Today’s episode of the Laundromat Resource Podcast with Andrew Cunningham is jam packed full of useful information for laundromat owners and newbies, alike!

Andrew has been in the laundromat industry in various roles and capacities for 35+ years and knows this business inside and out. He freely shares tips, insights, and procedures that only come with an intimate knowledge of the business. And we get to benefit from his many years of experience!

Andrew is a co-founder of the famous Lucy’s LaundryMart in Southern California and co-founder of Cunningham Investments. As a sales rep, multi-store owner, consultant, broker, and more in the laundromat industry, Andrew is well versed in this business from multiple angles. 

From quick tips and tweaks to improve business to his in-depth store analysis procedure, Andrew is one of the good ones dedicated to helping you find financial freedom through laundromat ownership.

In today’s episode, Andrew and I talk about:

  • His history in the laundromat business
  • How to survey a laundromat
  • The inception and rapid growth of Lucy’s Laundrymart
  • What makes a good broker
  • The glass ceiling of a laundromat
  • How to reach a laundromat’s potential
  • His simple tip to save money on a key utility
  • What to do if your laundromat is struggling
  • The 2 lives of our machines
  • Should you buy that laundromat?
  • Breaking down employee responsibilities
  • Your two most important business relationships
  • Coin vs. Card systems
  • Renting equipment
  • How to instantly lose $25,000
  • From most to least busiest days of the week
  • Laundry pick-up & delivery
  • Biggest mistakes owners make- laundry carts?
  • Make-up air for dryers
  • How to analyze a laundromat for sale

And so much more! Seriously, take good notes on this one. There is so much gold to be had for anyone interested in the laundromat business!

Listen To The Podcast Here

Watch The Podcast Here

Today's Sponsor

Laundromat Resource Marketing If you need help building or managing a website for your laundromats, let the experts at Laundromat Resource Marketing help you design and build a custom, professional website for you! As experts in the laundromat industry AND in web design and online marketing, we at Laundromat Resource Marketing are able to provide you with a professional website at an affordable price. We’re always transparent so there are no hidden fees. What we quote you is what you pay. Satisfaction and performance guaranteed! With no contracts to sign and guarantees like that, why not let us take care of your online presence while you focus on welcoming all of your new laundry customers? Click the logo or link above to find out more information. 

Andrew's Bio

Andrew Cunningham (Andrew Cunningham Enterprises, LLC), has a solid background with over 36 years of building, buying, selling and operating laundromats in Southern California. In 1995, Andrew and his brother raised $30m so that they could create a new concept of co-branding in the laundry industry.  Lucy’s LaundryMart™ was a unique store chain which pioneered and set the standard for co- branding in the industry. Since 1989, Andrew has been a professional consultant in the laundry industry and a licensed Real Estate Broker in California. In 2000, he created Andrew Cunningham Enterprises, LLC which is his platform for selling and buying laundries and for teaching owners and buyers alike, the ins and outs of purchasing and operating laundromats. His laundromat knowledge is extensive as is his list of clients who have succeeded in the industry. He is an expert at helping existing seasoned laundromat owners evaluate their existing operations with the goal of maximizing their profits and raising customer satisfaction. For those just starting out in the industry, perhaps buying their first laundry, Andrew brings with him years of experience, a wealth of information, knowledge, and experience. Few, if any other owners or operators even with years of experience provide the level of insight and expertise he offers. He is frequently hired to complete “Due Diligence Reports” used in the process of buying laundromats.  He is recognized by the Coin Laundry Association as an industry Leader and awarded this title in 2000. The Coin Laundry Association recognizes Andrew Cunningham as a teacher and mentor and at their request developed a training video for laundromat employees. Andrew can be reached at 310-951-4556 or [email protected].

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    Episode Transcript

    hey what’s up guys it’s jordan with the
    laundromat resource podcast
    show number 43 i’m pumped you here today
    because today
    we have a human laundromat encyclopedia
    on with us
    it is an incredible show i cannot wait
    for you
    to hear this so whether you own
    laundromats yourself
    or you’re looking to buy your first one
    you’re gonna learn a ton
    of stuff i know i did i took a lot of
    notes make sure you’re taking notes too
    because at the end i’m going to ask you
    what’s the one thing
    if you can narrow it down to one thing
    that you’re gonna pull out of this
    episode to put into practice because
    that’s where it’s at
    success follows action so learn
    something learn a lot of things today
    but make sure you put something into
    action we’ll talk about that at the very
    end um i want to give you a very quick
    update
    uh diligent capital investment i
    mentioned it
    in my in in my interview on the podcast
    a couple of episodes ago
    i just wanted to give you a quick update
    on it um basically what that is is that
    um
    a group of us have put together uh an
    opportunity for people who want to
    invest passively in laundromats
    to pool our money and and buy some water
    mats together and just wanted to let you
    know that that’s this thing is already
    trucking and if you’re interested in
    checking that out a little bit more
    check out diligence
    capitalinvestments.com
    the link will be in the show notes at
    london resource dot com
    show four three forty three um or
    if you’re on youtube it’s down below um
    so check that out if that’s something
    that’s interesting
    to you and without further ado let’s
    jump into our quick
    one one-minute marketing tip before we
    jump into it with
    andrew cunningham the human laundromat
    encyclopedia hey what’s up guys john
    here with your one minute marketing tip
    of the week
    and your tip today is simply this your
    brand is your opportunity
    to shape the way your community thinks
    about you
    um and i want you to ask yourself two
    questions
    number one what do you want your
    community to think of you
    and two how do you want your community
    to feel about you
    if you run everything you do through
    those questions
    you’re going to help yourself build a
    very strong brand
    for instance when you’re going to train
    your employees ask these questions
    before you train them if you’re going to
    pick color schemes
    of your stores and paint ask yourself
    these questions
    if you’re building a new logo or a
    website ask yourself these questions and
    you will build a brand
    that is strong and trustworthy and
    people will keep coming back too
    if you need any help building a strong
    brand let jordan and i know at
    laundromat resource dot com
    slash get online andrew i am super
    excited to have you here thanks for
    coming on the show man how you doing
    i’m doing great thanks for having me oh
    oh man it’s my pleasure
    my honor uh i we’ve talked a little bit
    on the phone here and there it’s good to
    see you face to face here well on zoom
    at least
    and uh and get to chat laundry mats with
    you and i know that we’re gonna have a
    lot of ground to cover
    and i can’t wait to hear all this
    experience you have in this industry and
    the wisdom you’ve compiled and your
    perspectives on things i’m very
    intrigued by them
    but before we get into all of that which
    we will get into all that
    and i just got to say hey you know what
    buckle in because i know we’re going to
    be
    we’re going to be on a ride so if you’re
    listening to this you know get the
    notepad out because you don’t want to
    take notes
    but before we get there why don’t you
    tell us a little bit about you
    and who you are and then we’ll talk
    about how you got into this business
    well um i’m one of 13 number six
    wow and uh born and raised california
    primarily fullerton in here local high
    school whole nine yards
    spent five years in aspen right out of
    high school that was my college degree
    and uh moved in with my brother in san
    francisco and went into business and
    then moved back down here
    my younger brother was working for a
    company called mpe
    and that turned out to be morton pollock
    enterprises
    and he sold washers and dryers there was
    a division
    but there was a pws which was pollock
    wickham and steinberg
    and uh he was working for them when he
    was driving a corvette now he’s
    21 and i’m 26 and i’m looking at my
    younger brother going
    i don’t get it i i think i could be
    driving that corvette not him so
    i uh uh i interviewed with mort and
    uh he hired me and uh i didn’t have a
    drive
    a broker’s license or even a salesman’s
    license at the time so
    uh i went to work surveying laundromats
    for six months for pws
    you can learn a lot by surveying a
    laundromat even before you get in the
    business
    uh what do you mean what do you mean by
    surveying the laundromat can you tell us
    what you mean
    what were you doing well uh you would
    drive up to a laundromat and you’d count
    the parking spaces
    and you’d look at where it was located
    in line or was it on a corner
    did it have a signal was there a
    crosswalk
    which are important aspects of what we
    do
    where the competition was where uh the
    people were coming from crossing the
    street same side of the street
    um and then you’d go into the laundromat
    you’d rate
    how it looked what it looked like copy
    the equipment down
    ages make an estimate of the age of the
    equipment
    um at the time a lot of them left the
    serial numbers available and you could
    look at them
    now they take them off so no one knows
    which is you know
    and then uh you’d break the van price
    down and
    and uh and then you’d turn that i turn
    report in and that was pretty much
    what you did yeah you got to know it and
    you left a business card for the laundry
    owner to see if they wanted to sell or
    they need your new equipment and
    that was pretty much your job so awesome
    after i yeah after i did that um i
    finally got my
    real estate license and i went to work
    selling laundromats from
    84 85 to 90.
