All coin laundromat owners have to deal with the rising costs of utilities. Things like periodic water rate increases and surging electricity bills are making it more expensive to own a laundromat—not to mention fixed cost like rent, regular machine maintenance and repairs. For coin laundromat owners, steady cash flow and liquidity are crucial. Profits need to keep pace with rising costs for the business to grow and thrive. And for coin laundries, sometimes the only way to offset expenses without going into the red and also making a profit is to raise vend prices on machines.
But raising coin-operated laundry machine prices can be clunky and conspicuous: many coin-only laundromats can only increase vend prices by the quarter. This can be a rather delicate matter for a business owner: Raise your vend prices too high and you’ll lose precious customer lifetime value and loyalty. On the other hand, if you keep the same prices for too long, you miss out on potential revenue—or worse yet—don’t hit your breakeven point.
From a financial perspective, increasing vend prices—whether due to a cumulative uptick in variable costs (water, electricity or gas) or lowering prices in order to compete with more established coin laundromats in the neighborhood—25¢ cents may not make much sense for you as a store owner either.
Furthermore, If you try to increase your washing machine cycles by $.50 overnight, you may end up losing some of the loyalty you’ve slowly built up and valuable customers in the process. You may find that a vend price increase of $.09 may be closer to what customers are willing to pay for, and also more in line with healthy revenue growth. Penny incremental pricing also allows you to stair-step or stagger pricing so you can split up increases over time.
Penny incremental pricing has a powerful effect on your bottom line. You can actually see how LaundryCard would benefit your laundromat with our online Profit Calculator.