Redefining the laundry business

(The Philippine Star) | Updated February 18, 2013 - 12:00am

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Suds Caloy and Charmaine Ang: Once you have satisfied a customer through consistent laundry
services, he is likely to return again and again.
MANILA, Philippines - With an average of eight out of 10 customers returning to do repeat business,
the laundry service franchise is gaining recognition as an enterprise built for the long term, notes Caloy
Hanzyl Ang, founder and franchise director of Suds Laundry and Dry Clean Services.
Once you have satisfied a customer through consistent service levels, he is likely to return again and
again, Ang notes. He will leave only if he is dissatisfied enough to go through the trouble of testing
another laundry service.
Now serving a customer base of approximately 80,000 that returns week after week to the four
company-owned stores and 14 franchises, Ang and wife Charmaine, Suds operations manager, have
set plans to grow the laundry service into a nationwide brand. For now, the business which the couple
started in Dasmarias, Cavite, in 2003 to service the needs of professionals working in the nearby
export industrial zones has branched out to Quezon City, Makati and Paraaque. Considering that a
typical Suds client, who works in an office, sends off five kilos of clothes a week for washing and pays
P35 a kilo, franchisees have been attracted to the business.
Like the Angs, they are optimistic because their market of time-challenged young families that have
both husband and wife in the work force is growing. Just about a decade ago, these early nesters
would have most probably lived with either the mans or the womans family and enjoyed having their
laundry done by a family member, a household helper or a daily wage earner.
But with the proliferation of affordable condominium units sprouting all over Metro Manila and midincome homes in the outskirts of the metropolis, they now can live on their own. As of mid-2012, a
Jones Lang LaSalle study projected that 137,000 residential units from the P1.5 to P6 million price
range would be coming up from 2012 up to 2016. Most of the occupants of these units would not have
the time, energy, space or a combination of any two or three of the aforementioned for laundry.
Caloy recalls that he was also once himself a harried professional employed with Intel in Cavite as a
reliability engineer. Still single at the time, he remembers the exact day he decided to get into the
business of washing other peoples clothes. It was raining, he was on foot and in a hurry to get his
duffel bag of 20 kilos of soiled clothes laundered in the neighborhood. He realized that the laundry
service that would go through the trouble of picking up its clients weekly washing -- and on top of that
offer them reliability and professionalism-- would easily outdo all existing mom-and-pop laundry shops.

Business ( Article MRec ), pagematch: 1, sectionmatch: 1

Still single but already in a relationship with Charmaine, he hatched the nucleus of a business plan that
night and convinced her to resign to run their store to be named Suds. They attended seminars on the
business, borrowed from relatives and in a few months time, they had their first store.

They had a logo and interiors that made use of the fun color orange not the usual blue. We wanted
it to be different. We hid the machines and put in air-conditioning. I sold my car and exchanged it for a
multi-cab so I could pick up laundry after work. Moreover, the pair found out through research that
customers were particular about the smell of their clothes and the availability of parking. But even after
they had opened and put in all improvements, they still did not earn enough to pay the rent.
They panicked and realized the urgency of marketing to their micro market. A combination of flyers, a
promo offering a discount and a banner screaming out the special offer in conjunction with the onset of
rainy season finally brought in the volume of customers they had targeted. They have since added a
rewards system to loyal customers tracked by a proprietary computer program that is part of the POS
(Point of Sales) machine in each Suds store.
They also focused on running the business more efficiently by getting their chemistry right. Among
their first lessons in the subject was selecting a detergent with more active ingredients than fillers since
it is the latter that gets the cleaning done. Their growing expertise in the area eventually brought them
to the practice of using four different types of detergentthree of them liquid to be used for delicate,
premium and regular-wear clothes. Powder is used only for bulky items that need heavy-duty cleaning
such as seat covers and towels slathered with oil and lotion.
With the intensity of geeks challenged by a science problem, the Angs went into franchising in 2008
with the goal of finding a royalty program that would work for both franchisee and franchisor and push
the business further forward. They developed the ladderized royalty system wherein no royalty is
paid to Suds during the startup period and with royalty increasing as a franchisees revenues increase.
Better yet, the royalty decreases once the franchisee gets past a revenue milestone.
Our growth depends on the growth of our franchisees, Caloy notes. The Angs have further redefined
the laundry business by putting up a plant that specializes in dry cleaning and bulk items such as the
scores of towels used by spas and beauty parlors. Suds encourages its franchisees to look for the
institutional users in their area and to pass on the washing and dry cleaning to their main plant in
exchange for a marketing fee. This way, our franchisees earn from the business of both retail and
commercial clients, Caloy says.
He discourages the thinking that owning a franchise is like running a remote control car. He declares:
The involvement of the owner in any business is critical. Our advantage is that we have already set up
and tested the systems they need to remain profitable and keep on growing.

