Simple Math Can Help Make Your Laundry a Success

Most successful coin and card operated laundry owners become sticklers about knowing what it costs to do a load of wash or dry by size and type of washer or dryer. This knowledge allows them to price their services profitably. Otherwise, they would be flying by the seat of their pants, just like, sadly, some laundromat owners have been doing for years.

But, if you are in the latter category, there’s good news: You can very easily jump into the former category with a little simple math, and we’ll even show you how!

Successful owners have not gotten where they are by doing things the way most others do. They are willing to go a step beyond what others do, and that is why they become -successful.

It’s not r

ocket science, and it isn’t hard to figure out following basic, logical steps.

First, a laundry operator needs to know what percentage of their income is brought in from each type of washer or dryer. What this entails is collecting, counting and recording by machine type and machine size. By totaling the income by type of machine, you will be in a position to know exactly how much of your income is derived from each type of washer and dryer.

It is almost a universally accepted practice that laundry owners collect and count every type of machine by size. Some can do this electronically, if they have card operations. Others still have to insert the key in the box and empty the coins into bags and then total up each type of bag to see what the actual income is. Whichever way is YOUR way, you can still accomplish the same result.

You can do this by following up the information you’ve collected by also following a few, quite simple, mathematical steps.

Use for an example, an unattended 1600 square foot laundry with 6 double loaders, 30 top loaders and 20 dryer pockets. For our example, the monthly lease on the laundry is $3000.

The monthly washer and dryer collections are $10,000, broken down as follows:

Top Loads $4,000

Double Loads $2,500

Dryers $3,500

You can see that the top loaders will produce 40% of that $10,000, the doubles 25%, and the dryers 35% of that income brought in by our imaginary laundry business.

So, the top loaders are responsible to bring in 40% of $3,000 ($1,200) as their fair share of the rent. Therefore each of the 30 machines is responsible for $40.00 toward the monthly rent. If each top load washer does 5.5 loads per day, or 165 loads in an average month, you’ll divide the $40.00 by that (165) and it means each top loader costs 27¢ per wash load done. That’s just to pay for it’s “share” of the rent. Of course there are other costs, like sewer and water, and we’ll get to that in a moment. But for now, at $1.25 per wash, after rent only, the laundry profits $.98 per load.

Using the same formula, the double load washers bring in one fourth of the income, or $3000. Divided by 6, that means each double loader makes $500 a month, or about $17.00 per day per machine. If each of the front load washers turn 11 loads per day, that means the vend price must be $1.55 just to cover rent.

Often, the largest variable expense for a coin or card laundry is for water and sewer. This bill, unlike the rent, will only be apportioned to the washers, because they are the pieces of equipment that affect the water and sewer bills.

If our imaginary sewer and water costs are $1500 per month, we can use the same math process to calculate those machine’s fair share of the cost just like we did for the rent.

We already know that the 30 top load washers are bringing in $4000 a month. If, as we saw earlier, they are (in total) turning 165 times, by dividing the $1500 water and sewer by that, and we can see that we need to collect an additional 9¢ per top load washer just to be at the break even point. That’s 27¢ + 9¢ for a total of 36¢. And we haven’t even touched on the other bills, or your need to make a profit.

Other payments – bills for gas and electric, insurance, janitorial, taxes, repairs, supplies, and depreciation – all can be apportioned among the machines in the same way.

A word of caution here though. Obviously, your gas bill is primarily driven by your dryers, and, though to not as great of an extent, your water heaters. However, the water heater can not bring money into the laundry, so it’s share of the total gas bill has to be apportioned to the dryers only.

In fact, a lot of your bills are less directly attributable to specific equipment. So only those things which collect money apply here.

But the simple formula (okay, it’s not really that simple, but it does make sense) we have outlined here will allow any laundry owner to know how he is paying for each of his business’s costs, and from that, you can determine how much you have to have to break even, BY MACHINE .

A few readers might ask, “Why do I need to know this. I know how much I’m taking in, and I know how much is going out. Pretty simple, really.”

And the answer is, “Because if you don’t know, you may not be setting your vend prices where they need to be.”

But the math method we’ve just outlined can help you see accurately not just where the money is going, but how you are getting it back.

