20 Years of Wisdom Packed Into 1 Interview with Peter Stern

Peter Stern has held many roles in this industry. He was an integral player in one of the largest privately held laundromat portfolios in the country, managed a fund investing in laundromats, and now works with Mr. Jeff, a laundry pick-up & delivery franchise getting started in the U.S. 

Peter joins Jordan on the show this week and shares his long and storied experience in the industry while dropping a TON of wisdom, practical knowledge, and actionable tips for laundromat owners and those of your wanting to buy your first laundromat. In a truly value-packed show, Peter holds nothing back and shares the ups and downs he’s seen in this business to help you better run your business.

In this episode, Peter and Jordan discuss:

  • Pioneering the laundromat superstore
  • Starting an energy company for laundromats
  • Being the acquisitions and operations manager for a large laundromat chain
  • Tips on scaling the business
  • The role of real estate and scaling
  • How to ramp up a new laundromat
  • Lagging vs leading indicators
  • Getting customer feedback
  • A major culture shift happening in the laundromat industry right now
  • Order value and the importance of trust with customers
  • Online reviews
  • Technology development over the years
  • Culture of care and attention to detail
  • Hub & spoke model of laundry drop-off services
  • Checklists
  • Churn rate
  • What is Mr. Jeff and who is it for
  • Looking outside of the industry for inspiration

And way, way more!!

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Episode Transcript

hey what’s up guys it’s jordan with the
laundromat resource podcast this is show
84 and i’m pumped you’re here today
because today we’re talking with peter
stern
and it is an incredible conversation i
mean we i have like a few pages of notes
that i was taking during this interview
there’s so much good information so much
good knowledge that peter drops he’s
been in the industry a long time
and he’s had some unique roles in this
industry too so we get into a lot of
that and i pin him down on a whole bunch
of details
about how
he and his company has been uh
successful
running a laundromat over the years so
there’s a lot of really good information
if you’re an owner or if you’re looking
to be an owner this is one that’s gonna
have a lot of very practical tangible
stuff for it so super pumped about that
before we jump into it with peter real
quick i want to say you guys are punks
not really but uh uh last week on the
episode i
announced that uh the analysis
calculator
that we launched for pro members who get
unlimited use you can try it for free
london resource.com calculators by the
way that link in every link in this
episode will be on the show notes a lot
of myresource.com show 84 or if you’re
on youtube down below
but anyways i announced the analysis
calculator i’m super excited about it i
think it’s going to be an awesome tool
for anybody buying
their first second thousandth laundromat
it’s going to help them analyze deals
and determine the valuations of
laundromats quickly and accurately so
i’m super excited about it but you guys
kind of flocked to it in force and
crashed it for you know like half a day
or maybe even a little bit more than
half a day so just wanted to say that if
you went to try to use that analysis
calculator and it wasn’t working when
you tried to go
i just want to let you know that it’s
there so you can go try it now lauderdam
resource.com calculators
and give it a shot and again pro members
unlimited use unlimited access to that
but even if you’re not a pro member you
can try for free download the sleek pdf
that it spits out for you really really
cool
but anyways this week
i am super excited i have a couple of
short books coming out um they haven’t
come out yet
one is on
uh the whole due diligence process
everything you need to know about due
diligence
probably the most crucial part of buying
a laundromat and doing it the right way
that’s why i wrote a pretty
comprehensive book on how to do that due
diligence that book is coming out here
in the next few months
however
ebook version of that book i have thrown
into the um the pro membership there so
pro members if you are out there you can
go download that uh the definitive guide
on
laundromat due diligence uh right now
it’s included in your membership uh if
you’re not a pro member just go be a pro
member it’s gonna be a no-brainer uh i
think it already is but there’s a lot
more even coming up over the next few
weeks um the uh the other book that’s
coming out is on how to finance or
different ways to finance a laundromat
deal so that’s coming out and that book
will come out
pretty soon here for pro members 2
well before its actual launch so
excited about those pro perks there and
there’s more coming can’t wait to share
next week’s uh with you i’m super
excited about it okay the other thing i
just wanted to say is
you know welcome to everybody who has
been over joining the uh the membership
over at laundromat resource whether the
free
or the paid membership uh welcome to
everybody and one of the things that
i have loved that’s been cracking me up
is some of your guys’s profile pictures
and we’re ranging from like very
professional
you know looking like i can tell you
you’re serious you mean business
pictures to a lot of very hilarious uh
hilarious pictures i’ve been
thoroughly enjoying your profile
pictures over there so uh hopefully you
guys are enjoying each other’s pictures
too so whether you’re commenting on you
know the forums or whatever the case may
be and you’re seeing those pictures i’m
just i’m loving it guys i am loving it
so uh continue to do that make sure if
you are a member over there make sure
your profile is filled out and what
that’s going to do a few different
things for you is
you know number one is going to help
people get to know you a little bit
better and uh man the whole
you know saying quote or whatever your
your network is your net worth like i
mean it’s so true and you know the
people that you’re spending your time
with the people that you’re learning
from the people you’re interacting with
do have a huge impact on you so when
you’re hanging out with other people who
are going in the same direction of you
as you who have similar goals as you
it’s just going to help you reach them
so much faster so go fill out that
profile go upload a picture i’m always
curious to see you know if people are
gonna upload the serious business like
uh which is awesome and i think it’s
really good or the hilarious which is
also awesome and really good so i just
wanted to let you guys know some of you
guys are really cracking me up over
there all right uh enough of that
enough of that um last week i said that
i was going to give away
um
dave menses book hard copies signed hard
copies of dave mintz’s book laundromat
millionaire to
at least one person who commented on the
forums this week i’m gonna give two away
and in order to let you know who the two
people are
that are getting the book i’m gonna
bring my daughter on to tell you uh just
because she’s hilarious and i let her
pick at random the people who we’re
gonna win so i’m gonna bring her on and
then we’ll jump into it with peter stern
with an amazing amazing interview
alright guys i’ll see you when i jump on
with peter
hi my name is evangeline berry and i am
eight years old and today i’m going to
be giving away two laundromat
millionaire books
and so if your name is called
congratulations and if not
okay so the first book i’m giving away
is to alex oliva
yay alexa
next one is
jim bernes
yay
okay congratulations if you won and if
you didn’t
too bad so sad okay
bye
peter how are you doing man thanks for
coming on the show i’m i’m good jordan
nice nice to meet you finally i’ve uh
been uh listening to you for a while so
it’s uh it’s great thank you for having
me on hey it’s my pleasure and i’m glad
to have you on too and uh it’s funny
because i heard about you like a long
time ago
and the the reason your name stuck out
because i thought you were related to
mark stern and then i think it was mark
stern who’s like oh no we’re not related
but i know who he
is think he hates that
no no uh no mark uh a long time um but
god it’s going going back almost 20
years that i know mark uh
good guy great industry guy um so
happy to be associated with them but no
no no relation that we know of okay okay
uh that’s right well okay well then if
you’re not related to mark stern then
can you tell us a little bit about not
not
you’re the most notable
in your tribe i like that yeah
you are now i mean coming on the podcast
you’re pretty much about to be thrown
into the spotlight
blowing blowing up
the new king of uh media move over
howard right
that’s right well tell us a little bit
about who you are and i’m curious how
did you get into this industry
uh so
you know um
you know peter stern a failed uh
baseball player so
that was my
hopes and dreams as a little boy
oddly enough it wasn’t uh getting into
the laundromat industry um that yeah
that wasn’t my first grade uh aspiration
so
but uh yeah it’s a it’s an interesting
path i mean let life uh in general you
never know uh what roads are gonna
lead you where i actually was a uh
finance major at a school uh
you know was working at uh
pricewaterhousecoopers on the consulting
side so had a much different uh
trajectory or vision or you know whether
it was an investment banking or staying
consulting
um and then uh a
mentor of mine who i interned with um in
college uh was doing the real estate for
alex weiss the the founder of uh lunch
capital clean rate centers
and alex was uh this was you know this
back 20 years ago alex was uh doing some
uh pioneering and some interesting
things in the industry and he wanted
some young blood
so he reached out to louis to see if he
had any young talent and uh it was like
you got to meet you got to meet and i
was like i love you but um
you know a finance background like what
what the heck am i going to do in the
laundry industry like he’s like you
don’t understand this is different you
know big box 24 hours they’re taking it
over the world i’m like
so he he’s a pretty persistent guy um
and he’s like
listen just do me a favor me meet with
alex once uh you know you have a nice
meal
if it’s a waste your time you know to
waste your time but do me that favor
uh met with alex for those of you who uh
are in the industry you probably know
everyone knows alex um
personality bigger than life uh
really charismatic engaging uh
person and we hit it off we’ve been
lifelong friends and uh colleagues and
work uh
for him in many capacities and uh it’s
just set me on this journey that’s been
um you know one hell of a ride
yeah real quick uh i mean alex is kind
of back innovating in this industry
right now so i just thought i’d throw
that out there and if actually if you’re
in if you’re in texas and you’re looking
for an opportunity to get into the
industry
uh alex actually has a couple of
opportunities so shoot me an email
jordantlandmyresource.com if you’re out
in texas looking for an opportunity to
get in the industry and i’ll i’ll pass
on what he’s got because he’s doing some
