Retooling Your Laundromat: When is the Right Time?

Laundromat retooling is necessary when the negative impacts of outdated, inefficient, or unreliable machines threaten the business's bottom line. To be succesful, laundromats must work hard to stand out and attract and retain loyal clientele. Making improvements by retooling can impress customers and benefit business owners.

Though you shouldn't need to retool a laundromat more often than every 10 to 20 years, you still need to weigh the cost-benefit carefully. If a lack of guidance or concerns over capital expenditure and equipment downtime have halted your equipment replacement strategy, let this guide help you get started. We'll cover several signs and scenarios that it's time to retool your laundromat, so you can plan a seamless transition to new equipment.

Signs It's Time to Retool

When laundry businesses retool, they can address and correct machine issues to increase customer satisfaction and operational efficiencies. If you're noticing any of the signs below, retooling may be a smart, beneficial solution:

Repairing vs. Replacing Laundromat Machines: Factors to Consider

When a piece of equipment breaks down, it can be difficult to determine whether it should be repaired (again!) or whether it’s time to invest in a replacement. While there is no universal formula, laundromat operators should weigh the following factors to make an informed decision:

Cost Thresholds

If breakdowns are infrequent or repairs are a small percentage of the price of a new machine, fixing the equipment may be worth it. When you choose the repair route, hire a professional commercial laundry technician so it's done right the first time. The can minimize downtime, and when the technicians spot potential issues or wear and tear, they can make recommendations to mitigate future breakdowns. Opt for high-quality OEM parts for guaranteed quality and the right fit.

Warranties or Service Coverage

If your machines are still under the manufacturer's warranty, repairs may be covered by the plan, making your costs minimal. For machines enrolled in a maintenance plan, it can be smart to make repairs until the contract is up, and then retool the laundromat with warrantied machines.

Repair History

Track breakdowns over time on each machine and consider the expense when deciding whether to retool or fix machines. A one-time issue may be reasonable to cover, but if you notice a pattern of breakddowns, those repairs can add up. When having machines out of service becomes routine, it's time to replace equipment rather than repair it.

Competitors

When a new business opens down the street or an existing competitor invests in a complete laundromat retool, it's probably smarter to replace your commercial laundry equipment than repair it. Proactively keeping your facility's equipment updated can help engender customer loyalty and prevent a competitor from attracting your client base.

When to Replace Commercial Laundromat Equipment

While equipment prices and repair invoices are obvious expenses, you should also consider whether your machines are incurring hidden costs that reduce your profitability. Here are a few scendarios where repairing outdated machines may cost you more than you might think, making replacement the smarter route.

High Business Volume

Coin-operated laundry equipment is designed to withstand harsh conditions, but extensive turns per day can shorten a machine's useful life. If your business volume is reducing equipment lifespan, consider replacement. Continuing at a high usage rate will potentially lead to frequent repairs, repeat downtime, and dissatisfied customers. Assess the wear and tear on your equipment in addition to the usage recommendations when determining whether it needs to be replaced and when.

Expensive Laundromat Utility Bills

New commercial laundry equipment is more efficient than older units, which translates to reduced water, electric, or gas bills. Compare usage estimates for new units against your existing equipment to calculate potential savings. Also consider future utility costs. If you expect rate increases or regulatory changes, replace your commercial laundry equipment early to stay one step ahead.

Trouble Retaining Customers

Inefficient laundry equipment that is frequently out of order and generally outdated is a quick way to drive customers to a nearby competitor. Updating to shiny new equipment can lend your space a more modern laundromat design that can help attract and retain customers. Not only do updated machines give the facility a refreshed, clean appearance that customers desire, but they also provide advanced technology to power faster, personalized cycles and offer flexible payment options.

Machines Lack Features

Even if equipment functions well, it represents a critical opportunity cost if it lacks modern features that appeal to customers and help you operate efficiently. If your store doesn't offer the experience customers want, they may very well choose a laundromat that does. Important features to consider include:

• Flexible payment types (smartphone apps that enable mobile payment)
• Advanced cycle selection
• Loyalty programs
• Large-capacity machines
• Remote monitoring for faster troubleshooting

Low Cost per Cycle

Customers are often willing to pay more per cycle for personalized wash programs and large-capacity loads. Research what local competitors charge to determine how much money you're leaving on the table by not retooling your laundromat. Modern machines also feature agile pricing technology that can increase your laundromt's profitability with just a few clicks.

