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A load of reality: how profitable is a dry cleaning business?
Dry cleaners are the lifelines of stained clothing, wrinkled dress shirts, and gowns with complicated cleaning instructions. In its prime, a single neighbourhood dry cleaner could wash and press over a hundred business shirts in a day [1].
In the present, however, it is an industry in decline. Before the pandemic began, the cultural shift away from business formal had already downsized the market for dry cleaning [2]. When the work from home arrangement took precedence over office visits, office workers started opting for casual wear, further reducing the need for dry cleaning.
In the United States, the National Cleaners Association reported that one in six dry cleaners have shut down their business [3].
An empty laundromat business, photo by Oli Woodman on Unsplash
For the dry cleaners who survived against the odds, it is of paramount importance to tap on all potential resources to future-proof the business. This article will provide dry cleaning stores with ideas on how to do so using POS systems, or point of sale solutions, zooming in on three types of dry-cleaning businesses: family-owned, chains, and on demand services.
Compact POS system for family-owned dry cleaners
Single store operations are a common sight in the dry cleaning industry – many are helmed by generations in the same family, and service regular customers.
For example, in the United States, the dry cleaning industry is extremely fragmented. The largest dry cleaner owns just 5% of the market, a far cry from monopolies in other industries [4]. Many businesses are also primarily run by immigrant families as a means of sustaining their livelihood rather than aiming for monopolistic expansion.
An employee preparing garments for wash at a dry cleaner
Family-owned laundry stores can make their businesses more efficient by tapping on POS technology. In the past, POS devices were primarily used for processing payments. Now, with the right software and hardware, POS systems can do anything from managing a loyalty program to running a delivery operation.
POS devices which are tailored for family-owned dry cleaners can help with business processes in the following ways:
Customer service. Consumers look out for quality, not novelty when it comes to dry cleaning services. Thus, it is of paramount importance for dry cleaners to build up a good reputation by increasing customer satisfaction. This includes making sure the whole process of dry cleaning is fuss-free and achieves the customer’s requests, as well as not damaging the clothing.
To help with this task, dry cleaners can make use of POS systems which have a built-in customer relationship management system. Good customer relationship management systems can save customer preferences, send reminders to customers for dry cleaning collection, and encourage customer loyalty through targeted marketing. On a broader scale, a customer relationship management system can help a business owner to make sense of their customer base and help owners to drive sales.
iMin’s D2, an example of a compact desktop POS suitable for small, family owned businesses
Sale software analytics. When running your own business, it is easy to get caught up in the business day and neglect macro trends. A POS system can track multiple metrics simultaneously, such as customer satisfaction and transactions for each service category. Over time, this information can help dry cleaners make more informed business decisions and help to drive sales.
Thus, POS systems can help dry cleaners save valuable time, and focus their efforts on providing top notch laundry services.
Multi-functional POS system for dry cleaning chains
Globally, there are not many laundry businesses chains which dominate the industry. One reason underlying this phenomenon is that many laundry businesses were unable to fully automate the process. In fact, to many owners, doing laundry well is a craft that cannot be replicated by an assembly line process.
However, there is another way that laundry businesses can harness technology to automate their work: a complete cloud-based POS system.
Carousel of individual garments for collection, photo by Nathan Dumlao on Unsplash
Cloud-based solutions. Unlike single store operations, dry cleaning chains benefit from economies of scale. However, scale is a double-edged sword, as multi-store management can be extremely difficult. To coordinate amongst different stores, dry cleaning businesses can look into cloud-based POS systems.
Cloud-based POS have the advantage of real-time tracking, which enables a one stop overview of all metrics, across all laundry stores. Dry cleaning business owners will also be able to notice discrepancies faster, stopping mishaps from happening before they get too serious.
Inventory management. The process of doing laundry is not as straightforward as wash, dry, and fold. Indeed, it is a multi-step process that has to account for different fabrics, customer preferences, and take special note of ‘surprises’ like stains and discolouration. Every piece of clothing has unique and multifarious properties. Denim jeans, for example, are a world away from a silk blouse.
The first thing that laundry chains have to manage is assessing the laundry load and tagging each piece according to its wash instructions. Repeating this process at high volume is a mammoth task.
To surmount this difficulty, dry cleaners should look out for a user-friendly POS solution which can customise many different properties of clothing items and sort them accordingly.
iMin’s desktop POS D4, an example of a multi-functional POS device
Staff tracking. Dry cleaning chains should also consider whether they require employee management services. The most important functions are typically employee scheduling and payroll. POS systems can help owners to handle these, saving them a load of headaches. In addition, POS systems can ensure that there are always employees available to help at each store, and note each employee’s sales and customer reviews.
All in all, a complete cloud POS solution with advanced features for dry cleaning can greatly benefit laundry businesses.
Delivery-centric POS system for on demand dry cleaning services
There are a whopping 779 on demand laundry services operating globally [5]. At this moment, more and more are being developed as ultra-quick doorstep services become a norm in consumer’s lives.
Most on demand services differentiate themselves from traditional dry cleaners through their delivery service [6]. Customers can easily download a delivery app, pack their garments in a bag, and send it off for cleaning without leaving the comfort of their home. They can see the tracking of garment delivery on the app, and be notified when the cleaned garments are on their way back.
For on demand services, the most effective combination would be a desktop POS on location and mobile POS devices for delivery drivers.
A desktop POS with advanced features will allow managers on location to monitor online orders and handle delivery tracking.
On the other hand, mobile POS devices are small and lightweight, yet have a full suite of POS functionalities. Thus, they are ideal for dry cleaning delivery riders to use. Mobile POS devices can be connected seamlessly through POS software, enhancing communication between the laundry hub and delivery riders. In addition, some mobile POS devices have built-in printing capabilities, for delivery personnel to tag bags should the need arise.
iMin’s M2 Pro, a user friendly mobile POS device with key features suitable for delivery services
By fully integrating POS devices, on demand services will find it easier to standardise the quality of service and scale up their delivery business.
All in a day’s work
To keep the spin cycles going, dry cleaners should look beyond upgrading their laundry machines. No matter the laundry business type, POS devices can go a long way in helping as a sale solution.
Interested to know more about POS Solutions? Clink here to explore more.
References
[1] https://www.nbcnews.com/specials/one-of-new-york-city-last-chinese-hand-laundries-closes/
[2] https://www.npr.org/2021/03/31/982953808/coronavirus-pandemic-upends-the-dry-cleaning-industry
[5] https://tracxn.com/d/trending-themes/Startups-in-Ondemand-Laundry-Services
[6] https://www.inc.com/magazine/201804/bill-saporito/rinse-laundry-startup.html