interesting stuff right now so anyways
enough about alex
so okay so you met with alex and uh he
he won you over he impressed you what
happened yes i came on board at the time
this was uh this was uh late 90s and uh
you know it seemed like
there were there were a lot of different
players there was laundromats uh there
was spin cycle lucy’s laundry there you
know there was a lot of attention and
focus on trying to replicate the
successes of like the blockbusters of
the world or home depot
take this
fragmented mom-and-pop industry and uh
bring in the big box 24-hour parking uh
attended
superstore concept and roll up and
consolidate the the industry um
there
uh as we stand here uh 20 years later uh
not been done there there are a lot
there are a lot of articles and
obstacles in executing in this industry
that didn’t exist and the others um
so
uh
but you know we were
uh
we went through these starts and stops i
in one of the stops i wound up agreeing
to
uh depart full time from laundry capital
i went into
business for myself opening up my own
laundromats uh was very successful with
that continued to consult for laundry
capital along the way we always believed
that there was this uh
big picture or this nut to crack in this
industry such massive opportunity
um untapped potential but it was just
you know we just couldn’t get our hands
around it
in the right way but we we kept at it
and uh as you mentioned earlier uh
uh alex is a entrepreneurial mindset by
nature so you know we we just kept on uh
plugging away at different concepts
along the years and different ideas
you know there there was a franchise
route there
um
and
we you know uh we wound up uh opening a
um
energy company along the way global
energy which uh is a seller of natural
gas and electric reseller to to the
industry and now uh to other industries
as well
um we oddly enough got involved in the
uh
pawn shop business that we were looking
to integrate into the laundromats that’s
p-a-w-n
by the way because sometimes
with something else um
the other one might have been more
lucrative as it turned out but uh unless
we uh
we we uh we’re in the uh tattoo business
for for a little while um
and then uh alex actually uh
started his uh a real estate company rw
real estate which uh
went on to be you know extremely
successful and uh took on a mind of its
own so uh
we continue to innovate and figure out
uh ways to
make money in and around the industry
while we had this uh core operating
company that was um
you know steady and and served as a base
of operations uh to
um
you know uh
try to uh try to figure something out
much bigger um and then uh somewhere
along the way i’d say
about um
five six years ago we were looking into
uh
uh executing a peer-to-peer concept in
the industry i i was a big believer uh
that that this was natural for for the
industry that um you had uh it you had
the recipe for success there we always
believed on the wash and fold side
the workers really drove that business
and very tough business to manage
control
on a corporate level
so
we believed with technology you could
innovate and
create a peer-to-peer concept the
problem was is that we weren’t
technology company by by nature you know
we didn’t have engineers on staff uh you
know what wasn’t in our dna
and um
yeah we
couldn’t uh
we realized very quickly it wasn’t gonna
be something that we could execute
in-house but we we loved the idea and
then you know there were ideas of these
uh pickup and delivery services that
were watching like like washio uh and
there was a huge demand for the business
we saw
uh various uh companies in new york
doing it and and then around the country
and uh you know
we we saw that
these companies were very good at uh
creating the tech and a marketing
platform um
and and
they they were able to piggyback on some
logistics apps that were already out
there in the marketplace but nobody was
really focused on the
back end solution of the processing so
we always believed that that was the
equation that the
quality and consistency of services was
going to be
what won there um
and again
old operating company we’re trying to
figure out this internally
and then uh after uh you know uh banging
our heads against the wall
long enough we said you know what
we’re not the ones to figure this out
there’s all these uh
bright young players
looking to get into the industry they
they have the tech
uh experience their uh
uh
they have the energy of the passion and
quite frankly they have the you know
they they don’t have the
cynical nature of 20 years of uh things
not working so they come with a fresh
perspective and and that’s healthy like
you know where we
say no that’s not gonna work because
they just start doing stuff and then
that doesn’t work they pivot do
something else and that’s really what we
believe was needed so
uh alex and i got together we went on a
hike we were trying to figure out how to
uh you know uh figure this all out and
we said you know what
let’s not recreate
the wheel here let’s not um you know try
to do everything ourselves
let’s launch a venture capital firm
let’s
place bets on some of this town out
there that is is looking to get in this
industry there’s lots of capital looking
to come in there’s lots of young uh
uh
talent and founders and software
engineers that are looking to get but
they don’t have the industry expertise
but we can be that value-add we we
understand the industry really well we
know what it needs we know its landmines
um we thought we could be really good
strategic investors so
that’s what we did we launched this fund
um you know one of our early investments
and success stories was sense who is a
pos so far as a service business that’s
really blowing it out of the water um
so and then uh then in my due diligence
i came across mr jeff which uh
was a international company based out of
spain but had a worldwide reach sold
2000 franchises across the globe uh
really focused on the app-based concept
pickup and delivery wash and fold
service business all the aspects that we
believe are a huge growth area huge
directory um
for the future of the industry and they
were bringing the
all the tech uh
and and all the marketing uh chops to to
really make this happen and it was a
franchise concept which we love because
we we always believed that that end of
the business counter business it needed
the tlc of an owner operator
so did extensive due diligence uh
met with the ceo another dynamic
brilliant uh personality um and uh we
wound up making a substantial investment
in mr jeff uh and also agreed to partner
with them to help them launch in the u.s
uh and in doing so
i i also full disclosure invested
personally in mr jeff as well um really
excited about the concept became so
excited that uh agreed to switch over
full-time and and help them launch here
in the us so that’s what uh that’s what
i’ve been busy doing for like the last
six months
it was like quite the whirlwind that you
you know kind of went through uh going
from
something totally different than this
industry and then wind it up where
you’re at right now
uh so let’s rewind i mean i want to ask
you about
mr jeff here in a little bit but before
we get to that let’s rewind
back a little bit
uh what so
when you when you started working you
know with alex and all that what was
your what was your role
yes so i i ran the operations of the
company for a little while
i did some uh
acquisitions uh in the in the early days
and then uh
then moved more into a strategic role
and uh
i was uh svp where i i work on
strategic growth and um uh
planning and trying to figure out a lot
a lot of it was um
you know outs after i i really you know
after getting out of the operations
day-to-day operations of the business i
knew it really well and then after
running my own laundromat knew it even
uh better uh but then i thought i could
come in from more of a high level and
figure out a 20 000 foot view of how we
can approach things differently not only
in the company but in the industry as a
whole
yeah that’s cool so i mean you started
like
kind of in the
smaller specific role with the
acquisitions and operations and then
kind of
expanded out to you know some of those
higher level thinking things which is
pretty cool can we talk just for a
second about
you know when you were running
uh when you were running operations what
you know what what was it about what you
guys were doing that was making you guys
so successful i mean you guys scaled up
you know
one of the biggest if not the biggest
you know
owners of laundromats and so how did
what was it about the operation what
were you guys doing that allowed you
guys to scale so big
well so i think it first and foremost in
the in in this
in that industry and especially in big
box when you’re you know building 5 000
square foot uh laundromats with parking
um
real estate is critical to scouting it’s
uh
probably
one of the biggest hurdles to that big
national play and and development um
it’s uh you know it takes a
lot of time to find uh the right site
you know vetted for
development and um and then the actual
execution
of the building and then then ramping up
stores so that that whole process i
think we became um
you know really proficient at
and uh
we also
as opposed to the spin cycles and
laundromats that were you know uh backed
by um
third party capital um you know they
sort of had a pressure to grow and grow
quickly
and we never did so i think that we
uh every every site was evaluated
standalone you know a lot of due
diligence go in um you know and we we
were able to
really uh
pick quality locations i i think that
that that was key
and then um
uh in a capital intensive business that
you know takes along the the ramp is is
critical so the speed of the ramp and um
through like listen we we made a lot of
mistakes early on and figured stuff out
but uh
you
you constantly learn and then um you
know keep on uh
building your process and we we got
really good at uh ramping stores quickly
i think that um
you’re seeing more of it today but
when when we
were first starting um
wasn’t a lot of marketing spend in in
this business and we always believed in
spending the marketing and um you know
that would get us to the
ramp faster and uh that made the dri
investment more more successful then um
you know when it came to operations
like listen uh
everyone loves this business because
from from the outside it’s a simple
business and i
and that’s true uh
at its core right
um but
there’s an art to executing the
simplicity day after day seven days a
week 24 hours a day 365 days a year
um and that that takes a
a
special type of uh operator and
commitment um
to you know making sure that uh
all all those key aspects of the
business are just uh taken care of
consistently the the cleanliness your
equipment working customer service um
you know as soon as you get arrogant and
think all right i got this i can look
away for a moment those things will
start to slide
and they don’t slide like
um overnight
it’s it’s like the boiling frog it’s so
gradual that you don’t notice it and
what i’ve always said in in this
business is that um
sales are a lagging indicator of
performance
so what happens is that
you you don’t have that
uh
like
instant uh feedback mechanism to tell
you whether you