    and then in 1990 my brother bill was
    working for pws at the time and he was
    the number one salesman selling new
    stores
    and i became eventually became number
    one salesman for
    existing stores brokerage then we both
    left in 90 and created cunningham
    investments and uh we had a uh
    he bought a condominium right on the
    beach in redondo beach and we overlooked
    the ocean while we did our business
    daily business
    and uh rough start man that lasted
    that lasted for about three years when
    uh we got frustrated with the fact that
    we weren’t making as much as we could or
    should i mean i left pws making great
    money and then for two years
    you know it was starting to do business
    it was really difficult
    um we came up with an idea to launch
    a uh a chain called lucy’s
    lucy’s laundry mart and we did our first
    store in inglewood and i believe in
    late 94 early 95. freestanding
    laundromat
    and um about um
    5 000 square feet and
    big big big at the time uh
    12 14 parking spaces and that turned out
    really well
    and we did uh private investors and you
    know probably eight to ten people that
    invested
    and um we were
    operating the store and we were filling
    up the drink in the snack machine
    almost daily it was getting depleted
    that much
    so we came up with a concept that we
    actually had four thousand square foot
    of laundromat we had a bowling alley
    next to us
    which was just a long and narrow strip
    that we we
    needed to separate
    the building in two parcels because the
    county said if you have
    one single purpose building your sewer
    fees would be 200 000
    if you have two tenants it would only be
    100 grand
    so we said okay we’ll make two tenancies
    a and b which
    b was just nothing more than a store a
    large storage locker
    so after filling up the drink and snack
    machines for as much as we did we
    decided to open up a convenience store
    inside the market inside the laundromat
    and
    um you’re talking about 10 12 14 hours a
    day
    on an excel spreadsheet how many candy
    bars am i going to sell how many chips
    are we going to sell how much sodas we
    can sell
    so it was bath by fire on the
    laundromat side as well as the the
    convenience store side
    yeah and we got that market up and going
    and uh within six months it was doing
    about thirty thousand
    um we were out selling the local markets
    in milk that’s how much
    we were doing and then we uh did uh
    third in normandy
    and then we did uh figaro and coldin
    and both very good successful stories
    and then we went out and raised venture
    capital
    uh to the tune of about 30 million first
    time ever
    um to do co-branding which was the
    laundromat convenience store but
    starbucks liked the idea so starbucks
    came on board
    and wells fargo liked the idea so wells
    fargo came on board
    and now we had a long dramatic
    convenience store a wells fargo bag and
    a starbucks under one roof
    so co-branding started to get born in
    southern california i’m not sure about
    the east coast because i’m sure there
    were some people doing some things but i
    wasn’t aware of it because
    i was buried in what we were doing right
    yeah and then um
    we raised like i said 30 million in
    venture capital and they launched the
    chain and they got it up to 27 stores
    and then i left the company and bill
    stayed on
    and then eventually
    pws bought the chain and sold the
    complete chain off
    and uh the rest is history i mean it was
    a nice
    venture and we got to do some things and
    it kind of showed that you could have a
    market or a convenience store inside of
    a laundromat
    and they could complement each other
    yeah i i can tell you that
    at both third in normandy which did 60
    000 a month in washing dry
    and uh inglewood which did about 30
    we did about uh 25
    in soap so in inglewood we did seven
    thousand dollars a month in soap sales
    and then
    in uh um third in normandy we did close
    to uh
    fifteen thousand a month in soap sales
    so it was
    it was a it was a fit it made it it made
    sense
    yeah huge and yeah huge sense and then
    um
    bill went on to work do um a a
    broker a developer a real estate
    developer and i stayed in the business
    i left for about seven years and then i
    came back
    and i’m back in the saddle again now and
    working uh my magic doing brokerage and
    consulting and
    operational aspects which is really
    where my strength is i like to
    to help people out and show them how to
    make more money once they get a
    laundromat
    well hey that’s why you’re on the show
    right now man
    i love it i love it well i mean that’s a
    crazy story though man a wild wild ride
    and i know that
    you know you probably got into pws right
    at the right time because i know they
    were booming we had
    um don and david stark on this yeah
    early on and they they came on and they
    talked about how they were
    cranking out laundromats like crazy oh
    yeah
    and they were just donna donna was the
    uh secretary executive secretary for
    all three of them um mort it was
    mart’s office uh uh john wickham’s
    office bernie steinberg’s office and
    mark pollack’s office
    and donna sat in the front so if you
    wanted to speak to either three of them
    you had to go through
    the gatekeeper yeah you’re not going
    through her easily oh it was not easy
    i loved it i love those guys and david
    was doing the construction
    yeah he he said he thinks he probably
    built around 800
    laundromats and it wouldn’t surprise me
    and speaking of which i if you’re
    listening to this right now i’m going to
    link to
    uh their podcast episodes because they
    did two they
    did a two-parter with them and they i
    mean it’s an incredible it’s incredible
    story so
    make sure to check those out if you
    haven’t yet yeah so i’ll link them down
    in the show notes or if you’re on
    youtube well i’ll link them in the uh in
    the description down below check those
    out for sure
    awesome stuff they know their stuff too
    anyways small
    small laundromat world but you got in
    right you know right at a boom
    and i got i got trained by some really
    really good people
    i mean there was a certain method to the
    madness and how they did it
    we had a salesman there named john marks
    and john was probably
    15 years older than i was so i’m in my
    uh it’s at 85 that’s 10 years i’m 28
    john’s probably 38 40. and and uh
    he probably at any given time had two or
    three longer events in escrow
    always brokerage always and we had a
    nice staff we had probably a staff of
    15 sales and they were they were
    cranking them out they were cranking out
    new stores left and right under the
    laundry land
    and bernie did the leases john did the
    financing and more did
    the rest so it was a it was a nice
    marriage and it was a good job
    uh good people and you learned a lot and
    uh
    um i think some some of that’s missing
    today i think that
    uh um as you and i spoke about the other
    day
    um i i think that there’s a handful of
    brokers out there that
    um take a keen interest in their clients
    well-being going forward
    but a lot of people uh a lot of brokers
    and sales people
    they’ll sell a laundromat and they’ll
    basically
    be gone the next day and that new owner
    will end up talking to people at parts
    departments and talking to
    other owners as they meet at the parks
    departments to figure out all their
    problems when
    um a broker the person who sold the deal
    should be stepping in and showing them
    how to run it how to operate it
    from that perspective and then you get
    people doing the same thing over and
    over again
    and it and it it grows
    yeah you know you know what i what i
    call that
    is uh when when somebody is
    yeah because we have these brokers right
    who will sell
    these laundromats especially here in
    southern california i think it happens
    everywhere they’ll sell the laundromats
    to you know first-time buyer don’t
    really give them any help
    kind of oversell it the buyer gets in
    they realize it’s not really what they
    thought it was going to be it’s actually
    going to take a little bit of work and
    it’s not just collecting quarters and
    that’s it and
    and so after a year or so they decide
    they want out because it’s not what they
    thought it was so they take it back to
    the broker and the broker
    sells it over again and they keep doing
    that cycle
    and i call that the laundromail like
    that there’s brokers making their living
    doing that it’s a big part of the reason
    i mean i got sucked into that when i
    first got into business and it was a
    rough go for me
    um but it’s a big part of the reason why
    i do what i’m doing now is because
    that’s a that’s not a good sustainable
    business model
    you know where you’re going to be
    helping people out it makes a lot of
    sense to help people
    succeed in their business because you
    know just
    strictly business sense if you can grow
    if you can help somebody else grow their
    business they’re going to help you grow
    your business so as a broker
    you should be you know helping
    your clients succeed because they’re
    going to help you succeed they’re going
    to bring you with them
    right right right yeah it’s important
    that you know one of the first
    you know there’s a lot of things that i
    tell these folks when they get into the
    business and there’s
    it’s from operational aspects too i say
    the first day you own a laundromat is
    the first day you’re preparing to sell
    it
    and i say that because it’s important
    that you keep
    good books and records as you go forward
    so that
    truthfully when a seller talks to an
    agent and says i’m ready to sell my
    laundromat
    or i’m thinking about selling it what
    value is there
    that owner should just hand him the
    books
    and it basically is here’s what i
    grossed for the last year two years
    here’s my profit and loss statement and
    then you go through all the expenses and
    you make sure that the expenses are
    properly represented
    as you look at it and and i find today
    that
    it’s it they don’t do it and so most
    owners
    scramble when you talk with them and you
    say well what’s your profit and loss
    statement
    and i mean right now they say well can
    we exclude 20 20 20 for covet and i go
    no you can’t exclude that that’s
    part of the the value that’s part of
    what what you did i mean it
    good or bad that’s what it is um but you
    find out that that
    that their the profit and loss
    statements are not properly represented
    and it causes problems because they
    bought it under a certain premise
    and now they’re trying to sell it for
    the same premise and it doesn’t work
    that way
    and so you find out that you know
    um the profit of law statements aren’t
    what they should be and had they been
    trained in the beginning
    the proper way to collect this data they
    would be handing you a book saying here
    what’s my value right so that’s missing
    today
    yeah and it also makes a lot of sense in
    terms of value i mean
    your business is a lot more valuable if
    if the
    if a buyer is able to finance it right
    you i mean that’s why
    housing prices have continued to go up
    right because there’s
    access to easy financing for housing
    prices so instead of having to come up
    with
    a hundred thousand dollars to buy a
    house you know you can come up with
    you know like three three thousand five
    hundred dollars
    you know with a with a a loan
    a down payment for a hundred thousand
    dollar house or whatever or twenty
    thousand dollars whatever the leverage
    is right
    right so when you can get your
    laundromat financed from
    uh with having a loan which you can do
    if
    which a buyer can do if you have good
    records good
    solid records it’s going to make your
    laundromat more
    valuable just by having those records
    yeah
    yeah yeah so it’s important that that
    you actually start to compile your
    records
    and you you actually get to teach the
    owner
    um what people will be looking for like
    they were looking for
    again that goes back to to you working
    with the broker that you’re working with
    and the other thing is
    you know when you look at someone’s
    profit and loss statement for the first
    time
    and you go over it and then you as an
    owner have questions and and i always
    have questions
    there isn’t there isn’t a question i
    can’t you know don’t have
    but when you try to get the information
    or you can’t get the information or it’s
    not
    prevalent you sow seeds of distrust
    so if it’s not um uh
    the insurance isn’t the correct stated
    amount
    then you look at the labor and it’s not
    the correct stated amount you start to
    sow
    seeds of doubt with this buyer that what
    else are they not showing you
    and what haven’t you been able to
    determine is correct or incorrect
    and now you have a breakdown of that
    fabric
    of having a good sale and having the
    buyer be comfortable with what they’re
    getting
    and so you you as a broker have got to
    build that
    portion up and and then it goes into the
    operational aspects of the laundromat
    and
    you have three correct two yeah two
    right now yeah
    and you’ve been at it for ten years
    seven
    so a lot of yours has been oh oh my god
    look what happened today
    i mean oh my gosh yeah especially early
    on but yeah
    there’s some there’s some horror stories
    i’m sure that you just go i can’t
    believe this
    oh yeah yeah i mean things things don’t
    surprise
    me so much anymore but that’s only
    because i’ve been desensitized to the
    surprising things
    yeah it’s um it it’s it’s uh when you
    get to the inner workings of a
    laundromat
    um and you start to look at um and let
    me give you an example
    um i think that one of the biggest
    failures of most laundromat owners today
    is they don’t have enough logic cards
    and they’ll tell you
    well they steal them and i say okay so
    you
    are a small uh five and dime
    or you’re a small hardware store in
    rural america
    and you know most of your customers they
    come in and they all write checks to you
    and guess what a couple of checks bounce
    every month or
    every year that’s the cost of doing
    business
    that’s what it is and i i cite an
    example that basically says
    i talked to an old-timer named vic rose
    in la and this is in the
    80s and fit probably had i don’t know 10
    or 15 laundromats in the valley
    and um i remember having a conversation
    with them and i said
    what’s a good number for laudery cards
