually mentioned that you allow one of your attendants to collect for you sometimes or always or whatever, and you even acknowledge you said, hey, most people say don’t do that, and that’s pretty common advice. So I’m curious why you decided to do that and how that’s going. And if you’re doing anything, if you need to do anything to kind of make sure things are good. Yeah.

Speaker B [01:10:13]:

There’S only so much you can do without micromanaging, and they know that. I have cameras everywhere, and I also have sensors on all the coin machines and on all the safes. And my employees, I’ve found this has just kind of been a philosophy of mine is it’s not always this way, but if you treat them with respect or you treat them like an adult, they’ll act accordingly. And I’ve kind of used that philosophy, and, yeah, it hasn’t always been perfect, but I have never seen any money that I can account for missing. Could there be going out the door in quarters, like somebody’s grabbing a handful here and there? Yeah, I’m sure there could be. But I live an hour away from my store, so if something happens and, hey, I’ve got to get down there. Or our coin boxes fill up so often, a lot of times on the weekends, if I want to have the weekend off, which is kind of my goal, I’ve got to trust these guys. And there’s one in particular that I trust and I think he’s manager quality if we grow into that. So it works out well. And I do give a lot of bonuses too. I don’t have a good bonus structure, but I give a lot of bonuses for, hey, you show up every day, you’ve been faithful to me and it works. We have a good relationship with each other, we trust each other, respect each other, and that’s how I go about that. Again, might not be the smartest thing ever that I’ve ever done, but it could be money walking out the door, but it hasn’t been enough. And I had never seen it to where I needed to take action on it. I did have one guy who was one of the guys had to let go. He was a closing guy and he decided, I mean, I have so much respect for this guy for what he was doing, but unfortunately I had to let him go. He was running his own wash and fold out of my Laundromat and they have access to the top of the machine so they can restart them. And every experienced Laundromat owner is going to say, oh, yeah, you never give the key to that to the attendants because they’re going to do this. But he had people in his apartment complex. He was bringing their laundry to the store to start the load at like 11:00 at night when he’s supposed to be cleaning up. And then he had people coming and helping him. He had employees.

Speaker A [01:12:32]:

It was just like full fledged business, man. There’s no yeah, you can make a lot of money.

Speaker B [01:12:36]:

Exactly. I’m like, this guy’s an entrepreneur. Like, how can we partner?

Speaker A [01:12:39]:

But.

Speaker B [01:12:42]:

Yeah, exactly. Unfortunately, he’s taken some other things.

Speaker A [01:12:46]:

Yeah.

Speaker B [01:12:47]:

Just didn’t work.

Speaker A [01:12:50]:

It happens, for sure. Yeah. Well, I was going to say maybe a case for going hybrid is that a lot of times those card readers will actually count the coins too. So you’ll have a record of two.

Speaker B [01:13:05]:

Yeah, I’m all about having backup records and as many backups as I can just to cross verify everything. That’s best way to do it.

Speaker A [01:13:13]:

So is the employee counting the money, the coins, or are they just dumping them in a safe or refilling the changes or something?

Speaker B [01:13:21]:

Yeah, unfortunately they have to. I would love it if they were able to just dump it in a safe and then I took care of that. But we have to use those quarters right away to restock the coin machines. Yeah, he counts them.

Speaker A [01:13:34]:

Yeah. Cool. Awesome. Well, I love listen, there’s advice that goes out there that seems universal and it just goes to show not all advice is universal and like you said, can your employee be skimming off the top from you? Yeah, maybe. Are you going to learn a hard lesson at some point? Maybe, but maybe not. It’s a process, right? All of this is a process, and the goal of the podcast is so that we’re sharing these things to speed up the process for everybody. But it’s still going to be a process, right. And maybe down the line you learn, hey, you treat people like adults, they’re going to respond accordingly. And that’s the lesson to learn. And maybe you learn, hey, I needed a backup and I paid a little bit of money to learn that lesson. Right. But I love that. Okay, we have another segment called Secret Sauce. And Secret Sauce is what one piece of advice do you have for other laundromat owners to help them take their business to the next level?