whether what you’re doing is right or
wrong
and
because of that you can get fooled into
complacency to think okay well i
i stepped off the gas a little bit and
nothing bad happened so i could and then
six months later
you see the ramifications of that and
then
it’s going to take another six months to
get it back
of hard work and consistency so
um just having that conviction and doing
the right thing day after day is is
really important in this business
yeah well i mean i think that’s
interesting because you’re dead on with
you know the sales being the lagging
indicator i’ve seen that in my own
business i would say for myself
personally you know that consistency day
after day after day and just being on
top of things all like that’s the
hardest part for me and it’s not the
part of the business that i love
actually
but it’s super crucial but i’m curious
if sales is the lagging indicator i mean
do you have anything that you’re looking
at as like a leading indicator
um so
like listen this has been
it’s been an interesting journey
especially with mr mr jeff because now
we’re getting more insight into our
customer base and metrics and in real
time data uh we didn’t have those tools
so really it’s it’s old school and it’s
uh
in your stores talking to your customer
base talking to your
employees watching the business um you
know
it’s it’s a presence that that that you
have to have um there’s certainly
uh
uh metrics that that you can look at but
like i said you know it was more
i
i’ve always been um
shocked by the amount of people in this
business that um
have a disdain for their customer base
and
that’s a it’s always been a puzzle and
an enigma to me and you know i so for me
when i you know was running the
operations or when um i ran my own
stores it was talking to your customers
they’ll tell you
i mean
it’s
there’s no secrets let’s say exactly
what’s going on how they feel what you
could do better and you gotta listen um
you gotta listen to the feedback uh that
that’s that’s your bread and butter
they’re they’re the ones putting food on
your table um listen to them and the
more the more you open up that dialogue
and and establish that trust with your
customer base the more you inform them
and uh
the better polls you’ll have
yeah so are you i mean
where were you back then were you
do were you doing that as you were
scaling up i mean i imagine that gets
more and more difficult
to do at specific locations at least as
you start to scale up are you training
employees do that or are you
getting snapshots at different places
and kind of trying to apply the lessons
kind of across the board how are you
handling that
yeah so you know that
so
if you’re asking about like in my own
stores which you know was very small i
was able to do it and execute on a
personal basis and i was able to
instill that and model that behavior for
my managers and then for my staff and
you created a culture
around that that that just became um
prevalent and and persistent and if you
if you were continuing to lead that then
then others followed and and and that
was effective i i did find uh you know
like in in a uh
a chain you know uh as large as clean
right that um it it does become harder
and harder to
to do that on a personal level and then
building that culture
around that becomes harder especially
when your turnover is high and you’re
you’re
working with the
um employee base that that’s constantly
changing so that’s um
that that’s
quite frankly been a challenge in the
business for for scale and growth um
and the the good owner operators that
are hands-on um really have really have
an advantage in there um you know
so and i think the way that the business
is changing um it’s even more and more
important because when when we first
uh
you know when we were first going at
laundry capital um
but it was mostly self-service
so
the customers did their own work you’re
more focused on keeping your equipment
running and uh your stores clean and and
listen having somebody friendly with a
smile that that yeah
was important but it wasn’t the make or
the break
of the business um because
there are a lot of stores across the
country that operate unattended you know
so that
that really but now you’re seeing a big
shift towards service
so
more of this hospitality nature is more
and more important and um
that’s a culture change in the industry
that it’s a dramatic shift and i’m not
sure
uh
everyone’s quite figured that out yet um
and and how to execute that in in in the
best way
so you know i always say like
especially on the on the wash and fold
side because washing fold is all about
trust
people uh in retail always focus on
average ticket which i think in
it’s it’s good for certain aspects but
what they’re missing in wash and fold is
the average value
that people are leaving in washington
folks the average ticket might be thirty
forty dollars right for a bag of laundry
but how much value is in that clothing
it
could be upwards of a thousand dollars
or if it’s your favorite pair of jeans
or t-shirt it’s invaluable it’s
irreplaceable so
trusting who you’re leaving with that uh
to process those clothes is
critically important and um you know
that that that takes a different level
of customer engagement
um and i think we can learn a lot from
like the restaurant industry when when
uh
you know when you go to a restaurant um
you know do you want to go to a place
where nobody knows you or do you want to
go where they know you by name they have
your favorite table they they already
have your drink ready like that that
sort of approach this business i think
um is is what’s really gonna make it
work in on on the service sector of the
business and that that’s where i believe
all the growth is
yeah i mean i love that kind of
framework of thinking where
you know i mean it is trust and i like
the
i have i haven’t really heard anybody
talking about you know the value of the
order and how much i mean i mean we know
kind of you know implicitly or when
something goes wrong customers let us
know right we lose something or
something
you know gets torn in the dryer or
something like that which happens
sometimes you know we hear about you
know hey this costs us much money you
know that that kind of thing but i
haven’t really heard that as like a
metric and you know thinking about it in
those terms
does
kind of i think add a little more weight
to the
you know that service side of the
business and you know how much
uh trust there is in people and there’s
kind of two maybe there’s more but two
that i can think of on top of my head
ways to build that trust and one is like
you were saying
get to know your customers personally
you know and and get to know them by
name and and hopefully they’re gonna
refer you and transfer their trust to
people that they know they’re trusting
you to people that they know so that
they’ll also trust you because
you know your cur your current customer
trust that they know trusts you or to do
it more
i’ll probably say and and to do it more
on uh on on the bigger scale and the
more public platforms like a google like
a yelp those kinds of things where
trust is also transferred maybe not by
somebody that you know personally but
but by
the masses right and so that’s why
you know getting
good reviews you know offering good
service is one thing and it’s definitely
going to help your business but taking
that one extra step and trying to
purposefully get reviews and
intentionally asked for reviews
actually is another way to kind of build
that trust uh and and again the the more
valuable
the product is for the customer the more
trust you need to build so anything you
can be doing service wise to build that
trust is going to be huge for your
business
100
uh
and i i see it in my own
uh
service uh like when i when i’m looking
for a new service like we’ve all become
like these uh
uh hack consumer research uh consumer
reports people where we’re going through
reviews and cross-checking sites because
you know uh
it’s it’s not just the rating you want
to make sure the reviews are valid and
that they you know they that and you
want to check all right
is this uh propaganda or is it real and
people know the difference and they want
to see even that the negative reviews
that they were like when i see
like listen you’re going to have
negative reviews it’s inevitable
hopefully otherwise you don’t have
enough business if you don’t have enough
volume in business um then you could
have you know six five-star reviews but
which by the way
people see also there’s not enough
reviews that’s a red flag but you know
when you get into hundreds uh if not
thousands of reviews you’re gonna have
some negative ones and
what i look for is is how the business
respond
and the really good ones you’ll see that
they’re all over it and they’re
responding and owning up to any mistakes
and criticisms and and taking care of
the customer so
this is uh
it’s a it’s a new world it’s it’s
changing fast and i i think um
i i think you hit the nail on the head
like um that’s that’s a big part of the
trust nowadays and
i i go back to emphasize that point of
the value like if you’re just uh
if you’re just ordering a hamburger
you might just take a uh you know um
uh a gamble uh one night in order from a
new place without much research right
like uh
i i take my food seriously but
one one meal like i’m not gonna put in
hours of research but
for that you know for a thousand dollars
worth of my clothes and my favorite
stuff like you know
i’m gonna i’m gonna put some effort into
that and then the residual effect of
that is because i’m i’m not just doing
this once i’m i’m doing it every week
after that so it’s it’s worth it’s worth
the research um so
i think i need to keep that in mind
yeah that’s huge i mean i i love i love
that i love that and i think that that
will be you know just for for anybody
listening that’s a that’s just a great
mindset to have especially if you’re
doing somebody else’s laundry whether
it’s pick-up and delivery or you know
just a wash right full the drop-off
you know laundry service uh i mean i i
like thinking about it in those terms
because those are the terms that our
customers are thinking about it and even
if it’s not even if they’re not
explicitly thinking i’m giving over a
thousand dollars worth of clothes
to these people you know
guess what
don’t deliver their clothes one time and
find out how much you know they one item
yeah why not
yeah i know
and you know the
that’s what that’s what i think like uh
all like a lot of the big uh
you know uh
venture capital back players like washio
missed in this industry is um
the
the error rate the margin of error that
we have in this business is so small
when you think about the
the countless items of clothing we
process you know in and out every day
you know the jeans the shirts the socks
yeah
i mean how many articles of clothing and
screw up one
uh pair of jeans one
t-shirt uh you know a comforter like
just one
and you know i mean it’ll wreak havoc in
in your in your day so like to think
about the
the
accuracy rate or the the quality rate
that you need to have in this business
you need you need to be uh
incredibly on point um and you know it’s
a testament to what a lot of good
operators out there do day in and day