Date:-05/28/2011
By:-Admin


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	Simple Math Can Help Make Your Laundry a Success Most successful coin and card operated laundry owners become sticklers about knowing what it costs to do a load of wash or dry by size and type of washer or dryer. This knowledge allows them to price their services profitably. Otherwise, they would be flying by the seat of their pants, just like, sadly, some laundromat owners have been doing for years. But, if you are in the latter category, there’s good news: You can very easily jump into the former category with a little simple math, and we’ll even show you how! Successful owners have not gotten where they are by doing things the way most others do. They are willing to go a step beyond what others do, and that is why they become -successful. It’s not r ocket science, and it isn’t hard to figure out following basic, logical steps. First, a laundry operator needs to know what percentage of their income is brought in from each type of washer or dryer. What this entails is collecting, counting and recording by machine type and machine size. By totaling the income by type of machine, you will be in a position to know exactly how much of your income is derived from each type of washer and dryer. It is almost a universally accepted practice that laundry owners collect and count every type of machine by size. Some can do this electronically, if they have card operations. Others still have to insert the key in the box and empty the coins into bags and then total up each type of bag to see what the actual income is. Whichever way is YOUR way, you can still accomplish the same result. You can do this by following up the information you’ve collected by also following a few, quite simple, mathematical steps. Use for an example, an unattended 1600 square foot laundry with 6 double loaders, 30 top loaders and 20 dryer pockets. For our example, the monthly lease on the laundry is $3000. The monthly washer and dryer collections are $10,000, broken down as follows: Top Loads $4,000 Double Loads $2,500 Dryers $3,500 You can see that the top loaders will produce 40% of that $10,000, the doubles 25%, and the dryers 35% of that income brought in by our imaginary laundry business. So, the top loaders are responsible to bring in 40% of $3,000 ($1,200) as their fair share of the rent. Therefore each of the 30 machines is responsible for $40.00 toward the monthly rent. If each top load washer does 5.5 loads per day, or 165 loads in an average month, you’ll divide the $40.00 by that (165) and it means each top loader costs 27¢ per wash load done. That’s just to pay for it’s “share” of the rent. Of course there are other costs, like sewer and water, and we’ll get to that in a moment. But for now, at $1.25 per wash, after rent only, the laundry profits $.98 per load. Using the same formula, the double load washers bring in one fourth of the income, or $3000. Divided by 6, that means each double loader makes $500 a month, or about $17.00 per day per machine. If each of the front load washers turn 11 loads per day, that means the vend price must be $1.55 just to cover rent. Often, the largest variable expense for a coin or card laundry is for water and sewer. This bill, unlike the rent, will only be apportioned to the washers, because they are the pieces of equipment that affect the water and sewer bills. If our imaginary sewer and water costs are $1500 per month, we can use the same math process to calculate those machine’s fair share of the cost just like we did for the rent. We already know that the 30 top load washers are bringing in $4000 a month. If, as we saw earlier, they are (in total) turning 165 times, by dividing the $1500 water and sewer by that, and we can see that we need to collect an additional 9¢ per top load washer just to be at the break even point. That’s 27¢ + 9¢ for a total of 36¢. And we haven’t even touched on the other bills, or your need to make a profit. Other payments – bills for gas and electric, insurance, janitorial, taxes, repairs, supplies, and depreciation – all can be apportioned among the machines in the same way. A word of caution here though. Obviously, your gas bill is primarily driven by your dryers, and, though to not as great of an extent, your water heaters. However, the water heater can not bring money into the laundry, so it’s share of the total gas bill has to be apportioned to the dryers only. In fact, a lot of your bills are less directly attributable to specific equipment. So only those things which collect money apply here. But the simple formula (okay, it’s not really that simple, but it does make sense) we have outlined here will allow any laundry owner to know how he is paying for each of his business’s costs, and from that, you can determine how much you have to have to break even, BY MACHINE . A few readers might ask, “Why do I need to know this. I know how much I’m taking in, and I know how much is going out. Pretty simple, really.” And the answer is, “Because if you don’t know, you may not be setting your vend prices where they need to be.” But the math method we’ve just outlined can help you see accurately not just where the money is going, but how you are getting it back. Date:-05/28/2011 By:-Admin