Speaker B [01:14:39]:

I think the upgrades are key. Every laundromat owner, especially the successful ones, will say the customer service is going to be key. But I think the upgrades are important too. Even if you don’t think that they’re going to have an initial return on investment, they add a lot of value to the customer. They help you look like more of a professional operator. And I think it just goes a long way. That’s the only key that I have. And to be honest with you, I think you really got to know how to do some of this stuff yourself. Because I think the first time I had a plumber come out, it was $2,200 to fix, like, one leak. And then come to find out I could YouTube and a little trial and error, was able to fix a leak myself. So being handy helps a lot. A lot of times. I don’t know how people do it without being handy because as you know, the maintenance guys are very busy. So if you can change something out easily, change out a drain, change out a water valve, or fix something on the back of a dryer, that’s like a common thing. It’s good to learn that stuff so that these guys are busy and they’re going to charge you when they come out.

Speaker A [01:15:56]:

Yeah, for sure. It adds up real fast and especially if you’re coming in with like a zombie mat type of situation and you’re looking to kind of build that business up, you can come in with the capital and have people do it, which is fine, and that can be a great business model. You can make a lot of money that way or you can come in and fix it yourself, save a little money and you can make a lot of money that way. So I love that.

Speaker B [01:16:23]:

Yeah, I respect both ways of it, to be honest with you. I mean, if you’ve got the capital, just have it get done. In fact, now I’m to that point where we’re making enough money I can hire. Just have this stuff done and just get it knocked out and move quicker. It’s a curve that has an exponential growth. When you start making the money, you start being able to put the money back into it, and then it just keeps making more, and it’s cool.

Speaker A [01:16:48]:

Yeah. I see a lot of people saying, don’t fix your own equipment. I see a lot of people saying you can only fix your own equipment. I see a lot of people saying, don’t fix your own equipment. And I see both sides. And I see the merits of both sides. But if you’re coming in and you’re kind of bootstrapping and you’ve used all your capital to put down all these deposits that you didn’t anticipate, get in there and fix it, man. And get to the point where you can hire out again. It’s just a process. There’s not necessarily a right or wrong way to do it, but we all want to try to move from that, like doing it yourself to, hey, I’m the business owner, and I’m running the business, not letting the business right. How dirty I have to get.

Speaker B [01:17:35]:

I think it’s really important to try to stay outside of your business. I think there’s a book called the Emyth. Really good book. Yeah. And it’s about working on your business, not in your business. And anytime you’re doing maintenance, you’re really working in your business. So if you can stay out of that, that’s great. But it is going to help you. That’s what I’ve found.

Speaker A [01:17:57]:

Absolutely. I’ll put a link to Emith and I mentioned good to great earlier. I’ll put a link to that one, too. Anybody wants to pick those up? Those are solid books. All right, we got another segment called Pro Tips. And Pro Tips is hey, what’s a piece of advice you got for somebody trying to get into this.

Speaker B [01:18:16]:

Think, you know, this is where I’ve had a lot of people contact me friends. And as you know, social media is blowing up this industry. I mean, I can’t tell you how many people send me this stuff off TikTok and instagram about how laundromat are the number one rated safe business or number one moneymaker. These businesses that people never thought of. And people looked at you funny when you were talking about buying one, and now they’re, like, all over social media, and it’s helped the industry a lot, but at the same time, it’s made it difficult to find new ones. But I think if you go and look for these resource like you you’ve got this podcast. I’ve turned so many people onto this podcast because I’ve learned so much stuff that I have to stop watching it because I can’t implement it all. It was just like this stuff is awesome, and it really gets you motivated and really makes you feel excited about the business. So If You’re Thinking About Getting Into Mean no need to even say that at this point because if you’re hearing me say this, you’re already watching your podcast, but it’s a great resource, that and the Facebook groups, there’s a couple of them that are really good. If you get on there and you be active and be respectful and professional, I think people treat you really well and a lot of great feedback on awesome, awesome.