out and people when they go back to your
question like what’s the key what what’s
this what’s the uh
you know uh
essential aspects to success it’s it’s
hard to describe in this like
magic bullet of something that’s going
to be so poignant and so
earth-shattering that people you know
you know blow people’s brains it’s like
uh
doing
stuff consistently well time and time
and time and time again that that’s
that’s
that’s the secret
that’s really hard to do
yeah it it is really hard it’s really
hard to do even just in
like self-serve laundry especially right
now where it can be difficult for people
to find good help you know if
i’ve i’ve gone through periods where
i’ve cycled through
you know attendance because yeah for
various reasons and
you know
it’s hard to it’s hard to provide a
consistent
environment even let alone a service but
even an environment right you’re cycling
through people and that just adds a
whole another layer kind of on top of it
which kind of brings up
your people need to care
about the customers and about the
clothes like they they have to you know
uh be incredibly conscientious
and
in return like to make that happen you
have to care about them
and i think that’s a common mistake that
that happens in this business uh people
focus on uh on on the the dollars and
cents and they they’re so anxious to
look at their revenue and check their
receipts of their cash register but um
you need to you need to invest time in
your employees uh
you know um a lot of great operators or
owner operators and family so they’re
vested in the business but if you’re
gonna have people working for you you
gotta care about them
yeah
yeah i think i love that i wrote down
that quote you know your people need to
care
about
you know the the people and the clothes
but in order to make that happen you
need to carry care i love that i love
that
so okay so i mean we’re talking about
this is
i’m just i’m going down the rabbit trail
here uh this is you know what we’re
talking about is
creating that consistent
you know consistent experience that
consistency every every
you know order needs to be processed
correctly you can’t be losing stuff you
know you can’t be ruining stuff
what kinds of
systems or processes do we need to be
putting in place here and how do we
you know how do we set that up uh
because it seems like i’m i’m getting a
little nervous now talking about this
because i’m like wow the responsibility
seems very heavy you know is this a
responsibility i want to take on so what
tools or what systems or processes do we
need to help us
kind of yes
i think technology can help a lot
unfortunately because the industry was
so fragmented uh for so many years and
um
there wasn’t
there wasn’t the investment in
technology infrastructure that there
should have been or compared to other uh
major retail industries that you’d have
this uh
technological advancement and infusion
so
from a technology standpoint um a lot of
the systems have been left behind
that’s changing so it’s coming in so so
using that
will help i i mean i do know that um
building that culture
is important of attention to detail and
and to make sure that uh
it’s one thing to create a process but
uh to make sure it’s followed
you know at a very high hit rate is uh
is extremely important and
i
so i i’ll go back uh one of the things
that we did during the height of the
pandemic i was still uh working at
laundry capital and
because we have
so much trouble
uh staffing during that time we’re we’re
in new york so
queens and brooklyn we were the
epicenter of
of it all and it was uh horrific and
you know we were struggling to number
one staff our stores in general but
number two
more and more people wanted wash and
fold because they didn’t want to be
inside a closed environment with a bunch
of people so there were more and more
people dropping clothes off
um
as a result we shifted our operation
to this hub and spoke concept where we
uh
shut down one of our uh biggest stores
to the public
and it just became a wash and fold
processing facility called it the hub um
and so
every day in new york we picked up from
you know our uh
40 locations brought it to the central
processing facility uh did all the
clothes and and and shipped it back out
i i i think
at the height we were doing 14 000
pounds of clothing a day
um
a
massive undertaking and uh didn’t really
have the technology built for that so
now we had to answer that question how
do we do this much volume and
you know have the consistency and
quality my question right now is how do
you especially when they’re coming from
40 locations not only
do you have to wash clothes and not ruin
them you have to wash clothes and not
lose them but now you can’t mix them up
and now you can’t send them back to the
wrong
locate like the the level of complexity
there has given me more anxiety so i
mean how did you guys solve that
so you know and it was it was uh it
happened so fast that like we didn’t
obviously nobody knew the pandemic were
coming and it wasn’t like we
you know sketched this out for six
months and debated we just jumped into
it so um i had to like really figure it
out very quickly on the fly and i you
know i thought back to a book that i
read many years ago and it was a
checklist manifesto um
you know and it’s incredible like you
know so
when when you take the airline industry
and like you use them as an example and
like they’re the quintessential example
for making sure little things are done
extremely consistently that seems stupid
that
how could i forget to do this or you
know it’s it’s not a big deal but they
have a culture ingrained in them
that is unbelievable and that’s why you
know the fail rate in the end
airline industry
is you know um astonishingly low i mean
because
we all know if uh
aircraft you know drops out of the sky
or crashes
it’s kind of strapped it’s traffic to
the world it’s headline news um
and
uh
they they have you know so many guard
rails in place to make sure that these
errors don’t happen and it’s this um
religious obsessive
uh attention to detail and
cross-checking and
that was uh you know a lot of the basis
for
um
the philosophy behind what we set up
you know
that i set up in the hub that
we had um
every step of the process a
check-in uh cross-check so you know they
said there was
pick up at the stores then they had to
sign it off to the driver driver checked
it in we checked the weights at every
checkpoint to make sure that you know
because sometimes maybe you’re missing a
bag but then the check of the weights
would tell you um you had tickets uh on
the outside of the bag i had tickets on
the inside of the bag in case the ticket
came off um
you know and when the clothes went to
the washer
the
ticket followed it and when it
transferred because sometimes you’re
going from the washer and you get
interrupted and then you have this card
of clothes that nobody knows where it is
so every single step of the process and
then you know it comes
down to
inspect what you expect and um you know
the classic mantra so
you know you couldn’t just create this
system
and expect it uh to just magically
happen you had to check that it was
happening all the time and
and when people knew that it was being
checked then you had to have built-in
rewards for people
doing the right thing i always like to
say catch people doing the right thing
and
recognize and and and praise them for
that and um you know we just built that
culture where uh the the quality and
consistency was rewarded and uh reveled
in and you know
that everybody was uh really really
focused on this
yeah i mean
first of all uh checklist manifesto is
awesome i’m gonna link it just in case
anybody wants to
uh check it out you can check it out on
the show notes or if you’re on youtube
the link will be down below
uh super good and you know
airline industry surgeons i mean like
the you know the people who have to do
things right
uh have
like you said they have these checklists
they cross check you know at at all
points there’s multiple people
checking just to make sure
that you’re doing things right and if
you’re you know going back to
that value metric of you know here’s
here’s how much this load of laundry
cost that somebody just dropped off into
my care you know well
when you’re doing 14 000 pounds of
laundry you know the value of that every
single day is
significant so you want to make sure you
get it right right so but the same you
should have the same exact mindset if
you’re doing 100 pounds of laundry a day
or what you know wherever you’re at on
that spectrum you need to have that same
mindset
so and i’ll tell you like there there’s
been uh
when i go back to the
the washios of the world that um and
there’s been
i won’t name them by name there’s a
number of others that are still around
um you know i think everyone has
struggled in that that online on-demand
pickup and delivery service laundry
everybody struggled with the the same
thing is that um it’s really
it’s really hard to acquire customers in
this business
and they’ve struggled i i believe
because
they didn’t control the quality and
retention has been a huge issue
so if you’re going to fight really hard
to get a customer don’t lose them yeah
like i i think you know and it’s more
exciting to get new business everyone
everyone loves that like they they love
the marketing side and they love me it’s
it’s more glamorous it’s more fun but um
if you can’t keep your customers
then you can’t win in this business so
retention is the key and
um
it’s it’s not sexy it’s not glamorous
but this this is the nuts and bolts that
need to be done in this business daily
to retain your customers um
and
you have them already and so so many
customers come in organically but um
i think that hanging on to every single
customer and fighting for it in this way
through the quality and consistency is
incredibly important and and i think
it’s um
i think it’s a lot i think that that’s
one of the biggest mistakes about uh
outsiders into this industry is there’s
an arrogance that um
that you know
they just focus on getting the customers
and not not keeping customers
yeah yeah well and i mean like you said
if you’re if you’re getting new
customers yeah it’s exciting
you know what’s a lot more exciting than
that is
making good money by providing a good
business right like yeah
yeah sure you can say i got you know 100
new customers this week or whatever but
if you just lost
99 of them like you just wasted a whole
lot of money and you know so
you’re on this constant treadmill just
churning through new customers um and it
you know
it’s a
it’s a very uh
slippery slope and dangerous business
model to to be on
yeah and you know and when we’re talking
self-serve you know one of the speaking
of which i mean one of the metrics i
don’t hear talked about a lot is that
churn rate and self-serve it can be
difficult unless you have a card system
it can be difficult to determine a churn
rate but that is definitely a metric for
the wash and fold and for the pickup and
delivery that should be that’s one of
the kpis right key performance
indicators
should be that churn rate so you should
know
when you acquire a customer how long
that customer on average is going to be
there and that’s going to help you
