Just a little thinking out loud
very day, we get
phone calls from drycleaners all over the United States. Many
of these calls deal with serious problems, and the callers are
looking for help. For the most part, we can give them some good
advice, but that’s all we can do. There are some things
the drycleaner has to do for himself.
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We can’t train employees and see
that the owner gets good production.
We can’t provide financing to help a
drycleaner change direction if that individual is broke and
cannot raise money on his own.
We can’t change the market potential
or a situation where a cleaner has poor visibility or an
out-an-out lousy location.
There are certain things that each
drycleaner has to do on his own.
What we can do is show a good operator how
to get more business, how to diversify, and how to expand by
opening additional locations and routes.
Let’s take a look at a situation
where a cleaner has a small business doing about $3,500 a week
and is just squeaking by. This business needs more cash flow to
provide the owner with a decent lifestyle. And as an investor,
he or she is entitled to a reasonable return on investment.
The answer is to increase sales. But how?
Let’s say the owner is in a small
town and is unable to attract a significant number of new
customers. There’s only one solution to increase cash
flow, and that’s diversification.
If this cleaner has other towns within 50
miles, he could develop a route. The average route generates
about $3,500 per week. Though our demographic capabilities, we
can help our members identify the best areas to target any new
service. Then all we have to do is set up a plan to get the
business.
Assuming that the average route order is
$15, and the route is run six days a week, the driver would
have to make 39 stops per day to generate $182,000 per year.
This $182,000 a year route should provide enough additional
profit to make this a very viable choice.
The marketing of a service like this is a
major consideration. For instance, how much does the cleaner
need to invest to make this goal a reality?
The very first step should be to develop a
marketing plan and then compute the necessary budget to support
that plan. Many cleaners, whether opening a new store or
beginning a new route, think that they can and should begin the
operations before developing a marketing plan. Still others
develop grandiose marketing plans with no consideration for the
expense of these programs.
How much would you budget for marketing,
if you wanted to build a route doing $182,000 per year? I would
figure about $9,100 a year plus the cost of the
salesperson’s time, when they’re not actually
making pick-ups and deliveries.
Think about it. $9,100 is only 5 percent
of the total dollar volume expected from this route.
That’s less than $760 per month. Yet
few cleaners embark on a venture like this with a clear enough
focus to include this in their budget. There’s a
misconception that they can begin the business, and then use
“profits” from the early sales to finance the
necessary marketing.
This never works. It never works, because
the sales never materialize to the point where there is enough
“profit” to pay for the marketing.
Next, there’ll be the cost of hiring
a salesperson to drive the vehicle. Remember, anyone can drive
the type of vans typically used for an operation like this, but
not everyone is a good salesperson. Salesmanship is the number
one trait you should be looking for when hiring someone to run
your route. A person, who smiles a lot, is energetic and
pleasant to talk to, will be the best choice.
Finally, a delivery vehicle needs to be
purchased, if the cleaner doesn’t already have one. Many
cleaners seem to like the new Dodge “Sprinter.”
I’ve never bought one, but they’re definitely worth
looking at.
Whatever vehicle you choose, it’s
worth the money to have it shrink-wrapped. Just as it is with
your store, really good signage on your vehicle will pay for
itself many times over.
Thanks for listening.
Dennis McCrory is president of The Golomb
Group Inc., a firm that designs marketing programs for
drycleaners. Contact him at The Golomb Group Inc., 7664 Plaza
Ct., Willowbrook, IL 60527 Tele: (800) 679-5856
E-mail: dennismccrory@golombgroup.com
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