    and uh he went on to tell me a story
    about
    having a barbecue on a saturday
    afternoon with all your family and
    friends and you go to the grocery store
    and you’re with you know your kids and
    you’re gonna go grocery shopping for the
    barbecue and you
    go up to the front door of the
    supermarket and there’s no shopping
    carts
    his question is are you going to go back
    to that grocery store to do your
    groceries and the answer is no i
    can’t put my groceries in a basket why
    would i want to shop there
    and the same thing goes for a laundromat
    um most laundry
    most most customers come in and they
    grab that laundry cart
    and they don’t let go of that laundry
    cart until they are finished
    yep the kids playing it the kids sleep
    in it the baby’s sleeping it
    i mean it’s they own it and then people
    say well what’s the right number
    and uh i remember telling the story in
    florida after giving a
    seminar for the cla and um
    i told them that it was uh
    10. logic cards per thousand square feet
    and then i went and i went on to the
    floor of the seminar
    and rick rollins r b wire pulls me aside
    and says what did you do
    and i go what do you mean what’d you do
    and he goes people are lining up here
    asking if
    your statement’s true and i go well i
    heard it from vic rosen a long time ago
    so i’m going to assume it’s true
    it’s just there’s never enough and so he
    he he brought it down to seven to ten
    cards per thousand but it’s still a true
    statement if you have a 3 000 square
    foot laundry
    you should have 25 logic cards and
    people say where are you going to put
    them i said put them down the aisle
    they’ll pick them up and they’ll take
    them wherever they’re going to go
    but no one will be without a logic card
    and that’s really an important part of
    the operational aspects of laundry um if
    you
    um if you take a look at a laundromat
    like a casino
    and you have slots and you have poker
    and you’ve got blackjack and you’ve got
    roulette you’ve got top loaders
    20s 30s 40s 50s 60s 80s
    1200s they’re all different
    they’re all different vending areas and
    the question is once you have them how
    do you move them in and out of your
    laundry
    to get the most productivity out of your
    laundromat
    and that includes keeping them a repair
    and that you know jumps into another
    whole area of
    when to buy and why to buy and um but
    but but if you look at it that way you
    just want to move that client
    in your laundry and so if you’ve got
    more of others and less
    less of some or whatever the case may be
    and you have a traffic jam
    then you’re going to want to look at how
    do you address that traffic jam so you
    walk into your laundromat you say
    you’re 40 pounders you got seven of them
    as an example
    and they’re constantly busy people are
    waiting for them
    well are your 30s not in repair
    or are they priced right are your 60s
    the machine above
    priced right maybe it’s time for you to
    jack up the price in the 40s and force
    them back in the 30s and
    force them into the 60s so you alleviate
    the traffic jam so people can get in and
    out of the laundromat
    which is the key as quickly as possible
    so you can do higher volumes
    and that goes to the next statement that
    goes to
    what’s what’s the max
    and people toy with it and uh
    every laundromat has a glass ceiling
    every laundromat will hit a
    numerical number that is the maximum
    that they could do in that store
    and that’s based on where you are who
    you’re who you’re
    how much parking you have who do you
    share the parking with
    nail salons restaurants liquor stores i
    mean
    it all depends on what it is and then
    it’s the equipment mix of what you have
    inside but every laundromat has a glass
    ceiling
    you can only fit so many people in a
    laundromat at any given time and that’s
    the match you can do
    so when you start to talk about you know
    i’m doing
    four and a half turns per day i i kind
    of shrug my shoulders and say that’s
    nice
    i mean that’s an okay number and people
    will tell you well you know if the
    injuries
    four five or six i’m i’m doing great and
    i go okay well
    divide six into how many hours you
    you are in business you know eight fifty
    percent so i only have fifty percent
    usage of
    doing eight turns a day if your average
    cycle’s an hour
    and i’ve had conversations with
    equipment
    guys and you know they want to argue you
    know
    all the different features that you have
    on the machines today and i say but the
    bottom line is this for easy math
    it’s an hour per cycle seven and a half
    to load
    seven and i have to unload and put it in
    the dryers fifth
    45-minute cycle plus or minus it’s
    we’re talking about numbers that you can
    look at that you can say
    here’s the goal that i want to get to in
    my store
    so now you say can i do seven turns a
    day can i do
    six turns a day and the question is you
    might be able to
    depends on all the variables that we
    just i just spoke about
    on do i have enough to get them in the
    store and how do i keep them there
    and you keep them there by giving them a
    clean safe
    well-lit place to do their laundry and
    it’s a female driven business
    and so you have to cater to them now
    when i talk to the people in
    la in the hispanic neighborhoods i
    always tell them to put combat mirrors
    in the corners of their laundromat and
    they go why because the hispanic women
    are short enough they won’t see over the
    80 pounder
    and they don’t know one where their kids
    are and two who’s around here and they
    want to feel safe
    but if they can look up and see a mirror
    now they get to see the whole store and
    what’s going on and there’s a little bit
    less anxiety and more comfort that it’s
    okay in the store
    that’s a good tip i like that so
    go ahead no probably i’ve got you know
    yeah no i’m
    i’m curious i mean okay so you’ve
    intrigued me right so you’ve you said
    hey four four and a half turns yeah fine
    whatever right
    but you know really you could be doing a
    lot more than that
    right potentially it provided the other
    factors you know your equipment makes
    your parking all that stuff kind of
    lines up right so
    so let’s say a laundromat is
    under performing their potential turns
    per day
    what can someone do to help them reach
    that potential of their laundromat
    well one of the first things that i’d
    sit down with them and say who are your
    competition and where are they and what
    are they doing
    and so i’ll do a grid that that i’ll
    take
    um depending now depending upon where
    you are you uh
    if you’re in rural america you’re gonna
    go probably three to five miles out
    if you’re in downtown l.a you’re going
    to go a half a mile out
    i mean it’s just the density of
    population and i drive
    in four different directions and i
    survey all the competition and then i do
    a spreadsheet that shows
    how many top loaders how many and what
    at what price
    and and then how many uh
    front loaders there are and the
    different sizes there are so i can see
    one if there’s a hole
    in other words is the area of vacant
    40 pounders or 60 pounders or is that
    the least amount that they have
    so that i can probably assess what’s
    going on in the neighborhood what they
    need
    and then i’ll also look at your vend
    prices and for me i like to maintain a
    dollar
    per size in between each machine
    so if you’ve got a top loader and you’re
    at two dollars and you have a 20 pounder
    i’m sorry i’d be at three
    right be at least 275 and then the next
    machine would be 375 the next machine
    before 70 but and i would go all the way
    up
    to try to maintain that dollar because
    what will happen is when they come into
    your laundromat
    you’re going to see where they believe
    is the best value for them
    they’re they’re not dumb they’re just a
    little bit poor
    but they know where value is and so
    they’re going to go where they think is
    the best value for them
    in that laundromat and that’s where you
    get your logjam when you look at that
    and you go oh my god those are
    doing seven turns a day on those
    machines but the machines below them are
    only at five or four and the machines
    above them are only at three and two
    i want to force them in the other
    machine so i can actually get people
    in and out of my laundry mat quicker if
    they’re all waiting for those
    so you raise it a quarter well sometimes
    people go i’ll still pay the extra
    quarter because i still see the value
    well you just made more money if they go
    to this
    machine above you made more money if you
    go to the machine below you alleviated
    traffic so you don’t really lose
    you just are moving them in your laundry
    to create more flow
    so you talked about um maximums you know
    if you took a
    2 000 square foot laundromat or a 3 000
    square foot laundromat
    and you figure that the average family
    comes in
    um to your laundromat and um it’s
    probably one and
    it’s probably at least two people for
    the most good
    if you’re in a college town or what have
    not it’s usually
    one or two guys or gals because they’re
    doing a buddy system to do the laundry
    but if you have a family it’s probably
    two to three people well you take a 3
    000 square foot store
    and you start to put in these different
    families and quads
    and you probably can only get 20
    25 people in that 3 000 square feet
    and that’s your that’s your limit that’s
    your cap and they’re going to be there
    for hour and a half two hours
    depending upon their size so you’ve
    already have now there’s your ceiling
    so now now the question is how are they
    affected
    inside your laundry do i have enough
    folding do i have enough dryers
    so each one of those areas once you get
    out of the top loaders or front loaders
    is that where do they go do you have on
    a folding is it two-tiered folding are
    they using benches for folding are they
    using
    the the washing machines for folding in
    which they’ve seen they do
    um and then once and then the dryers
    you’ll have enough capacity to do the
    drying for what they’re
    for what they need in my store and
    there’s the threshold i think you could
    probably be
    maybe 10 more poundage in your washers
    than you do your dryers and after that
    you’re in trouble
    and i’m against putting machines in
    walls
    now i remember i’m only i’m only
    southern california i’m not east coast
    because i know that they have bowling
    alleys and they’ve got dryers on one
    side washers on the other side
    i got that but for the most part when
    you’re building a square laundry box
    dryers can only go against walls and so
    i do my best to avoid putting machines
    against the walls
    because i want that saved for dryers and
    i don’t have them now i will have them
    eventually
    so i kind of i’m planning ahead
    and then from an operational span
    standpoint what can i what can i do for
    these folks well
    i don’t think dryers ever can have
    enough makeup air
    i dryers are tested in a gymnasium
    and they get all the free oxygen they
    want
    and then we force them behind a wall
    that’s three feet wide you can barely
    get your shoulders down for a repairman
    to get in there
    to do the repairs and they’re starving
    starving for air
    and so you look at you know some people
    are lucky they get to put holes in the
    walls and they get to draw
    fresh air from the outside right behind
    the dryers and everybody’s happy
    but the reality of it is that’s really
    not how it works in fact
    it actually it it goes against
    the grain a lot of times when you talk
    about engineering a laundry
    with dryers and the tip for the day
    is that i think that you if you improve
    the makeup air to the back your dryers
    you probably can save five to ten
    percent of your gas bill
    now i know that’s a lot people go oh my
    god i’m spending 1500
    a month in gas um but the truth is
    they’re just starving for air
    and currently if you don’t have
    an access to the outside from the walls
    behind your dryers
    you’re drawing your makeup combustion
    air from
    above the t-bar ceiling and then
    sometimes
    from the laundry itself where your
    tenants are where all your customers are
    and my recommendation is that you
    buy three or four
    bathroom exhaust fans and you put them
    above
    all the doors that go into behind the
    dryers that you have access for for
    repairs
    and you put them on a timer and they
    just come on and what they’re basically
    doing is just sucking air from the
    inside of the laundry
    into the back of the dryer so they don’t
    work so hard
    to breathe and and and that starts to
    feed them with the air that they need
    because
    you have combustion air and up outside
    and you have makeup air
    directly i mean sorry the other way
    around you have makeup air above it and
    you have combustion air behind it and
    they just
    circulate so you’re taking the makeup
    area now becomes
    combustion air and the combustion air
    now is burned
    and it burns and it throws up i mean
    ready for this one this is a this is a
    killer
    it throws up lint and stepped on oxygen
    so the oxygen is 98 98.5 percent
    and when it comes out of that nice
    beautiful candy cane that gets dumped on
    your roof
    it’s around 92. but the killer
    is they have the relief vents
    on your roof right next to those candy
    canes
    and that stepped on oxygen and that lint
    gets sucked
    right back into the laundromat yeah
    and now you have poor circulation
    stepped on oxygen and lint covering your
    laundromat
    not only is it covering the large amount
    on the co2 bar ceiling and in behind the
    dryers
    it’s also now dusting your entire
    laundromat on the inside
    and what has to happen is you
    you have to be able to
    prevent that from happening yeah if you
    can
    yeah well i mean it’s it’s a huge uh
    yeah i mean lint
    is just a big problem i think it’s a big
    problem why you know i get asked all the
    time why
    we don’t use water recyclers so much of
    water
    you know purification systems right to
    recycle the water like car washes
    you know and lint is just a huge prob i
    think lint is probably the biggest
    reason that we don’t
    do that it makes it not cost effective
    to do that for most laundromats
    and maybe they’ll solve that problem
    maybe they’re working on it but
    i’m working on solving that problem
    right now i i have something that’s
    gonna
    that we’ll do another podcast but i have
    got something else here that will