determine lifetime value and all that
and then you can start to implement
ways to you know extend out that
timeline for the average customer right
and that’s where you start you know
optimizing that business you start
making more money you know and and you
know that you’re providing a better
product at that point too
it’s it’s interesting because
there’s never really been
great data in this industry no we don’t
know our customers we don’t know the
customer habits and
um it’s always been an incredibly
consistent business in terms of
sales once the store is ramped like it
stays consistent so there’s lot there’s
been this long-held belief that um you
know it is a steady business uh
um from
uh customer churn that that you don’t
have a lot of turnover but um you know
now that i i’m working uh with mr jeff
and we have insights into uh
customer data and we’re able to track
customer habits i think that people are
going to find very soon that that a lot
of their assertions and assumptions
about
the customer habits in this business are
are
false
and
that that
that
sales have largely been a matter of uh
capacity
in this business
that you know you have a certain amount
of equipment you have peak periods and
you know most
busy good performing stores um
well if their all their equipment is
running their equipment’s spinning
during those periods and and
like there’s there’s an overflow that
goes to the laundromats or it’s
but whether those they don’t know
whether those customers are the same
customers they just know that the same
machines are spinning at the same times
well
you know
to me there’s an unbelievable power uh
and massive opportunity to be unlocked
if we understand the customer habits and
then we can change that dynamic
even out the
demand curve of this business offer them
incentives to come during off-peak
periods make sure you’re remarketing and
capturing customers
there’s there’s
a tremendous amount of power that i
think is coming
down the road um when when we now begin
to understand and know our customers and
uh what their needs are and um how to
market to them and how to retain them
how to um
re-engage them when you they left like
wouldn’t it be great to know that a
customer left you and understand why um
and then target them to get them back so
all this
hasn’t historically been done really
well in the industry if if at all and uh
really exciting uh excited about what’s
in the pipeline with the technology to
come
yeah i did uh i did actually a couple
podcasts on data i did one we’re just
talking about the importance of data and
how we haven’t really been using data in
our industry at all you know for the
most part and how that is going to be
the in my view that’s going to be the
biggest unfair advantage for the people
who are jumping on the bandwagon now and
learning how to use that how to collect
that data how to organize that data how
to use that data to make better business
decisions
i’ll link that podcast episode for
anybody interested i got a lot of really
good feedback
on that one but i also did an episode
talking about
how
that
that very fact the fact that the data is
super powerful
is is
a little bit of a concern in this
industry in my view and i don’t hear
anybody else really saying this but in
my view and i’ll just put myself on the
limb here you know with a lot of the
manufacturers offering
you know
pay through their systems
uh and and tracking that data getting
that customer data not a big deal until
now that these manufacturers are
starting to
you know buy up distributors build
stores put stores in the in the places
where their customers are
and you know they’re working on a
different level because they have a huge
swath of data that they can make those
business decisions on so something
interesting also to keep an eye on in
this industry that data can be
a double-edged sword and i think unless
we as owners and operators are
are trying to get into that data game
early i think we’re going to get left
behind if not by other owners we’re
going to get left behind by the
distributors and and not distributors
but the manufacturers
uh there too so interesting i
i
agree with what you’re saying and you
you just need to look laterally to any
other uh
massive retail industry and look how
data has changed the game and it’s um
if you ask any
uh ceo of any major retail chain um you
know
owning owning their customer
is
one of the
critical aspects of their strategies
today
and
right now the launch mat industry
uh
the owners on their revenue they don’t
own their customers
so i think that that’s that’s something
to
to
be on the lookout uh that down the road
yeah i
want to let that sit for a second
because i mean that’s a that’s a pretty
that’s a pretty powerful statement right
there you know the owners own the
revenue not the customers and you know
and i think that
you know data data is the ownership that
we’re talking about right like the
customer
you know patterns the customer behaviors
you know all this data that you can you
can
snag and analyze and make decisions off
of
that that’s what we’re talking about
we’re talking about ownership and so
yes i mean the customers are coming to
your
store so that your customers but
that that data is is where the real
money is uh you know on the bigger scale
so
i’m i’m interested to see you know how
how you kind of keep going and alex and
and people like you guys
uh
who are now getting better and better
access to that data how you’re going to
be able to and how this whole industry
is going to be able to
evolve and change and
uh and grow and you know i’ve already
i’ve been saying for a while like even
over the last five years this technology
has increased and there’s been more
interest in the industry and there’s
more savvy
business owners coming in this industry
is changing
rapidly and it’s becoming much much
much more sophisticated uh than it has
been for you know decades you know
before and so i don’t know it’s just
kind of interesting i think that right
now is a really interesting time to be
in this industry because there’s a lot
of change happening and whenever change
is happening
wealthy i think it’s i think
i think we’ll look back or maybe not us
but our kids or grandkids will look back
at this period of time and this will be
a
pivotal time in history so i think it’s
not just an interesting time to be in
in the laundry business or any business
i think it’s
an interesting time to be
a human
and i don’t say that lightly if you look
at the advancements in ai that that you
know are in the pipeline or even you
know starting to permeate society
and you look at the rate of change in
society that has occurred and it’s been
i mean the pandemic just poor
kerosene on a trend that was already you
know
um
uh
pretty
significant in society but
we haven’t seen a rate of change like
this i mean if you if you study history
and go back and you know look at the
industrial revolution and that that was
a bit of a time but th this
and it’s hard to
appreciate while you’re living through
it
um so
but
it the
the force of magnitude that’s occurring
um right underneath our feet is uh
seismic
and for anyone to think that uh
the status quo if they if they’re just
continuing to
ride out this wave the the
the way they are today i you just you’re
gonna be left behind um if you’re not
forward thinking uh today yeah i i it’s
funny i i was watching um
a documentary on uh it was blockbuster
and netflix and you know like it was
just uh
it was hard to for blockbuster to
conceive the changes i mean it was hard
for the major studios of hollywood to
understand like that they were giving
away
you talk about owning
their users they were giving away their
content just because it was incremental
revenue to build this behemoth of
netflix while they’re just accumulating
all their users
and when you look at the value of that
today
i mean if anyone understood it
they clearly never would have done it
i’m sure there’s
tons of executives uh
kicking themselves today but it was um
amazing and you know um
so i just and
that’s not that long ago yeah i know
well yeah and it’s crazy because it’s it
you know what’s funny is i don’t know if
it’s funny or not but
the
the rate of change is
it’s
like impossibly fast right now but
what might be even faster is
our
how how quickly we get used to things
like
think about
not walking around with a phone in your
pocket like i’m not that old but i
didn’t have a cell phone until i was in
college
i didn’t walk around with the phone and
even when i had a cell phone in college
i could play that little snake game you
know where it went around
that was pretty much it you know what i
mean like that and and now
not that long ago
you know or not that not that farther
ahead i can’t even imagine like my i
operate a business with my phone and a
laptop like that’s
insanity and
you know that didn’t even exist
you know not that long ago so
yeah i i a couple years ago
my kids are
16 now but uh so they
i don’t know if you remember there was a
trend the polaroid cameras became
big again so they they saw it they
thought it was cool so i bought it for
them for christmas they opened it up and
so you had the camera and then you had
the
you know the cell phone package with the
film in this and uh one of my voice goes
dad what’s that and i’m like oh that’s
the film he goes oh
what’s film
yeah
those are the moments where you’re like
oh man i
i got old somewhere along the way yeah
yeah yeah
i was excited i i i have those moments
constantly you constantly reminded
i’m explaining to my kids that phones
used to be plugged into the wall and
they just
they they could not comprehend it so i
was watching that i don’t know if you
said you see licorice pizza
no the it’s a movie like set in the 70s
so yeah like they show like i mean i i
tell my kids imagine like you had to
like
you’re interested in a girl and you had
to call their house and speak to their
parents first to get her on the phone
like
they’re like no you had to say yeah like
that’s what we had to do like it was and
then i explained the whole phenomenon of
like all right well
you know you had a phone like and you
answered it downstairs but then you
wanted privacy so you wanted to go
upstairs so you had to like leave the
phone off the hook you had to go and
take the other phone off though and
they’re like i mean you can see like the
deer in the headlights like of what you
know
oh man i don’t know how life just
went so fast see what i’m talking about
you do it so fast right and that’s i
mean but genuinely that’s happening
right now in our english i think i think
used to it is not even the uh
the right word it’s uh you know
dependent on it not dependent yeah
exactly
and borderline addicted to it
um absolutely we can’t go back
could you imagine like we couldn’t
function
yeah no i know and but you know kind of
to bring it back to topic like that’s
that’s what’s happening now and i see a
lot of owners kind of holding on
to that
old school business model where i mean
listen if if there’s any time to be
forward thinking in our industry it’s
right now and you don’t have to be like
some crazy innovator but you need to be
kind of on the crest of that what you
need to be on the front end of this
thing
otherwise you’re going to get left
