What to buy? How much to pay?
hen buying shirt
equipment, should you buy on price, quality or service? Can it
be as simple as picking one of the three? A, B or C? I suspect
not. I don’t think that anything is ever quite that easy.
As drycleaners, we have become a cartel of survivors. We have
remained steadfast regardless of what is put on our plates.
 | ||
It is hard to understand exactly why that
is, but what is clear is that we accept rising costs from other
industries but not in our own. Somehow, we will accept, however
reluctantly, that gasoline, for example costs 400 percent more
than it did 30 years ago, but if our supplier announces that
hangers now cost $1 more per case we will balk, at least, or
perhaps immediately begin to shop around for a better deal. How
sensible is this?
It is time to buy new shirt equipment. We
will visit the trade shows and check out four or five major
brands and first look at the prices of the models that fit the
bill. Let’s say that we are looking for a basic single
buck unit. We do need a way to whittle that list down to two,
or three at most.
Too often, the highest priced unit is
eliminated from the running. This may be a bad move and it may
be a very costly move, as contradictory as that may sound.
There are two scenarios. You are either
comparing two competitive brands or the same machine from two
different dealers. The same rules, believe it or not, apply
regardless of which situation you developed in your mind as you
were reading this.
You can buy anything based on quality,
service or price. Which drives you? If you charge $1.25 for
your shirts, you probably buy based on price. Furthermore, you
assume that your customers buy based on price. This too, is
probably a very costly mistake as it probably isn’t true.
If you charge $2.75 for your shirts, price isn’t your
main concern.
You know that your customers can pay less
if they wanted to and you probably do just as many shirts as a
guy that is charging a buck and a quarter. But does that mean
that you will pay more than you have to for the same product.
Probably not.
But what is the “same”
product? You can buy an Ajax Legacy from one of two dealers.
One dealer wants $1,000 more than the other. Is the higher
priced distributor automatically eliminated? That depends on
your viewpoint. If you view the “product” (in this
case, an Ajax Legacy body press) as simply the machine itself,
it’s a no-brainer. Buy the cheaper one.
But actually it is more involved than
that. The product that you are buying is a combination of
quality and service. What do you know about the dealer, his
work ethic and the quality and training of his service staff?
You may think that this is hard to measure
and you are probably right, but how do your customers know that
you are worth twice as much as your competitors? How do they
measure you?
Frankly, if you pay $1,000 more for a
machine that will last 10 years, that is a mere $100 per year.
Do you think that your customers are paying you $100 more per
year for your “product?”
Of course they are. And they are because
they consider your product to be more than the physical
garment. They consider that your “product” is a
myriad of intangibles such as a great location, door to door
service, a car hop, easy billing to your credit card, fast
friendly service, a newly decorated store, employees that enjoy
their job. The list goes on: up-to-date equipment; shirts that
actually get cleaned; free minor tailoring; a phone call to
discuss something that isn’t so minor.
These are the things that you use to
defend your higher price. You insist that they are worth
something to you and expect that they are worth something to
someone else.
In the final analysis, the product is
something tangible and intangible combined. As a whole, the
value is difficult to put a price tag on.
If the equipment being compared is
different, your challenge, too, is different. Why does brand X
cost $4,550 more than brand Y? You need to learn what, exactly,
you get for your $4,550. It just might be worth every last
penny. Just like you expect a customer to be able to tell the
difference between a 99-cent shirt and a $2 shirt (in spite of
their ignorance as to what goes on behind the counter). You
must learn what the differences are. It may be the best time
that you spend.
When considering any equipment, the
“cost of use” is paramount. The cost of utilities
goes on forever. It is far cheaper to pay more for something
that will cost less to run. One manufacturer makes at least two
single-buck shirt units. The productivity possible from one
happens to be 15 percent more than on the other. Fifteen
percent.
It happens that the model that is capable
of more productivity is more expensive. It isn’t priced
that way because of the productivity, it just happens to be
that way. If you paid $21,500 in wages to press 100,000 shirts
last year, would you rather have paid $18,000?
Because the cost of labor goes on forever,
the initial cost for a model that is more productive is well
worth it. (A quarter of a million dollars over the life of the
machine!) This same type of thinking is true whether you are
thinking about utilities, the cost of pads and covers, the
hourly rate of a service technician or the cost of replacement
parts. It may not be obvious, at first glance, what you get for
how much money, but it is often worth a hard look.
“If you do what you’ve always
done, you’ll get what you always got.”
Donald Desrosiers has been in the
shirt laundering business since 1978 and is a work-flow systems
engineer who provides services to shirt launderers through
Tailwind Shirt Systems, 867 Spencer St., Fall River, MA. He can
be reached by phone at (508) 965-3163 or by e-mail at tailwind1@comcast.net and he has web sites located at: www.tailwindshirts.com and www.dondesrosiers.com
 |