CCI News & Blog

Interview with Chicago Area Laundry Owner, Bill Norteman

Bill Norteman has been in the self-service laundry business since the early 2000s. He owns several laundromats in the Chicago area and has implemented CCI’s LaundryCard system in his stores.

What attracted you to the self-service laundromat business?

I began looking closely at the self-service laundry business shortly after September 11th, 2001.  A friend of mine and I were in a precarious position. We’d spent all of our adult lives preparing for a career in the airline industry which began to collapse in the early 2000s. We both loved and wanted to continue in our jobs as long as possible and decided the laundry business would be a good hedge against what, at the time appeared to be the inevitable loss of our jobs and along with it any prospect of re-employment in the same industry. We were fortunate our fears did not come to pass. While many did lose their jobs, we were able to remain employed throughout. These dark days of layoffs and bankruptcies in the airline industry gave us something positive to focus on – growing and expanding our Laundry business.

What is your favorite part of this business?

I really enjoy being in control of my financial destiny. The business will do well if I make good decisions and put the time into it. Of course the opposite is true as well.

What is your least favorite part of this business?

It’s really a double edged sword. I really like the variety of people I meet and work with. This is true of both employees as well as customers. I have a tendency to assume everyone is a good honest person. Sometimes this turns out not to be the case, and because I’m a fairly trusting individual I end up being disappointed on occasion. To be honest, we all run into this in our daily lives, but when I fail to accurately judge someone’s character, it stings a little more when it affects your bottom line.

In your opinion, what is the biggest issue laundromat owners are facing today?

The challenges facing laundromat owners are in some respects similar to those faced by most American small business owners.  

  1. The ever rising cost of goods sold. The price of water has doubled in less than 3 years in our area, and while during that time gas and electricity has remained fairly constant, those commodities have fluctuated as well.
  2. Employees. As minimum wages continue to go up, the problem we have is balancing the need to pay a competitive wage while offering a competitively priced product.
  3. Technology. As with most businesses, technology is constantly changing. Investing in laundry equipment and payment platforms that can keep up with the changes is key.  This is where CCI’s LaundryCard has been a big help. They are always innovating their product and are able to stay on top of security concerns and advances in technology.

What trends are you noticing in the self-service laundry industry, especially in the Chicago area?

I’ve noticed a trend away from small neighborhood laundries. While small stores will always be with us, due to the high cost of building a new laundry, most newer stores are 3,000 sf or larger. The larger stores can offer more products and services to offset these higher upfront costs.

How do you market/advertise your business?

We’ve tried many approaches to marketing over the years and their overall effectiveness has also changed with time. We’ve used yellow pages, newspaper inserts, direct mail, door flyers, signs in public places, ads in holiday community calendars, chamber of commerce welcome packages, radio spots, google, yelp, email campaigns to our web page, etc. The only medium we haven’t tried, that I can think of, is television. We found it to be cost prohibitive. Currently our preferred marketing strategies are email campaigns and online search engines such as Yelp and Google, which we hope take customers to our websites.

Before you had LaundryCard, what had you heard about card systems in Laundromats?

Before investing in LaundryCard, I went to the “Clean Show”, a biennial trade show featuring equipment and products from all the manufacturers and vendors of laundry and dry cleaning equipment. There I was able to see and touch all the available payment systems.

Why did you choose the LaundryCard system over other systems?

In 2005 when I first looked at and compared LaundryCard to other systems, LaundryCard was years ahead in development. It was the most feature filled platform available. While the technology has come a long way in the last 12 years, LaundryCard has only gotten better.  The number of other payment systems has grown, but none can compete with LaundryCard’s features, reports, stable operating platform, support, and cost.  

How have your customers responded to LaundryCard?

Customers really like the system. They love being able to walk into our place without carrying a pocket full of quarters. They like the flexibility of using cash or credit card. Periodically I’ll see a new customer looking a bit puzzled as they are trying to figure out the system. Before an attendant or I can greet them, there’s always an existing customer that will jump in to explain how to get a new LaundryCard. Customers get excited about the system and enjoy teaching and telling others about it.

Did you realize a return on your LaundryCard investment?

Yes. We realized a return on our investment fairly quickly with each store and continue to enjoy the benefits.

How does LaundryCard save you time?

We save time collecting. We don’t have to empty hundreds of coin boxes across our stores each week or spend time cleaning lint out of jammed coin drops.

We save time managing. We can address customer service issues by adjusting a customer’s LaundryCard balance from our computer or any mobile phone. We can evaluate the effectiveness of different promotions and pricing strategies by pulling reports summarizing sales or starts for any time period and analyze how each type / size of equipment is doing. We can remotely monitor the maintenance status of our washers and dryers, sending a technician when needed. We can pull employee hour reports simplifying payroll.

Customers save time as well. With a quick trip to the X-changer to check their balance and/or add value to their card, they can start any and all machines by simply dipping their laundry card into the reader. This is significantly faster than inserting quarters.  This becomes an even greater time savings as vend prices increase with time.

Which LaundryCard features have been most valuable to your business?

I’m a huge fan of the remote access feature. I really like checking in throughout the day to make sure the attendants have shown up on time and to see how sales are doing. As someone who has a full time job, it’s comforting knowing my investment is being taken care of and I can go about my day without worry. When / if there are issues, I can remotely login and fix most customer service problems.

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Do you use incremental vend pricing with LaundryCard? If so, how has being able to raise vend prices by a few pennies instead of a quarter had an impact on your bottom line?

Yes, we usually raise prices in nickel or dime increments. By raising prices consistently but in small increments, we get very little pushback from customers and most don’t even notice. This allows us to keep ahead of utility and other cost increases. Our competition has to raise by an entire quarter which provides us with a competitive advantage.

What advice do you have for laundromat investors thinking about adding a LaundryCard system?

I’m biased. Without LaundryCard I would not be as successful as I am, so I would say it’s a no brainer – just do it. That being said, it’s important to note that what’s right for me on my budget and in my market might not be for everyone. An existing small store with a limited budget may want to consider a FasCard System. This can be added to some but not all machines without affecting coin sales and provide some of the advantages of LaundryCard.

If you are building a new Laundromat or rehabbing an entire store in today’s market, you’d be remiss to not invest in a complete payment system. Look at all the systems out there and ask some questions. Don’t look at just the benefits to customers, just the benefits to owners, just the price tag, or just the company’s support –  look at all these and more. The choice will be clear.

Would you implement LaundryCard in your next store? Why?

Yes. Just last week I purchased a closed laundry and signed a new lease for that space and the space next door. I’m building an entire new laundry in this space, and it will be a LaundryCard store. We just placed the order last week.

What do you feel are the keys to a profitable self-service laundromat business in 2016?

Much the same as any small business, the owner needs to be vigilant and able to adapt to changing market conditions. Failure to analyze trends and customer response to pricing and marketing strategies can be very costly. LaundryCard provides an owner with the tools to closely monitor these trends.

What do you wish you had known when you were first getting into the laundromat business?

The list is endless. It has been an exciting journey filled with many learning opportunities. The whole process of becoming a business owner / operator has been very satisfying for me personally.  

What are your top business goals for the rest of 2016 and into 2017?

As I begin construction on my 4th Laundromat later this month, I hope to incorporate many of the ideas and features I have learned are very popular with customers. My goal is to divide my attention between getting the new Laundry up and off to a successful start while maintaining the level of customer service we’ve attained at our existing stores. Incorporating technology such as CCI’s LaundryCard is indispensable when running multiple locations.

 

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