Business Valuation

Considering selling your business soon? Many owners who are thinking about selling are hesitant to invest in laundromat retooling. What they fail to realize is that new equipment often has a higher business valuation and can attract a larger pool of buyers. Work with a financial advisor to compare the equipment investment to projected increases in your business valuation—the results might just surprise you.

Tax Savings

Laundromat retooling puts energy-efficient machines in your space, helping the business qualify for incentives, grants, and other savings. Many municipalities reward energy-efficient businesses with local grants and tax savings. Federal tax incentives are also available to encourage efficiency improvements, and new commercial laundry equipment often qualifies. Look into programs you would be eligible for after updating your machines, then factor those savings into your decision.

Laundromat Retooling Strategies

Once you’ve decided to update your facility, you must determine the best approach to doing so. There are three primary strategies to retooling, each with benefits and limitations:

Individual Machines, As Needed

Some laundromat owners prefer to weigh potential savings against laundromat equipment repair costs for  individual machine, replacing one at a time as feasible. This conservative approach can extend the life of each washer or dryer, but it can also cause disruptions:

• The facility may need to shut down more frequently for intermittent equipment delivery and installation.
• Keeping old machines on the floor prevents the shop from looking modern and attracting new customers.
• When customers gravitate toward updated machines only, it creates a bottleneck. Customers may become frustrated when their preferred washer is taken.

Full Store Retool

Owners starting a laundromat and those overhauling an existing business often choose a full store retool. A complete revamp allows them to achieve a fresh, modern laundromat design that attracts customers. While this approach delivers the greatest customer appeal, you should weigh all of the pros and cons.

Cons:

• High upfront costs
• Business disruption and downtime during equipment installation
• Requires careful planning and timing

Pros:

• Improved efficiency and lower operating costs
• Enhanced store aesthetics and atmosphere
• Opportunities for increasing load capacities

If you're an established business aiming for a full retool, be mindful of putting if off for too long. Delaying can cause equipment to become extremely outdated and inefficient, potentially costing you financially and reputationally. Instead, consider financing options that help you replace your commercial laundry equipment with less immediate investment.

Stepped Approach (One Machine Type or Row at a Time)

A gradual approach is the most common laundromat retooling strategy and for good reason. Proactively scheduling partial retools at regular intervals allows laundromat owners to:

• Balance the budget for replacement commercial laundry equipment
• Minimize business downtime and disruptions
• Anticipate the expense of replacement machines, rather than reacting to equipment breakdowns
• Begin promoting your updated laundromat and equipment early to attract new customers

Budgeting for Laundromat Retooling

Fortunately, many distributors offer attractive programs and incentives that can help laundromats manage the cost of replacing equipment. If you are considering retooling your facility, researching distributors to find the best incentives can result in significant savings. Some options to consder include:

• Financing Programs: Many vended laundry equipment manufacturers, including Dexter Laundry, offer attractive financing programs to help offset the capital expenditure.
• Trade-In Incentives: While some companies may offer to haul away your old equipment for free others will actually pay you for your used commercial laundry equipment.
• Special Pricing/Deals: Some distributors offer special pricing and periodic incentives for purchasing equipment in larger quantities to maximize your stepped or full shop retool budget.
• New Technology: Work with a reputable and experienced distributor that represents top-rated manufacturers to assess the various equipment costs and benefits and determine the best product mix for your needs.

If you're a laundromat owner struggling to understand when or how to update your equipment, Western State Design is here to help. While many businesses prefer to retool proactively using a stepped approach that minimizes downtime, not every laundromat follows the same model. Let us evaluate your utility costs, repair frequency, and the impact of outdated machines on your business to find the right approach. Manufacturer-supplied financing and warranties, plus our maintenance contracts, can protect your investment for the long haul. Contact Western State Design today to discuss your laundromat retooling program.