behind and yeah you know i i just
i’m worried about you know
who’s going to be picking up the pieces
if a bunch of laundromat owners are
getting left behind you know
we’ll see
it
it will be
i i think uh a very
very interesting next five years in in
this industry with the amount of capital
the amount of technology
and
the
rapidly
changing uh habits of our consumer base
um with pickup and delivery
and more people
just valuing their time differently
switching from self-service to full
service like i i think it’s uh
like i said a seismic shift
in the industry and um with with these
periods of transition
uh creates great turmoil but it also
creates great opportunity so
things will shake out and there’s gonna
be some you know major winners but
unfortunately i think uh the people that
stay stale will
ultimately lose out
yeah and i mean just you know to your
point i i genuinely get contacted at
least every other week by some venture
fund who’s looking to enter into the
business uh who’s looking for
you know some input into the industry or
some insight or a board member or
something and i i’m contacted all the
time
in fact i have a call later this week
with one uh and so
you know that to me that’s just telling
me hey people outside of our industry
are seeing
how far behind we’ve gotten you know
inter in comparison to the rest of
things and are one and are thinking
there’s an opportunity
but i mean it might be too late for them
now i mean it’s uh
you know like we’re like the last of
mohicans in in retail right so uh i
remember going to the icsc show uh 20
years ago
and
landlords didn’t want it laundromat
wanted nothing to do with it as a dirty
seedy business
you know and and now
you go to a real estate show and people
are clamoring for the retail use so low
default rates um you know where
where where the uh you know when when
you look it’s always been recession
proof uh our business
it’s amazon proof
um you know it’s uh
it’s
um
it’s a traffic uh traffic generator
which is uh you know key to
all retail right now right how do they
get people away out of their house and
you know moving into stores um it’s a
consistent use so there’s all these
aspects
of uh
the laundromat um
use that has made it like the the prize
pony of the show now and um so i think
uh
i i definitely think that um you know
you’ve seen things come
full circle and uh there’s um
there’s there’s a definite um change on
the horizon for the business and you
know
but now you’re gonna see that
there’s gonna be an evolution of it so
because
because it’s so prized and because it’s
so valuable and so sought after there’s
an influx of capital now that technology
finally comes you’re able to reinvent
itself and um you know there were sort
of
and this is horrible to say and i always
like drove me crazy but there wasn’t a
lot of innovation or advancement in the
laundromat industry
because there was an attitude was like
yeah well
they have no choice
this is what it is and we’re doing like
people were doing fine
that’s that’s about to change yeah i
think you’re absolutely right
well speaking of being
you know up in front of the wave uh
let’s talk about
mr jeff and what it is and and and what
it does so why don’t you tell us what
what is mr jeff
so
mr jeff is uh
a business and box concept so
as
dna the company is technology-driven the
chief uh
product and technology officer he got a
phd in
ai
15 years ago so you talk about being
out of the curve uh
brilliant and uh
so
the
the company was uh
you know founded on on the roots of
technology and started in in laundry but
the vision is much
bigger the vision is so we have other
verticals as well that are developing
there’s jeff fit there’s jeff coffee
there’s jeff uh works jeff beauty so
it’s creating an ecosystem for
everybody’s daily needs and the the
concept is um
you know a hybrid of uh bricks and
mortar
bridging that bricks and mortar to the
online and pickup and delivery
so the typical mr jeff location is 500
to 1000 square feet
um you know but
a
beautiful bright clean box um
where people can either come in uh drop
off their laundry or dry cleaning items
uh and then they can have a delivered
home or will pick up and deliver or they
can pick up and you know uh
drop off and pick up themselves so there
there’s there’s an optionality there for
the customer base and what we found is
because of what i mentioned
uh prior because of that trust factor a
lot of people like to see the physical
presence of the store um but rather than
create this massive store and massive
infrastructure and a huge capital
investment it’s it’s much smaller like a
mr jeff
a typical box here in the states you can
get into for 150 175 000
all in
um so
that
that lower cost of entry but you still
have this uh brand equity and
credibility of the bricks and mortar
people can see the cleanliness they can
see
uh the uniform staff the beyond the
shared professional uh behind the
counter
um
you can see the um
you know professional marketing and then
the apps there so and a lot of times the
first service they like to come in and
talk about how they want their clothes
uh folded how what type of detergents we
use and so forth and so on and then
eventually convert to online but um it’s
it’s a franchise model um the the
the uh
the mantra or the mission of the company
is to democratize entrepreneurship
so we’re looking to make a um
uh low cost of entry low barriers to
entry to get hard-working entrepreneurs
into business
and equip them with every tool they need
to run the business so
mr jeff will provide
the drivers app they’ll provide the um
customer facing app they’ll provide the
business suite um the marketing platform
there’s a chat bot that’ll take them
through everything that they need to do
to execute an online marketing program
on their own there’s a jeff academy to
learn everything you need to know about
the laundry and dry cleaning business
how to process clothes and then how to
run a business in general and then every
franchisee gets assigned a partner
success manager who’s there to uh with
them you know from the time they sign
that franchise agreement to find the
location to build out the location to
launch their grand opening and then
every day thereafter for whatever needs
they have to to support them
in the business so
you know for me miss mr jeff gives the
you know it
it’s the combination that had always
been missing in this business
so you get the
big company branding power the big tech
behind you the big uh marketing
capabilities everything that uh
consolidation or the lack of
consolidation
didn’t provide historically but then you
give that into that you put that in the
hands
of the owner operator and as i mentioned
long before the owner operator executes
on the quality and the consistency and
hiring the right people and making sure
they’re caring about their staff and
making sure they’re caring about the
customer and providing that hospitality
so the the combination between
um
uh all the uh
fixed assets that would be very
expensive uh and nearly impossible for
an individual store owner to build jeff
has built and then they’re giving that
platform to the entrepreneur to go out
and make their business successful
yeah that’s that’s awesome and i it’s
kind of an interesting
uh niche within
the within the market because i think
you know when i think of
laundromats and where
a lot of laundromats are going it’s kind
of like what we were talking about
earlier some of those big kind of box
store-esque you know i see looking
around la here when i’m up in the bay
area a little bit like bigger
uh bigger laundromats are
are
you know kind of the thing now
but this is more
of
you know that
that smaller location but wider
radius of service model which i think
actually works and i’m generally
speaking
not
uh not a huge fan of
self-service laundromat franchises
but in terms of pickup and delivery i
think it might make sense a lot it
definitely makes sense in my mind more
than
uh you know
a self-serve only type franchise model
yeah
me too by the way um i i’m not uh
or at least yet i i don’t see the value
in a self-service franchise
and largely because
when i was at clean right and for years
and you know uh working on
other concepts as well
um
we tried uh you know and others tried
and failed spin cycle had 200 stores but
there wasn’t branding power on the
self-service side um and a clean ride
when we sold the store um we would make
the new operator take down the signage
and put up new marks and you know like
there was no difference between a clean
right center and joe’s laundromat um
so
i i have a hard time
understanding
what the value proposition is of a
franchise system that’s gonna take
six
eight percent off the top line of
revenue
what are you getting in return for that
well you know like that you could go to
a distributor and you know have them
build like
the same box can be built across the
street
um
with the same technology the same
machinery the the same system and you’re
not paying uh six to eight percent in
royalties so i i i didn’t see um
the value there and that there’s not a
lot that they’re doing in terms of game
changing the self-service end of the
business on the service side
there is a lot that can be done if you
if you’ve ever
you know uh if you if you’re trying to
either build a wash and fold or pick up
and delivery uh program you you know
that you need tech you need logistics
apps you need digital marketing um
as i mentioned branding and trust is
critically important in that side of the
business so
all these aspects lend itself to a
franchise concept in fact like
we’ve we’ve always believed in this uh
in in the industry um we’ve done it
we’ve done it in
different ways where we have a like a
leasing concept or we
whenever we sold stores to uh
to an owner operator in the past um
you saw the over-the-counter business go
up
self-service business didn’t change very
much if anything it went down a little
bit because
they didn’t invest in the same way of
keeping their equipment running or the
cleanliness or so but over the counter
business went up from that hands-on
owner operator so
we see that
being a franchise business the problem
is is that um
the the the systems and technology and
the marketing platforms didn’t exist so
that’s everything that jeff brings to
the table and and
uh provides
value in in the franchise program uh
um platform and the other aspect is that
that uh
that uh
that’s where all the growth is
so i
like
without trying when you know uh at clean
right
wash and fold sales group can keep
growing year over year where it used to
be virtually uh
you know it was non-existent in terms of
the model when it first started it’s
upwards of 20 of our business and some
stores uh some locations even more
so you’re seeing this gravitational pull
towards the service side of the business
that’s
there’s an inertia to it that it’s not
going to be able to stop
and
i just think the habits of society in
general everything is going to
online app
um
pickup and delivery service so
there’s
there’s no reason why laundry isn’t
going to follow suit
yeah yeah and i think i i’d be
interested to see because you guys are
relatively new in the states right i
mean i know you’ve been here for a