    that might be able to mitigate that that
    lint situation
    but you mentioned water recycling and so
    when i
    was in charge of operations for lucy’s
    um we had there was a there’s a store
    at 8th and bonnie brae and it was a
    combination of lucy’s
    and it turned into a wells fargo
    kiosk and a burger king
    and burger king liked our format because
    in our format it only cost them about
    300 000 to put a burger king in
    in that application versus a million if
    it was a freestanding one i mean
    they really liked it there was an
    apartment building just
    to the east of us and i’m talking about
    15 feet off the property line
    and the laundromat was up against the
    property line so basically you had 15
    feet and now you have
    all the apartment windows of all the
    tenants okay
    and um
    we had a lint problem and it was dumping
    all that lint on the roof and then
    getting sucked into these so we had to
    put a lint collection system on the
    laundromat
    to the tune of about 150 000 and
    literally
    big huge bags of lint got collected i
    think it’s still there
    but you you you mentioned the the the
    water
    the water purifier well they wanted us
    to put a clarifier which is the big box
    at the bottom
    and the front of your laundry went that
    collects all the lint
    well we tried to do recycling and it was
    a quarter of a million dollars and it’s
    like it doesn’t justify
    the cost of what you’re talking about to
    get water purification and then the
    county
    of the health department says that you
    have to have
    so many parts per billion uh
    out nine logs so it goes point zero
    zero zero out nine and
    eight is what they dump in the ocean and
    nine is what you get to drink
    okay laundromats are probably somewhere
    uh
    zero zero zero unk and it’s a it’s a
    three or four and
    you can’t touch it that’s why they would
    like you to have
    some longer mats are now required to
    have clarifiers not a lot of them but
    probably i don’t know 25 percent of the
    laundromats in la now have clarifiers
    it’s to collect all that stuff that gets
    dumped into the sewer system and they
    have a hard time cleaning out the sludge
    so it’s not cost effective for for water
    purification
    uh for two reasons one is to to do it
    the correct way
    the cost of the installation of it and
    plus it’s hard to
    get that water purified to that level
    that the health department would allow
    you to
    recycle it or use it the other thing is
    whether or not it would be an open
    system or a closed system a closed
    system meaning
    that if it broke down you would be
    without water whereas an open system
    you’d be able to funnel in
    fresh water to compensate for it while
    the other part
    was broken down and you got it fixed and
    so the cost to put those two together
    was becoming cost and effective so it’s
    always been that way you look at it you
    go man too much money to spend for it
    doesn’t make any sense
    right so yeah now if you’re the only
    laundromat in town
    and you were doing a couple hundred
    thousand well you know
    you would probably want to spend the
    money right
    yeah so well hey i would love to change
    gears
    slightly here uh i i get so i do a lot
    of consulting and stuff but i get a lot
    of calls from
    struggling laundromat owners and you
    know who’s
    you know business just isn’t doing well
    maybe they’re even losing money
    um and i’m just i’m curious i mean you
    have so much experience so much
    knowledge
    what would you say to somebody whose
    laundromat is losing
    money every single month and they don’t
    know
    what to do they don’t know where to turn
    i would probably start back at the
    basics i’d go back and survey my
    competition
    and i’d look at how how i fared
    to my competition with regards to
    cleanliness
    newness i mean there’s a lot of things
    you can do in a logger map that’s not
    going to cost you a lot of money
    you can paint you can keep it cleaner
    and so i would probably look at um where
    have i failed
    um some things you have um
    you have some barriers number one is if
    you’re paying too much rent
    um there really is no fix for that and
    uh
    i think the golden rule or the or i
    should say
    the the litmus test is
    um four times your rent
    is what you should be doing in volumes
    and nothing lasts
    your rent should be 25 basically yeah
    and if you’re if you’re at
    30 or 35 your landlord’s your silent
    partner and it’s just going up rapidly
    and the way to combat that is
    and this goes this is a comment to all
    laundry owners this isn’t just the ones
    that are struggling
    if mcdonald’s or any of the major
    corporations needed to raise prices they
    don’t check with anybody they just raise
    the prices i mean i can’t
    tell you that um you know i go to a
    starbucks i get a
    i got a short and it’s 2 15. but down
    the street it’s 2 35 and over here it’s
    250
    and everybody has different pricing
    structures based on what their rent is
    i mean it’s what their expenses are and
    what’s the ratio to there
    so as an owner operator you want to try
    to stay ahead of the curve and the only
    way to stay ahead of the curve
    is how can i raise my event prices and
    what are you offering your clients
    when you do raise your event prices you
    don’t need new equipment to do that
    you need to offer a clean safe place
    that they can do their wash
    in a relatively quick amount of time
    and you should have a game plan that
    every year you’re raising one of your
    machines
    just it’s it’s a you need to keep that
    hedge off of that rent because if that
    rent gets up in the 30s and 40s
    you’re going to have a hard time staying
    open and you’re going gonna have a hard
    time selling it
    and you may end up with that laundromat
    for a long time because
    you rent is too high and so the next
    question is
    what do i need to do to make it back
    down to the percentages and you have to
    go survey your competition
    and see what your competition is doing
    and then you need to cut your costs like
    i mentioned on the makeup air and you
    need to look at
    do i have any gas hogs do i have
    is it time to replace my equipment and
    we should jump on that and talk about it
    um equipment has two lives
    economic life and physical life
    and the physical life will always
    outstrip the economic life
    what do you mean by that can you explain
    that a little bit yeah um
    with enough baling wire and spit you can
    pretty much keep a wire
    washer or dryer going forever but the
    problem is
    in doing that is that you have a couple
    of factors that work against you one is
    your repair man’s getting wealthy okay
    you have customer dissatisfaction
    because they don’t trust your
    equipment’s going to work when they go
    in there so they may be leaving you for
    another laundromat
    because they don’t trust reliability of
    your equipment
    okay you may not be giving refunds on a
    regular basis
    or getting it back to them quick enough
    and that now you’ve
    you further damaged your relationship or
    your relationship with your client took
    a hit and so
    um the physical life will be there
    the economic life is is that when it
    gets to a point
    where the cost of new equipment
    is equal to the cost of repair replace
    the equipment
    and now comes the big test
    the big test is what are you going to
    replace it with
    now i’m not particularly talking about
    the brand i’m talking about
    if you surveyed your competition and you
    know what your turns per day are
    you’re going to change the mix of your
    laundromat based on what your clients
    needs are
    and you may not no longer have 15 or 20
    top loaders you may have five
    and you may have go from 12 30 pounders
    to
    20 30 pounders based on
    competition based on what your client’s
    needs are
    based on your turns per day but the goal
    here is to make sure that
    at what point in time do i change my
    equipment out it’s where
    the costs along with the lost revenue
    costs you can replace it for the cost of
    new equipment and that’s when you’re
    replacing your equipment
    that’s not talking about any of the
    depreciation or any other benefits you
    get from replacing equipment
    so replacing equipment isn’t just oh my
    gosh i got to replace the equipment
    it’s a thoughtful process that says
    what’s going on how much am i spending
    every month for repairs
    how much are spending a month for labor
    and then
    what would be the cost of new equipment
    if i replaced it and then
    what do i replace it with based on the
    statistics and based on this data
    i love that because i i think a lot i
    mean people ask me all the time right
    like how do i know when to replace
    equipment and i like this kind of
    systematic approach because we’re
    we’re told all the time like you know
    replace equipment after a certain number
    of years or
    your equipment’s just looking aging so
    replace it but
    i love what you’re saying because this
    gives us numbers right it gives us
    a hard like definite
    here’s when you need to replace them and
    it you only need to replace them
    when it makes sense economically to
    replace them
    right numbers don’t lie people do
    numbers are solid you can look at them
    and you can go oh my gosh i didn’t know
    it it always um uh
    gives me great pleasure when you talk to
    somebody who really hasn’t studied turns
    per day and
    you know i have a form that i give them
    in excel that’s really easy and
    you know people well we’re getting
    we’ll talk about a card and coin but i’m
    going to talk about coin because that’s
    really what what i do
    they basically weigh it and then they
    just give you the amount and i have a
    form that actually takes the amount
    converts it to dollars and divide by the
    machines divided by the number of days
    divided by the event price and there’s
    returns per day
    and so they get kind of giddy when they
    get to finally get to see that they go i
    never knew that
    you go oh and how long have you had the
    laundromat oh about two years they go oh
    and who’d you buy it from i mean
    yeah it’s like here’s your package this
    is what
    this is what you should have been handed
    or should have been discussed
    when you originally bought it um i want
    the call um
    do you think i should be doing 40s or
    50s
    or 40s or 60s and you go okay well
    what do you need let me see what your
    your action is what’s your competition
    let’s other is there a hole
    i remember doing a store in um
    uh out in the uh riverside area
    and um we did a survey of the
    area and i found i found
    that when we did the survey um the area
    was
    void of 60 pounders i mean basically um
    out of four laundromats there was eight
    60 pounders
    and i looked at i looked at the client
    and i said you know
    i’d put five or six eight sixty pounders
    in this store because the neighborhood
    doesn’t have them
    and it turned out to be a a big benefit
    for them because
    they’re doing more volume than they did
    before and it’s because of those 60
    pounders
    but we wouldn’t have known that had we
    not surveyed the area and looked at
    whether or not there’s a hole in the
    neighborhood
    plus it gives you the chance to go and
    see what your competitors are doing
    and why they’re doing what they’re doing
    any and
    the other thing is and i’m just jumping
    around here um
    it just came into my head someone says
    um should i buy that laundry
    and i i’m hesitant to tell them to buy
    the laundry
    and i’m hesitant because it’s not my
    decision it’s your decision i’ve given
    you everything that i possibly can
    however i’ll take another one for you if
    you can’t go to that laundromat
    friday night at 10 o’clock get out of
    the car
    walk into the laundromat and feel
    comfortable don’t buy it
    just don’t buy it that advice would have
    saved me
    a ton of heartache
    because
    i i’ve had some interesting and
    interesting situations
    uh in the laundry that like figure one
    colder which is
    uh figaro and a century approximately
    and this is
    back in the 80s but um i
    there there have been some scary moments
    that you just look at it and you go is
    this worth it
    and um it was part of the chain and you
    know it was okay but but
    you still so when i talk with people
    they oh yeah i want to buy a laundry i’m
    going to do this and this and that
    and then they’re all excited and they go
    look at it well we like what’s the next
    step and i says the next step is i want
    you to go friday and saturday night
    and i want you to get out of the car and
    walk around that parking lot and if you
    can do that you feel comfortable then we
    can go to the next stage
    if you can’t we’ll find you another
    locker man yeah and i
    i was interviewed on my own podcast by a
    former guest and we were talking about
    that
    and you know uh peter mayberry was the
    guy who was interviewing me and he said
    hey
    you know it’s just important for people
    to know not every laundromat
    is for everyone not any not not everyone
    can do
    any laundromat right there are areas so
    unless you’re a you know a vigilante
    laundromat owner who wants to come clean
    up the neighborhood you know
    which i ended up being an un
    an unwilling and unwitting uh you know
    guy who had to come in and clean up this
    laundromat because i got sold into a
    frankly a dangerous situation right and
    and there are those
    laundromats out there so you do need to
    be careful you know
    and i i think that’s amazing advice
    especially
    uh for you know someone who
    is not used to that like a rougher
    neighborhood
    or you know it’s easy you know for
    somebody who lives here in orange county
    to want to go buy a laundromat in south
    l.a
    but if you’re not used to you know
    making
    making that transition from those two
    different cultures because they’re very
    different cultures
    that can be a rude awakening it can be
    very difficult for someone to do
    it is in fact um interesting you should
    say that
    um i tell people that you should you
    want your long-term route within a half
    an hour where you work or play
    because what’s going to invariably
    happen
    is it’s going to be a saturday afternoon
    and you have a whole house full of
    guests
    post coping and um
    you’re having a grand old time and you
    get that phone call saying
    there’s a problem with the laundromat
    there’s a flood now
    we’re going to go back to dg we’ll go
    we’ll talk about employees
    so you go honey i got to go well your
    laundromat’s an hour away