Speaker A [01:19:44]:

Well, I mean, hey, we have another segment called Recommended Resources, but it sounds like those are recommended resources. You got the podcast and stuff, but you got the Facebook groups. Anything you need to add to that or does that cover mean, I know.

Speaker B [01:19:55]:

You’Re a book junkie and we’re all about this personal growth stuff at the same time as building our laundromats? I think the other book that I absolutely love for leadership is called Extreme Ownership. Yeah, that one, I think is a must when you get into any type of leadership position and it’s really about accountability for yourself, which is probably a great life tool, too. Like, hey, how is this failure my fault? Even if there’s no way in the world you could think it’s your fault, try to find a way to link it back to you. And that tip, to me has gone really far.

Speaker A [01:20:32]:

Yeah, well, and that’s a mindset shift. That is I just think it’s so powerful. You can have that victim mentality where you can blame anyone or anything else. And for a lot of us, myself included, I think that’s like the natural inclination, right? Like push it off to somebody else. And as a business owner, but just as a person, I was just having this conversation with my kids yesterday and just saying, hey, look, don’t blame I was talking to my daughter. Don’t blame your brother for this happening. It’s on you. In anything that happens, it’s on you. And there’s a way that you could have done things differently, even if you’re totally 100% wrong, somebody robbed your business or whatever, hey, it’s on me. I need to do a better job of taking care of my business, right? Whatever it is.

Speaker B [01:21:25]:

Did my business get robbed because I shared too much information on this podcast? I don’t know.

Speaker A [01:21:30]:

Yeah, well, I’m heading over there at the Crowbar in a little bit. Awesome. Love that. Thank you for that recommendation. I’ll put a link to Extreme Ownership, too. Super good book, highly recommend it. Last question I have for you is if people are interested in just chatting more about what you got going on and how you three X your business or three X your goals for your business, even what’s the best way they can contact you?

Speaker B [01:21:57]:

I think Facebook is probably the best. Most people have Facebook. I’m on there as amel Shafroth, and I think the spelling and everything you can put in the link. And then I’m also on Instagram. That’s more just like my personal life and me and my dog. But there’s some laundry stuff on there, too.

Speaker A [01:22:15]:

Trickles in there. I love it. Dude, this has been an awesome interview just hearing your story. Yes. But also just the practical tips and advice you gave in terms of growing your business from somebody who’s grown your business incredibly in a very difficult market like La Market is no joke. So to be able to do what you’ve done is a huge accomplishment. So huge congrats to you. But also a big thank you for coming on and sharing that. And I know we’re just down the street from each other, so we’re going to have to actually hang out in the near future, too, so I appreciate you coming on, man.

Speaker B [01:22:51]:

Yeah. Thank you for having me. It was an honor.

Speaker A [01:22:54]:

Honor is mine. I love doing this. I love hearing from people like you who are killing it in this business and who are willing to help people like me, and the people listening try to kill it in this business, too. So I appreciate you a lot. Honors all mine. And we’ll have to be doing some more chatting together.

Speaker B [01:23:12]:

That sounds good. Sounds good.

Speaker A [01:23:18]:

All right. I hope you love that interview with Amel. So much good stuff. Love hearing his story. He’s got some unique approaches to stuff, which is very cool, and hopefully you got something good out of that. As always, I want you to pick one thing and put it into action, not just you, but also me, and put it into action today. For me, it comes out of this quote that I wrote down from him. He says, anything you can do to improve the customer experience is going to benefit me, right? So sometimes we got that selfish side inside of us, and if that’s where you’re at, no problem. But it turns out that if you want to be the most selfish, then you need to help other people. I don’t know if that really makes sense, but I think the point is clear, right? Like, it benefits you when you help other people. So put yourself out there. Go find a way to improve the customer experience rants at your Laundromat or your laundry service business. Or if you’re not in there yet, start putting together a plan of how you want to treat your customers when you do take over. All right? Pick one thing for you. Maybe share it on the forums. Laundromatresource.com forums. And we’ll see you next week. Peace. Bye.