little while but you’re relatively new
right
yeah so we we just we just launched to
come to the states uh
and started marketing franchises over
the summer so our first
our first uh
mr jeff location will be open uh in
coral gables and
hopefully uh i’d say two to three weeks
and then uh more in the pipeline to
follow so you know there’s
it takes time to find locations and
build stores but um we’re starting to
build out stores now as we speak
yeah so i’d be interested to see how
this goes for you guys because i mean i
think you’re hitting it at
like you mentioned before we talked
about before like it’s a very
intriguing time
to be
coming in in that pickup and delivery or
that drop off laundry side
the service side of our business because
i see that as
being one of the big
plays for you know going forward and
where a lot of like you said a lot of
the growth is going to be in our
industry is going to be on the service
side of the business
you know
when you when you think about it from
uh
i i just believe it’s going to be a
disruptive force uh in the industry and
um
people throw that word around a lot so
you know i i don’t want to sound cliche
but when when you see all the elements
are there that it’s ripe for that so
um
you know when you look at that
industries that tend to be disruptive
there there usually is a complacency in
the status quo and uh in an inefficiency
that exists
that
just because of the power structure and
the major players that exist they
they’ve sort of forced it to remain
inefficient long term and that that
inefficiency
is equipment utilization
so
even in a great store i mean
uh your utilization overall could be 30
right so you you know you build a new
big box laundromat today
you know you’re putting
million two million five into it um and
what is
what is the bulk of that payment
majority of that payment is the
equipment um
equipment manufacturers are very happy
with with this model right they they
sell a lot of equipment they sell a lot
of parts and time for a retool you
retail entire store um it’s it’s a great
equation uh
except for the fact that the owners just
can you know continue to load debt onto
their balance sheet um
and uh listen
there has been a decent return but um
there is
a different way to do this and when you
look at uh
the mr jeff model and you see with a
limited amount of equipment
how productive these machines could be
and what imagine a world where you
bought equipment modular or uh in a
modular sense where you know you added
equipment as you needed it so you start
with a couple pieces of equipment as
your business grows you you add more uh
equipment and then you know maybe add
you know pop in another small location
as as the demand grows so that your um
your sunk cost is very light
and
you just uh
continue to have this incredible ri i
mean how happy would you be in your
laundromat if all of your equip all of
your equipment just spun all day long
yeah
yeah no i mean i’d be ecstatic and in
fact we had uh andrew cunningham who’s
been on the show and he was basically
saying hey if your machines aren’t doing
24 turns a day
then you’re they’re underutilized right
like
it’s even i mean even a great like some
of the most fantastic turns per day
stats i’ve heard are like 10 turns per
day you know people don’t want to share
those because you know they’re right for
competition coming in but 10 turns per
day is awesome
but that’s
still only half utilized like 50
utilized right like
it’s if you’re gonna be a 24 hour store
so i mean that’s
i like what you’re saying and i think it
makes a lot of sense that the machines
that we buy can be
much more productive than
than typical which is why i think people
do um
do bring in
you know pick up and delivery or drop
off service to try to get those make
them more productive right
um but you’re right i like i like what
you’re saying here
and then i think i think eventually and
uh you know
my vision is down the road that um we’re
we’re gonna develop what’s called the
the hybrid model for jeff where we
layer in a very small self-service uh
component
so instead of having these massive
stores we’ll have smaller footprint
stores of
two thousand square feet
and um
and and the rationale we like we we
could never when i was at clean right we
could never pencil out uh small stores
because of the labor component
because you can’t have half a person
working or a quarter of a person
so you needed the bigger stores to
justify the sunk cost of labor
you know if you’re open 24
hours a day that’s 160 labor hours
you really couldn’t you couldn’t justify
a small store on self-service but with
mr jeff it changes the dynamic because
you have the labor fully loaded now on
the service side and to maintain a
self-service operation
um you’re not adding any incremental
labor they need to keep the store clean
keep the bathroom clean um make sure uh
you know the the customers um know how
to use the equipment answer a few
questions but it’s like you’re not going
to have to add more labor to run that so
to me that that’s just a incremental uh
revenue stream but you later on so it’s
sort of you you reverse engineer this
rather than build the massive laundromat
and make a
you know do a little wash and fold
business you have the washing fold pick
up a delivery business and then just add
extra revenue on from the self-service
side
and and you also
now create a
pipeline for new customers for full
service
so
they come in at a lower price entry
point of self-service or they haven’t
completely trusted leaving their clothes
with somebody they see a friendly
attendant they see them doing other
people’s
clothes um they you know maybe have dry
cleaning items they wash their own
clothes leave their dry cleaning items
and then you
uh
you then convert that customer to full
service and now you have more capacity
opened up for uh additional self-service
so you keep on
feeding that pipeline of sales which
which i think is uh
incredibly lucrative model
yeah
yeah i like that okay so who
who
who’s the right person for
this business who’s you know who
if people are listening to this right
now and they’re kind of intrigued like
who should be who should be looking into
this a little deeper here
so you know i i i think that
there’s certainly a broad spectrum of uh
entrepreneurs who could make this work
um i i do
know
just some uh specific experience in the
past in the industry i happen to believe
that uh small restaurant owners who have
been um
you know really beat up by the pandemic
uh and are have struggled many of them
closed i think that they have you know a
really good
skill set and profile that will uh check
all the boxes of that you know they have
the front of the house hospitality
customer service engaging marketing to
customers especially a small restaurant
that does pick up and delivery because
now they know
uh not uh pick up just delivery
pick up the ingredients
and then uh and then um but they also
have the back of the house experience of
you know that attention to detail and
constant operations and quality and
consistency managing the labor force and
then for them when when i’ve brought
people from the restaurant industry
into this industry
they’re blown away they love it because
the margins are better uh it’s lower
labor to manage um and uh their their
quality of life is so much better um
in in this business so that’s definitely
a target i’d like to tap into because i
think that there’s a lot of uh
great hard-working uh restaurant owners
who have been um
unfortunately displaced and i think
their skills would be
put to good work um in this business but
um i i wouldn’t preclude anybody uh you
know um that that just wants uh
you know
that that wants to uh
get into business for uh you know low
cost of entry um
and uh you know put in putting their
time and uh work hard and and and make
good money um you know i think that it’s
it’s really it’s really that simple
yeah uh i mean out of curiosity is
if there’s somebody who maybe they
already own a laundromat or they own a
couple laundromats uh or whatever i mean
is this something that
you know if they want to add a pickup
and delivery or a drop off or something
like that is this something
for them what would that look like for
somebody who already owns a laundromat
yes so we have uh so i would say there’s
two different profile launcher mod
owners that i would speak to the the
first is
the launch mod owner that sort of uh
been in this game a long time um more
tired was hoping their kids were going
to take over the business their kids
they they did a good job providing for
their kids put them through great
colleges and now their kids don’t want
to work in the laundromat business so
they they don’t have an exit strategy
um they they have a cash flow in
business but you know they’re not
looking to really
reinvent the world here
and
they’re resistant to the change and
don’t want to deal with all that i would
say there’s an opportunity for them
to
sort of be a sub landlord
to a jeff franchisee
so
you don’t have to reinvent your business
you don’t have to put in more time and
energy just
give mr jeff but a small spot in in your
launch mat they’ll pay you rent they’ll
feed the machines for the wash and fold
and that can be a really good win-win uh
situation for
an uh operator of that profile
if it’s an operator profile that is
seeing the change on the horizon
um
seeing this demand for washing forward
maybe they have a competitor down the
street that’s eating into them a little
bit that’s doing wash and fold pick up
and delivery but they’re um
you know
don’t really know
how to get into it or looking evaluating
software systems evaluating marketing
and
just really
uh want a good partner in all that a
whole turnkey solution for getting into
the wash and fold pickup and delivery
side and get in with a growing brand um
i think that that would be an
opportunity for that type of profile of
of operator
yeah that’s awesome
yeah right i like uh i like having kind
of a couple different options there for
for different types of laundry mat
owners so
my
last question is if anybody’s intrigued
by this
i mean we’ve talked about a lot of
really interesting stuff so there might
be a couple different
types of people
uh who might want to have a chat with
you
uh
so number one i mean it could be
somebody who just
is intrigued by some of the stuff that
you’ve talked about some of the points
you brought up you know had some
questions for you likes you know the
experience you’ve had and maybe thinks
that you know
you they want to connect with you or ask
you a question or whatever or
maybe somebody’s interested in mr jeff
you know either on the hey i’ll be a you
know a sub landlord or i’ll i’m
interested in being a franchisee
what’s the best way for them to get a
hold of you
yeah so i i as you can tell like i i’m
uh
happy to talk about this industry at any
time so uh anyone who wants to reach out
to me uh
can get me at uh
peter.stern
at mr jeff app.com
that’s app
and uh yeah uh for for whatever the
reason or if people just want to kind of
uh they’re curious about the the
industry and my experience are
happy to i’m always happy to chat with
people in and out of the industry about
the industry it’s been uh you know a
lifelong journey and passion of mine so