    so now you already lost two hours from
    this dinner party and depending on how
    long it takes you to resolve the problem
    that you have
    you’re gone for at least three hours
    from four o’clock now you’re back at
    seven o’clock half your guests are gone
    so i tell people if you can get a
    laundromat that’s within
    30 minutes of where you work or play the
    other thing is
    and i’m gonna jump back when i jump back
    to employees
    um when when a
    laundromat owner takes over a store for
    the first time
    um they don’t have a clue and i can’t
    tell you how many people have taught how
    to use a broom
    correctly didn’t you
    i believe it yeah and how to teach me so
    so what i what i do
    and there’s a couple things that i do as
    a broker that one is i get everybody
    involved in what they’re doing and i
    hand them a kind of a booklet that
    basically says
    here’s an overview of what you should
    know and here’s an overview of what you
    should provide
    and one of them is a um an hourly
    a daily a weekly a by
    a bi-monthly a monthly quarterly and
    semi-annually and an annual list of
    responsibilities for the employee for
    the attendant what they need to do
    and then you also have to teach them and
    nobody takes the time to teach their
    employees they
    have a thought process that says they
    know how to use a broom or
    they know how to clean up but what
    constitutes an emergency and what do you
    do
    during this and how do i shut off this
    or another good tip for laundry owners
    um if you have a situation where you’re
    you get um brownouts or you get power
    outs
    power outages um i instruct the
    employees to turn off every breaker in
    the panel
    except for the lights and the reason is
    is because
    when that power comes back on it could
    be a huge surge
    more than you normally take and it’ll
    fry computer boards
    and unless you have a device on your
    panel
    called an eemon demon which is the real
    name it’ll
    stop the surge and only deliver the
    correct amount of power
    you’re going to fry computer boards when
    the lights come back on the employee can
    go back in and turn all the breakers
    back on and all the machines are back on
    but if you don’t i mean and this
    happened a lot in la
    the dryers just got fried the computer
    boards got fried well it’s 110 bucks at
    the time
    to replace 20 computer boards and it was
    like
    why didn’t somebody tell me this well we
    didn’t know it until now but
    so it it go it points to
    your employees or your first line of
    defense and it’s very important that you
    give them the right tools and that
    includes
    training them on what constitutes an
    emergency what to do in an emergency
    to what their responsibilities are i
    mean if there’s a fire
    employee get everybody out do the all
    these steps and everybody has a step to
    follow
    and i think that if most owners would
    begin to start to take that approach
    i think you’d start to see volumes go up
    and i think people will be sticking
    around a lot longer because
    they have well-informed educated
    employees that are doing exactly what
    they should do given the situation
    that’s awesome awesome advice because
    you know i i think you know a lot of
    laundromat owners
    i i mean i think it’s starting to change
    a little a little bit less
    mom and poppy there’s still i mean i
    still say it’s probably majority mom and
    pop laundromat owners
    right but there’s more and more that are
    multi-store owners that are starting to
    put
    together these systems and these
    trainings for employees but i think a
    lot of
    mom and pop owners aren’t really
    thinking about that they’re just
    thinking hey i’m going to hire somebody
    to come clean
    and you know resolve minor issues
    that customers have which is fine but
    when you start to think
    about it more like a business which is
    what you’re saying basically like think
    about it
    as if it’s a business because it is a
    business right
    instead of a cash machine which is how i
    think a lot of owners
    especially first-time owners who get
    into the business who are sold that by
    brokers or distributors or whoever
    right you know to see it as a cash
    machine but you need to shift that
    mindset a little bit and i love what
    you’re saying about training these
    employees
    but i think it’s something that
    stereotypically we’re not good at as
    laundromat owners
    and you know training employees even
    knowing what to train
    employees and i don’t think there’s a
    ton of resources out there
    for that uh right now there’s some i
    think but not a ton
    right it’s it’s it’s a part of the
    industry that needs to be
    um uh analyzed and what’s the best way
    to approach it just like
    yeah the uh the lint situation so we we
    all this industry has a couple little
    interesting quirks that need to to be
    looked at a little bit deeper i
    personally have a a guy that uh
    worked for me uh at lucy’s
    and uh um i’ve been known to hire
    have him take my clients on a saturday
    and grab all the employees
    and spend two hours with them and show
    them how to
    to do the basics so that the employees
    understand it
    the other thing another reason why you
    do this
    is that you know you need some kind of
    manual if you have employees and in the
    old days
    people were paid under the table and
    nobody really cared about the employee
    they were dispensable until
    until government got involved and said
    there’s no more
    independent contractors you’re either an
    employee you’re not and
    you know i like i when i talk with
    people i kind of chuckle sometimes and i
    go
    i have a rule for you if they if you
    supply them with a broom
    they’re an employee period so they show
    up
    with all their own stuff and they come
    in when they want a different issue
    they’re an employee and and you have to
    treat them like that
    well you can’t just get rid of your
    employees then
    there has to be cause so if you
    start out with a um a booklet that
    basically says here’s
    the rules and regulations that you as an
    employee show up on time and you go
    through the whole list
    and it’ll take you a little to put it
    together but it won’t take you long
    to realize what your mistakes are where
    your holes are
    within six months you should have a
    pretty nice kind of
    contract for your employees that you
    modify
    all the time and you just put that in
    there that you reserved right to modify
    this contract anytime or this
    manual anytime and and you get them to
    acknowledge it and you put it in
    whatever their native language in so
    they can sign it
    and then you you can build a case on
    that and
    and the building the cases is just you
    know late late late
    late didn’t do this didn’t do this
    didn’t do this this sheet wasn’t
    done and now you at least have some
    cause to be able to say
    i can’t use you anymore i’m gonna hire
    somebody else
    and uh it’s it’s um it’s
    it’s an insurance policy
    the more you hold on to this and you you
    you
    make it like that business that you and
    i are talking about it’s not
    it’s interesting they think oh
    laundromats no big deal it’s a fun thing
    it’s cash flow you know
    like you say it’s a business and
    the tighter you run it the more
    profitable you are going to be
    in the long run and it goes with
    training and it goes through
    you know um the repair guy
    great story and i tell this to everyone
    here’s another pearl for you ready
    the number two most important person
    besides your employees
    is your repair guy
    now everyone in this industry
    can tell you oh my gosh
    do we have a repair problem they don’t
    show up on time
    they don’t have the parts with them i
    mean ad nauseam well i have news for you
    it didn’t start out that way what
    happened
    is some people wouldn’t pay the repair
    people on time
    or would argue what their rates were or
    would argue whether or not he actually
    spent the time on the machine
    et cetera et cetera et cetera my
    attitude is this
    that’s your most important person in the
    operational aspect besides your
    employees
    and take care of them
    when they show up give them half their
    money if you want in the beginning
    when they show up and they give you a
    bid that’s going to be three bearing
    jobs and it’s fifteen hundred dollars
    give them the seven hundred dollars for
    the parts
    on a friday afternoon when you’re really
    busy
    and a machine breaks down if you take
    care of your repair guy and you call
    them on the phone
    they’re going to drop what they’re doing
    they’re going to come and see you
    because you pay them on time
    and there isn’t a hassle and that’s how
    you build that rapport with your repair
    guy
    and your business succeeds you succeed
    you don’t have broken down equipment you
    don’t have pissed off customers because
    i’ve taken care of my repair guy and
    that’s the most the second most
    important person i have
    in this industry and so i see it happen
    all the time
    where’s charlie well he’s not here why
    not well you know he had other things to
    do
    that doesn’t make any sense in my book
    something’s inherently wrong with
    a repair person who says they’re going
    to be there doesn’t show up so
    one of the first things i tell my
    clients is make sure you take care of
    your repair guy and make sure that
    they’re
    they’re paid when they they hand out the
    invoices
    and it’s legit um i think that in our
    industry here in southern california
    we could use a uh a boost in the number
    of repair people that are
    currently repairing equipment holy cow
    we can i don’t
    i struggle i’m always looking for repair
    people i take care of my guys i pay him
    i’ll pay him cash i’ll pay them what
    front like whatever it takes and i
    cannot hang on to repair
    people i’ve asked for recommendations
    and
    it’s tough man even even with the
    distributors
    that have repair people that cost more
    money
    i can’t even get them to be consistent
    it’s crazy so so we have a hole there
    somebody come be a top-notch repair all
    you gotta do i wanna tell you
    all you gotta do is be on time and do
    what you say and you will have more
    business and then you will know what to
    do with
    you could create a whole business
    hire people make sure they’re on time
    and have clear communication if you
    can’t be somewhere
    just let you know let that model that’s
    all you need to do
    you don’t even have to be that good at
    repairing to be honest
    like no you just have to be okay
    adequate and be all the time yeah and
    show up
    you know that that is a that is one of
    the things that that this industry
    has um suffered with it it is a uh it’s
    a problem
    and and now more than ever and for all
    the folks out there wanting to start
    want to get in the business to start
    a different company there’s there’s also
    the new all the new systems
    now i’m i’ll be honest with you uh it
    has been um a blind spot for me
    on all the technology because and the
    reason is
    is that it has
    developed and propelled itself
    exponentially in this industry
    that you have the the debit card and the
    and the in the uh
    the the easy card system or whatever the
    system is
    um uh that that it’s taking this
    industry over
    and it’s a flash now who repairs
    those so now you’re
    channeled into whatever company that is
    whatever software program they have
    whether it’s that company alone or is a
    repair person out here
    are they too busy do they have too many
    clients so there’s another area
    for someone that’s savvy in computers
    that understands
    software’s to come in and have their own
    little
    slice of life here because that’s part
    of the industry and that stuff’s
    breaking down and whenever you have
    electronics now wireless is different
    but a lot of it’s hardwire
    to begin with in the back room you still
    have lint and you still have
    moisture and that always causes a
    problem it’s it’s a
    it’s it’s it’s something we can’t get
    away in a locker man
    until we resolve the lint issue which
    we’ll get to it at a different time
    but that’s the problem you have so you
    have not only do you have repair of the
    hard equipment
    of bearings and coin drops and and
    mechanisms and and
    hoses and belts and all the other things
    you actually have the electronics of it
    and the software of it and who can stop
    a machine and go through
    and do a software repair or hardware
    repair uh right there on notice or do
    you have to wait for
    uh uh the next day because it’s past
    five o’clock new york time
    that you can’t get a rep to do it so
    there’s another area
    that this industry in at least in
    southern california right now
    uh could use a boost in to to get some
    money or get a company that basically
    says we can work on all those things
    well i tell you i’m this close to
    quitting everything else i’m doing and
    starting my own repair
    company because i think i could probably
    make a lot more money doing that
    i’ll sell my laundromats and make a lot
    more money fixing machines
    holy cow man absolutely yeah absolutely
    crazy well uh real quick i mean i have a
    couple of we have a couple little
    segments i want to get to in a second
    but real quick
    you mentioned earlier uh you want to
    talk coin versus card
    and i’m just kind of curious on your
    take on that i mean you just touched on
    it briefly right there but
    i’m not part i’m old school
    but um i think that um
    i think there’s a time and a place in
    the evolution of the card systems and
    what have not that it’s beneficial for
    particularly multi-store owners because
    it uh
    it improves one is it takes away
    it takes away the possibility of theft
    from people handling money
    two um there’s a accurate accounting of
    it
    and you don’t have to worry about it i
    mean i’ve seen some systems where
    basically they just show me here’s my
    bank statement
    here’s what the bank deducted here’s
    what i made yesterday and then it goes
    further and this is what my
    turns per day on each machine was uh and
    not just the
    the the the size of the machine as a as
    a general but each machine doing the
    turns and and then you get in the
    conversations of
    um why are those machines doing more
    trends well they’re in the front or
    they’re in the back or they’re next to
    this so they’re next
    whole different again that’s that matrix
    that you get to play with once they’re
    in the store like a casino you’re just
    moving them within the parts