http://www.businesscoachphil.com/quickand-easy-steps-to-starting-a-laundrybusiness
Business Coach, Inc.
Quality Business Training

Take Advantage Of The Booming Laundromat Industry

Not so many years ago, you can only see laundromats in the main streets of
major cities. Now, however, these establishments have sprouted left and right,
and it seems that many of them are prospering. With the shortage of laundry
women and our busy lifestyles, more and more people are using the services of a
laundry shop to clean their clothes. With these changes, a laundry shop is now
one of the most stable businesses the middle class can afford to put up.
For those who wish to venture into this promising business, here are some tips to
guide you:
Capitalization. This depends on the size and type of your target market. If you
are aiming for the industrial market, you will be needing millions; since this is a
more sophisticated topic, we will not discuss it here. On the other hand, if you
plan to cater to individual clients, you may be able to start with only around PhP
250,000 (as of October 2012) for a simple set-up. This amount will cover a very
basic set-up, with some amount left over for operating expenses.
Location. This is the most critical decision because a bad location can rarely be
remedied except by relocation. There are five main criteria in selecting the best
location for a laundry shop.
1. Proximity. The nearness of the shop to plenty of potential clients is the most
important. Make sure the population nearby is the type that is most likely to
patronize a laundromat. Condos and middle class residential areas are some of
the good potential markets since they could afford to pay for laundry services.
2. Visibility of the shop is critical. You may be a few steps away from the
main street, but if you are not easily seen by passersby, then you will have few
customers. If putting up large signages do not remedy the situation, you should
look for another place.
3. Good water supply. Water supply must not only be of sufficient quantity, but
must also be free of too much minerals that affect the cleaning process.
4. Affordability. Compute your projected profit so that you will know if the
rental expense can be accepted and still make a good income. Since nobody can
be sure of how much sales the location will generate, be conservative in your
estimate. If you feel that the ideal location is too small or too expensive, you can
just have a pick-up center and put your equipment at home or in a lower rent
area.
5. Reasonable lease contract. Read your lease contract carefully before
signing. There may be restrictions that can hinder your business. For example, it

is possible that the contract does not allow the use of LPG, and this may force an
unacceptable increase in your electricity bill. Include pre-termination terms so
that you would have reasonable expenses in case you are forced to close shop
before your contract is finished.
Equipment. Buy equipment suitable for commercial operations. Note, too, that
you may void the warranty if you use a home type machine for commercial
laundry. In the case of washing machines, you have a choice of buying a front- or
top-load machine. If you have the capital, it is probably better to buy frontloading washing machines because they use less water and electricity. With no
agitator in the middle, they are gentler on clothes. Another issue is what type of
dryer to use. An LPG-fuelled dryer will mean a lower operating expense, but it is
also riskier than electric dryers and is often not allowed in condos and some
lease contracts.
Pricing. This would depend on how cost-efficient your operations are. If after
computing your expenses you are confident that you have lower costs than your
competitors, then it may be possible to price lower for market penetration. The
risk in this strategy is that it may trigger a price war that will make everyone a
loser. Generally, it is safer to just go with the market rates and to compete on
quality of service instead.
Marketing. Allocate a budget for promotional expenses. Most laundries are
enthusiastic in marketing only during the launching stage. Never stop giving out
flyers and other marketing activities to get and retain customers. Since it is
easier to retain old customers than to get new ones, have loyalty programs to
ensure continuous patronage.
Use your own good judgment. There are many companies that will sell you
their products and services for laundry businesses. Some of these suppliers even
conduct their own seminars. The best policy is to personally scout for and visit
each potential supplier. Also, attend several seminars to get a balanced
viewpoint. Ultimately, it is you who must decide what is best based on your own
observation and never rely solely on what you are told. If you believe you do not
have good judgment, then perhaps you should not go into business.
The laundry shop business, if in a good location and well run, is likely to be very
profitable. Still, there are many blunders that someone new to this business can
commit. Learn all you can about this business before risking your hard earned
capital.
To know more about this topic, BusinessCoach, Inc., a leading business seminar
provider, conducts a seminar on this entitled Starting a Laundry Shop Business.
Contact them at (02) 727-5628, (02) 727-8860, (0915) 205-0133 or visit
www.businesscoachphil.com for details.
Click here to view details of the seminar: Starting a Laundry Shop Business