um yeah reach out to me anytime despite
the fact that that
you were in first grade it was not your
aspiration no i yeah you know i i still
like i’m uh i’m about to be 47 years old
and i i still play baseball like i play
in like an old man’s league and you know
i
get up on sunday morning and i you know
there’s there’s got to be a scout out
there that’s going to see the potential
still if tom brady could do it at his
age like
the nfl i i could i could still make it
right like there’s a disney movie to be
made about that’s what i’m talking about
well i have found that the best way to
get seen by the scouts is to be on this
podcast so i’d expect a couple phone
calls
a lot of i mean a huge part of my
audience is professional baseball scouts
they’re looking for an aging uh
rag arm uh
catcher whose knees don’t work anymore
and you know can can sort of it has no
power left you know like i i’m your guy
like i’ll make it happen for your
organization
all right well hey you know what the
giants probably could use you so
it’d be like if you call
peter man this has been awesome a lot of
really really good stuff uh i have a
couple of questions left for you um we
have two segments that i want to run by
you number one is called the secret
sauce
and the secret sauce is basically hey if
you have one piece of advice you can
give to somebody who either now
currently owns a laundromat with all
your laundry mat experience that you
have or who maybe owns a pickup delivery
your choice uh
what what’s the best piece of advice you
could give them to help them improve
their business
yeah so i i think that um
get outside of your business
i think that uh you know uh one of the
mistakes especially when i own my own
stores was that i
spent so much time and attention and
focus inside my box that you become
tunnel vision you also have a uh
you have a bad feedback loop
so as i mentioned before i talk to my
customers all the time but you know
largely when i was talking to my
customers
they were there so they were happy so
they were giving me positive feedback
and that felt good but you know
so i would say you know get outside of
boxing only um into competitors see what
uh competitors are doing and uh and
people out there in the industry in
general but even outside of the laundry
industry um look for inspiration
elsewhere we’ve been behind the curve
for a long time
as i mentioned the rate of change has
been you know uh dramatic which has put
us further the the chasm is so great
between
uh
the laundry industry as a sense today
and where society is going so
get out there and say use different apps
it doesn’t have to be laundry apps um
you know you use different um
services uh you know go out and paint it
when you’re in other retail operations
pay attention to what they’re doing i
think there’s a lot that we can all
bring from the outside and make our
industry better
i think that’s great advice i mean uh
serge is super good advice because
you know number one
yes we’ve been kind of lagging behind
and there are other sectors of the
retail industry that are doing things
more innovatively and stuff like that
that we can learn from but also just
that other perspective you know i found
that
looking outside of
what i’m doing and that’s why i read a
lot of business books there’s really not
a whole lot of laundromat books out
there
you know but uh
there’s there’s a few and but i read a
lot of business books a lot of you know
personal development books all those
things uh biographies you know because
it gives really good
insight and podcasts lots of other
podcasts i mean this is really the only
one you need but if you wanted to you
could listen to some other ones uh you
know but it does give you kind of a
fresh perspective and new you know ideas
to try out and new
um you know points of reference to to
work from and so i think i mean i think
that’s great advice for any laundromat
owner it could be hard to do because
like you mentioned before
doing the day in day out keeping things
consistent you know it
it it’s tough sometimes and it can be a
grind and time consuming but
it’s well worth taking that step back
and
and looking around what’s going on
around you i think that’s great advice
uh the second uh section that we have or
segment that we have is called pro tips
pro
tips and pro tips is for maybe the
person who is looking to buy their first
laundromat or the person who maybe has a
laundromat and wants to start a pickup
delivery or the person who doesn’t have
a laundromat but wants to start a pickup
and delivery uh so pro tips is what
advice
do you have for them to help get them
started in the right direction or what
do they need to know before they get
going
yeah so
uh getting getting into this business i
yeah i think that um
i have uh
in my 20 years in the industry
everyone has like
a friend or an uncle or somebody that
heard about the business and wants to
get into it and uh
so they say well you talk to them and i
reach out to them and i think i’ve
talked more people out of getting into
the business than than getting in and
getting into the business um
and i think that that
well
i i guess i take that responsibility
seriously
if somebody’s coming to me i know
they’re looking
with their nest egg and they’re gonna
you know invest their hard-earned life
savings into a business i don’t take
that lightly so i i think that i’m you
know uh i
tell them the good the bad and the ugly
and i think getting to somebody like
that is important and so um
going to
uh car salesmen
and asking them about why you know if
they think it’s a good idea or how they
should buy this car is not only is not
always the
the best resource
so trying to find an unbiased resource
about getting into the industry where
you can get some facts um you know on uh
certainly i’m not the only one but um uh
i i think like you know listening to
like your podcast is certainly helpful
the coin laundry association is great um
you know it’s a it’s a great resource
for anyone looking to to get into the
industry
but uh you know and then then you gotta
you gotta be realistic with um
your
capital structure and what you wanna do
so there there’s different avenues as
some of them we touched upon today
there’s you know the big box
laundromat there’s the people that want
to you know build a chain of laundromats
in a region um
there’s
more of the the lower cost of entry as
we described with the
mr jeff uh traditional
box if you don’t have
the you know robust capital structure um
to get into so i i would say that
do you know doing all that soul
searching up front um and then
understanding uh
the level of commitment i think that
this is
largely sold as a uh
absentee business to a lot of people and
i think that i i discourage people from
thinking that way
i uh um it’s certainly like i said it’s
a better quality of life than uh
typically in the restaurant industry um
especially if you’re good at uh
recruiting building and uh developing a
staff and
but you know somebody needs to lead them
um and
especially in the beginning building
that culture
is intensive and i think that the owners
should be there and understand their
business uh understand the loopholes the
shortcuts
in order to manage it better so
um i think uh under you know
being realistic about the the time
commitment um and then i i
god i mean this is uh it’s a
i think a different uh podcast to be
honest with you to all the things that i
would tell somebody getting to i mean
from the real estate perspective to the
design and layout of the store to um you
know
what their marketing approach is like
there’s so many things to
consider um that i i just i wouldn’t
take it like lightly especially
especially in the traditional uh if
they’re
putting a large amount of capital into
it so yeah
exposure to competition like you know
the one thing to think about when you’re
putting in a million five asset is not
only
is it going to be successful today but
is it going to be successful 5 ten
twenty years from today and knowing how
you’re defensively positioned in the
market is also important because you
could build it
in a good spot for today but then you
left a prime spot for somebody to you
know take over all your hard work
there’s
there’s a lot so
i would say call somebody like you or me
like you know talk it talk it through uh
spend spend uh a good amount of time
before you pull that trigger
yeah i was just thinking maybe we should
figure out a time where we can do a live
webinar where we can go through a bunch
of that stuff a little more appointedly
with some people and they can answer
some questions i think that’d be a lot
of fun
yeah for sure helpful for people so
yeah i’d love to do it yeah so to sum up
your
your secret sauce and your pro tips is
get outside input
okay
well uh awesome peter this has been uh
incredible again i’m gonna have the uh
peter’s email address in
the show notes and if you’re on youtube
it’ll be down in the description but
just so you know it’s peter.stern
at mrjeffapp.com
and again that that’ll be in the show
notes and in the description uh thank
you so much for coming on it has been an
awesome conversation that just flew by
for me uh yeah i i took a few pages of
notes so i appreciate you coming on and
at least teaching me a whole bunch oh my
my my pleasure jordan hopefully
hopefully your fans get uh some use out
of it all right listen what are you
gonna start believing me when i say that
these interviews are incredible and
you’re gonna love them i mean every week
i know i pretty much say that but these
interviews are so good so full of
practical tangible information a big
thank you to peter
for joining us and and sharing all that
wisdom that he has gathered over the
last like 20 years in the industry so
good well even though this thing was
packed with information knowledge uh
practical tips all that stuff
none of it’s gonna do any good unless
you put it into action right talk about
this all the time so pick one thing from
this interview and put it in to action
okay whether it’s something that uh you
know peter said maybe in the secret
sauce for pro tips or something that we
talked about kind of all throughout the
interview there’s just so much good
stuff in there pick at least one thing
and do something with it this week make
your dreams happen
through the actions that you take all
right uh again thanks a lot for having
so much interest in the in the analysis
calculator that you crashed it go check
it out laundryresource.com there’s
calculators um and again pro members you
know go download that book on due
diligence it’s there well before it’s
come out to the masses so if you haven’t
yet checked out the pro membership check
it out at lawnmanresource.compro
and otherwise we’ll see you guys at
whatever the next thing is maybe the
next podcast episode the next webinar
maybe on youtube
uh on the blog on the website uh maybe
at the laundromat millionaire conference
i’m gonna be there in person live i
would love to hang out with you march
2nd the 4th i’ll put a link in the show
notes or you can check out
laundrymillionaire.com
click on the conference and register and
come hang out with me and a bunch of
other like crazy all-stars in this
industry all right all right we’ll see
you guys later peace