    um but for coin and card um and then
    there’s a hybrid and i like the hybrid
    and um i just like coin i’ve always
    heard that
    cash is king and and um i i kind of um
    again i’m old school on that i don’t
    mind taking a little bit of time to
    count quarters um it may be
    unsanitary now it may require you to
    bleach your money
    uh may require you to wear gloves where
    you handle it
    i mean um i’ve been known to uh actually
    wash
    wash uh uh money out of the changers
    and try optimism for launder or
    and put a rubber band on the pillowcase
    and wash the money and dry it in the
    dryer
    and and you actually have clean money i
    mean and it’s it’s you know
    it’s like i can touch it and use it
    right um but but but
    we’re talking about actually washing
    right we’re not talking about laundering
    money and having cleaning yeah i
    i’ve actually i’ve actually i just want
    to be clear on that that we’re
    talking about physically putting it in a
    washing machine
    with some tide or ariel or something
    yeah bleach bleach actually soaking it
    in bleach and just
    rinsing it and putting it in a pillow
    case when drying it and having it come
    out crispy
    and then you can get you know but you
    know i’ve done it
    um not anymore but i have um
    but it i mean because money is dirty i
    mean it touches so many different hands
    and you have no idea where it’s coming
    from and and
    i think a lot of people like the fact
    that you can wave your ae
    or your debit or your credit card in
    front of the
    thing in your machine set which i think
    as we evolve
    i think that’s where it’s going to end
    up in the long run although i still do
    like coin because i think cash is king
    and
    for all the for all the variable reasons
    of that um
    i’m kind of more of a hybrid guy but
    it to talk about that you have to make
    sure that it works for you and you have
    to make sure you have equipment that
    works for you
    and that gets back to the repair part
    which is vitally important
    i want to do an uh a little separation
    there um one of the interesting things
    that we talked about in the beginning
    which was
    when you buy a laundromat your first
    step is getting ready to sell it
    um one of the things that that i’ve
    noticed in the industry today
    is that um i’ll look at the the listing
    for sale the laundry for sale
    and i’ll see um the equipment is
    anywhere between 12 and 18 years old
    and um if you’ve maintained it and it
    looks good
    you know again you’re trading dollars
    with a bank
    versus with your repair guy where’s your
    money well spent in order for that
    equipment to work
    but i find on the profit of law
    statements you’ll see something like 350
    and you’ll go i’m sorry 350
    for what 350 for repair and i’m like no
    no that might be and 350 dollars
    for a week might be 350 for
    the parts but it’s not 350
    for the repair and they go well the
    seller says he fixes his own equipment
    and i kind of chuckle and i say well all
    right so let’s
    change businesses
    you own a car rental now remember
    the laundromat and a car rental aren’t
    that much different people are going to
    go up crazy
    no you’re renting equipment to the
    public it doesn’t matter what it is
    it could be um hammers and jackhammers
    and chainsaws but you’re renting
    equipment to the public
    just happens to be cars and so
    the thought process for the person who
    fixes their own equipment
    and doesn’t put it on the profit and
    loss statement
    is so you own a car rental and
    at the end of the day your eight cars or
    12 or 20 cars or rented out you got five
    in the shop
    and those five cars two needs a
    transmission and one needs a couple of
    oil changes and you need a brake job
    so when you close the doors at six
    o’clock you’re gonna put on your green
    jeans and you’re gonna go out there work
    till one or two in the morning repairing
    your own equipment
    and then wake up tomorrow and do the
    same thing again he goes that’s not how
    businesses are run
    there’s a line item for that and the
    reason there’s a line item for it
    because there’s a cost associated with
    that now i think that it’s fantastic
    that you have the time of your life to
    be able to go and repair the equipment i
    think that’s wonderful
    and i recommend that all laundry owners
    repair their own equipment
    to a certain point
    and if you do that you should pay
    yourself for that
    so when you pay yourself for that
    whatever the going rate is that’s what
    it should be
    reflected on that profit and loss
    statement and i find that
    10 out of 10 times when i look at a
    listing
    and there’s three things that i look for
    on a listing and
    and and almost every time i look at them
    it’s blank or it doesn’t have anything
    or the numbers are
    woefully um uh uh misrepresented
    um and and and so i
    i i take the time to either talk to the
    other broker or i take the time to talk
    to the seller and say
    you know uh it’s difficult to sell you
    you’re breaking down
    trust because most people expect to see
    this expense on the
    report and it’s not there and um and and
    then
    then you have an uphill battle um with
    the seller
    with the broker and then you actually
    have a
    um a hand uh confidence-building
    conversation with your buyer
    to explain to them what’s happening and
    what the real numbers should be
    and how it builds on top of it um what
    people
    i think fail to understand both sellers
    and
    brokers and buyers um for every 500
    that isn’t stated on the profit and loss
    statement
    that the buyer incurs once escrow closes
    on an expense that you didn’t catch that
    is a constant
    deduct every month um if you’re buying
    out of four or five buying out of five
    four multiple
    um that’s six thousand a year that’s
    twenty you just overpaid by twenty five
    thousand 000
    for that laundromat that you shouldn’t
    have because you missed something or
    somebody understated something so it’s
    vitally important
    that when you slow down i know you’re
    all excited
    i know you all want to buy a laundromat
    i mean i have a half a dozen buyers
    right now that are
    you know you got anything in orange
    county you got anything in the valley
    you got to be in la and
    the question is well here’s one and
    here’s one here’s one and the first
    thing i do is i go nope
    nope rent-a-gross ratio is off no
    they’re understating this nope they’re
    understating that and i go
    so they want 350 000 in the laundry and
    my estimation is only worth 275
    because there’s a hole
    i treat it like it’s my money if i’m not
    going to invest in it why would i
    recommend
    that somebody who wants to get in the
    business who has some hard-earned cash
    to invest in a lot of right why would i
    want to sell them something that i know
    that it’s not going to produce that kind
    of revenue
    on a monthly basis and they’re not going
    to go after the seller they’re going to
    go after me
    and go after me meaning we’re going to
    have that come to jesus conversation of
    why didn’t you tell me
    why did you miss this how did you miss
    this i mean i have 35 years in this
    business
    i can’t miss anything
    it doesn’t bode well yeah you know
    and and i want i want them to stay with
    me i want them to call me up and say hey
    i got a problem
    what’s the problem i don’t know what
    machines to add oh great what are your
    turns per day great let’s sit down and
    have a conversation about your store
    and then it goes through did you survey
    do you have this do you have this let me
    see the reports let’s talk about it
    so i think that’s a huge yeah i think
    it’s a huge point
    i mean i love that you said for every
    500 bucks you know that’s 25 grand of
    equity that you’re overpaying
    uh because i think people don’t think
    about it
    like that right and and it’s really easy
    in this business
    to miss 500 bucks either in overstated
    income or
    understated expenses which you know
    it’s just easy to do because it’s really
    difficult sometimes to pinpoint exactly
    what a laundromat is doing unless
    you’re working with somebody who has
    this experience in the industry and can
    tell
    the gotchas like the repair costs right
    unless first of all it’s that trust the
    trust that you built up in the beginning
    i i find that um probably a majority
    uh 75 70
    80 80 20 rule the old 80 20 rule
    um that it’s not the it’s not the income
    it’s the expenses yeah it’s the expenses
    that are understated more than the
    uh income is overstated because if the
    income is overstated they’re paying tax
    on it nobody wants to pay taxes
    so they’re going to keep that as tight
    as they possibly can
    or even less which is a benefit to the
    owner the guy who’s buying it
    who he takes over the store and it’s
    doing a thousand dollars more per month
    it’s like
    hey wow this is pretty good so but i
    find that that
    that the the the challenge for us
    as brokers and as buyers is to make sure
    that
    um the line items are properly filled
    out and you’re close to being what it
    truly is
    what the expenses are and there’s
    expenses that you can’t get away with
    industry and you know what they are
    i mean you know um everything is
    verifiable but
    gas water and electric everything else
    is a
    fixed payment uh repairs for the most
    part but
    but if you’re on a contract with
    somebody you’re paying him 550 a month
    just to show up once a week to fix
    whatever’s there and then it’s plus
    parts
    so even part of the part of that is a
    fixed expense you can call fixed
    rent’s fixed insurance is fixed labor’s
    usually fixed because you don’t want to
    fluctuate hours
    by giving employees more hours and
    that’s the other thing
    what’s your coverage and um
    are you paying them the going rate at
    14.50 or 15
    an hour in l.a now or orange county i
    think it’s 14 or 15 an hour
    um and how many hours do you have your
    coverage and
    then the conversation becomes between us
    is when do you need coverage
    and what is important coverage so old
    rule of thumb
    um and i don’t know if you’re familiar
    with this but
    uh saturday sunday friday monday tuesday
    thursday wednesday
    those are your busy days of the week
    and you could go into a laundromat on
    any wednesday and shoot a shotgun and
    not hit anybody
    like i get clients coming out well we
    went to the laundromat on wednesday at
    one o’clock in the afternoon
    and there was nobody there they’re not
    doing the volume wait stop
    time out it doesn’t work that way
    they’re all creatures of habit
    yep go there saturday afternoon to four
    o’clock
    and then let’s talk so
    you know they don’t know that so so you
    talk about cyclicals and then you talk
    about um cyclicals for the year
    so i used to have a graph i don’t have
    it now but
    it used to show a a mean line
    with the calendar january february march
    april all the way across
    and then on the left hand side it would
    show 115
    and 85 and you’d start in january
    and you’d loop it down and it would go
    right through the summer months so it
    would be
    just after school got out when we were
    in school which should be
    mid-june through july and august which
    will be down to the 85
    and then out of august it would start to
    creep back up come september school
    would start again
    right back and then it would go up and
    then you’d have this you’d have this
    cycle you’d say okay
    so they’re doing a collection in july
    well the laundry’s off 50
    it’s not doing the volume relax it is
    it’s people wear less clothing during
    the summer
    therefore the volumes are down if you
    were doing a collection in january you’d
    be all giddy saying oh my god it’s doing
    50
    more than it should i’m buying i’m
    stealing it okay but that’s
    not how it goes because you’re doing an
    average right
    for what the volumes are so those are
    some of the things that i talk to
    uh clients with uh when i sit down with
    them and say here’s
    kind of a a benchmark for you to look at
    when you look at laundromats and again
    it goes back to
    and then it goes daily i mean each
    laundromat’s different daily
    um but usually the afternoons are busier
    than the lunchtime and the mornings are
    sometimes busier
    but remember they’re all creatures of
    habit and
    everybody has their time that they like
    to go uh
    to a laundromat and um nobody likes to
    do laundry it’s not something that we
    all like to do
    it’s probably one of the least likely
    chores i mean i can tell you i hate
    doing laundry
    well which is one of the reasons pickup
    and delivery is starting to take off
    right now which which is huge yeah um
    and and um which didn’t exist
    when i started it was
    it wasn’t even a thought not even an
    afterthought it wasn’t even a thought
    um i don’t well somebody could probably
    fill me in on this i don’t know when the
    evolution
    or the yeah the the the evolution of it
    came in blew up i don’t know if it was
    um 2005
    2010 um but
    um it’s a it’s arrived
    um you know there’s a there’s a lot of
    conversations on that
    um and um i find that one of the
    interesting conversations i’ve had with
    people that have laundromats that do
    wash and fold wash dry and fold
    and then they’re like i need another
    location and you go why do you need
    another location
    and they go well because i can’t do the
    volume i don’t have a big enough store
    and one of the first things to say is go
    rent a laundromat from somebody else
    make a deal with the guy down the street
    that you you’ll take over his laundromat
    from 12
    until six in the morning you’ll he he
    gets all your quarters whatever it costs
    you to do your laundry doesn’t matter
    i mean there’s more than one ways to
    skin a cat instead of spending 250 000
    for a new location and be liable for the
    lease and all those other things that go
    associated with it and what have not
    so there’s more than one way to skin a
    cat when you want to grow that wash dry
    fold and
    this is now becoming more of a wash dry
    fold
    clientele particularly in the college
    towns and where
    you have uh upwardly mobile people that
    are pushing out
    and they don’t want to do one i mean
    it’s it’s
    quite apparent based on the numbers that
    i’ve seen on some of these stores you’re
    like
    you’re doing what and how much oh my
    gosh it’s it’s
    it’s amazing um and
    learning that is another thing it’s a
    whole different school of thought
    and it takes a whole different mindset
    yeah it really is like having two