*Originally published by the Manila Bulletin. C-4, Sunday, October 28, 2012.
Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved.
May not be reproduced or copied without express written permission of the
copyright holders.

Things to consider
before opening a
laundry shop
business
Learn tips from a laundry shop business veteran
By Carlo P. Mallo | May 6, 2012

Download

t may be considered a dirty job by most, but the laundry shop business is a thriving
industry in highly urbanized cities such as Metro Manila, Cebu, and Davao.
The growing number of Filipinos opting to live in mid-rise and high-rise
condominiums, owing to the lack of space where to hang and dry clothes, has
spurred the growth of the laundry business in the Philippines.
Washing the dirty linens may not be a bad thing after all as every whirl of the
washing machine and every steam released by the dryer generates ka-ching for
you. Entrepreneur Philippines had a one-on-one interview with Monina AtienzaSantos about the ins and outs of setting up a laundry shop business
Starting nearly 10 years ago, MR. Laundry Shop was born in Quezon City with an
initial investment of only P100,000 that was used to lease a space, hire staff, buy

two washing and drying machines, and other products needed for the business like
detergents, signage, and plastic wraps.

Washing clothes may be easy, but running a laundry shop is no walk in the park.
To get your laundry shop venture up and running, here are five must-haves in this
kind of business from MR. Laundry Shop owner Monina Atienza-Santos:

1. Reliable staff
More than anything else in this business, competent, reliable and trustworthy staff
will be the life support system that your business will need in order to survive. It
took me two years to find that staff who I can trust. Now she has been with me for
eight years already. Its a give and take system between the owner and the staff. If
you do not compensate them well, they will try to get back at you in other ways,
such as pilferage. If you pay them well for their good performance, you will earn
each others trust, says Atienza-Santos.

2. Fixing the leak

Plugging the holes in a leaking pipe is one thing that a laundry shop owner must
deal with everyday.
And it does not only refer to actual leaking pipes, but other holes in the daily
processes of the laundry shop that lead to wastage or pilferage of products.

A good inventory system will save you thousands of pesos. Being the owner, it is
important that you get to see all the procedures and see places where one can
improve efficiency or if not, at least you can easily spot where there might be

pilferage going on. Unless you have full faith and confidence in your staff or the
person manning your shop, you have to constantly monitor it.
1 of 2 NEXT
3. Not all soaps are created equal
The soap that you use may be your advantage over competitors in the laundry shop
business. Some soap may cause itchiness or allergy to your clients while some
detergents may be too harsh on clothes.
Believe it or not, people are very particular with the detergent. It is important that
you use detergents that are actually hypo-allergenic or something [that is] not so
harsh with the clothes. A good quality of detergent can be your advantage over
other laundry shops and it shows the quality of your business.

4.

Customer loyalty

The customer may not always be right but it is easier to keep customers coming
back than having new ones come to your store, thus your loyalty to customer
service is of extreme importance in a business like the laundry shop.
Honesty is something that the customer will greatly appreciate. Make sure that all
the clothes that the customer endorses will be returned complete. The level of trust
that you would want to establish with the customer is when the customer will no
longer ask you to itemize the laundry or even weigh it. The clients trust you
enough that they will just leave their laundry for you to take care of it.
5.

Location

Like any other business, ones location is a crucial factor in the success or failure
of your laundry shop.

I strongly discourage putting up laundry shops in an area where there are already
existing laundry shops. Good locations are where there is a captured market for
you. Densely populated communities, condominiums, dormitories for workers are
just some of the ideal locations where you can put up a laundry shop. Dormitories
for students, however, and in the university belt areas, are not ideal [because]
studentswould rather wash their own clothes [to save money].

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