    different businesses i mean you’re using
    the same assets but you’re running two
    different businesses you have two
    different
    client avatars clientele types um
    and so you know and you know one is a
    logistics company which is pick up and
    delivery
    it’s a logistics business right right
    and laundromat is not that
    at all right so you’re renting equipment
    out like you said
    and um so it is it’s definitely a
    different mindset
    but you’re utilizing the same assets and
    it’s a way to
    it’s another way that you can get those
    turns per day
    up on your machines uh you know without
    necessarily even drawing more
    customers from your immediate age right
    yeah right the question is is that which
    machines do you dedicate
    how do you dedicate it yeah do you
    monitor all the logistics that’s it yeah
    and you’re right you have a delivery
    company and you have a labor company
    okay and then you have the management
    and and one of the
    challenges that laundry owners face
    today is
    um when i when we started lucy’s um i
    had the privilege
    and the honor to work with john gorman
    one of the original founders of taco
    bell
    and one of the things that stuck with me
    was um
    we asked john at what point in time do
    you need a manager
    and he says the average owner can run
    five taco bells before he needs help
    just to give you an idea i think that
    in today’s marketplace since you do have
    three organizations within one
    organization
    you as an owner have to choose which
    part of the organization you want to run
    in order to do it effectively
    um so i and i’ve seen it and i’ve talked
    to these owners
    you’ve got an owner that has three
    stores
    two of them do uh one of them does just
    laundry
    wash a regular uh self-service and the
    other one does self-service and wash
    drying fold
    and so you have in my book you actually
    have
    four companies within your company
    the challenges is being effective and
    being
    um good at all of them and then
    the the smartest one is taking a step
    back and saying what am i really good at
    and what do i need help at and then you
    solicit the help
    to get the other areas covered because
    it’s hard to
    to to run your three your three
    laundromats as it is it’s hard to run
    three laundromats
    filling up soap and bleach and the candy
    and the snack and all that stuff and
    running that happens
    now you’ve got a delivery company for
    for four vehicles two vehicles four
    vehicles
    that you’re watching all the time are
    they getting maintained who smashed it
    how’s the insurance in places
    i mean i see posts all the time which is
    i didn’t know we had this scratch on
    this van and there’s a big hole in the
    side of it
    could you at least tell me when you did
    it i didn’t know what happened okay all
    right
    so so you have you have these segments
    and in order to get better in order to
    be
    proficient at what you do you as the
    owner have to step back and say
    i’m at my breaking point
    and now i need someone to handle what
    you said which was logistics which is a
    big portion of this business
    where are you going how long does it
    take you to get there but you know
    and and and the routes and what have not
    and then you have the people actually
    doing the work
    which is another segment um and then you
    have the overall
    financial books that you’re running for
    the profitability of the business
    so there’s four or five hats that as an
    owner is wearing
    and as the more stores you open up
    the more you have to take a step back
    and say where am i failing or
    where do i need help at in order to
    maintain and grow this company in the
    right direction
    and i think at some point in time you’ll
    have owners that
    are frozen they want to grow
    but they’re frozen because it’s like
    i’m 16 hours a day at this and i’m still
    not
    getting to that level of proficiency
    that i need or i want
    to see from it and you got buddies
    elbowing you saying hey man have you
    done this if you’ve done that or
    or hey you know and you’ve talked to
    guys like you own two stores or four
    stores
    and they’re giving you tidbits and you
    sit back and you go home and you go oh
    my god i’m not doing this right
    or i need help and then it’s what does
    it help cost me
    and how much beneficial is it going to
    be to me and what area do i want to take
    over
    and what area am i weak at that i want
    somebody else to run for me
    and that’s the challenges faced with
    people that are doing the wash drying
    fold along with self-service laundry
    it’s uh something needs to be looked at
    yeah yeah definitely a whole a whole big
    beast
    uh a lot of opportunity there especially
    right now
    um i think it’s just getting started
    i mean it’s going but i think there’s
    plenty of room for it to grow
    but it’s definitely a whole different
    beast i think it’s
    the other one of the other segments that
    you and i would like to probably talk in
    another cast
    about um what the industry needs
    um from our perspective here and and
    remember we’re
    kind of myopic here west coast is a lot
    different than the east coast in the
    midwest i guarantee
    in fact a funny cut funny note um i see
    more people buying used equipment in the
    midwest
    than anywhere else i’m like i would
    never buy used equipment unless
    it was just starting a store and i
    needed to see if that worked so that i
    could build it up and buy new equipment
    but they trade you know i mean i’ve seen
    pictures of 40 year old sissels and
    they’re like hey
    well these work and i’m going what do
    you have that dryer for
    so anyways so there are some areas that
    you and i
    could talk about in in in improving this
    industry
    we talked about lent we talked about uh
    a repair
    we talked about uh two areas of repair
    physical repair of the equipment
    and and then actual repair of the um
    electronics for lack of a better
    description yeah and that includes dvrs
    that includes security systems
    um most of the security companies out
    there you’re on a three-year lease
    and uh if you uh bail after a year and a
    half they want the 18 months of money
    that they would have gotten had you
    stayed on the
    track you sold the business whatever
    they want the 1800 to get out of the
    contract it’s like
    how does that work yes so so there’s
    some areas here that we could look at
    and discuss um on on
    how to improve this leg of the business
    to give
    the owners that we know and the people
    that we know in this business
    a leg up on uh running their
    laundry i love that i love that maybe we
    could even do like a little running
    series at some point or something let’s
    talk about that
    uh yeah that’d be i think that’d be a
    lot of fun i think they’d be
    really helpful for people yeah i think
    so too well we have a little segment
    that i want to get to
    called the secret sauce listen up it’s
    the secret sauce
    secret sauce is this question is hey
    what what tips can you give
    to current owners what’s your maybe like
    your number one or one or two tips that
    you can give to current owners
    to help them improve their their
    business right now like i think i gave
    you two right
    two in the beginning two already you’ve
    given a ton
    you need more laundry carts and you need
    to assess
    which ones you need and i know you can
    get extenders so they can’t take them
    out the door
    but i think laundry carts are a big plus
    um
    to keep your customers in place
    um the other one was the makeup air
    which i think is a huge uh
    area um one of the things that i still
    do to this day which you’re going to
    think is funny
    is when i meet with an owner at a
    laundromat and we’re going to talk about
    um i just stopped by charlie and say hey
    charlie what’s going on i go hey i’ll be
    at the laundromat okay i’ll go by and
    see them
    just to keep the relationship going and
    you know maybe they’ve had a lot of room
    for three or four years and maybe i
    assisted them in buying it maybe i did
    and i just know who they are and i go
    and talk with them
    and um i always can find something
    operationally that i can point out and
    say
    if i were you i would you know here’s
    okay and
    and the makeup air is one and basically
    i would take a
    a piece of paper or a wad of lint
    or something i could find in the trash
    can like a bounce
    and i’d go to the door that has access
    to the back of the dryers and i get them
    i bend down and put this piece of paper
    or whatever i have right at the bottom
    of the door and it would just get sucked
    right in
    so i said your dryers are they’re just
    starving for air you can’t give them
    enough air
    so i tried to say look there’s
    three things you can do dryers like to
    do this
    this is how they talk about the
    circulation you get the combustion
    make a pair to combustion air to exhaust
    right
    so at the top i would put in the
    ceilings you put the egg crates
    which allows the air to go up and in
    front of the dryers and get sucked into
    the top above the t-bar ceiling
    and those are the the egg crate uh uh uh
    ceiling tiles that they make and then i
    put
    if you don’t do that i put exhaust fans
    above the
    curtain wall above the dryers to suck
    and force the air behind the dryers
    and then at below i sometimes tell
    people to cut a hole in that door
    to allow the air to get to and fro
    in the bottom of it to create a venteri
    effect that will feed those dryers
    and give them more air which
    if they get more air and they’re burning
    properly your gas bill is going to drop
    so just a natural phenomena and then you
    can always have
    and you can always call your local gas
    company in southern california so the
    california gas
    and you can have them come out and
    they’ll tell you
    whether or not your pilot lights are
    burning at the right
    color they’ll just look at it and go
    too rich starved or whatever then you
    can get a game plan together with your
    mechanic on how to make sure that those
    dryers
    get what they need in order to burn
    efficiently
    and that those two points right there i
    think are
    the the laundry carts and the make-up
    air will allow you to one save money but
    actually um your customers will be a lot
    happier
    um and you’ll have a more satisfaction
    in your laundromat
    if you can do those two things i love
    the secret sauce because
    those are we’ve never heard anything
    like those
    two tips so i mean i think those are
    great tips and they’re super actionable
    right like you can go out
    you know jump online right now and order
    laundry carts and have them delivered
    you know in the next week to your
    laundromat so get out there and do it
    i’ll probably go
    order a couple more i’m not i’m not
    quite at that 10 per thousand square
    feet so i know i need to add a few
    i’m going to give you uh an andy tour
    okay
    and i’m going to talk about logic cards
    so um jordan calls me on the phone and
    says hey i’m thinking about um
    buying a laundromat and i’ll go okay
    send me the setup sheet and i’ll get the
    setup sheet and
    then i’ll mark up the setup sheet and
    i’ll send it back to you and we’ll talk
    about the cash flow
    and you go you know i still like the
    laundry let’s take a look at it so
    i when i drive up to a location now this
    is it doesn’t matter if it’s
    a new location that you want to build a
    new store
    or it’s an existing laundromat so i’m
    driving down the street
    and i look at the location and i pass it
    and i drive
    depending upon where i’m at half a mile
    east a half a mile north a half a mile
    west and a half miles up
    and i will survey what’s there
    now when i come back to this location
    the first thing i’m looking for
    is it on the corner does it have a
    signal or a stop sign
    is there a crosswalk is it in line
    meaning is it down the street and it’s
    not on a corner
    and is there a competitor across the
    street
    are all the all the apartments or the
    the rental houses across the street
    people have to walk across well most
    women and their little
    chickens are not going to walk across
    the street if there’s a lager mat on
    their side
    okay and the only way they’ll do that is
    if they’re a crosswalk
    and if it’s a big boulevard forget it
    i’m also looking at
    what are the natural boundaries is there
    a river
    is there a freeway is there a railroad
    track
    these are going to prevent people from
    coming they’re natural barriers
    okay particularly in the cities that and
    the neighborhoods that you and i were
    you used to looking at and seeing you
    know you’re like oh okay
    natural barriers and then i look at um
    parking
    exposure ingress and egress in the
    shopping center
    where is the laundry in the shopping
    center is it in the crotch where the two
    points meet
    does it have a lot of glass are there
    drink and snack and vending machines and
    candy machines all blocking
    the glass so that people can’t see out
    and people can’t see
    in another safety factor i don’t like
    machines
    i don’t like anything in my windows if i
    can avoid it i get everything out of my
    windows
    i want the people in there to be able to
    see out and i want somebody
    to be able to see and to see what’s
    going on because at night that’s what
    you need
    okay i’m going to go at night to see if
    the parking lot’s well lit and if it’s
    not i’m gonna mark down the lights that
    are out and tell the guy and get the
    landlord to fix those lights because you
    don’t have any safety or security here
    then i’m gonna look at who my tenants
    are liquor store
    barber shop nail salon dental store
    these all eat up parking so
    during my out normal hours they’re going
    to compete with me for parking
    after hours most of these aren’t open i
    get the parking
    but how much is that is my business 30
    35 40
    at night so i then get out of my car and
    is it safe to get out
    is there parking in front of the
    laundromat
    or is the parking in the parking lot and
    i’m walking
    20 or 30 feet to get into the laundry
    and then i look at you and say
    where are my laundry carts and i walk in
    there and you’d be surprised you
    and and you’ll laugh the next time you
    go into a laundromat your competitors
    you’re just going to start to laugh
    you’re going to go this guy’s only got
    11 laundry cards and he has 3 000 square
    feet
    how are you surviving i mean you want to
    you want to spend what are they about 50
    now buck 30 buck 50.
    um uh um give me five just under a grand
    750 right
    you could pick up the average logic
    customer is between 50 and 70
    a month that’s a family of three and a
    half okay
    um so what if you picked up two more
    people
    because you have carts you have no idea
    it’s it’s just another thing so now i’m
    looking at carts i walk in the door
    and i’m looking at the floor and i’m
    looking at the ceiling now
    ceiling tiles another oh another pearl
    for you for your for our customers okay
    you have a leak in the roof everybody
    does
    okay well it could be
    it could be condensation okay
    from the pipes okay it could be an
    actual leak but you don’t know
    and it’s not for you to worry about when
    you replace that tile
    don’t replace it take the new tile and
    put the new tile underneath it
    and leave the the water tile above it so
    it acts like a sponge
    and you will save on ceiling tiles
    because it’ll absorb whatever moisture
    is coming through because it already has
    it just looks bad now you have a clean
    tile up there for the most part for
    another six months it’s going to stay
    clean
    when it starts to leak you take the old
    one off you put another one underneath
    it and acts like a sponge
    simple way to save your ceiling and make
    it look nice that’s a good tip
    okay so now you walk into the laundromat
    you’re looking around and what am i
    looking for
    i know that trash on the floor isn’t
    gonna
    push people away overflowing trash cans
    will
    because then it’s gonna go on top of the
    counter then it’s gonna go here
    also the uh night walk though the
    watchman
    newspapers that they nope you you don’t
    get to advertise on my laundromat
    unless you want to pay for it there’s no
    rent there’s no this there’s no none of
    those bulletin boards that they have
    outside or inside
    all trash no phones we all have cell
    phones now
    but i could tell you a story of when i
    was at
    when i first did lucy’s in inglewood
    where um we had a drug problem outside
    and there were four phones and
    phones like newspaper racks they can put
    anywhere they want they’re not regulated
    but if you touch them
    it’s grand theft it’s you they can put
    them where they want but you can’t touch
    them
    so they wouldn’t take the phones out so
    i just set up out
    leaving every night i would take uh
    silicone caulk and i would fill in the
    corner slots
    with silicone and it only took me about
    a month and they removed the phones
    even after i asked them to remove the
    bones because it was a drug problem and
    people weren’t coming to my logarithm
    that was me and this was 1987 or
    something like that
    not an issue anymore for those of you
    who don’t know there used to be phones
    that you put
    quarters into to be able to call people
    these are called pay phones
    right so now i’m in the laundromat so
    i’m looking for trash i’m looking for
    the ceiling
    and now i’m looking at the overall
    layout of the store
    and as i walk through it i either
    chuckle or i smile
    because i’m looking at those are 35
    pound milners
    those are 35 years old i mean
    okay um now i’m you know i’m okay
    all right uh 16 quarters all right four
    dollars okay all right okay
    all right okay you’re in the right range
    okay all right um and you see eight of
    them and
    four working and four look like they
    just got
    baseball bad beaten and you’re like i
    don’t understand this
    and then you look in there and you go
    okay so i do a quick
    poundage reading on the machines and i
    don’t care what your machine is
    10 20s 8 30s i’m doing my math
    and then i just look at all the dryers
    and i every dryer is a 30 pounder unless
    they’re new ones
    and i do the math and i see if they have
    the proper amount of ratio of poundage
    to poundage
    again i like to have a little more
    sometimes you have a little less
    but now i’m looking at mix i’m looking
    at flow do i have machines
    that are against the wall so that um and
    they don’t do it anymore they used to
    i haven’t seen too many today but i like
    to see a free-flowing laundromat where
    people can walk in the laundry room
    without getting stopped in
    in the older days they used to have some
    laundromats where the machines came out
    of the walls
    and if you were doing your washing you
    were in there you had no way to escape
    well that’s just making the person who’s
    doing their laundry fearful that they
    can’t get out of a situation if someone
    came in the door
    and said how do i get out of here so i’m
    looking at the layout i’m looking at the
    equipment
    i’m looking at the age of the equipment
    i’m looking at are all the lights on
    do they have lights are they all working
    are they all functional
    and and then i leave the store and i sit
    down on my car and i and i rate
    ingress and egress and that’s how i look
    at a laundromat
    every time i go to a new laundry
    and i count the logic cards
    and i give it a grade and then i sit
    down with you and say here’s what
    my discovery was at this particular
    laundromat here’s where i think you can
    improve
    you can call me today and say come down
    to look at my login and tell me what you
    think of them because i haven’t been
    into your stores
    so i’d be more than happy to do that so
    but it just takes another set of eyes
    not yours
    and it’s one of those like hey i think
    i’ll do this every six months i just
    have somebody come in and look at my
    store
    from their perspective and it could be
    another owner that you know in orange
    county say hey
    come by and rip my store apart
    and and you get you get that i mean you
    know
    because you realize you’re really not in
    competition with each other
    right you’re you’re just trying to gain
    the mass of people that need their
    clothing washed
    and how do i provide for them so your
    competition is really yourself
    how can i provide this neighborhood
    and you and i can talk about in the
    future we can do another podcast
    of demographics how they impact you what
    do they really mean what do you look for
    um to um what’s the average family spend
    um an example i’ll just give you a
    little tidbit um
    somebody said you know i i look at
    renters and
    i get it down to a number and i multiply
    that number by
    i divide it by the number of people per
    household and in hispanic communities i
    know that it’s probably double so if
    they say there’s 3.5
    there’s six people living in that house
    it’s just
    just the way they they work and
    but that household is 50 to 70
    per household so you’re doing 25 000
    in your laundromat not including wash
    dry and fold
    and not including vending because
    vending
    is an adjunct to your wash i take that
    25
    000 and i divide it by orange county i’m
    going to divide it by 60.
    you’ve got 425 permanent customers
    coming to your shopping center every
    week to do their wash
    those are your numbers and if you wanted
    to you could sit down and put a
    percentage to each day of the week
    saturday sunday friday monday tuesday
    thursday wednesday and you can figure
    out
    approximately how many people are coming
    to your logger mat on fridays
    as a percentage and then divide that by
    16 hours you’re gonna go geez i don’t
    have a lot of people coming in here
    now the question becomes how do i get
    them in here right
    and and then it goes back to if i had
    more parking
    i could do more volume if i had more
    volume i need more dryers i had more
    dryers i need more washers and now it
    becomes one of those
    oh my god i’m chasing my tail here but
    that’s
    when you’re doing that then you’re doing
    it right
    i love that i mean again the systematic
    approach is something that i think
    is missing even with most brokers that
    i’ve worked with that i’ve seen
    they’re not taking the systematic
    approach a lot of them are just kind of
    basing off their experience and so they
    have like these
    you know general knowledge where they
    can kind of get ballpark and stuff like
    that but i love the systematic approach
    and again
    treating your business like a business
    right and that’s what you’re doing
    that’s what you’re saying
    when you’re going through i mean i i was
    taking all kinds of notes while you were
    talking about your process and stuff
    like that because i i think
    even just having an owner do that for
    themselves and i love the advice of
    having somebody come in
    every six months and just tear your
    laundry mat apart it terrifies me to
    death
    to have that happen but it’s way better
    to be critiqued by somebody who knows
    and to be able to make
    you know adjustments to improve your
    business
    than to be ignorant of that stuff and
    feel and not feel that uncomfortable
    feeling of saying
    hey here’s some things that i’m not
    doing optimally
    that i could do better right it feels
    scary to me
    but you know ultimately if you want to
    grow your business it’s like that whole
    like iron
    sharpens iron kind of thing right you
    have somebody come in and telling you
    how to improve your business it’s only
    going to benefit you and
    as important it’s going to benefit your
    customers
    and your community that your laundromats
    in right
    you’ll be you’ll laugh and i’ll i’ll and
    i’m going to use you so that everybody
    can see that you’re human
    um what was the last time you surveyed
    your competition
    oh i was just i was thinking this i
    don’t even want to talk about that i was
    because i was thinking i was like man i
    need to go back it’s probably been two
    years at least since i’ve gone out and
    looked at
    the competition and you’d be surprised
    um i’ll give you a story um i got a guy
    in la
    and um we found out that
    he only has one competitor that
    competitor has equipment the same age as
    his equipment which is 20 years
    so this neighborhood has not had a
    resurgence of new equipment for 20
    years that’s
    shocking but it’s also
    a benefit to him because we went in
    there and said
    what do we need to change how do we need
    to change it based on the competition
    and based on the machines that the other
    competitor has we’re going to put new
    equipment in here you’ll do just fine
    because in that case since they haven’t
    seen new equipment once they see new
    equipment
    it’s not so much that it’s new it’s they
    know it’ll work
    right yep even if it’s a quarter more
    it won’t matter they’ll be at his door
    so well
    we don’t know go ahead yeah no that was
    awesome man i mean that
    that whole that whole secret sauce thing
    was
    incredible there was so much good stuff
    in there uh i mean you’ve given already
    a ton of
    tips for newbies but we have a section
    called pro tips
    pro tips and that’s if you have a piece
    of advice to give to somebody buying
    their first laundromat
    what would you tell them go there late
    at night so you’re comfortable that you
    know that that’s the laundry you want to
    own
    move very slowly and methodically
    in your analysis and investigations
    don’t give up
    when it doesn’t fly right the first time
    because it’s not going to fly right the
    first time
    trust the process with your broker
    and realize that once you get to escrow
    the escrow officer rules the broker
    the seller and the buyer have no say
    because the escrow officer has her own
    set of rules that she has to work by
    and she’s only asking for information in
    order to close that escrow
    don’t open escrow
    unless you have a deal
    unless you have verified several things
    escrow in my estimation is good for two
    things
    three things you’re legally good to
    transfer the business you’re going to
    get a bill of sale
    you need an assignment of lease and you
    got your financing
    and those are the only three things that
    i look at when i talk to my clients
    about
    what escrow means the rest of it you get
    to do collections you get to
    learn about the business you get to be
    trained on it but that’s all
    what the escrow officer does and trust
    in the fact that that’s the process
    there is no control after once it gets
    to escrow it’s out of our hands
    yeah and most people don’t understand
    that they think you can manipulate
    something that’s like
    she’s got her own rules that’s what
    they’re for they’re a neutral
    neutral party yeah awesome
    awesome pro tips i think those are great
    things for newbies to be thinking of
    again a lot of
    uh unique tips there that we haven’t
    heard before on the podcast so
    really really good stuff and we haven’t
    really talked about escrow at all i
    don’t think no podcast so
    i mean at least bringing that up i
    appreciate that maybe we can do
    something later on down the line talking
    about escrow too
    um okay well i have two more questions
    for you the first one
    is uh do you have any resources that you
    would recommend
    i i feel like there’s not a ton of
    resource there are resources out there
    but there’s not a ton